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Amid challenges regarding Philadelphia’s upcoming law prohibiting employers from requesting an applicant’s salary history, the City has agreed not to enforce the upcoming law until after the court has finally resolved the injunction request.

The law, which was set to become effective May 23, 2017, has been challenged by the Chamber of Commerce for Greater Philadelphia (the “Chamber”). The Chamber’s lawsuit alleges that the pending law violates the First Amendment by restricting an employer’s speech because, among other reasons, “it is highly speculative whether the [law] will actually ameliorate wage disparities caused by gender discrimination.” It is also alleged that the law violates the Commerce Clause of the U.S. Constitution, the Due Process Clause of the Fourteenth Amendment, and Pennsylvania’s Constitution as well as its “First Class City Home Rule Act” by allegedly attempting to restrict the rights of employers outside of Philadelphia.

On April 19, a judge for the Eastern District of Pennsylvania stayed the effective date of the law, pending the resolution of the Chamber’s motion for a preliminary injunction. Prior to resolving the injunction, the parties will first brief the court on the Chamber’s standing to bring the lawsuit. This issue, regarding whether the Chamber is an appropriate party to bring this lawsuit, will be fully briefed by May 12, 2017, before the law is set to become effective. However, there are several other issues to be resolved as part of the lawsuit. The City’s decision to stay enforcement of the pending law until all issues are resolved is intended to help employers and employees avoid confusion during the pendency of the lawsuit.

Although the City of Philadelphia will not enforce this law in the interim, employers with any operations in Philadelphia should review their interviewing and hiring practices in case the lawsuit is decided in favor of the City. Further, employers in Massachusetts and New York City will also be subject to similar restrictions on inquiring about an applicant’s salary history when those laws go into effect. Massachusetts’ law is scheduled to become effective in July 2018, and New York City’s law will become effective 180 days after Mayor de Blasio signs the law, which may occur as soon as this week.

Paid Leave_shutterstock_371740363The state of Maryland appears poised to join seven other states and various local jurisdictions (including Montgomery County, Maryland) already requiring employers to provide paid sick and save leave. On April 5, 2017, the Maryland House of Delegates approved a bill previously passed by the Maryland Senate that would require most employers with at least 15 employees to provide up to five paid sick and safe leave days per year to their employees, and smaller employers to provide up to five unpaid sick and safe leave days. Although the bill contains an effective date of January 1, 2018, the actual effective date will depend on action by Governor Larry Hogan.

The following employees are not covered by the bill:

  • Employees who regularly work less than 12 hours a week;
  • Employees who are employed in the construction industry;
  • Employees who are covered by a collective-bargaining agreement that expressly waives the requirements of the law;
  • Certain “as-needed” employees in the health or human services industry.

Under the bill, an employer may not be required to allow an employee to:

(1) earn more than 40 hours of earned sick and safe leave in a year;
(2) use more than 64 hours of earned sick and safe leave in a year;
(3) accrue a total of more than 64 hours at any time;
(4) use earned sick and safe leave during the first 106 calendar days the employee works for the employer.

The bill also preempts local jurisdictions from enacting new sick and safe leave laws except for amending existing laws enacted before January 1, 2017, i.e. the existing law in Montgomery County.

The bill passed with enough support in both chambers to survive a promised veto by Governor Hogan, who favored an alternative that would require the benefit only for companies with at least 50 workers and make tax incentives available for smaller companies that offered the leave. However, if he still vetoes the bill, lawmakers will not have an opportunity to override the veto until next year’s legislative session beginning on January 10, 2018, which means the bill would not take effect until after January 1, 2018, and could possibly be subject to amendment in the next session.

*Marc-Joseph Gansah, a Law Clerk – Admission Pending in the firm’s New York office, contributed to the preparation of this blog post.

Our colleague Steven M. Swirsky, a Member of the Firm at Epstein Becker Green, has a post on the Management Memo blog that will be of interest to many of our readers in the retail industry: “NLRB Acting Chair Dissents Point to Likely Changes to Board Election Rules and Employee Handbook and Email Standards.”

