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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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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Chicago is the most recent city to adopt a “predictive scheduling” ordinance, the Chicago Fair Workweek Ordinance.

Effective July 1, 2020, employers subject to the Ordinance must provide advance notice of work schedules to covered employees. If changes are made to the posted schedule, employers must pay additional wages, “predictability pay,” as a penalty. This penalty applies to both increases and reductions of shifts.


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As of August 1, companies doing business in Mexico can anticipate that unions will move quickly to legitimize existing collective agreements under a new government-issued protocol. Among other steps, the process includes a vote by covered employees to determine whether they approve the terms of the agreement. Collective agreements must be legitimized by May 1,

On July 22, 2019, a three-judge panel for the Ninth Circuit withdrew its holding 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. The panel held instead that the question should be decided by the state’s highest court.

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[With special thanks to our summer associate Whitney Chukwurah for her contribution to this post.]

All private employers with 100 or more employees in the US and certain federal contractors with 50 or more employees in the US must report data on race/ethnicity and gender across job categories in their annual EEO-1 filings. As previously reported (HERE), in 2016, under the Obama Administration, the Equal Employment Opportunity Commission revised the EEO-1 form to require certain employers to report W-2 wage information and total hours worked (referred to as Component 2 Data) for all employees by race, ethnicity and sex within 12 EEOC created pay bands.

The implementation of the revised EEO-1 form has been subject to litigation; however, covered employers now have until September 30, 2019 to provide EEOC with pay data.


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On July 10, 2019, the California Senate Labor Committee voted in favor of Assembly Bill (AB 5). As we previously reported (see HERE), AB 5 would make it harder for companies to rely on independent contractors because it presumes a worker is an employee unless a hiring entity passes a difficult three-part test. Supporters

California is known as one of the most progressive, pro-employee states in the country. But if the last several months are any indication, Illinois is quickly catching up.

Here’s a quick overview of what’s happening in the prairie state:

Illinois Wage Payment and Collection Act   

What’s New? As of January 1, 2019, employers must reimburse employees for all “necessary” expenses. So what’s a necessary expense? Anything required of the employee in the discharge of his/her employment duties that “inure to the primary benefit of the employer.” Computers, cell phones, uniforms, etc. may all constitute “necessary” expenses that the employer is required to reimburse.

Takeaway: Employers should review their policies, job descriptions, and third party contracts to determine which positions/roles may result in necessary expenditures.


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