May 2009 Quick Clips

UNITE HERE’S Raynor Quits, May 30, 2009

UNITE HERE has developed a reputation as a force you don’t want to mess with. Now it’s just a mess. The union was formed with the 2004 merger of UNITE - the primarily textile and apparel workers' union led by Bruce Raynor, and HERE - the hotel, restaurant, and casino workers' union led by John Wilhelm. This past year the marriage suffered what now appears to be irreconcilable difficulties. Raynor was suspended from the office of president earlier this month, and he has now announced his resignation. Raynor said he decided to resign not out of "my own volition but because I have been forced out of office by the same people that ruined the merger of our two unions." Raynor has pledged to continue a "fight to demonstrate that their [the Wilhelm faction’s] actions have been unconstitutional and illegal." Meanwhile, UNITE HERE has issued a statement applauding Raynor's resignation as "good news." And you thought unions brought people together, didn’t you?

An FMLA Regulation Oops? May 28, 2009

by Darrell R. VanDeusen

Under the FMLA, employees have the right to take leave on an "intermittent" or "reduced leave schedule" basis. The statute itself provides that such leave may be taken in order to care for a spouse, son, daughter, or parent with a serious health condition. 29 U.S.C. § 2612(b)(1).

But the new DOL regulations, which took effect in January, do not say the same thing. Under new section 825.202(b)(1), intermittent leave may be taken for a serious health condition of a parent, son, or daughter, or for the employee's own serious health condition " . . . which requires treatment periodically, rather than for on continuous period of absence." There is no indication that your "spouse" qualifies. And there’s no mention that a reduced leave schedule is available. The section then provides that for intermittent leave or leave on a reduced leave schedule to be taken because of one's own serious health condition, or to care for a parent, son, or daughter with a serious health condition, there must be a medical need for the leave. "Spouse" is again omitted.

Unless and until the DOL clarifies this language, employers are well advised to rely on the statute, not on the regulatory omission.

FMLA Regs Will be Repealed if House Bill Gains Momentum, May 23, 2009

by Darrell R. VanDeusen

After waiting years for the DOL to revise FMLA regulations, changes took effect in January of this year. Legislation introduced by Congresswoman Shea-Porter (D-NH) on April 29, 2009, and co-sponsored by 24 other representatives would turn back the clock and restore some of the more “employee friendly” portions of the old regulations. House Bill 2161, titled “To Nullify Certain Regulations Promulgated Under the Family and Medical Leave Act of 1993 and Restore Prior Regulations and Direct the Secretary of Labor to Revise Certain Regulations Under that Act” would - according to Congresswoman Shea-Porter - "restore the Family and Medical Leave Act to its original intent and spirit."

The legislation would repeal the following new regulations and restore their predecessors: 825.205(a)(2), 825.207, 825.215, 825.220(d), 825.302, 825.303, 825.307, and 825.312. It would also modify 825.308(b), 825.115(a) & (c), and revise the medical certification form. Keep your eyes on this legislation; employers already have a hard time weaving their way through the changes from the old to new regulations.

Paycheck Fairness Act Still Lurking About, May 23, 2009

by Darrell R. VanDeusen

On May 21, Sen. Dodd (D-Conn.), Sen. Mikulski (D-Md.), and Rep. DeLauro (D-Conn.) met (ok, they held a news conference) to press for traction to get passage of the proposed Paycheck Fairness Act, which would make compensatory and punitive damages available as remedies in Equal Pay Act cases. The House approved H.R. 12 on January 9 with a 256-163 vote. The Senate version (S. 182) was introduced the day before by then Senator Clinton (D-N.Y.), but was not taken up. The bill would amend the EPA to add non-retaliation requirements, increase penalties, and authorize the labor secretary to seek additional compensatory or punitive damages. Supporters argue that women are routinely paid less than men for comparable work and that current laws are not strong enough to deter employers. Opponents respond that the bill is unnecessary because there are protections against pay discrimination under Title VII .

