FLSA’s anti-retaliation provisions permit lawsuits against persons, including entities, even if not enterprises within interstate commerce

The Tenth Circuit held that, unlike its other provisions, FLSA’s anti-retaliation provision applies to persons whether or not they are engaged in interstate commerce. In the case, two workers became convinced that their employer owed them overtime under federal law (FLSA, the Fair Labor Standards Act). They complained to the DOL, were fired and the DOL sued the company alleging that the discharges were retaliation for cooperating with the DOL’s investigation.

FLSA’s overtime (and other provisions) apply only to employers who are engaged in interstate commerce. Here the company argued it had established it was not. The Tenth Circuit held that, whether it was or wasn’t was irrelevant in a retaliation claim. The court held that, as written, FLSA’s anti-retaliation provisions do not require proof that the defendant is engaged in interstate commerce. The court held, therefore, the company could be sued for retaliation, whether or not it was engaged in interstate commerce.

Source: Acosta v. Foreclosure Connection, Inc., case no. 17-4111 (10th Cir. 2018).

NLRB GC sets goal for 5% reduction in across-the-board casehandling time

NLRB General Counsel Robb announced a goal of reducing Board processing times by 5%. This goal applies to all aspects of the Board’s activities.

I am pleased to announce that the Agency has adopted a Strategic Plan calling for a 5% reduction per year in case processing time. This reduction includes not only case handling in the field, but also applies to the time between issuance of an Administrative Law Judge’s decision and Board Order, and to issuance of a Board Order and closure of the case.

All General Counsel side divisions are subject to this 5% reduction goal, including the Divisions of Advice, Legal Counsel, Enforcement Litigation,1 and Operations-Management in connection with case processing in Regional offices, where a significant number of cases will be affected.

The NLRB GC left it to the Divisions and Regions to determine for themselves how best to reach the 5% goal.

In that regard, I am vesting the Divisions and the Regions with wide discretion to develop systems and processes they believe will enable them to meet the Agency’s strategic goal.

Source: NLRB General Counsel memo no. GC 19-02 (12/7/18).

Supreme Court ruled driver wasn’t required to arbitrate

The Supreme Court held that a driver for a trucking company need not arbitrate wage and related claims, even though the driver is technically an independent contractor, not an employee. In reaching its holding, the Supreme Court, first, decided that such driving falls within the Federal Arbitration Act’s exclusion for transportation workers, meaning, the Court held, the FAA does not apply. The FAA is of course the federal law that permits the arbitration of federal lawsuits. Next, the Supreme Court held that the FAA’s exclusion applies not only to employees but independent contractors.

Applicability of the decision is expected to be argued in a number of pending cases, including lawsuits brought by independent contractors who drive for social media based delivery services.

Source: New Prime, Inc. v. Oliveira, case no. 17-340 (1/15/19).

NLRB requires unions to state explicitly that they will work not to harm neutral employers when threatening “area standards” picketing

When companies work at the same site or even just near each other, a union — unhappy with one of them — may come to feel that actions at that location — such as that particular employer’s wage or benefit levels — are depressing “area standards.” Unions (like everyone) have a right to protest actions that affect their community, even if for example none of their members work for that employer. That is often the case because that particular employer is often a non-union company that the union is trying to organize.

Before commencing their protest activities, the union may warn not only that employer but all the employers at that location. The Board calls those other employers “neutrals.”

The Board require unions who give such warnings to explicitly state that they will work to minimize the impact on neutrals.

A union’s broadly worded and unqualified notice, sent to a neutral employer, that the union intends to picket a worksite the neutral shares with the primary employer is inherently coercive. Without any details, such a notice is ambiguous about whether the threatened picketing will lawfully target only the primary employer or will unlaw- fully enmesh the neutral employer. The neutral would understandably question why the union is sending a strike notice to an employer with no role in the dispute, and this question would reasonably lead it to at least sus- pect, if not believe, that its business would be targeted by the picketing and that it would be prudent to cease doing business with the primary employer to avoid losses. It would be unrealistic to expect neutral employers, many with little experience in arcane common-situs picketing law, to assume the union would avoid enmeshing them in the picketing. Thus, an unqualified picketing threat communicated to a neutral at a common situs is an am- biguous threat, and such an ambiguous threat enables a union to achieve the proscribed objective of coercing the neutral employer to cease doing business with the prima- ry employer—the very object a union seeks to achieve when it makes a blatantly unlawful threat to picket or unlawfully pickets a neutral. Accordingly, as our dis- senting colleague refuses to acknowledge, it is reasona- ble to conclude that when a union sends to a neutral an unqualified and therefore ambiguous notice of its intent to picket a common situs, it does so with an object to coerce the neutral to cease doing business with the pri- mary employer. A union may still lawfully inform a neutral of its intent to picket as long as it qualifies the notice by clearly indicating that its picketing will comply with legal limitations on such picketing.

Source: Electrical Workers IBEW Local 357, N.L.R.B., Case 28-CC-115255, 12/27/18

Shutdown shuts down E-Verify

DHS has shut down E-Verify during the pendency of the current government shutdown. DHS explains:

E-Verify Accounts Inaccessible

While E-Verify is unavailable, employers will not be able to access their E-Verify accounts to:

  • Enroll in E-Verify;
  • Create an E-Verify case;
  • View or take action on any case;
  • Add, delete or edit any user account;
  • Reset passwords;
  • Edit company information;
  • Terminate accounts; and
  • Run reports.

