Supreme Court Roundup: A Look Back – and Ahead – for Employment Law

by Baker Donelson
Contact

Baker Donelson

As the Supreme Court ended its 2017-18 Term, Justice Anthony Kennedy announced his resignation; the Court did away with "agency fees" for public employees; and in other decisions favorable to employers, the Court solidified the use of class waivers in arbitration agreements and eased up on the standards for analyzing exemptions under the Fair Labor Standards Act (FLSA). This roundup summarizes the Court's decisions during the 2017-18 Term that impact employers and previews employment cases upcoming in the 2018-19 Term.

2017-18 Term – Decided Cases

Epic System v. Lewis, Ernst & Young v. Morris and National Relations Board v. Murphy Oil USA (consolidated cases)
This group of cases posed the question as to whether an agreement that requires an employer and an employee to resolve employment-related disputes through individual arbitration and waive class and collective proceedings is enforceable under the Federal Arbitration Act (FAA), notwithstanding the provisions of the National Labor Relations Act preventing employers from limiting employees' rights to engage in "concerted activities" in pursuit of their "mutual aid or protection." In an "epic" decision, the Court held that class action waivers in employee arbitration agreements are enforceable. For an in-depth analysis of that holding, read our recent article found here.

Janus v. American Federation of State, County, and Municipal Employees, Council 31
In 1977, the Supreme Court held in Abood v. Detroit Board of Education that a union representing government employees could require non-members to pay an "agency" fee, which is a percentage of full union dues, generally because the non-members benefited from the union's efforts. The Janus case raised the following question: Should Abood be overruled and public-sector agency fee arrangements be declared unconstitutional under the First Amendment?

Mark Janus works as a child support specialist employed by the Illinois Department of Healthcare and Family Services. Janus is represented by, but not a member of, AFSCME Council 31. Janus did not want to join the union because he opposed various public policy positions that it took. Nonetheless, the union required that Janus, as a non-member, pay an agency fee as a condition of his employment with the State of Illinois. Janus sued, alleging that requiring him to pay an agency fee violated the First Amendment. Chief Justice John Roberts and Justices Samuel Alito, Anthony Kennedy, Clarence Thomas, and Neil Gorsuch agreed with Janus's argument. Justice Alito, who authored the majority opinion, opined that "[c]ompelling individuals to mouth support for views they find objectionable violates [a] cardinal constitutional command…" and "measures compelling speech are at least as threatening" as those that involve restrictions on what can be said.

The Janus decision is expected to have a significant impact on public sector unions. No doubt, public sector employees who are non-members will take advantage of the Janus decision and will likely stop paying agency fees to the union that represents them. Unions may also begin "marketing" to enforce non-union members to continue their financial support. We may also see state legislatures entering the fray to enact laws to protect unions from being forced to offer full benefits to non-members. Janus applies only to public sector employees. Therefore, unless an employee works in a state with a right to work law, private sector employees can still be required to pay union dues as a condition of employment.

CNH Industrial N.V. v. Reese
In CNH Industrial N.V. v. Reese, the Supreme Court explained in a per curium opinion and without hearing oral argument, that collective bargaining agreements (CBAs) between employers and unions are interpreted under ordinary principles of contract law, including when determining whether a contract is ambiguous. Before the Court issued its decision in M&G Polymers USA, LLC v. Tackett, 574 U.S. (2015), the Sixth Circuit had applied "Yard-Man inferences," relying on evidence beyond the language of the contract, to determine that the CBA at issue in the case provided for the union members' insurance benefits to be vested for life. In Tackett, the Court had rejected the Yard-Man inferences because their application "distort[ed] the text" of CBAs and conflicted with the traditional rule that contracts must be construed according to their plain language. As such, in CNH Industrial NV, the Supreme Court reversed the Sixth Circuit's decision because it could not be "squared with Tackett." The Supreme Court explained that Yard-Man inferences are not ordinary principles of contract interpretation and that the CBA's silence regarding the issue of vesting meant that, like the other benefits of the union members, those insurance benefits terminate when the CBA itself terminates.

