Seyfarth Policy Matters Newsletter - October 2020

Seyfarth Shaw LLP

A Tribute To The Late, Incomparably Great, Justice Ruth Bader Ginsburg.  Exactly two weeks to the day, the Country began collective mourning over the loss of one of the greatest jurisprudential minds in a century. Justice Ruth Bader Ginsburg was fabulous in every way imaginable — from her famous workouts, which occupy their own website, to her lore in the pop culture zeitgeist, to her fierce advocacy for justice, the rule law, and gender equality, a battle too long fought with too few advocates. It is hard to grasp how her unwavering capacity for compassion and empathy often outweighed her uniquely brilliant legal mind. And are those not the precise characteristics those appearing in court would want a jurist to possess? Since this is, after all, a blog focused on policy affecting employers, which employment-related opinion from the Notorious RBG left the greatest mark? 

  • Wal-Mart Stores Inc. v. Dukes et al.  Like most of her most famous SCOTUS opinions, her mark came through her dissent in a case that struck down a class of about 1.5 million women in a gender bias class action against retail mammoth Walmart in what was, at the time, the largest Title VII sex discrimination case in U.S. history. Counsel for Dukes and her fellow class members stated that Justice Ginsburg's dissent "reflected two of [her] real strengths — her mastery of civil procedure and her appreciation of the modern workplace and the ways in which bias [especially bias against women] can infiltrate modern personnel decisions."
  • Epic Systems Corp. v. Lewis.  In another dissent, RBG criticized the majority’s holding that employers do not violate the National Labor Relations Act by including class-action waiver provisions in arbitration agreements. In her opinion, not only did she call the majority decision “egregiously wrong,” she also took the rare step of reading her dissent from the bench. This may seem quaint, but by reading her dissent from the bench, in the presence of her colleagues, she let them, and the watching world, know just how wrong-headed she believed the holding to be.
  • Vance v. Ball State University.  In this case, Justice Ginsburg dissented to the slim majority’s holding that a worker can only hold an employer vicariously liable under Title VII of the Civil Rights Act for harassment by a purported supervisor "empowered by the employer to take tangible employment actions against the victim." The Justice forcefully wrote that “[n]ot even Ball State, the defendant-employer in this case, has advanced the restrictive definition the court adopts, . . . [y]et the court, insistent on constructing artificial categories where context should be key, proceeds on an immoderate and unrestrained course to corral Title VII.” The dissent in this case was masterful not only in its dismantling of the majority’s holding, but it is also demonstrative of her keen knowledge of our government’s system of separation of powers. Justice Ginsburg implored “Congress' court to correct the error into which this court has fallen, and to restore the robust protections against workplace harassment the court weakens today."
  • U.S. v. Virginia.  In one of her earliest, most forceful, most impactful, and most precedential employment-related opinions, SCOTUS invalidated a categorical ban on women enrolling in the Virginia Military Institute. While not an “employment law” case per se, its effect on the work place is undeniable — "[n]early 25 years later, VMI's female alumni are among our nation's leaders in corporate boardrooms, within our military, and within our communities,” said VMI. The school goes on to call the late Justice a “courageous legal scholar whose impact on our institute and our nation is an inspiration for all.” This opinion was a bellwether for the next 24 years on the court — Justice Ginsburg announced her presence swinging, letting the rest of the world know that while she was on the Court, she would do everything in her power to ensure true equality between the genders. As our very own Camille Olson recently relayed to a legal publication, it was “the Brown v. Board of Education for women's rights in terms of [their] place in schools, academies and even the workplace.”

Trump Work Visa Halt …. Halted.  On Thursday, October 1, the U.S. District Court for the Northern District of California, in the case of National Association of Manufacturers v. DHS (20-cv-04887-JSW), issued a preliminary injunction halting implementation of Presidential Proclamation 10052 ("Proclamation 10052" or "the Proclamation") — which PMN wrote about here, here, and here — which suspended entry into the U.S. under four categories of nonimmigrant work visas: H-1B, H-2B, L-1 and J-1, for a period lasting until December 31, 2020, and with discretion to be continued "as necessary." In issuing the injunction, the court found that the Administration had established a scant record to justify the Proclamation, and that the Proclamation contravened the carefully established statutory scheme for employment-based immigration. The Court specifically declined to issue a nationwide injunction, and the injunction only applies to the plaintiff organizations, which included the National Association of Manufacturers, the U.S. Chamber of Commerce, the National Retail Federation, and Technet and their respective members, as well as Intrax, an operator of cultural exchanges. It is unclear at this point whether the State Department will stick to the narrow confines of the injunction; or, to avoid bureaucratic hassle, will suspend implementation of Proclamation 10052 across-the-board.  Guidance from the State Department can be expected early next week. Stay tuned.

“Just When I Thought I Was Out, They Pull Me Back In.”  The Godfather III is widely ranked at the bottom of the trilogy pantheon; but it certainly has one of the most memorable quotes. This must be precisely how the Country feels about the continued promise of a stimulus deal. The last two weeks were more of the same. Last Thursday, Treasury Security Mnuchin told a Senate Banking Committee that there is no way around it: pumping additional stimulus dollars into the economy is “still needed.” Mnuchin told the committee that “[i]f the Democrats are willing to sit down, I’m willing to sit down anytime for bipartisan legislation, let’s pass something quickly,” At the same time, Speaker Pelosi told the press that “[w]e’ll be, hopefully soon, going to the table with them,” but did not indicate whether Democrats would bend on their stance that the country needs $2.2 trillion in fresh aid. Mnuchin and Pelosi held their first in-person talks since August on Wednesday, yet fell short of reaching an agreement.