Following is an excerpt:

NLRB Acting Chair Philip Miscimarra has given the clearest indication to date of what steps a new Republican majority is likely to take to reverse key elements of the Labor Board’s hallmark actions of the Obama administration once President Trump nominates candidates for the Board’s two open seats and the Senate confirms. In each of these cases, Miscimarra highlighted his earlier opposition to the majority’s changes in long standing precedents and practices. …

Read the full post here.

Our colleagues Brian G. Cesaratto and Adam S. Forman, at Epstein Becker Green, have a post on the Technology Employment Law blog that will be of interest to many of our readers in the retail industry: “Phishing Scam Targets Human Resources and Payroll Departments.”

Following is an excerpt:

Human Resources and Payroll should advise employees in their departments to be on the lookout for the latest tax season phishing scam designed to steal employees’ tax related information and social security numbers. Given the regular frequency of these types of attacks, employers should be taking appropriate steps to safeguard employee Personally Identifiable Information (“PII”).  At a minimum, Human Resources should have in place written policies regarding the handling of employee PII and provide training designed to protect employee PII against a data breach.  Because Human Resources works with employee PII on an everyday basis, it may be the best equipped to secure sensitive personnel information against the type of fraudulent scheme highlighted in the recent IRS alert. …

What preventative steps can be taken to guard against these attacks? Human Resources should ensure that policies and procedures are in place requiring that the sending of employees’ confidential tax related information by email only be done with 100% confidence that the intended recipient is within the organization and has requested the information. Indeed, the IRS advises that employers consider adopting written policies that govern the electronic distribution of confidential employee Form W-2s and tax related information. …

Read the full post here.

Our colleagues Brian W. Steinbach and Judah L. Rosenblatt, at Epstein Becker Green, have a post on the Heath Employment and Labor blog that will be of interest to many of our readers in the retail industry: “Mayor Signs District of Columbia Ban on Most Employment Credit Inquiries.”

Following is an excerpt:

On February 15, 2017, Mayor Muriel Bowser signed the “Fair Credit in Employment Amendment Act of 2016” (“Act”) (D.C. Act A21-0673) previously passed by the D.C. Council. The Act amends the Human Rights Act of 1977 to add “credit information” as a trait protected from discrimination and makes it a discriminatory practice for most employers to directly or indirectly require, request, suggest, or cause an employee (prospective or current) to submit credit information, or use, accept, refer to, or inquire into an employee’s credit information. …

Read the full post here.

Our colleague Sharon L. Lippett, a Member of the Firm at Epstein Becker Green, has a post on the Financial Services Employment Law blog that will be of interest to many of our readers in the retail industry: “New DOL FAQs Provide Additional Guidance (and Comfort) for Plan Sponsors.”

Following is an excerpt:

Based on recent guidance from the Department of Labor (the “DOL”), many sponsors of employee benefit plans subject to the Employee Retirement Income Security Act of 1974, as amended (“ERISA Plans”) should have additional comfort regarding the impact of the conflict of interest rule released by the DOL in April 2016 (the “Rule”) on their plans. Even though it is widely expected that the Trump administration will delay implementation of the Rule, in mid-January 2017, the DOL released its “Conflict of Interest FAQs (Part II – Rule)”, which addresses topics relevant to ERISA Plan sponsors. As explained below, these FAQs indicate that the Rule, as currently designed, should not require a large number of significant changes in the administration of most ERISA Plans. …

Read the full post here.

A New Year and a New Administration: Five Employment, Labor & Workforce Management Issues That Employers Should MonitorIn the new issue of Take 5, our colleagues examine five employment, labor, and workforce management issues that will continue to be reviewed and remain top of mind for employers under the Trump administration:

Read the full Take 5 online or download the PDF. Also, keep track of developments with Epstein Becker Green’s new microsite, The New Administration: Insights and Strategies.

Our colleagues Judah L. Rosenblatt, Jeffrey H. Ruzal, and Susan Gross Sholinsky, at Epstein Becker Green, have a post on the Hospitality Labor and Employment Law Blog that will be of interest to many of our readers in the retail industry: “Where Federal Expectations Are Low Governor Cuomo Introduces Employee Protective Mandates in New York.”