China Agritech v. Resh
In China Agritech v. Resh, the Supreme Court issued a unanimous decision on June 11, 2018, holding that individuals cannot stack class action lawsuits one after another. In American Pipe & Construction Co. v. Utah, the Court held that the timely filing of a defective class action suspends the applicable statute of limitations as to the individual claims of purported class members. The Supreme Court opined that while its decision in American Pipe means that the statute of limitations in a class action case is tolled as to individual class members, this tolling does not extend to the filing of a subsequent class action based on the same facts and circumstances.

Digital Realty Trust, Inc. v. Somers
In Digital Realty Trust, Inc. v. Somers, the question at issue was whether the anti-retaliation provision for "whistleblowers" in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 ("Dodd-Frank") extends to individuals who have not reported alleged misconduct to the Securities and Exchange Commission and thus fall outside the Act's statutory definition of "whistleblower." In a favorable decision for employers, the Court held that to sue for a violation of Dodd Frank's anti-retaliation provision (15 U.S.C. § 78u-6(h)(1)(A)), a whistleblower must first report a violation of the securities laws to the SEC. Section 78u-6(a)(6) defines "whistleblower" as "any individual who provides . . . information relating to a violation of the securities laws to the Commission." The Court opined that the clear statutory definition of "whistleblower" provides the answer.

Masterpiece Cakeshop, Ltd. v. Colorado Civil Rights
In Masterpiece Cakeshop, Ltd. v. Colorado Civil Rights, perhaps better known as the "baker case," the Court held that the Colorado Civil Rights Commission's conduct in evaluating a cake shop owner's reasons for declining to make a wedding cake for a same-sex couple violated the Free Exercise Clause. This was a very narrow decision which focused on the Commission's conduct when investigating the charges of discrimination that Charlie Craig and David Mullins filed after Jack Philips, the cake shop owner, declined to make their wedding cake on the grounds that he does not create wedding cakes for same-sex weddings because of his religious beliefs. The Commission found in favor of Craig and Mullins, and the Colorado Court of Appeals subsequently affirmed the Commission's ruling.

The case wound its way to the Supreme Court where the question at issue was: does the application of Colorado's public accommodations law to compel a cake maker to design and make a cake that violates his sincerely held religious beliefs about same-sex marriage violate the Free Speech or Free Exercise Clauses of the First Amendment? In the Court's narrow holding, the court found that a commissioner's remarks during the administrative proceedings relating to the discrimination charge evinced a bias against religion that violated the First Amendment's Free Exercise Clause. "To describe a man's faith as 'one of the most despicable pieces of rhetoric that people can use' is to disparage his religion in at least two distinct ways: by describing it as despicable, and also by characterizing it as merely rhetorical – something insubstantial and even insincere," Justice Kennedy said. "This sentiment is inappropriate for a commission charged with the solemn responsibility of fair and neutral enforcement of Colorado's antidiscrimination law – a law that protects discrimination on the basis of religion as well as sexual orientation," Justice Kennedy wrote in the majority opinion. But the question all court watchers wanted answered was this: Does the First Amendment protect the baker's right to deny services to same sex-couples? That constitutional question went unanswered in Masterpiece Cakeshop; thus, it is unlikely that the decision will have any far-reaching impact.

Encino Motorcars, LLC v. Navarro
In Encino Motorcars, LLC v. Navarro, the Court considered whether service advisors at car dealerships are exempt under 29 U.S.C. § 213(b)(10)(A) from the FLSA's overtime pay requirements. In a tight 5-4 decision, the Court held that service advisors at car dealerships are exempt from the FLSA's overtime pay requirements because they are "salesm[e]n . . . primarily engaged in . . . servicing automobiles" under 29 U.S.C. § 213(b)(10)(A).

The exemption ruling is not that memorable, but the Court's reasoning may have far-reaching impact on courts' interpretation of FLSA exemptions. The Court rejected the Ninth Circuit's conclusion that FLSA exemptions should be construed narrowly in holding that service advisors were not exempt. The Court explained that the Ninth Circuit had used a "flawed premise that the FLSA pursues its remedial purpose at all costs." The Court noted that the FLSA has more than two dozen exemptions, and the court said that those exemptions are as much a part of the FLSA's purpose as the overtime pay requirement and that courts must read the exemptions, fairly not narrowly.

