NFL No-Kneeling Compromise: Implications for the Workplace

 

Q: Can private employers limit workplace speech and activities?

A: Yes, but only if the limits do not violate other laws.

On May 23, 2018, the NFL issued a new rule that will require all players on the field to stand for the national anthem. The NFL will also impose fines to teams whose players, coaches, or staff fail to follow the new rule.  NFL Commissioner Roger Goodell stated the new rule is a compromise because it does not require players to enter onto the field for the national anthem.  If players choose to enter onto the field, however, they are required to stand for the national anthem.

The NFL rule comes after a contentious and highly publicized 2017 football season. A number of players around the league knelt during the national anthem to protest racial injustice and bring attention to this cause. In response to these protests, President Trump tweeted that players who kneel during the national anthem should be suspended or fired.  Vice President Mike Pence walked out of an Indianapolis Colts game after players knelt for the national anthem.  Several individual teams, such as the Dallas Cowboys, imposed their own sanctions against players who knelt.  Most teams did not.

The new rule illustrates how private employers, such as the NFL, may limit workplace speech and activities. Generally, an employee’s workplace speech is not protected by the First Amendment.  The First Amendment prohibits the government, not private employers, from infringing upon a person’s freedom of speech and religion.  The NFL, as a private employer, is not a government actor, and therefore cannot violate the First Amendment.  As a general matter, private employers are free to prohibit or restrict speech in the workplace about non-work topics such as politics and  social conditions outside the workplace.

That does not mean that private employers may intrude on all forms of speech by employees, however, because some workplace speech is protected by laws other than the First Amendment.  Employers may not violate these other laws when limiting workplace speech.  For example, Title VII of the Civil Rights Act of 1964, which prohibits employers from taking adverse action against an employee for being a member of a protected class such as race, also prohibits retaliating against an employee for reporting workplace discrimination based on race or other protected classfications.  Under federal labor laws, employers also cannot discipline or terminate employees for their involvement in protected “concerted activity,” such as discussing wages, employment terms or working conditions and forming a union. As a result, employers should be cautious when disciplining or terminating employees for their speech in the workplace or about working conditions.

If speech is not protected by other laws, employers can discipline or terminate employees. Employers also have an have an interest in keeping the workplace professional and efficient.  Provided it does not violate other laws, employers may terminate employees whose workplace speech is disruptive or hinders workplace performance.

Many employers wish to avoid disputes and hard feelings between employees, which often arise from differing opinions over sensitive topics, particularly in today’s charged political and social environment. Virtually all employers want to avoid having those topics spill into communications with customers and important commercial partners.   As a result, many employers choose to implement policies or rules governing workplace speech.  Private employers are free to do that, but they must be wary of the line between protected and non-protected speech.

Employers should consider implementing training for supervisors and employees discussing what speech is and is not appropriate in the workplace.   HR staff should also be aware of what speech is protected in the workplace.  Employers should consult with a labor and employment attorney if they have any questions about protections on workplace speech.

— Doris E. Baxley*

* Ms. Baxley is a 2018 summer associate in Pepper Hamilton’s Berwyn office. She is not admitted to practice law.

 

PAID Program Provides a Way to Resolve Overtime and Minimum Wage Violations

Q.  I suspect that our company may have inadvertently committed overtime and minimum wage violations. Is there a way I can make this right without incurring substantial legal liability?

A.  Possibly. Earlier this year, the United States Department of Labor (DOL) Wage and Hour Division announced the creation of a new nationwide pilot program called the Payroll Audit Independent Determination (PAID) program. In short, the PAID program encourages employers to conduct payroll self-audits and, if they discover overtime or minimum wage violations, self-report those violations to the DOL and work with the DOL to rectify the problem and ensure employees are paid any wages owed.

Before reaching out to DOL in an effort to resolve any pay issues under PAID, employers must certify that they have read certain compliance materials about the federal Fair Labor Standards Act (FLSA). After reviewing the compliance materials, employers can self-audit their payroll practices by themselves. While the materials on the DOL website about the PAID program do not address attorney involvement, a company may consider conducting a payroll audit under the direction of an attorney. One benefit of auditing payroll practices under the supervision of an attorney is the potential to keep confidential the legal analysis and conclusions from such an audit under the attorney-client privilege. However, if an employer chooses to resolve any wage and hour issues with the DOL through the PAID program, information collected in a payroll audit inevitably will need to be disclosed to the federal government.

The PAID program is not available to employers to resolve claims that are already being investigated or litigated. Further, if either DOL or a court has determined in the past five years that the employer has violated the FLSA by engaging in the same compensation practices at issue in the proposed PAID self-audit, an employer will be prohibited from participating in PAID.