It is not as if those parties are not receiving any pressure to pass something: a coalition of nearly 200 major public and private sector groups across the U.S. called for “No Recess without Relief”; cities will furlough public employees; and even democrats — moderate democrats, but democrats nonetheless — are pressuring Pelosi to reach a deal. On top of that, the evidence reflecting a failing economy in desperate need of additional stimulus is piling up. For example, U.S. airlines will lay off tens of thousands of workers; Disney will lay off 28,000 employees; Allstate Insurance is laying off 3,800 employees, about 8% of their workers; 9,000 Shell Oil workers are losing their jobs; Fashion designer Ralph Lauren is cutting 3,700; and Defense contractor Raytheon is trimming 15,000 workers. Yesterday, despite real, live negotiations throughout the week, the Speaker telegraphed that Congress is unlikely to reach a deal and House democrats proceeded with passing their own stimulus, augmenting the previously-passed HEROES Act. Will the President’s contraction of the virus affect the stimulus negotiations? Answering that question requires prescience beyond the mortal ken, but some analysts, including the Speaker of the House, believe it could be a catalyst.”

Speaking Of The House’s Own Stimulus Legislation, What Is In It?  What feels like eons ago, the House passed a sweeping stimulus package, intended as a follow up to the CARES Act, which Seyfarth analyzed in depth. This week, House Democrats introduced a “slimmed-down,” $2.2 Trillion version of the HEROES Act totaling $1.2 trillion less than the original bill. The measure — which passed last night by a vote of 214 to 207 with at least 17 Democrats opposing the measure — includes $436 billion in emergency aid for state and local governments; $225 billion for schools and child care; an additional round of $1,200 stimulus checks for most Americans; money to restore $600 expanded unemployment payments through January; $75 billion for testing, contact tracing and other health care efforts; billions for housing assistance; and funding to shore up the census, U.S. Postal Service and elections. Notably absent is any kind of liability shield, which republicans have long prioritized since the inception of the pandemic, as we here at PMN noted here

The Pen Has Spoken: What Did, And Didn’t, Governor Newsom Sign Into Law?  The deadline for Governor Newsom to approve or reject bills passed by the Legislature expired Wednesday night. Seyfarth prepared a comprehensive compendium of the measures the Legislature passed last month, and we here at PMN commented on the same. Seyfarth has also published a helpful summary of those measures Governor Newsom signed and did not sign. Two bills — one vetoed, one signed — highlight the COVID-19 truncated legislative session. The first, AB 1867, immediately signed by the Governor, requires, inter alia, employers with 500 or more employees nationwide to provide 80 hours of supplemental sick leave for certain, specified COVID-19-related reasons. AB 1867 was designed to “fill the gaps” left by the employee qualification of the FFCRA. The second, AB 3216, was surprisingly vetoed by the Governor at the last minute.  AB 3216 would have required certain employers to offer employees who were laid off due to a state of emergency job positions that become available and for which the laid-off employees are qualified.

Stimulus Might Be Out Of Reach, But At Least The Government Will Stay Open, For Now.  Late Wednesday night — or early Thursday morning depending on your circadian rhythm — the president signed a stopgap bill to prevent a complete government shutdown. The measure extends about $1.4 trillion in government funding until December 11. The funding patchwork gives congressional leaders and the administration two months to negotiate a more sweeping spending bill, or they will be back where we are now — forced to pass a stopgap measure to ensure the Government’s doors remain open. Perhaps, as part of the larger spending negotiations, Congressional leaders will be able to agree on some kind of stimulus to pull the Country out of its economic rut. Stay tuned!

On The Streets Of Philadelphia: City Ordinance Expands Requires Paid Leave.  California is not alone in its legislative endeavor to provide paid sick leave for COVID-19-related reasons — as Seyfarth explained here, the Philadelphia City Council passed, and the Governor recently signed, amendments to a City Ordinance providing that individuals who work 40 or more hours per week can receive emergency leave equal to the greater of (a) 80 hours or (b) the average hours worked over a 14-day period, up to a maximum of 112 hours. Permitted reasons for taking emergency leave are essentially the same reasons as those set forth in the FFCRA, except the Ordinance employs the term public health emergency instead of COVID-19. The public health emergency amendments to the regular sick leave legislation are set to sunset on  December 31, 2020.

DOL Interprets Meaning of Independent Contractor v. Employee Classification.  For a few years now, the classification of workers and the future of the so-called “gig economy” has been a salient topic of conversation across the nation. Nowhere is the controversy more visible than in California, which passed the now infamous AB 5 in 2019. Indeed, Seyfarth’s California-centric publication has its own tag dedicated exclusively to AB 5, and the controversy surrounding the same. As Seyfarth summarized here, the DOL issued for the first time proposed interpretations, to be codified as a rule after the comment period has ended. The DOL’s proposal — which would be codified at 29 C.F.R. §§ 795.100 through .195 — would institute a factor test for determining the classification of a worker. The most salient factors to consider are: (1) the nature and degree of an individual’s control over the work and (2) the individual’s opportunity for profit or loss. If both factors militate in favor of a particular classification, “there is substantial likelihood that is the individual’s accurate classification.” If the two factors don’t produce a clear arrow toward one classification, a court would then consider: (1) the amount of skill required for the work; (2) the degree of permanence of the working relationship between the individual and the potential employer; and (3) whether the work is part of an integrated unit of production.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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