UPDATE: New Jersey Limits Use of Criminal History in Hiring Decisions

As we reported in December 2013 (see here), New Jersey was on the road to joining 6 other states which have recently passed legislation banning or limiting the use of criminal background checks in the hiring process.  On August 11, 2014, New Jersey Governor Chris Christie signed the Opportunity to Compete Act, and New Jersey joined Connecticut, Illinois, Massachusetts, and Rhode Island, among a number of other states, cities, and municipalities, in prohibiting employers from asking about an applicant’s criminal history during the initial stage of the application process.  The New Jersey legislature had passed the measure in June.

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Southern District Magistrate Judge Clarifies FLSA “Computer Professional” Exemption

In an April 2014 decision in the Southern District of New York, Olorode v. Streamingedge, Inc., No. 11 Civ. 6934 (GBD) (AJP) (S.D.N.Y. Apr. 29, 2014), employers were given some clarification on the Computer Professional overtime exemption available under the Fair Labor Standards Act (“FLSA”).  As courts in the Second Circuit have not often had occasion to expound on the Computer Professional exemption, this decision will be helpful going forward in understanding which computer- or technology-based employee positions likely will qualify for this exemption and which likely will not.

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Second Circuit Finds that Entry-Level Audit Associates at Accounting Firm are Exempt from Federal Overtime Requirements

In Pippins v. KPMG LLP, No. 13-889 (2d Cir. July 22, 2014), the Second Circuit Court of Appeals unanimously held that entry-level audit associates (“Plaintiffs”) at KPMG LLP qualify for the Fair Labor Standards Act’s (“FLSA”) “learned professionals” overtime exemption.  The Second Circuit explained that, while the closely-supervised employees were “the most junior members” of the KPMG accountancy team and did not “make high-level decisions,” their work still required sufficient knowledge and judgment to qualify for the exemption.

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California Court of Appeal Enforces Contractor’s Agreement to Arbitrate Misclassification Claims Out of State

On Monday, July 21, 2014, the California Court of Appeal issued its opinion in Galen v. Redfin Corp., A138642.  This case is important for two reasons:  (1) the court upheld an arbitration agreement between a Seattle-based company and a California plaintiff challenging his status (and that of the putative class) as an independent contractor (v. employee), even though the agreement provided for the application of Washington law and a Washington venue; and (2) it reinforces California’s strong policy of enforcing forum-selection clauses, a policy that is relevant outside the context of arbitration, such as in the noncompete context.

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Illinois Becomes The Fifth State To Enact So Called “Ban The Box” Law, Prohibiting Private Sector Employers From Asking About Criminal History

This past Monday, July 21, 2014, Illinois joined Hawaii, Massachusetts, Minnesota and Rhode Island as the fifth State to enact a so called “ban the box” law.  Signed by the Governor, the law will take effect on January 1, 2015.  Called the Job Opportunities for Qualified Applicants Act, the law prohibits private sector employers from asking about a job applicant’s criminal record or history until after the employer has scheduled an interview.  If the hiring decision is made without interview, then the employer cannot ask until after it has made a conditional offer of employment.  The law applies to all private sector employers with 15 or more employees.  Exceptions to this new law include: (1) jobs which cannot be held by convicted criminals under federal or state law, (2) jobs requiring licensing under the Emergency Medical Services System Act, and (3) a limited exception for jobs requiring fidelity bonds.

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Second Circuit Finds Possible Pretext in Vague Justification for Non-Transfer

On July 14th, the U.S. Court of Appeals for the Second Circuit vacated an award of summary judgment for the defendants in Abrams v. Department of Public Safety, State of Connecticut, et al., Case No. 13-111, holding that statements concerning an employee’s “fit” for a position could give rise to an inference of discrimination.

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DOL Proposes to Amend FMLA Definition of “Spouse” to Include Same-Sex Marriages

The U.S. Department of Labor has proposed amending the regulatory definition of “spouse” under the Family and Medical Leave Act to expressly include individuals in same-sex marriages.

In a Notice of Proposed Rulemaking published on June 27, 2014, the DOL proposed the revision in light of the recent United States Supreme Court decision in United States v. Windsor, which found unconstitutional those provisions of the Defense of Marriage Act that prohibited federal recognition of same-sex marriages.

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California Supreme Court Limits Application of Commissioned Employee Exemption

On July 14, 2014, the California Supreme Court held in Peabody v. Time Warner Cable, Inc. that employees qualify for the California “commissioned employee” exemption in a pay period only if they receive “earnings [that] exceed one and one-half (1-1/2) times the minimum wage” in that two-week pay period.  The Court held that an employer may not satisfy the minimum earnings prong of the exemption by reassigning wages from a different pay period for employees who are paid commissions that are calculated monthly.  In addition, as explained below, while the Court expressly declined to address the issue, its reasoning will lead plaintiffs’ counsel to argue that more than half of an employee’s pay in a pay period must “represent commissions” if the employee is to meet the exemption in that pay period.

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Undocumented Workers May Pursue Claims Under California’s FEHA, So Says The California Supreme Court

On June 26, 2014, in Salas v. Sierra Chemical Co., the California Supreme Court held that undocumented immigrants who fraudulently obtained employment still may pursue retaliation and discrimination claims under the California Fair Employment and Housing Act (FEHA).  In its decision, the Court also found that the affirmative defenses of unclean hands and after‑acquired evidence, which typically can limit an employee’s ability to obtain relief, are not complete defenses to FEHA claims brought by undocumented workers.  Under the Court’s ruling, employees who used false documentation to obtain employment not only may bring such a lawsuit but also can recover lost wages, emotional distress damages and attorneys’ fees, even if they actually were never legally entitled to work for the employer.

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