The Court also rejected the Ninth Circuit's reliance on a 1966-67 Department of Labor Occupational Outlook Handbook and the FLSA legislative history, both of which the Court found unpersuasive; thus, the Court abandoned the position held for more than 70 years that the exemptions to overtime under the FLSA must be narrowly construed for a "fair interpretation."

2018-19 Term – Cases Pending

The 2018-19 Term begins on October 1, 2018. We can look forward to another banner year of interesting employment-related cases pending before the Court that employers should keep an eye on in the coming months. The Court has granted certiorari in the case of Varela v. Lamps Plus, Inc. to determine whether the FAA forecloses a state-law interpretation of an arbitration agreement that would authorize class arbitration based solely on general language commonly used in arbitration agreements.

The Court has also granted certiorari in BNSF Railway Co. v. Loos to determine whether a lost wages damages award to a former railroad employee is subject to withholding or taxation under the Railroad Retirement Tax Act. In New Prime, Inc. v. Oliveira, the Court will once again take up an issue related to the Federal Arbitration Act (FAA). Section 1 of the FAA provides that the FAA does not apply "to contracts of employment of seaman, railroad employees, or any other class of workers engaged in foreign or interstate commerce." 9 U.S.C. § 1. The questions at issue are: (1) whether a dispute over the applicability of the Section 1 exemption must be resolved by a court or an arbitrator; and (2) whether Section 1 of the FAA applies to independent-contractor agreements.

In Mount Lemmon Fire District v. Guido, the Court will consider whether, under the Age Discrimination in Employment Act (ADEA), the same 20-employee minimum that applies to private employers also applies to political subdivisions of a state, as the Sixth, Seventh, Eighth, and Tenth Circuits have held, or whether the ADEA applies instead to all state political subdivisions of any size, as the Ninth Circuit held in this case.

We will keep you apprised as the Court considers these other questions in the coming session, and we will analyze the impact such decisions may have on your business.

 

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.

© Baker Donelson | Attorney Advertising

Written by:

Baker Donelson
Contact
more
less

Baker Donelson on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide

JD Supra Privacy Policy

Updated: May 25, 2018:

JD Supra is a legal publishing service that connects experts and their content with broader audiences of professionals, journalists and associations.

This Privacy Policy describes how JD Supra, LLC ("JD Supra" or "we," "us," or "our") collects, uses and shares personal data collected from visitors to our website (located at www.jdsupra.com) (our "Website") who view only publicly-available content as well as subscribers to our services (such as our email digests or author tools)(our "Services"). By using our Website and registering for one of our Services, you are agreeing to the terms of this Privacy Policy.

Please note that if you subscribe to one of our Services, you can make choices about how we collect, use and share your information through our Privacy Center under the "My Account" dashboard (available if you are logged into your JD Supra account).

Collection of Information

Registration Information. When you register with JD Supra for our Website and Services, either as an author or as a subscriber, you will be asked to provide identifying information to create your JD Supra account ("Registration Data"), such as your:

  • Email
  • First Name
  • Last Name
  • Company Name
  • Company Industry
  • Title
  • Country

Other Information: We also collect other information you may voluntarily provide. This may include content you provide for publication. We may also receive your communications with others through our Website and Services (such as contacting an author through our Website) or communications directly with us (such as through email, feedback or other forms or social media). If you are a subscribed user, we will also collect your user preferences, such as the types of articles you would like to read.

Information from third parties (such as, from your employer or LinkedIn): We may also receive information about you from third party sources. For example, your employer may provide your information to us, such as in connection with an article submitted by your employer for publication. If you choose to use LinkedIn to subscribe to our Website and Services, we also collect information related to your LinkedIn account and profile.

