In May 2008, Congress enacted the Genetic Information Nondiscrimination Act. It prohibits employers from using genetic information to make employment decisions, restricts employers’ use and disclosure of genetic information, and prohibits retaliation against employees who complain about genetic discrimination. Last month, the Equal Employment Opportunity Commission issued a final rule clarifying some of the provisions of GINA and explaining other sections in greater detail.

Definitions

Under GINA, “employees” include applicants at any stage of the hiring process. GINA’s protection also extends to employees’ family members, who are limited to persons who are or become related to an individual through marriage, birth, adoption or placement for adoption.

Genetic information is defined as information about: 1, an individual’s genetic tests; 2, the genetic tests of that individual’s family members; 3, family medical history; 4, an individual’s request for, or receipt of, genetic services, or the participation in clinical research that includes genetic services by the individual or family member of the individual; or 5, genetic information of a fetus carried by an individual or by a pregnant woman who is a family member of the individual and the genetic information of any embryo legally held by the individual using an assisted reproductive technology.

The EEOC did not define genetic tests in the rule. Instead, it gave examples of tests that are, and are not, included in the definition. The rule allows the collection of data from complete blood counts – liver-function and cholesterol tests, for example – but does not allow tests that genetically determine a predisposition to breast cancer, or DNA tests that reveal family relationships (such as paternity).

Actions don’t need to be deliberate to be prohibited

Although an earlier version of the EEOC’s rule included references to “deliberate acquisition” of genetic information, that terminology has been eliminated in the final rule. The EEOC explains that employers can violate GINA without intent.

Employer policies that present a “heightened risk” of acquiring genetic information, such as those requiring medical documentation for prolonged absences, should be considered carefully. Employers should be wary about warning employees not to provide genetic information. The rule provides that employers will not be held liable if employees provide genetic information after receiving this warning.

Requesting and obtaining genetic information

GINA prohibits requests for employees’ genetic information. The rule makes it clear that this includes conducting an Internet search that is likely to result in obtaining an individual’s genetic information.

There are, however, situations in which obtaining genetic information is permissible. An employer that inadvertently obtains an employee’s medical history or genetic information is not in violation of GINA. For example, a supervisor who asks an employee, “How are you?” will not subject her company to liability if the employee answers with genetic information. Also, an employer that asks for genetic information in response to a request for accommodation under the Americans with Disabilities Act will not be held liable if the condition is not readily apparent.

GINA makes an exception for publicly available genetic information about an individual, such as information found on an unprotected social media website or a general interest website not directly related to genetic information.

Employers must be careful, however, when using these sites. The rule explains that intent can be a factor in determining whether a rule violation occurs. An employer that intentionally performs an Internet search to obtain genetic information about an employee will leave the employer open to liability under GINA.

Websites that do not fall into this exception would include those that specifically involve genetic information, such as the website of a genetic testing program. GINA also allows employers to request employees’ medical histories to comply with Family and Medical Leave Act certification requirements, but employers must carefully guard that information.

Another exception under GINA is for employer wellness and disease management programs. The rule requires that participants “provide prior knowing, voluntary and written authorization.” This means that the employer must use language “reasonably likely to be understood by the individual from whom the information is sought; describes the information being requested; and describes the safeguards in place to protect against unlawful disclosure.” The employer may not receive individually identifiable genetic information.

Genetic classifying and monitoring

While GINA prohibits employers from classifying or segregating employees based on genetic conditions, the rule clarifies that employers may limit or restrict employees’ job duties based on genetic information if a law or regulation mandates genetic monitoring (e.g., certain OSHA regulations). The rule makes clear that neither GINA nor the rule creates a cause of action for disparate impact.

GINA permits employers to engage in genetic monitoring of the biological effects of toxic substances in the workplace, provided that they notify employees of their intent, and employee consent is obtained in places where law does not require such monitoring. An employee who refuses to participate in a voluntary genetic monitoring program should be informed of the potential risks, but cannot be subject to discrimination.

Steps for employers

• Train human resources personnel, managers and recruiters.
• Revise EEO policies to prohibit discrimination based on genetic information and associated retaliation.
• Discontinue requests to applicants and employees for family medical history except in the limited circumstances permitted in connection with a wellness or disease management program.
• Include a statement that family medical history or other genetic information should not be provided when requiring medical documentation, such as in a request for a reasonable accommodation or leave.
• Store personnel records, such as FMLA certifications that contain genetic information about an employee, in a confidential medical file, and strictly limit access.
• Implement procedures to prevent the disclosure of genetic information in response to a subpoena or civil discovery and to permit disclosure only when specifically required to comply with a court order.