Reintroduced Bill Intended to Aid Farmers and Immigrant Workers, May 15, 2009

by Andreas Lundstedt

On May 14, legislation (S. 1038, House bill number not available) was reintroduced in both houses of Congress. The current bill is essentially identical to one introduced in the 110th Congress and is said to ease shortages of farm labor by allowing illegal immigrants to work in the U.S. agricultural sector while on the path to legal residence.

The bill would create a five-year pilot program to identify undocumented agricultural workers and legalize the immigration status of those who have been working in the United States for at least two years. The bill would also revise the H-2A visa system by allowing farmers to bring guest-workers to the United States to harvest their crops.

The bill would make undocumented agricultural workers eligible for a “blue card” provided they can show they have worked in the United States at an agriculture job for at least 150 work days over the two years that ended Dec. 31, 2008. The blue card would grant a worker temporary legal resident status. The total number of blue cards would be capped at 1.35 million over a five-year period, and the program would last five years. Once in possession of a blue card, the worker would have to be employed for three years (working at least 150 days per year) or five years (working at least 100 days per year) before the person would be eligible to apply for a green card. In addition, before applying for a green card, workers would have to pay a $500 fine, show that they do not owe any taxes, and demonstrate that they have not been convicted of any crime involving bodily injury, the threat of serious bodily injury, or harm to property in excess of $500.

Supporters of the bill argue that Congress must pass this legislation. Currently, because of a shortage in workers, the agricultural sector is not operating at an optimum level, and many farmers are forced to see their crops go lost. Sen. Diane Feinstein (D-Calif.) said that there is a ripple effect throughout the economy when farmers suffer economically, noting effects on agriculture-related businesses such as farm equipment manufacturing, packaging, processing, marketing, lending and insurance.

Worker Misclassification Bill Passed In Maryland, May 13, 2009

by Andreas Lundstedt

On May 7, Governor Martin O’Malley signed S.B. 909 into law. The bill creates a presumption that work performed by an individual who is paid by an employer creates an employer-employee relationship. The bill applies to three areas of State government: labor and industry, workers’ compensation, and unemployment insurance. It prohibits construction companies and landscaping businesses from failing to adequately classify an individual as an employee and sets up investigation procedures and penalties for noncompliance.

The bill distinguishes between employers who “improperly” classify employees and those who “knowingly” misclassify them. If an employer improperly misclassifies employees, the employer has 45 days to pay restitution to affected workers and come into compliance with all applicable labor laws. If not remedied within that time, the employer could incur a penalty of up to $1000 per each misclassified employee. If the employer has “knowingly” misclassified employees, the employer is subject to a penalty of up to $5,000 per misclassification, regardless of whether the employer enters into compliance within 45 days. An employer who has been found to have knowingly misclassified employees on three or more occasions may be assessed an administrative penalty of up to $20,000 for each misclassified employee. A misclassified worker also has the ability to sue the employer, provided he does so within three years of the violation.

A recent national study of misclassification in the construction industry revealed that 5% of randomly audited Maryland construction companies misclassified their employees as independent contractors (well below the estimated national average of 15% to 20%). It is believed that the new law could potentially save Maryland taxpayers almost $100 million annually in recovered income tax collections and unemployment insurance payments.

Maryland OKs Collecting Fees From Unaffiliated State Union Members, May 11, 2009

by Andreas Lundstedt

On May 7, Maryland Governor Martin O’Malley, as part of his legislative priorities for the 2009 General Assembly Session, signed legislation S.B. 264, dubbed “The Fair Share Act.” The bill will go into effect on July 1, 2009, and will affect nearly 33,000 state employees in nine Executive Branch bargaining units.

The bill gives the State the go ahead to collectively bargain with the exclusive representative of a bargaining unit for service fees from State employees who are not members of that exclusive representative. Employees who are dues-paying members of an employee organization that is not the exclusive representative would also be required to pay any negotiated service fee.

