1. Non-Competition Agreements
For many years part of an employee onboarding process has included signing a non-compete or non-solicitation agreement. That may change in April when the Federal Trade Commission (FTC) is expected to vote on a new rule that would make such agreements unlawful.
“The rationale behind the rule was that limiting competition suppresses wages, hampers innovation, and blocks entrepreneurs from starting new businesses,” said Patrick J. Barrett, an attorney with Fraser Stryker.
“By stopping this practice, the agency estimated that the new proposed rule could increase wages by nearly $300 billion per year and expand career opportunities for approximately 30 million Americans.”
The FTC rule would cover traditional employees, as well as independent contractors, interns, volunteers, apprentices, and sole proprietors who provide services to a client.
The National Labor Relations Board (NLRB) also signaled similar sentiments, noting that most non-compete and non-solicitation agreements violate clauses in the National Labor Relations Act.
2. Severance Agreements
The NLRB revised its stance on severance agreements in the past year. For many years severance agreements were put in place when employers and employees were parting ways to protect employers from future legal disputes.
“Historically, employers have included confidentiality and nondisparagement provisions,” said Sara McCue, an attorney with Baird Holm. “By using those provisions an employer essentially is saying to the employee that they can’t discuss what they were paid.”
The NLRB’s revised stance holds employers can’t offer employees an agreement that asks employees to waive all of their statutory rights (such as discussing pay) in exchange for pay or benefits.
Instead, McCue said, the clause must now be so specific it may render these agreements ineffective.
“That might mean fewer severance agreements overall, which could mean more litigation and lawsuits filed against employers,” she said.
3. Religious Accommodations
The Supreme Court’s ruling in Groff vs. DeJoy last June means employers must prepare a more robust argument for rejecting an employee’s religious accommodation request.
The Court unanimously agreed that Louis DeJoy, the postmaster general for the United States Postal Service, failed to accommodate Gerald Groff’s request for Sundays off due to his religion.
Before the unanimous decision, an employer could argue that accommodating the religious practice would present an undue burden, such as paying extra for an employee to work overtime. That no longer stands.
“The employer must look at its entire business and determine whether, within that context, the accommodation would result in substantial increased cost in operating the business. Moreover, the effect on coworkers (i.e., voluntary shift swaps) and increased administrative costs, including overtime, is not an “undue hardship” unless it is an undue hardship on the conduct of the employer’s business.”
4. Tracking Paid Sick Leave
Amy Luckenbill, government affairs committee co-chair for the Human Resources Association of the Midlands, said employers should be watching the Nebraska Healthy Families and Workplaces Act. The act is the proposed resolution put forth by the Paid Sick Leave for Nebraskans, which currently has a petition circulating in preparation for the 2024 voting season.
If the petition gathers enough signatures to be placed on the ballot and receives votes from 60% of Nebraska voters, companies will be required to offer employees paid sick leave so the employee can take care of themselves, or a family member.
“While any preparation on the issue is speculative at this point, employers do need to keep track of ballot initiatives and referenda, in addition to decisions made by the courts or guidance documents from the EEOC (Equal Employment Opportunity Commission),” she said.
“Employers should be investigating how their current payroll and time off technologies will accommodate any new requirements, should the initiative be voted into law.”
5. EEOC Enforcement Guidance on Workplace Harassment
Speaking of the EEOC, the first update to its Guidance on Workplace Harassment may come this year. The guidance, which hasn’t been updated since 1999, will include protections against sex-based discrimination in the virtual workplace.
The guidance includes sexist or racist comments or imagery.
“The proposed guidance also addresses Title VII’s prohibition of sex-based harassment and discrimination, which specifically includes harassment based on sexual orientation, gender identity, pregnancy, childbirth, or related medical conditions,” Barrett said.
“While the final guidance does not have the force of law, it does clarify requirements under the law or EEOC policies.”
Bonus Question
While not new, McCue said one of the most common questions they receive is concerning the Americans with Disabilities Act (ADA) and its provisions for animals in the workplace.
“There’s quite a bit of confusion from businesses concerning what its obligations are as an employer versus what are their obligations as an entity that is open to the public,” she said.
Title I states that an employer has to work with an employee towards a workplace accommodation, but doesn’t specify what animals are accepted.
Title III states that a workplace that is open to the public,
such as a restaurant or shopping mall, must allow service animals for individuals with disabilities. In many cases, that’s a
registered canine.