Your interactions with our Website and Services: As is true of most websites, we gather certain information automatically. This information includes IP addresses, browser type, Internet service provider (ISP), referring/exit pages, operating system, date/time stamp and clickstream data. We use this information to analyze trends, to administer the Website and our Services, to improve the content and performance of our Website and Services, and to track users' movements around the site. We may also link this automatically-collected data to personal information, for example, to inform authors about who has read their articles. Some of this data is collected through information sent by your web browser. We also use cookies and other tracking technologies to collect this information. To learn more about cookies and other tracking technologies that JD Supra may use on our Website and Services please see our "Cookies Guide" page.

How do we use this information?

We use the information and data we collect principally in order to provide our Website and Services. More specifically, we may use your personal information to:

  • Operate our Website and Services and publish content;
  • Distribute content to you in accordance with your preferences as well as to provide other notifications to you (for example, updates about our policies and terms);
  • Measure readership and usage of the Website and Services;
  • Communicate with you regarding your questions and requests;
  • Authenticate users and to provide for the safety and security of our Website and Services;
  • Conduct research and similar activities to improve our Website and Services; and
  • Comply with our legal and regulatory responsibilities and to enforce our rights.

How is your information shared?

  • Content and other public information (such as an author profile) is shared on our Website and Services, including via email digests and social media feeds, and is accessible to the general public.
  • If you choose to use our Website and Services to communicate directly with a company or individual, such communication may be shared accordingly.
  • Readership information is provided to publishing law firms and authors of content to give them insight into their readership and to help them to improve their content.
  • Our Website may offer you the opportunity to share information through our Website, such as through Facebook's "Like" or Twitter's "Tweet" button. We offer this functionality to help generate interest in our Website and content and to permit you to recommend content to your contacts. You should be aware that sharing through such functionality may result in information being collected by the applicable social media network and possibly being made publicly available (for example, through a search engine). Any such information collection would be subject to such third party social media network's privacy policy.
  • Your information may also be shared to parties who support our business, such as professional advisors as well as web-hosting providers, analytics providers and other information technology providers.
  • Any court, governmental authority, law enforcement agency or other third party where we believe disclosure is necessary to comply with a legal or regulatory obligation, or otherwise to protect our rights, the rights of any third party or individuals' personal safety, or to detect, prevent, or otherwise address fraud, security or safety issues.
  • To our affiliated entities and in connection with the sale, assignment or other transfer of our company or our business.

How We Protect Your Information

JD Supra takes reasonable and appropriate precautions to insure that user information is protected from loss, misuse and unauthorized access, disclosure, alteration and destruction. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. You should keep in mind that no Internet transmission is ever 100% secure or error-free. Where you use log-in credentials (usernames, passwords) on our Website, please remember that it is your responsibility to safeguard them. If you believe that your log-in credentials have been compromised, please contact us at privacy@jdsupra.com.

Children's Information

Our Website and Services are not directed at children under the age of 16 and we do not knowingly collect personal information from children under the age of 16 through our Website and/or Services. If you have reason to believe that a child under the age of 16 has provided personal information to us, please contact us, and we will endeavor to delete that information from our databases.

Links to Other Websites

Our Website and Services may contain links to other websites. The operators of such other websites may collect information about you, including through cookies or other technologies. If you are using our Website or Services and click a link to another site, you will leave our Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We are not responsible for the data collection and use practices of such other sites. This Policy applies solely to the information collected in connection with your use of our Website and Services and does not apply to any practices conducted offline or in connection with any other websites.

Information for EU and Swiss Residents

JD Supra's principal place of business is in the United States. By subscribing to our website, you expressly consent to your information being processed in the United States.