Also, employees will be unable to resolve E-Verify Tentative Nonconfirmations (TNCs).

What’s an employer to do? For starters, DHS has suspended the 3-day deadline, which normally would require an E-Verify case to be commenced within the deadline for completing I-9’s, i.e., within the first three business business days following hire. Here is DHS’ list of accommodations and advice for employers during the shutdown:

  • The “three-day rule” for creating E-Verify cases is suspended for cases affected by the unavailability of E-Verify.

  • The time period during which employees may resolve TNCs will be extended. The number of days E-Verify is not available will not count toward the days the employee has to begin the process of resolving their TNCs.

  • We will provide additional guidance regarding “three-day rule” and time period to resolve TNCs deadlines once operations resume.

  • Employers may not take adverse action against an employee because the E-Verify case is in an interim case status, including while the employee’s case is in an extended interim case status due to the unavailability of E-Verify.

  • Federal contractors with the Federal Acquisition Regulation (FAR) E-Verify clause should contact their contracting officer to inquire about extending federal contractor deadlines.

Source: See the DHS’ web page regarding the impact of the current shutdown on E-Verify, https://www.e-verify.gov/e-verify-and-e-verify-services-are-unavailable

Tenth Circuit holds that the False Claims Act protects only individuals who are employed at the time of retaliation

The Tenth Circuit held that the False Claims Act (FCA) protects only individuals who are employed at the time of the alleged retaliation. In this case, the employee left the employer complaining of what she believed were violations of the False Claims Act. She then entered into a settlement, in which she promised not to disparage her former employer. The company believed she proceeded to do just that — disparage it — and sued. She responded by, well, suing, alleging that the company’s lawsuit against her was retaliation prohibited by the FCA. The Court held that the FCA did not apply to her claims. The Court held that that FCA protects “only persons who were current employees when their employers retaliated against them.” Since, by that point, she was a former employee, she was no longer protected by the FCA; even if the company’s lawsuit were construed as retaliation, it was not retaliation prohibited by the FCA.

However, the Tenth Circuit cautioned that its ruling doesn’t mean all “former employees” lack FCA protection. Instead the question is whether the individual was employed at the time of the alleged retaliation. “If that condition is met, it doesn’t matter whether the employee remains a current employee of the employer when suing.”

Source: Potts v. Center for Excellence in Higher Education, case no 17-1143 (10th Cir. 2018)

Impact of Supreme Court’s Janus decision continues to expand, even beyond labor law

Bloomberg BNA published an interesting article looking at the expanding reach of the Supreme Court’s Janus decision in 2018, which held that public employers could not, under the First Amendment, be required to pay union dues or even a service fee. Many have predicted that Janus will have a major impact on unions in America. Its application to unionized workforces in the private sector is already being litigated. Bloomberg BNA’s article notes that its impact is expanding even beyond labor law:

  • Legal commentators are debating whether it has heightened the protections afforded commercial speech under the First Amendment. Historically commercial speech has of course enjoyed less protection than political speech.
  • It may have rendered unconstitutional laws in states that require attorney bar membership.
  • It may mean that statutes, like Title VII, which require one party to pay the other’s attorney fees are unconstitutional.
  • It may have rendered the NLRB’s longstanding rules that require, within limitations, that employers sometimes allow workers to wear political or pro-union buttons in the workplace.

D.C. Circuit confusingly has affirmed the Obama Board’s Joint Employer doctrine

The D.C. Circuit has affirmed the Obama Board’s Joint Employer doctrine, which holds that “indirect” control is sufficient to establish Joint Employer status. The rule has proven to be exceptionally controversial and politically sensitive, so much so that the Trump Board has already announced it will be issuing a formal regulatory rule to address the issue.

While the dissent in the D.C. case would have preferred to remand the case and let the Board issue its own rule, the majority decided to tackle the issue head on, or nearly so, or actually not at all head on. Rather the D.C. Circuit’s decision has left employers, unions and individuals more confused than ever over the current status of the law.

The majority held that, as a general principle, the Obama Board had been within its rights to re-articulate the Joint Employer rule in a way that made “indirect” control sufficient to establish Joint Employer status.

We hold that the right-to-control element of the Board’s joint-employer standard has deep roots in the common law. The common law also permits consideration of those forms of indirect control that play a relevant part in determining the essential terms and conditions of employment. Accordingly, we affirm the Board’s articulation of the joint-employer test as including consideration of both an employer’s reserved right to control and its indirect control over employees’ terms and conditions of employment.

What exactly is “indirect” control? That’s been the issue throughout the evolution of this controversial issue, and unfortunately the D.C. Circuit offered no guidance. It simply chided the Board for not, itself, having offered such “legal scaffolding” and suggested that an appropriate standard will somehow distinguish between control over the “matters governing essential terms and conditions of employment” versus “those types of employer decisions that set the objectives, basic ground rules, and expectations for a third-party contractor.”

Employers, unions and individuals are left now to wait for the NLRB to issue its own rule. When the NLRB develops its own rule, one thing seems clear from the D.C. Circuit’s decision, it cannot simply ignore “indirect” control.

A categorical rule against even considering indirect control—no matter how extensively the would-be employer exercises determinative or heavily influential pressure and control over all of a worker’s working conditions—would allow manipulated form to flout reality.