The benefit of this program? After evaluating information provided to it, DOL can accept a company into the PAID program and then facilitate the payment of wages to employees in exchange for employees agreeing to release claims with regard to the particular FLSA violation at issue—all while the company avoids the payment of liquidated damages and attorneys’ fees. Companies typically cannot require employees to waive wage claims unless the process is supervised by a court or the DOL.

The major downside? Neither the employer nor the DOL can force an employee to sign a waiver and release of claims. Employees may opt to accept payment and sign a release of claims or they can decline to accept payment and then file a private lawsuit with the knowledge that its employer believes it may have violated the law. However, an employee may be reluctant to file a private lawsuit because of the likelihood that it would take many years and require the employee to incur the cost of both attorneys’ fees and litigation.

In addition, it is possible but not certain that the DOL may share this information with other agencies, resulting in further liability.   It also appears unclear whether the DOL will apply a two year or three year statute of limitations to employers who participate in the PAID program.

The PAID program’s impact on employee claims under state wage and hour laws is uncertain. According to the DOL website, DOL “may not supervise payments or provide releases for state law violations.”  Thus, even if an employee signs a release of claims while participating in the PAID program, the employee may not release claims under state law. As such, a state labor department or private plaintiff may still try to recover unpaid wages, liquidated damages, and attorneys’ fees if available under state or local law.

As a pilot program, much remains to be seen about how the PAID program will actually be implemented. There are perhaps just as many risks as there are benefits for an employee participating in the PAID program. If your company is interested in conducting an audit of its payroll practices, or exploring the possibility of participating in the PAID program, please contact any member of the Pepper Hamilton Labor & Employment group.

Lee Tankle

Supreme Court Upholds Validity of Employee Class Action Waivers

Q.  Can my company require its employees to sign an arbitration agreement mandating that they arbitrate all employment disputes, and limiting their ability to participate in a class action against the company?

A.  On May 21, in a 5-4 opinion, the U.S. Supreme Court ruled that arbitration agreements in which an employee waives the right to pursue his or her employment claims in a class or collective action are enforceable under the Federal Arbitration Act (FAA). The holding in Epic Systems Corp. v. Lewis, No. 16-285, resolves a circuit court split on whether class action waivers in arbitration agreements violate the National Labor Relations Act (NLRA). Justice Gorsuch delivered the opinion of the Court, rejecting three primary arguments made by employees to undermine the validity of class action waivers under the FAA.

For more information about this case, please click here.

-Tracey E. Diamond

 

California Adopts Stricter Test for Independent Contractor Status

Q.  What is the standard for determining if an individual is an employee or an independent contractor in California?

A.  On April 30, the California Supreme Court adopted a new and more onerous test (the ABC test) for determining whether individuals are employees or independent contractors. In its decision in Dynamex Operations West, Inc. v. Los Angeles County Superior Court, 2018 Cal. LEXIS 3152 (Cal. 2018), the court abandoned the test that it had applied since 1989 from S.G. Borello & Sons, Inc. v. Department of Industrial Relations, 48 Cal. 3d 341 (1989). Although the Dynamex case arose from claims under California wage orders — which govern, among other things, the duty to pay the minimum wage and to compensate for overtime hours worked — the decision has broader implications.

For more information, please click here.

-Susan K. Lessack

Employees Should Not Be Working While on FMLA Leave

Q: Can I require an employee to do work while the employee is on FMLA leave?  What if the employee volunteers to work while on leave?

A: Under most circumstances, employees should not be required or permitted to perform work while on leave.  The Family and Medical Leave Act (FMLA) provides eligible employees a maximum of twelve weeks unpaid, job-protected leave for specified family and personal medical reasons in a twelve month period.  During that time, employers are prohibited from interfering with, restraining, or denying the exercise of or the attempt to exercise, any rights provided under the FMLA.

This does not mean that an employee must be left alone completely. While an employee is on leave, employers are permitted to inquire about the location of documents, the status of an assignment, and pass on institutional knowledge.  However, employers should keep communication with employees on leave to a minimum.  It is recommended that when communicating with an employee on leave, the employer should make it clear that it is not requiring or requesting the employee to work.

Some ways that employers may be found to have interfered with an employee’s leave include forcing an employee to complete an assignment, and denying or discouraging an employee from taking leave. Although interference is determined on a case-by-case basis, employers should be mindful that allowing an employee to work on leave may constitute impermissible interference.

Employers who pay for FMLA leave but allow or require employees to perform work while on paid leave also put themselves at risk of a claim for interference with leave. Although the employee is being paid, the basis for the leave is a medical necessity.  Thus, the employee would be entitled to the protections provided under the FMLA even though he or she is being paid.

As a general practice, employees on leave should not be asked or allowed to work on any assignments. If an employee does perform work while on FMLA leave, any hours spent completing assignments should not count towards the protected twelve week period.  To ensure compliance with the FMLA, employers should include a section in their personnel policies that discusses what conduct is appropriate while an employee is on leave.

Renee C. Manson