On January 4, 2011, President Obama signed the FDA Food Safety Modernization Act (FSMA), which seeks to promote food safety by enacting strict safety standards in the food industry. In addition to the enactment of safety standards, Section 402 of the FSMA ensures sweeping protections for whistleblowers in the industry. The FSMA whistleblower protection applies to any “entity engaged in the manufacture, processing, packing, transporting, distribution, reception, holding, or importation of food.” The anti-retaliation provisions protect any employee of a covered entity who provides to the employer, the federal government, or the Attorney General of a State information that the employee reasonably believes constitutes a violation of the FSMA; testifies or is about to testify about any such violation; assists or participates in any such proceeding; or objects to or refuses to participate in any activity that the employee reasonably believes is a violation of the FSMA.
Expanding on our December 21 post, the U.S. Equal Employment Opportunity Commission on January 11, 2011, announced that private sector workplace discrimination charge filings reached the “unprecedented level” of 99,922 during fiscal year 2010, which ended on September 30, 2010. According to the data, all major categories of charge filings in the private sector, including charges against state and local governments, increased significantly.
The Genetic Information Nondiscrimination Act (GINA) prohibits discrimination in hiring and employment decisions based on an individual’s genetic information. So, for example, a company cannot refuse to hire a woman because her mother had breast cancer. The law also prohibits requesting, requiring and/or purchasing genetic information, with limited exceptions, and prohibits disclosure of genetic information. There are many open questions about the law, such as whether companies can have wellness programs anymore (restricted genetic information is routinely gathered as part of such programs) or whether it is a violation of the law for a supervisor to learn about genetic information by accessing an employee’s page on a social networking site, or by asking innocent questions about the employee’s health, such as “How are you?.” The EEOC issued final regulations last week in an attempt to answer these and other questions under the law. A short discussion follows.
In yet another employee misclassification case, Kentucky Attorney General, Jack Conway, brought suit against FedEx Corp. alleging that FedEx violates Kentucky state law by misclassifying its drivers as independent contractors. The Complaint contends that FedEx violated state law in regards to unemployment insurance, workers compensation, payroll taxes, and the Kentucky Consumer Protection Act. The lawsuit asks the Court to order FedEx to classify its drivers as employees and to pay the contributions and penalties required by state law, which includes back pay dating to 2000 and totaling at least $10 million.
Our prior posts have chronicled recent attempts by Congress and state legislatures to crack down on employers who misclassify employees as independent contractors, the most notable of which was the Employee Misclassification Prevention Act that, among other things, seeks to create a cause of action under the FLSA for misclassification and to require employers to keep records of hours worked by independent contractors. On September 15, Congress took yet another step in the enforcement direction when Senator John Kerry (D-Mass.) and Representative Jim McDermott (D-Wash.) introduced The Fair Playing Field Act of 2010 (S. 3786, H. 6128), which seeks to close a so-called “loophole” under the current tax regime.
Continue Reading Congress Proposes Additional Independent Contractor Legislation; “The Fair Playing Field Act” Receives Strong Support From White House
The Dodd-Frank Wall Street Reform and Consumer Protection Act just signed into law by President Obama, H.R. 4173, 111th Cong. (2010) (“Dodd-Frank”), creates new statutory rights and incentives for whistleblowers and also expands already existing rights, such as under the Sarbanes-Oxley Act (“SOX”). Now more than ever, clear policies and procedures backed by strong audit, compliance and investigatory functions are critical to managing the anticipated increase of regulatory enforcement and private party whistleblower litigation that this expansive legislation likely will create.
The Senate Committee on Health, Education, Labor, and Pensions has announced that it will conduct a hearing on Thursday, June 17, 2010 on the Employee Misclassification Prevention Act, which was introduced in both the Senate and House on April 22, 2010. The Act seeks to amend the Fair Labor Standards Act so that worker misclassification is a violation of federal law. The act also requires employers to maintain records reflecting hours worked and wages paid to independent contractors. See our previous post for a detailed discussion of the legislation.
Continue Reading Senate Labor Committee To Conduct Hearing On Independent Contractor Legislation
The Secretary of Labor has finalized implementing regulations under Executive Order 13496, which requires federal contractors and subcontractors covered by the National Labor Relations Act (NLRA) to post a new notice advising employees of their rights under the Act. Note that most employers in the private sector are covered by the NLRA; the Order is not limited to companies with union activity or representation.
The regulations are codified at Title 29, Part 471 of the Code of Federal Regulations. The Department of Labor (DOL) also provides a helpful fact sheet about the new requirement.
For years, employers wrestling with thorny wage and hour issues under the Fair Labor Standards Act (“FLSA”) have used the Wage & Hour Division’s (“WHD”) opinion letters for fact-specific guidance. To the extent a particular issue was not addressed by a current opinion letter, the employer could submit a request for an opinion letter and obtain definitive guidance from WHD. Employers who relied on opinion letters were immune from FLSA liability under the Portal Act’s safeharbor provision, which allows an employer to avoid liability for FLSA violations if the employer relied on a written interpretation of the WHD.
Continue Reading Changes To Opinion Letter Process Another Signal That Enforcement Is DOL’s Top Priority
The proposed 2011 fiscal year federal budget signifies a renewed commitment to combating employee misclassification, as it contemplates funding an additional 4,700 investigations into worker misclassification issues. With penalties for worker misclassification being quite steep — including back taxes, interest, and even punitive fines — employers should audit their workforce to ensure that their independent contractors are properly classified.
Unfortunately, there is no bright line test to determine whether a particular worker has been properly classified as an independent contractor. In fact, the precise definition of an independent contractor not only varies between federal and state law, but can also vary from state to state and even statute to statute.