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-221-0309 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post Final rule for GINA appeared first on Daily Journal of Commerce.

E-mailing, texting, and illegal wiretapping are featured in three cases that involve privacy in the workplace. Although the decisions may appear to be varied, there is a common thread: A well-crafted, broadly distributed and acknowledged electronic resources policy is of paramount importance when defending against an employee’s invasion-of-privacy claim.

E-mails

In March 2010, the New Jersey Supreme Court ruled that plaintiff Marina Stengart, a former employee of Loving Care Agency, had a reasonable expectation of privacy in e-mails exchanged with her personal attorney through her personal e-mail account, even though those communications were stored on a company-issued laptop.

The court’s ruling is binding only for employers doing business in New Jersey but it’s the first decision of this kind from a state supreme court, so it may be persuasive in other states.

Also:

• The decision does not appear to apply outside of attorney-client privileged communications.
• While the court found that the plaintiff had a reasonable expectation of privacy in her e-mails, it did not suggest that she had a viable claim against her employer for invasion of privacy, which would require the employer’s review of the e-mails to be considered highly offensive to a reasonable person.
• Most importantly, the employer’s electronic resource policy did not notify its employees of its ability to retrieve e-mails, including e-mails transmitted through personal accounts. In fact, the policy did not even mention personal e-mails.

Text messages

In June 2010, the U.S. Supreme Court held that the city of Ontario, Calif., Police Department did not violate the Fourth Amendment rights of a SWAT team member, Sgt. Jeff Quon, by reviewing text messages sent and received by him on a department-issued pager. The court ruled that even with the assumption that he had a reasonable expectation of privacy, the city’s review of his text messages was motivated by a legitimate, work-related purpose and was not excessive in scope.

The court emphasized the importance of a well-crafted and broadly distributed electronic resources policy stating that the employer’s policies concerning communications “will, of course, shape the reasonable expectations of employees, especially to the extent that such policies are clearly communicated.”

The court pointed out that corporate e-mails and text messages sent by cell phones are two distinct forms of communication. The former is sent through (and often stored on) a company-owned server, whereas a text message is sent through the cell phone provider’s server. If applicable, both forms of communication should be addressed in the employer’s policy.

Illegal wiretapping

In September 2010, the Seventh Circuit Court of Appeals in Chicago affirmed the criminal conviction for federal violations by an IRS agent who activated the “auto forwarding” feature on his supervisor’s Microsoft Outlook, causing a copy of all incoming e-mails to his supervisor to be forwarded to his own mailbox.

For employers, the court’s decision highlights the risk of commonplace information technology actions. Corporate IT departments routinely activate “auto forwarding” after an employee has left an organization so that a supervisor or coworker can promptly respond to e-mails intended for the former employee. IT departments commonly rely on “e-mail journaling” as well, to create a duplicate set of outgoing and incoming e-mails for archival purposes.

Even if the IT department activates these features for legitimate business purposes, the employer remains at risk of civil liability under the federal Wiretap Act, and the monetary damages can be significant. If “auto forwarding” or “e-mail journaling” were activated on an enterprise-wide basis, the potential exposure could be substantial.

Employers can reduce the risk of harm by providing employees with notice of the relevant IT procedures and obtaining the employees’ signed consent.

Items that should be part of a well-crafted electronic resources policy include:

• Informing all employees that the policy applies to every employee.
• Warning employees that the company will monitor the use of employees’ electronic resources including, but not limited to, computers, cell phones and pagers.
• Notifying employees that duplicates of e-mails transmitted through a personal e-mail account using company equipment may be stored on that equipment.
• Explaining that the company may, at its discretion, review all communications stored on, or transmitted by, company equipment regardless of whether a personal account is used, subject to state laws regarding attorney-client communications.
• Prohibiting employees from using any company resources (including the telephone) to communicate with a personal attorney, except with the company’s prior approval.
• Warning employees that they can be disciplined for violating any part of the policy.

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-221-0309 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post Workplace privacy when it comes to e-mails, texts and wiretaps appeared first on Daily Journal of Commerce.

Here is a look at legislation affecting the building industry.

1. New OSHA regulations for cranes and derricks

On Aug. 9, the federal Occupational Safety and Health Administration published new regulations for the construction industry’s use of cranes and derricks. The new regulations will become effective on Nov. 5.