Following is an excerpt:

Earlier this week New York Governor Andrew D. Cuomo (D) signed two executive orders and announced a series of legislative proposals specifically aimed at eliminating the wage gap in gender, among other workers and strengthening equal pay protection in New York State. The Governor’s actions are seen by many as an alternative to employer-focused federal policies anticipated once President-elect Donald J. Trump (R) takes office. …

According to the Governor’s Press Release, the Governor will seek to amend State law to hold the top 10 members of out-of-state limited liability companies (“LLC”) personally financially liable for unsatisfied judgments for unpaid wages. This law already exists with respect to in-state and out-of-state corporations, as well as in-state LLCs. The Governor is also seeking to empower the Labor Commissioner to pursue judgments against the top 10 owners of any corporations or domestic or foreign LLCs for wage liabilities on behalf of workers with unpaid wage claims. …

Read the full post here.

On December 9, 2016, Los Angeles Mayor Eric Garcetti signed ordinances no. 184652 and 184653, collectively referred to as the “Fair Chance Initiative.” These ordinances prohibit employers and City contractors (collectively “Employers”), respectively, from inquiring about job seekers’ criminal convictions until after a conditional offer of employment has been made. Both ordinances will go into effect on January 22, 2017 and will impact all employers in the City of Los Angeles and for every position which requires an employee to work at least an average of two hours per week within the City of Los Angeles and all City contractors and subcontractors, regardless of their location.

No Criminal Inquiry Until After Offer

Specifically, these ordinances prohibit Employers from inquiring about a job applicant’s criminal history, at any time or in any manner, unless and until a Conditional Offer of Employment has been made to the applicant. Following the Conditional Offer of Employment, Employers are permitted to request information regarding the applicant’s criminal history. However, Employers can only withdraw or cancel the conditional offer as a result of the applicant’s criminal history after engaging in the “Fair Chance Process.”

New “Fair Chance Process” Required

The “Fair Chance Process” requires Employers to prepare a written assessment highlighting the specific aspects of the applicant’s criminal history that pose an inherent conflict with the duties of the position sought by the applicant. Employers must provide the applicant with written notification of the proposed withdrawal of the conditional offer, a copy of the written assessment regarding the risks posed by the applicant’s criminal history, and any other relevant documentation. The applicant is then given an opportunity to provide the Employer a response to the written assessment, including any supporting documentation. Employers must wait at least 5 business days after the applicant is informed of the proposed withdrawal before taking any action, including filling the position for which the applicant applied.

New Posting and Recordkeeping Requirements

Additionally, Employers’ job postings must now include a notice stating that they will consider all qualified applicants regardless of their criminal histories, in compliance with these ordinances. Employers must also conspicuously post a notice regarding the “Fair Chance Initiative” in a location in the workplace visible to all job applicants; this notice must also be sent to each union or workers’ group with which the employers have any agreement that governs over employees. Further, Employers must retain all job application documents for three years. Penalties for violations of these ordinances may be assessed at up to $500 for the first violation, up to $1,000 for the second violation, and up to $2,000 for subsequent violations. The City may then, at its discretion, distribute a maximum of $500 from that penalty directly to the applicant. The penalty provision of the ordinances will not go into effect for employers in Los Angeles City until July 1, 2017. However, the penalty provision for City contractors is effective immediately.

Exceptions from these ordinances include: (1) employers who are required by law to seek a job applicant’s criminal history; (2) positions for which an applicant would be required to possess or use a firearm; (3) positions which, by law, cannot be held by an individual with a criminal history; and (4) employers who are prohibited, by law, from hiring persons with criminal convictions.

Employers with operations in the City of Los Angeles should:

  1. Remove questions regarding criminal history from job applications;
  2. Ensure future job postings include required equal employment notices;
  3. Defer inquiries regarding criminal history until making conditional job offers; and
  4. Ensure the Fair Chance Process is followed before denying employment based on criminal history.

The new episode of Employment Law This Week offers a year-end roundup of the biggest employment, workforce, and management issues in 2016:

  • Impact of the Defend Trade Secrets Act
  • States Called to Ban Non-Compete Agreements
  • Paid Sick Leave Laws Expand
  • Transgender Employment Law
  • Uncertainty Over the DOL’s Overtime Rule and Salary Thresholds
  • NLRB Addresses Joint Employment
  • NLRB Rules on Union Organizing

Watch the episode below and read EBG’s Take 5 newsletter, “Top Five Employment, Labor & Workforce Management Issues of 2016.”