Seyfarth Policy Matters Newsletter - October 2020 #2

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The Saga Of The Stimulus Deal Continues. As readers of this newsletter are well aware, the negotiations over additional stimulus legislation to confront COVID-19, and all of its attendant consequences, has seen a number of peaks and valleys in the months since negotiations began, and coverage of the negotiations has taken up too much blank space. This week, however, Speaker of the House Nancy Pelosi and Treasury Secretary Steven Mnuchin expressed optimism that a deal could be reached before the election. Yesterday, the Speaker announced that she and the Secretary were on the cusp of a deal on a stimulus package. However, the highest hurdle remains: The United States Senate and Mitch McConnell. Despite the optimistic tone, as of this morning, nothing has come to fruition.  

DOL Issues RFI to Contractors in Follow-Up to White House EO Targeting Implicit Bias Training, While States Have Legislated Training into Law. Over the past few months, we here at PMN have been following closely state legislation and other actions being taken to further diversify workforces, including pushing for the release of company EEO-1 data and mandating implicit bias training (IBT). Indeed, last month, California enacted SB 973 — which Seyfarth summarized here — requiring employers to annually submit various pay and hours data for its workforce to the state Department of Fair Employment. Since the George Floyd protests, several states have enacted IBT into law: Connecticut passed a bill in August requiring IBT for police officers; New Jersey passed a bill the same month mandating IBT for state, county and municipal law enforcement officials; in New York State, Senator Tim Kennedy introduced Bill No. S8521, requiring the establishment of a training program on implicit bias. The bill’s Sponsor Memo cites the Ohio State University Kirwan Institute for the Study of Race and Ethnicity in defining implicit bias, its insidious nature, and the necessity to educate.

About a month ago, President Trump entered into the implicit bias fray with the issuance of Executive Order 13950 (EO) titled Executive Order on Combating Race and Sex Stereotyping. The EO essentially bans IBT within federal and federal contractor workforces.  The EO begins by proclaiming that “it shall be the policy of the United States not to promote race or sex stereotyping or scapegoating in the Federal workforce or in the Uniformed Services, and not to allow grant funds to be used for these purposes.” The EO lists nine “divisive concepts,” then: (a) prohibits the U.S. military from conducting training “to believe any of the divisive concepts” (see EO §3); (b) institutes a new contract clause for insertion into agreements with federal contractors, which, among other things, mandates that the contractor “shall not use any workplace training that inculcates in its employees any” of the “divisive concepts” (see EO §4); (c) requires the heads of federal agencies to review their respective grant programs and require recipients to not use federal funds to promote any of the “divisive concepts” (see EO §5); and (d) requires that any workforce trainings held within federal agencies not promote any of the “divisive concepts” (see EO §6). On Thursday, the DOL’s Office of Federal Contract Compliance Programs (OFCCP) published — in accordance with EO §4(c) — a voluntary Request for Information (RFI) to federal contractors, requesting information on a number of topics relating to diversity and inclusion training. In a somewhat tempering note, the RFI clarifies that “training is not prohibited if it is designed to inform workers, or foster discussion, about pre-conceptions, opinions, or stereotypes that people—regardless of their race or sex—may have regarding people who are different, which could influence a worker's conduct or speech and be perceived by others as offensive.”

Over 150 business organizations led by the Chamber of Commerce circulated a strong letter questioning the purpose and necessity for EO 13950. In a showing of rare political bedfellows, the letter from the business community followed hard on the heels of a similarly critical letter organized by the Leadership Conference on Civil Rights,  joined by 121 civil rights groups and allies, including NAACP Legal Defense and Educational Fund and the Lawyers’ Committee for Civil Rights Under Law: could this be a rare signal of both sides getting together - Or - Not a Blue America or a Red America but an America??? Here is our note of hope from the PMN.

Administration Changes The H-1B Game; The Response Is Mostly Disappointment.  Earlier this month, the Departments of Labor and Homeland Security issued interim final rules — without adhering to the notice and comment requirement of the Administrative Procedure Act (“APA”) — making it more difficult and costly for both businesses and foreign workers in the H-1B and other specialty occupations. The DOL rule, “Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States,” took effect immediately on publication (October 8, 2020); the DHS rule, Strengthening the H–1B Nonimmigrant Visa Classification Program,” will be binding for new H-1B requests filed on or after December 7, 2020. Seyfarth provided an in-depth analysis of the measures here. Among the changes are a new one-year limit on placement of workers at third-party firms, more restrictive definitions of what jobs and employment relationships qualify for the visa, and increased minimum pay. A variety of business groups and universities have sued the agencies over the rules. According to a Complaint filed by the U.S. Chamber of Commerce, the National Association of Manufacturers, Cornell and Stanford Universities, among others, “if left unchecked,” the rules would “sever the employment relationship of hundreds of thousands of existing employees in the United States, and they would virtually foreclose the hiring of new individuals via the H-1B program.” The lawsuits seek to enjoin implementation of the rules on the grounds their implementation violated the APA.