The new rules, which replace standards 40 years old, address advances in crane and derrick design, update specific industry work practices, adopt new qualifications for equipment operators, and help minimize hazards. OSHA’s goal is to prevent electrocutions, crushed-by/struck-by dangers, collapses and overturned equipment, and other lethal hazards. These new rules are meant to be minimum safety requirements only.

According to OSHA, approximately 267,000 business entities employing 4.8 million workers will be affected by the new rules.

Significant requirements in these new rules include:

• Inspection of tower crane parts prior to assembly;
• Use of synthetic slings in accordance with the manufacturer’s instructions during assembly and disassembly;
• Assessment of ground conditions to determine if the ground is sufficiently stable to support the anticipated weight of the equipment; and
• Procedures for working in the vicinity of power lines.

Also included in the new rules are requirements for qualification or certification of crane operators. Employers will be responsible for the relevant training, including paying for certification, and will have up to four years to ensure that their operators are qualified or certified unless they are operating in a state or city that has existing operator qualification requirements.

If a state or city has its own licensing or certification program, OSHA mandates compliance with that city’s or state’s requirements only if they meet the minimum criteria of the new federal rules. State plans must issue job safety and health standards that are at least as effective as comparable federal standards.

The new regulations apply to the construction industry only; however, a “general industry” employer performing construction-related work will be covered by the regulations.

Within the next month, OSHA is expected to provide additional materials to aid compliance. It will publish a series of guidance and outreach documents before the regulations become effective. For more information, visit www.osha.gov.

2. Proposed revisions to HIPAA regulations

Last month, the U.S. Department of Health and Human Services proposed new HIPAA regulations to clear up confusion with the Health Information Technology for Economic and Clinical Health Act. HITECH, which became effective in February 2010, requires that business associate agreements (the agreements between covered health plans and third-party service providers, such as pharmacy benefits managers or insurance brokers) contain certain provisions relating to privacy. Until now, however, it has been unclear exactly what those provisions must contain.

If adopted, the proposed regulations should clear up the confusion. The good news is that the proposed regulations appear to require only limited changes to existing business associate agreements, including the following:

• The business associate must comply with the HIPAA security rule;
• The business associate must report any breach of security regarding protected health information to the covered entity;
• The business associate’s subcontractors must agree to the same restrictions on the use and disclosure of PHI as the business associate; and
• If the business associate performs any of the covered entity’s compliance obligations (such as distributing a privacy notice), the business associate would have to comply with the HIPAA privacy rule to the same extent as the covered entity with respect to those delegated obligations.

Under the proposed regulations, HHS is required to investigate any complaint that, upon review, suggests willful neglect on the part of the covered entity. HHS would be required to impose a monetary penalty if willful neglect were found; HHS would not be able to assess a monetary penalty if the covered entity were to demonstrate that the violation was not the result of willful neglect, and was promptly corrected as soon as the covered entity knew of the violation.

HHS is soliciting comments on the proposed regulations, so it is likely they will not become final for at least six months. Once the rules are final, existing business associate agreements may remain in place for up to 18 months.

For additional information, visit .

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-889-8861 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post 2 new regulations Oregon contractors should know about appeared first on Daily Journal of Commerce.

1. Changes to Flexible Spending Accounts

Beginning Jan. 1, 2011, individuals will need a physician’s prescription for all over-the-counter drugs, other than insulin, in order to be eligible for a reimbursement from their health FSA, Health Spending Account (HSA), or Archer Medical Spending Account (“Archer MSA”).

And beginning Jan. 1, 2013, annual health FSA contributions will be capped at $2,500 (the current maximum is $10,000.) This contribution limit may increase each year starting in 2014, as it is adjusted for inflation.

2. Guidelines to be issued for Uniform Health Plan notices

The Department of Health and Human Services by March 23, 2012, must issue regulations establishing the format for important forms used by health care plans. The new guidelines will cover forms sent to enrollees and applicants, and summarize their benefits and coverage, and notices of any changes to plan coverage. Health plans will have to issue change notices no later than 60 days before the effective date of any mid-year change.

3. Employer notice requirements about health insurance exchanges

Beginning March 1, 2013, employers must provide employees with written notice about health insurance exchanges, including: the existence of a health insurance exchange; potential eligibility for federal assistance if the employer’s health plan is “unaffordable” based on detailed criteria and if an employee’s household income is below certain thresholds; and the possibility that employees may lose the employer’s contribution to health coverage if they purchase health insurance through the health insurance exchange.