  • Our Legal Basis for Processing: Generally, we rely on our legitimate interests in order to process your personal information. For example, we rely on this legal ground if we use your personal information to manage your Registration Data and administer our relationship with you; to deliver our Website and Services; understand and improve our Website and Services; report reader analytics to our authors; to personalize your experience on our Website and Services; and where necessary to protect or defend our or another's rights or property, or to detect, prevent, or otherwise address fraud, security, safety or privacy issues. Please see Article 6(1)(f) of the E.U. General Data Protection Regulation ("GDPR") In addition, there may be other situations where other grounds for processing may exist, such as where processing is a result of legal requirements (GDPR Article 6(1)(c)) or for reasons of public interest (GDPR Article 6(1)(e)). Please see the "Your Rights" section of this Privacy Policy immediately below for more information about how you may request that we limit or refrain from processing your personal information.
  • Your Rights
    • Right of Access/Portability: You can ask to review details about the information we hold about you and how that information has been used and disclosed. Note that we may request to verify your identification before fulfilling your request. You can also request that your personal information is provided to you in a commonly used electronic format so that you can share it with other organizations.
    • Right to Correct Information: You may ask that we make corrections to any information we hold, if you believe such correction to be necessary.
    • Right to Restrict Our Processing or Erasure of Information: You also have the right in certain circumstances to ask us to restrict processing of your personal information or to erase your personal information. Where you have consented to our use of your personal information, you can withdraw your consent at any time.

You can make a request to exercise any of these rights by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

You can also manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard.

We will make all practical efforts to respect your wishes. There may be times, however, where we are not able to fulfill your request, for example, if applicable law prohibits our compliance. Please note that JD Supra does not use "automatic decision making" or "profiling" as those terms are defined in the GDPR.

  • Timeframe for retaining your personal information: We will retain your personal information in a form that identifies you only for as long as it serves the purpose(s) for which it was initially collected as stated in this Privacy Policy, or subsequently authorized. We may continue processing your personal information for longer periods, but only for the time and to the extent such processing reasonably serves the purposes of archiving in the public interest, journalism, literature and art, scientific or historical research and statistical analysis, and subject to the protection of this Privacy Policy. For example, if you are an author, your personal information may continue to be published in connection with your article indefinitely. When we have no ongoing legitimate business need to process your personal information, we will either delete or anonymize it, or, if this is not possible (for example, because your personal information has been stored in backup archives), then we will securely store your personal information and isolate it from any further processing until deletion is possible.
  • Onward Transfer to Third Parties: As noted in the "How We Share Your Data" Section above, JD Supra may share your information with third parties. When JD Supra discloses your personal information to third parties, we have ensured that such third parties have either certified under the EU-U.S. or Swiss Privacy Shield Framework and will process all personal data received from EU member states/Switzerland in reliance on the applicable Privacy Shield Framework or that they have been subjected to strict contractual provisions in their contract with us to guarantee an adequate level of data protection for your data.

California Privacy Rights

Pursuant to Section 1798.83 of the California Civil Code, our customers who are California residents have the right to request certain information regarding our disclosure of personal information to third parties for their direct marketing purposes.

You can make a request for this information by emailing us at privacy@jdsupra.com or by writing to us at:

Privacy Officer
JD Supra, LLC
10 Liberty Ship Way, Suite 300
Sausalito, California 94965

Some browsers have incorporated a Do Not Track (DNT) feature. These features, when turned on, send a signal that you prefer that the website you are visiting not collect and use data regarding your online searching and browsing activities. As there is not yet a common understanding on how to interpret the DNT signal, we currently do not respond to DNT signals on our site.

Access/Correct/Update/Delete Personal Information

For non-EU/Swiss residents, if you would like to know what personal information we have about you, you can send an e-mail to privacy@jdsupra.com. We will be in contact with you (by mail or otherwise) to verify your identity and provide you the information you request. We will respond within 30 days to your request for access to your personal information. In some cases, we may not be able to remove your personal information, in which case we will let you know if we are unable to do so and why. If you would like to correct or update your personal information, you can manage your profile and subscriptions through our Privacy Center under the "My Account" dashboard. If you would like to delete your account or remove your information from our Website and Services, send an e-mail to privacy@jdsupra.com.

Changes in Our Privacy Policy

We reserve the right to change this Privacy Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our Privacy Policy will become effective upon posting of the revised policy on the Website. By continuing to use our Website and Services following such changes, you will be deemed to have agreed to such changes.

Contacting JD Supra

If you have any questions about this Privacy Policy, the practices of this site, your dealings with our Website or Services, or if you would like to change any of the information you have provided to us, please contact us at: privacy@jdsupra.com.

