The new year will bring along a variety of new obligations for California employers.  Although some of the new laws clarify existing law and provide helpful guidance, several impose additional requirements.  This update highlights key provisions of some of the more notable changes taking effect in 2017.  Links to the statutes and/or prior updates regarding the same are provided where applicable.
Continue Reading California Employers – New Year, New Rules in 2017

As a reminder that non-union employees are also protected by the National Labor Relations Act (NLRA), the Seventh Circuit Court of Appeals in Chicago recently upheld a National Labor Relations Board (NLRB) decision holding that Staffing Network Holdings, LLC (“Staffing Network”) violated the NLRA by twice threatening non-union employees with discharge for engaging in protected, concerted activity, and for actually discharging an employee Griselda Barrera for the same. See Staffing Network Holdings, LLC v. NLRB.
Continue Reading Non-Union Employee’s “Bad Attitude” Protected by the NLRA

In Kaye v. Rosefielde (A-93-13), the New Jersey Supreme Court recently held that an employer need not demonstrate that it suffered an economic loss in order to recoup the salary of a disloyal employee.  The Court explained that courts have the equitable power to require disgorgement for any pay periods during which the employee was disloyal.
Continue Reading New Jersey Supreme Court Holds That an Employer Can Sue a Disloyal Employee To Clawback Salary Without Showing Economic Loss

Most employers have separation agreement forms that have served them well over the years.  The terms have become fairly standardized and, aside from the occasional tweak, they don’t change much and are rarely challenged.  Enter the EEOC, upsetting the apple cart with its new strategic enforcement initiative.  In recent litigation, it has staked out an aggressive (and new) position challenging what appear to be fairly standard separation agreement provisions.  Although it suffered a minor setback earlier this month, we shouldn’t expect it to back off from its new-found position.
Continue Reading The EEOC’s Assault on Separation Agreements – A Bump in the Road, But It’s Far From Over

In Weber v. Fujifilm Medical Systems USA Inc., et al., case numbers 13-4891 and 14-0206, decided on October 9, 2014, the U.S. Court of Appeals for the Second Circuit held that a former executive’s employer could use “after-acquired” evidence – evidence of an employee’s misconduct during the period of employment which the employer discovers after the employee’s discharge on other grounds – to confirm the nondiscriminatory reason for his termination.
Continue Reading Employer Permitted to Use “After-Acquired” Evidence at Discrimination Trial

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

In an 8-0 decision[1] issued March 25, 2014 in United States v. Quality Stores, Inc., the Supreme Court held that severance payments made to employees who are involuntarily terminated are taxable wages for the purposes of withholding Federal Insurance Contributions Act (“FICA”) taxes, i.e., Social Security and Medicare.  This decision resolves a circuit split created when the Sixth Circuit ruled in 2012 that these kinds of severance payments did not constitute “wages” under FICA[2] while the Third, Eighth and Federal Circuits had all previously held that at least some severance payments were “wages” subject to FICA taxes.[3]

In the wake of this decision, employers should, under most circumstances, treat severance payments made to involuntarily terminated employees as taxable wages subject to FICA taxes. There are exceptions to the general rule, however, and it is important for employers to seek competent legal counsel to assist in determining the tax status of a specific severance program.

Continue Reading US v. Quality Stores, Inc.: Supreme Court Finds Severance Payments Taxable Wages Under FICA

By James R. Hays, Maranda W. Rosenthal, and Jonathan Stoler

As the risk of a double-dip recession looms and companies continue to adjust their workforces to adapt to the more challenging economic times, employers are being faced with making the tough decision regarding the possibility of layoffs. Workforce reductions are one of the most unpleasant events for employers to deal with and often involve both economic and emotional considerations. Layoffs can expose employers to unexpected pitfalls and disastrous legal consequences as the company tries to navigate the myriad complex laws involved. In recognition of the current economic climate and the enormous amount of work required to properly plan and execute a large-scale layoff, this article is intended to assist in identifying key issues and to suggest several best practices when implementing a reduction-in-force.

Continue Reading Fears Of A Double-Dip Recession And Managing Workforce Reductions

Before filing suit under the California Fair Employment and Housing Act ("FEHA"), an employee must exhaust her administrative remedies with the Department of Fair Employment and Housing ("DFEH"). In the recently decided case of Wills v. Superior Court, the court gave little leeway to an employee, finding that she failed to exhaust her administrative remedies because her DFEH complaint only alleged discrimination based on a denial of family/medical leave, while her lawsuit raised different allegations of disability discrimination, retaliation, harassment, and failure to accommodate.

Continue Reading Court Says Okay to Terminate Bipolar Employee Who Threatened Coworkers

Justice Melvin L. Schweitzer of the New York Commercial Division recently issued a decision in Greater Talent Network, Inc. v. Alec Melman, et. al., Index No. 650522/2010 (Sup. Ct., NY County, Dec. 22, 2010) that can have important ramifications for New York employers.
 

Continue Reading “I Quit,” “No, You’re Fired!” New York Supreme Court Tells Employer to Think Twice Before Terminating Employees Without Setting Forth a Reason