DOL reaffirms its FFCRA leave regulations following New York court ruling

Following a New York federal court’s ruling that struck portions of the DOL’s recent regulations governing FFCRA leave, the DOL has issued further rulemaking with expanded explanations. The new rulemaking largely reaffirms the prior regulations, including the specific rules struck by the New York court, but modifies the DOL’s prior rules regarding the FFCRA’s exclusion for employees of a health care provider by limiting the exclusion to those employees who are physicians or other health care providers, or “other employees who are employed to provide diagnostic services, preventive services, treatment services, or other services that are integrated with and necessary to the provision of patient care,” apparently agreeing with the court in the New York case that janitors or cafeteria workers are not excludable, in other words, are entitled to FFCRA leave. The DOL’s new rulemaking will appear in the Federal Register 9/16/2020. The DOL summarizes its new rulemaking, as follows (quoting the DOL):

  1. The Department reaffirms that paid sick leave and expanded family and medical leave
    may be taken only if the employee has work from which to take leave and explains
    further why this requirement is appropriate. This temporary rule clarifies that this
    requirement applies to all qualifying reasons to take paid sick leave and expanded
    family and medical leave.
  2. The Department reaffirms that, where intermittent FFCRA leave is permitted by the
    Department’s regulations, an employee must obtain his or her employer’s approval to
    take paid sick leave or expanded family and medical leave intermittently under
    § 825.50 and explains further the basis for this requirement.
  3. The Department revises the definition of “health care provider” under § 825.30(c)(1)
    to mean employees who are health care providers under 29 CFR 825.102 and
    825.125, and other employees who are employed to provide diagnostic services,
    preventive services, treatment services, or other services that are integrated with and
    necessary to the provision of patient care.
  4. The Department revises § 826.100 to clarify that the information the employee must
    give the employer to support the need for his or her leave should be provided to the
    employer as soon as practicable.
  5. The Department revises § 826.90 to correct an inconsistency regarding when an
    employee may be required to give notice of expanded family and medical leave to his
    or her employer.

With regard to parents of students on hybrid schedules (studying partly in school and partly remotely), the DOL clarified that such parents do not need to obtain permission from the company to take leave on the days the students are working remotely. The DOL explained that such leave is not intermittent leave technically (which would require permission it says, see #2 above) but is simply a day of regular leave.

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“Vertical” component of DOL Joint Employer rule struck

A New York court has struck the “vertical” component of the DOL’s recent Joint Employer rule, ruling it is invalid as “arbitrary and capricious.”

To be clear, the Department’s justifications for engaging in rulemaking are valid. Promoting uniformity and clarity given the (at least superficially) [parenthetical in original] widely divergent tests for joint employer liability in different circuits is a worthwhile objective. The Court is sympathetic to the Department’s concern that putative joint employers face uncertainty, and that this uncertainty is costly. This opinion does not imply that the Department cannot engage in rulemaking to try to harmonize joint employer standards.
But the Department must do better than this. Any future rulemaking must adhere to the text of the FLSA and Supreme Court precedent. If the Department departs from its prior interpretation, it must explain why. And it must make more than a perfunctory attempt to consider important costs, including costs to workers, and explain why the benefits of the new rule outweigh those costs. Because the Final Rule does none of these things, it is legally infirm.

An example of “vertical” joint employment is when a worker is an employee of one company — for example a staffing agency — that in turn is a contractor to another company. Vertical joint employment is distinguished from “horizontal” joint employment where the person is employed by one company to work for both it and, for example, its sister corporation. The court emphasized its ruling did not question the DOL’s final rule as far as it applied to horizontal employment.

Source: State of New York v. Scalia, case no. 1:20-cv-01689 (S.D.N.Y. Feb 26, 2020).

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The EEOC has limited its own authority to file “pattern or practice” lawsuits

The EEOC has formally acknowledged its own limitations on its authority to bring a “pattern or practice” lawsuit against an employer. When the EEOC brings such a lawsuit, it is not acting in a representative capacity on behalf of any particular employees (as it does in a so-called sec. 706 claim, citing Title VII’s relevant section), rather it is suing (under sec. 707) as the government itself asserting the employer has a pattern-or-practice of discrimination, which according to the Supreme Court requires it, in short, to prove that the employer’s “standard operating procedure” is to discriminate, quoting Int’l Bhd. of Teamsters v. U.S., 431 U.S. 324 (1977). Previously the EEOC has argued that, when it sues under sec. 707 it does not have to comply with a number of pre-lawsuit requirements. In a recent opinion letter, the EEOC reversed course on that argument and acknowledged that, no, it must comply with those pre-lawsuit requirements.

This opens a number of possible defenses by employers faced with pattern-or-practice lawsuits, including arguments that the EEOC failed to satisfy pre-lawsuit requirements such as the following:

  • The requirement for an actual charge to have been filed first.
  • The requirement for an investigation of that charge.
  • The requirement for good faith conciliation efforts by the EEOC prior to filing its lawsuit.

This also permits employers to assert that

  • They acted in good faith, and/or
  • They modified or rescinded the pattern-or-practice.

Arguably the latter gives employers the ability now to moot any pattern-or-practice lawsuit by the EEOC by modifying or rescinding the practice, even after the EEOC has filed its lawsuit.

In its opinion letter, the EEOC also took the position that it can no longer use the pattern-or-practice process to challenge employer actions that are not themselves discriminatory. Specifically this seems to be a concession on its part that, contrary to its litigation efforts to-date, it does not actually have the authority to challenge mandatory pre-dispute arbitration agreements, even if they ultimately had the effect of limiting a worker’s ability to participate in governmental investigations.

Because the EEOC’s opinion letter was not issued through the formal rule-making process, future EEOC Commissioners could re-reverse course. However, this opinion letters is publicly available and at least establishes a dispute over the EEOC’s jurisdiction in pattern-or-practice cases, which, if re-reversed by an EEOC under the leadership of a Democratic President, could be seen by the courts as arguably at least in part political in nature and therefore deserving of Congressional clarification.

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Apple must pay for mandatory post-shift searches, Ninth Circuit holds

The Ninth Circuit has held that time spent in a mandatory post-shift search constitutes “hours worked” that must be paid under the Fair Labor Standards Act. The case was filed against Apple, which argued the time should not be compensable, especially in a class (collective) action, because the employees only needed to go through the searches if they brought a bag to work and some employees did not and therefore never had to go through such searches. The Ninth Circuit rejected the argument holding, at best, it merely went to the question of which employees could recover how much money for such time and which couldn’t because they hadn’t experienced such losses. The issue did not, according to the Ninth Circuit, alter its ruling that such time is compensable when an employee must go through such searches. Not only did the Ninth Circuit reject Apple’s argument, the Court then entered summary judgment against Apple, meaning the case was, from the Ninth Circuit’s perspective, so clear that there was no need to waste further time by holding a trial. The decision follows Ninth Circuit precedent permitting similar class (collective) actions by employees of Nike and Converse.

Source: Frlekin v. Apple Inc., case no. 15-17382 (9th Cir. 9/2/2020).

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