Employment Law Updates

Employers should be aware of potential legal pitfalls in their employment application forms. A good rule of thumb is to avoid asking for information that cannot legally be considered in making a hiring decision. The following are examples of information that should generally not be requested:

The U.S. Department of Labor today issued its long-awaited final regulations confirming the proposed changes to the Fair Labor Standards Act overtime pay exemptions. The salary level that is required as part of the test for an employee to be classified as exempt has been $455 per week for many years. The new regulations increase this level to $913 per week. The change on an annual basis is from $23,660 to $47,476. The new salary level goes into effect on December 1, 2016.

The United States Department of Labor (DOL) enforces several laws and regulations that require notices to be posted in the workplace. The required posters are available in electronic copy through the DOL. Not all employers are covered by every law or regulation.

As an example, businesses with fewer than 50 employees are not required to post a notice about the Family and Medical Leave Act (FMLA). More information is available from the DOL about the most recent poster requirements at the Poster Advisor on their website.

Effective July 1, 2017, a new Virginia law requires employers and payroll service providers to notify the Office of the Attorney General “without unreasonable delay” after discovery of a breach of computerized employee payroll data that compromises the confidentiality of the data.

National origin discrimination is one of the forms of discrimination prohibited by the federal civil rights law known as Title VII. The Equal Employment Opportunity Commission has issued new guidance in a question-and-answer format about this type of discrimination. Here is an example of the types of issues addressed by the guidance:

A federal judge in Texas yesterday issued a nationwide preliminary injunction preventing the U.S. Department of Labor’s new overtime rule from going into effect as scheduled on December 1.

A judge in Fairfax County recently voided a noncompete agreement for a worker whom a company classified as an independent contractor. The worker had signed an agreement that labeled her as an independent contractor, and also included a 2-year noncompete provision. She subsequently left the company and went to work for a competitor. When her former company filed suit to enforce the noncompete agreement, the judge ruled that the entire agreement was void because it misclassified her as an independent contractor when she actually was an employee. The judge concluded that the misclassification violated public policy and thus rendered the entire agreement unenforceable.

The Equal Employment Opportunity Commission (EEOC) announced on June 2, 2016 an increase in the maximum penalty for employers that fail to comply with certain federal notice-posting requirements. The maximum penalty will increase from $210 to $525.

Employers are increasingly using the hair follicle drug test rather than the more frequently used urine and blood tests to test for drug use by employees. Recent federal legislation will allow employers of commercial drivers to add hair testing as an option in addition to urine testing. The hair test offers some advantages over other forms of testing:

On May 11, the President signed into law the new Defend Trade Secrets Act of 2016 (DTSA). This new statute contains two significant features that employers should note.

The law’s most prominent feature provides for the first time a civil claim in federal courts for misappropriation of trade secrets. Until now, trade secret misappropriation claims have been handled primarily in state courts under laws such as the Virginia Uniform Trade Secrets Act. The state laws have some limitations that are remedied by the new federal statute. For example, the DTSA will allow companies to pursue trade misappropriation that occurs across state and international borders. The new statute also defines “trade secrets” broadly. Greater uniformity in trade secret law nationwide will be a likely result of the DTSA.

There has been an increase in lawsuits against employers for noncompliance with the Fair Credit Reporting Act (FCRA) involving pre-employment background checks. The FCRA has several mandatory steps that must be taken when an employer does background screening of a potential employee for criminal record, credit history, and certain other information.

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