Companies can be more confident that liability under the National Labor Relations Act will not flow from the misclassification of its workforce alone, thanks to a recent NLRB decision. Baker McKenzie attorneys call this welcome news for companies, but say they still must look at workforce relationships and properly classify independent contractors.

In a much

Companies with operations in California can exhale slightly, with the Ninth Circuit Court of Appeal and another California appellate court recently concluding, separately, that the rigid “ABC Test” established in Dynamex v. The Superior Court of Los Angeles County does not apply in the joint employer context.

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Ten years from now there may well be no more Employee Retirement Income Security Act (ERISA) class actions. The law, like the rest of life, is not immune from disruptive innovations. In our own lifetime, we have seen disruptive innovations from chemical photography to digital photography, from personal computers to smart phones, and from snail

The bad news is that your company may still be recovering from trying to compile and organize all of the EEO-1 Component 2 pay data for submission by September 30, 2019. The good news, however, is that the EEOC has announced that it will no longer collect Component 2 pay data in the future. (Everyone can let out a collective sigh of relief now!) To the extent they haven’t already done so, companies are still required to submit Component 2 pay data for years 2017 and 2018 this year, but they will not be required to do so on an ongoing basis.

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In July, we reported that a three-judge panel for the Ninth Circuit withdrew its holding in Vazquez v. Jan-Pro Franchising Int’l that Dynamex Operations West, Inc. v. Superior Court—the landmark California Supreme Court decision that makes it harder for companies to rely on independent contractors—applies retroactively. Rather than answering the question of Dynamexs retroactivity, the Court stated its intent to file an order certifying that question.

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On September 24, 2019, the Department of Labor (finally) issued the final rule on the minimum salary threshold required for employees to qualify for the Fair Labor Standards Act’s “white-collar” exemptions.

The final rule:

  • Raises the new minimum salary threshold to $35,568 per year ($684 per week). The previous salary threshold, which had been in place since 2004, was $23,660 ($455 per week).
  • Raises the “highly compensated” employee salary threshold from $100,000 to $107,432 per year.
  • Allows employers to count certain non-discretionary bonuses, incentives, and commissions to satisfy up to 10% of an employee’s salary level.
  • Does not impact the job duties test.
  • Is estimated to make an additional 1.3 million more workers eligible for overtime.
  • Will take effect quickly — on January 1, 2020.


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This summer the U.S. Women’s Soccer team won more than the World Cup – they’ve had tremendous success in garnering public support in their bid for equal pay. However, beyond the star power of Alex Morgan and Megan Rapinoe, pay equity continues to be a hot button issue for employers in the U.S.

We’re pleased

Today California Governor Gavin Newsom signed a landmark bill making it more difficult for companies to engage independent contractors. (See our previous coverage HERE.) Assembly Bill 5 “will help reduce worker misclassification — workers being wrongly classified as ‘independent contractors’ rather than employees, which erodes basic worker protections like the minimum wage, paid sick days and health insurance benefits,” Newsom wrote in a statement.

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This week, the National Labor Relations Board finally came to its senses and adopted the contract coverage test for cases alleging an employer had unlawfully, unilaterally changed employees’ terms and conditions of employment. MV Transportation, Inc. 368 NLRB No. 66 (2019). This week’s decision is likely to change the forum unions select for the enforcement of their labor agreements. Ironically, the decision may compel employers to consider additional bargaining rather than litigation before an arbitrator given there is little opportunity to appeal an adverse arbitration award.

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As previously detailed here, the U.S. Supreme Court’s 2018 Epic Systems decision established that requiring employees to waive their right to pursue collective or class actions does not violate the National Labor Relations Act’s “catchall” protection—the right to engage in “concerted activity”—and courts must enforce arbitration agreements as written.

The Supreme Court not only confirmed the legality of class action waivers under the Federal Arbitration Act, but it also narrowly construed the NLRA’s catchall provision as focused on the right to organize unions and bargain collectively in the workplace.

The Court’s holding that the right to engage in such “concerted activities” does not guarantee collective or class action procedures underpins a recent NLRB decision concerning issues of first impression: imposing and requiring as a condition for continued employment a new class action waiver rule in response to collective action.


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