JD Supra Cookie Guide

As with many websites, JD Supra's website (located at www.jdsupra.com) (our "Website") and our services (such as our email article digests)(our "Services") use a standard technology called a "cookie" and other similar technologies (such as, pixels and web beacons), which are small data files that are transferred to your computer when you use our Website and Services. These technologies automatically identify your browser whenever you interact with our Website and Services.

How We Use Cookies and Other Tracking Technologies

We use cookies and other tracking technologies to:

  1. Improve the user experience on our Website and Services;
  2. Store the authorization token that users receive when they login to the private areas of our Website. This token is specific to a user's login session and requires a valid username and password to obtain. It is required to access the user's profile information, subscriptions, and analytics;
  3. Track anonymous site usage; and
  4. Permit connectivity with social media networks to permit content sharing.

There are different types of cookies and other technologies used our Website, notably:

  • "Session cookies" - These cookies only last as long as your online session, and disappear from your computer or device when you close your browser (like Internet Explorer, Google Chrome or Safari).
  • "Persistent cookies" - These cookies stay on your computer or device after your browser has been closed and last for a time specified in the cookie. We use persistent cookies when we need to know who you are for more than one browsing session. For example, we use them to remember your preferences for the next time you visit.
  • "Web Beacons/Pixels" - Some of our web pages and emails may also contain small electronic images known as web beacons, clear GIFs or single-pixel GIFs. These images are placed on a web page or email and typically work in conjunction with cookies to collect data. We use these images to identify our users and user behavior, such as counting the number of users who have visited a web page or acted upon one of our email digests.

JD Supra Cookies. We place our own cookies on your computer to track certain information about you while you are using our Website and Services. For example, we place a session cookie on your computer each time you visit our Website. We use these cookies to allow you to log-in to your subscriber account. In addition, through these cookies we are able to collect information about how you use the Website, including what browser you may be using, your IP address, and the URL address you came from upon visiting our Website and the URL you next visit (even if those URLs are not on our Website). We also utilize email web beacons to monitor whether our emails are being delivered and read. We also use these tools to help deliver reader analytics to our authors to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

Analytics/Performance Cookies. JD Supra also uses the following analytic tools to help us analyze the performance of our Website and Services as well as how visitors use our Website and Services:

  • HubSpot - For more information about HubSpot cookies, please visit legal.hubspot.com/privacy-policy.
  • New Relic - For more information on New Relic cookies, please visit www.newrelic.com/privacy.
  • Google Analytics - For more information on Google Analytics cookies, visit www.google.com/policies. To opt-out of being tracked by Google Analytics across all websites visit http://tools.google.com/dlpage/gaoptout. This will allow you to download and install a Google Analytics cookie-free web browser.

Facebook, Twitter and other Social Network Cookies. Our content pages allow you to share content appearing on our Website and Services to your social media accounts through the "Like," "Tweet," or similar buttons displayed on such pages. To accomplish this Service, we embed code that such third party social networks provide and that we do not control. These buttons know that you are logged in to your social network account and therefore such social networks could also know that you are viewing the JD Supra Website.

Controlling and Deleting Cookies

If you would like to change how a browser uses cookies, including blocking or deleting cookies from the JD Supra Website and Services you can do so by changing the settings in your web browser. To control cookies, most browsers allow you to either accept or reject all cookies, only accept certain types of cookies, or prompt you every time a site wishes to save a cookie. It's also easy to delete cookies that are already saved on your device by a browser.

The processes for controlling and deleting cookies vary depending on which browser you use. To find out how to do so with a particular browser, you can use your browser's "Help" function or alternatively, you can visit http://www.aboutcookies.org which explains, step-by-step, how to control and delete cookies in most browsers.

Updates to This Policy

We may update this cookie policy and our Privacy Policy from time-to-time, particularly as technology changes. You can always check this page for the latest version. We may also notify you of changes to our privacy policy by email.

Contacting JD Supra

If you have any questions about how we use cookies and other tracking technologies, please contact us at: privacy@jdsupra.com.

- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.