NYS Publishes Official Paid Sick Leave Website While NYC Amends Its Own Paid Sick Leave Law. As we at PMN discussed, on September 30, 2020, New York’s general Paid Sick Leave (PSL) mandate, expanding beyond the statewide COVID-19 Emergency Leave Law, went into effect. While employers need not permit the use of PSL until January 1, 2021, all other obligations are live. As employers continue to prepare for compliance with the new mandate, the State recently published a NYPSL website and a set of FAQs. Both summarize and expand on certain aspects of the NYPSL law. We encourage you to read Seyfarth’s review of the highlights, here. Meanwhile, in September, the New York City Council adopted legislation that would amend the City’s existing Earned Safe and Sick Time Act (“ESSTA”) in light of the New York State paid sick leave (“NYPSL”) law taking effect on September 30, 2020. In addition to requiring benefits aligned with those under the NYPSL law, the amendments impose distinct new obligations on City employers and impact certain existing ESSTA obligations. For more information, see Seyfarth’s comprehensive Legal Update on the law.

EEOC Attempts To Streamline Conciliation Process Through Proposed Rule.  The EEOC recently published a Notice of Proposed Rulemaking suggesting changes to the current conciliation process when the Agency finds reasonable cause for any charge of discrimination in violation of established federal anti-discrimination laws. The proposed rule would require the Agency to provide the respondent with: (1) a summary of the facts and that the Commission relied on in its reasonable cause finding; (2) a summary of the Commission’s legal basis for finding reasonable cause; (3) the basis for any relief sought, including the calculations underlying the initial conciliation proposal; and (4) identification of a systemic, class, or pattern or practice designation. The public will have until November 9, 2020 to comment.

California Legislature Provides Some Relief To Civil Litigants In Light Of The Pandemic. At the onset of the Pandemic, Chief Justice Tani Cantil-Skakuye instituted new rules governing civil litigation set to expire 90 days after the COVID-19 state of emergency is lifted. Late last month, Governor Newsom signed into law SB 1146 concerning electronic service of process and remote depositions, codifying Emergency Rules 11 and 12. Those rules permit the use of remote depositions and require a “party represented by counsel, . . . [to] accept electronic service.” Additionally, the bill extends certain civil deadlines for the duration of the COVID-19 state of emergency, plus 180 days after the emergency ends

New York’s List of “Hot States” Now Incorporates 80% of United States While in-State Cluster Zones Are Designated. New York State Governor Andrew Cuomo announced on Tuesday that 40 states have now met the metrics to qualify for the incoming Travel Advisory, and that non-essential interstate travel between Connecticut, New Jersey and Pennsylvania is being “highly discouraged.” Gov. Cuomo issued Executive Order No. 205 in June requiring all “travelers entering New York from a state with a positive test rate higher than 10 per 100,000 residents, or higher than a 10% test positivity rate, over a seven day rolling average,” to “quarantine for a period of 14 days consistent with Department of Health regulations for quarantine.” Dealing with the rising levels of COVID-19 within the state, on October 6, Gov. Cuomo issued Executive Order 202.68, detailing how New York will deal with clusters of COVID-19 by designating red (severe), orange (less severe) and yellow (caution) zones. There are also new penalties that apply throughout the state for violations — not just in the cluster zones. A person may be fined $15,000 for promoting or organizing a non-essential gathering. Also, fines for not wearing face coverings are up to $1,000, and local governments may keep such fines if they assess them.

The Great White North’s Southern Neighbors Are Too Sick To Visit. Restrictions along the world’s longest undefended border, between Canada and the U.S. — which began in March — will remain in place until Nov. 21, according to Public Safety Minister Bill Blair. “Our decisions will continue to be based on the best public health advice available to keep Canadians safe,” he recently announced. Canada’s policy of exclusion is likely to continue given the recent spike in COVID-19 cases in the U.S.

SBA And Treasury Seek To Simplify PPP Forgiveness For Loans Less Than $50,000. This week, the U.S. Small Business Administration (SBA), with assistance from the Treasury department, released a more simple application to forgive loans taken under the Paycheck Protection Program. The application can be found here; instructions for completing the application are here; and the Interim Final Rule on the new application is here. At the same time, Senator McConnell introduced a stand-alone relief bill in the Senate to extend and expand the PPP. The Senate rejected the proposal, falling short of the necessary 60 votes to end debate on the measure.

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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