Employees who because of religious beliefs prevent them from joining or financially supporting a collective bargaining organization would however be exempted from the bill. Such employees may still have to pay a certain negotiated amount, equal to that of the service fee, to a tax-exempt nonreligious, nonlabor-related organization, and would also have to provide proof of such payment. The bill also states that service fees may not be bargained for in negotiations between an employee organization and a University System of Maryland institution, Morgan State University, St. Mary’s College of Maryland, or Baltimore City Community College. Twenty-three states already either require state employees to pay a service fee or permit the fee to be mandated through collective bargaining.

White House Announces DOL “Surge”, May 8, 2009

by John Bolesta

In an effort to boost troop levels in its ongoing war on employers (now known as mainland employer contingency operations), the White House proposed a $104.5 billion Labor Department budget for fiscal year 2010. As part of the proposed increase, a discretionary request of $13.3 billion would allocate $1.7 billion for worker protection programs, a 10 percent increase over the prior year's budget. Specifically, the DOL's Wage and Hour Division would receive $228 million, an increase of $35 million from the prior year, including funding to hire 200 new investigators. The Employee Benefits Security Administration is expected to hire 75 new employees, and the Office of Federal Contract Compliance Programs hopes to add 213 staff members. Employers- gird your loins!

Proliferation of “Green Jobs” May Have Economy Seeing Red, May 8, 2009

by John Bolesta

Apparently, the grass on the renewable energy side of the fence is not quite as green as many have claimed. Calling the green jobs proposals put forth by the Obama Administration a “myth”, several economists at a May 4 Heritage Foundation discussion unequivocally denounced claims by several policy groups and the current Administration that green job creation will boost the sagging economy. According to several prominent panelists, the Spanish government’s investment in alternative energies beginning in 1997 can only be viewed as a resounding failure and “any country that tries to do what Spain has done will have the same result.” Stating that “the whole system collapsed” because of the reliance on government subsidies, an economics professor at the King Juan Carlos University in Madrid found that for each green job created by government subsidies in the renewable energy sector in Spain, 2.2 jobs would have been created in the rest of the economy without those subsidies. Moreover, the panelists pointed out that green energies, such as solar and wind power, produce less energy than other power sources and cost more due to the increased labor demands typically seen with green energy production. Lastly, reports touting green jobs as a way to help the economy fail to account for the jobs that would be lost in a shift to different energy sources, which could result in a net loss of jobs in the energy sector. Congress and President Obama brushed these concerns aside, however, as $500 million of the recently enacted American Recovery and Reinvestment Act was directed specifically for preparing workers for green economy jobs.

Video of the Heritage Foundation discussion may be viewed at http://www.heritage.org/press/events/ev050409c.cfm.

Maryland Governor Signs “Me Too” Ledbetter Statute, May 8, 2009

by John Bolesta

On April 14, 2009, at the close of the Maryland General Assembly’s 2009 session, Maryland Governor Martin O’Malley signed the Maryland Lilly Ledbetter Civil Rights Restoration Act, which mirrors federal legislation passed earlier in the year. The federal Lilly Ledbetter Fair Pay Act reverses the Supreme Court’s 2007 decision in Ledbetter v. Goodyear Tire & Rubber Company, which requires employees to file discrimination claims within no more than 300 days of the date on which the discriminatory compensation decision was made. Both the federal and Maryland law clarify that an unlawful employment practice occurs when a decision or practice is adopted, when an individual becomes subject to that decision or practice, or when an individual is affected by the decision or practice. Supporters of the Maryland version expressed concern that Maryland courts would rely on the decision in Ledbetter v. Goodyear Tire & Rubber Company when interpreting state anti-discrimination laws. In light of the federal Lilly Ledbetter Fair Pay Act’s unequivocal objective - invalidating the Supreme Court’s decision in Ledbetter - it is not entirely clear the extent to which Maryland Courts would have utilized the Ledbetter decision when interpreting state employment discrimination laws. What is clear, however, is that every Maryland employer will now be expected to preserve personnel files of departed employees indefinitely and will be expected to adequately document every decision concerning employee compensation.

A summary of the federal Lilly Ledbetter Fair Pay Act and some of its effects on employers may be viewed at http://kollman-saucier.com/articles/article60.html.

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