4. New health insurance exchanges

State-established health insurance exchanges must begin to operate no later than Jan. 1, 2014. The exchanges will be virtual marketplaces that allow individuals and eligible employers to purchase health insurance. Initially in 2014, only employers with up to 100 employees can purchase insurance for their employees through the exchange.

Beginning Dec. 31, 2015, states can limit access to exchanges to businesses with up to 50 employees.

And beginning Jan. 1, 2017, states can allow employers with more than 100 employees to purchase health insurance for their employees through the exchange.

5. Penalties for “large employers” that do not provide health insurance

The Patient Protection and Affordable Care Act does not require employers to offer health coverage to their employees. However, large employers will be subject to penalties beginning Jan. 1, 2014 if they do not: 1, offer coverage; 2, offer coverage that is affordable; and 3, offer coverage that meets the minimum value standards.

For purposes of the PPACA penalty, a large employer is an employer that has 50 or more full-time employees and full-time equivalents. Full-time employees are defined as those that work 30 or more hours a week calculated on a monthly basis. Full-time equivalents are calculated using the monthly total of hours worked by part-time employees. Only employers with 50 or more employees or full-time equivalents may be subject to non-participation penalties.

A large employer that does not offer its full-time employees (and their dependents) an opportunity to enroll in minimum essential coverage will pay a penalty if at least one of its full-time employees receives federal assistance to purchase insurance through an exchange. The penalty will be equal to $2,000 multiplied by the total number of full-time employees, minus 30 from that number.

A large employer that offers minimum essential coverage to full-time employees (and their dependents) also will be subject to a penalty if the health coverage offered is either: unaffordable because the employee’s required contribution is more than 9.5 percent of their household income; or the actuarial value of the employer’s plan is less than 60 percent, meaning the plan pays for less than 60 percent of covered health care expenses.

In either situation, the employer will pay a penalty that is the lesser of $3,000 for each full-time employee receiving federal assistance to purchase health insurance through an exchange, or $2,000 multiplied by all full-time employees (subtracting 30 from the total).

6. New disclosure rules for federal contractors and subcontractors

A number of federal agencies plan to issue an interim rule that will require federal contractors and subcontractors to disclose executive compensation, and to disclose first-tier subcontractor awards on contracts expected to be $25,000 or more.

This rule is based on laws that require the Office of Management and Budget to create a free, public website that provides information about all federal contract awards.

Under the interim rule, by the end of the month following the month the contract is awarded, and annually thereafter, the contractor or first-tier subcontractor must report the names and total compensation of each of its five most highly compensated executives for the preceding, completed fiscal year.

Contractors and subcontractors whose gross income in the previous fiscal year was less than $300,000 are exempt from these disclosure requirements.

The rule also requires contractors to report subcontracts of $25,000 or more, and any changes made to those contracts that affect data previously submitted. According to the interim rule, these new reporting requirements “are sweeping in their breadth, and are intended to empower the American taxpayer with information that may be used to demand greater fiscal discipline from both executive and legislative branches of government.”

Employers should beware that this is only the tip of the iceberg in regard to health-care reform. Monitor developments to prepare for future changes.

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-889-8861 or hrubin@littler.com.

Patricia Haim, a shareholder in Littler Mendelson’s Portland office, and Janice Kim, an associate in Littler Mendelson’s Portland office, assisted in preparing this article. Contact them at 503-221-0309.

The post 6 health care reform changes you should know about appeared first on Daily Journal of Commerce.

Here is a look at legislation affecting the building industry.

Update on the Job Applicant Fairness Act

A new Oregon law generally prohibits the use of credit histories for employment purposes. Limited exceptions include federally insured banks and credit unions, businesses required by law to consider employee credit history, and police and other public employers hiring for law enforcement and airport security.

Additionally, the law includes an exception when the individual’s credit history is “substantially job-related;” however, that exception is not defined in the statute.

The Oregon Bureau of Labor and Industries issued final rules, effective today, to implement the law. The rules define “substantially job-related” under the law to mean a position where “an essential function … requires access to financial information not customarily provided in a retail transaction or that is not a loan or extension of credit.”

An employer should consider updating its employee handbook to state that it does not consider an applicant’s or employee’s credit history for employment purposes except as authorized by law. The definition of “substantially job-related” could include, for example, accounting department employees, financial advisers, and certain employees in the securities and insurance industries. If a third-party service is used to perform background checks, a written notice should be sent instructing the service not to obtain or use credit histories except when specifically instructed to do so and to comply fully with Oregon’s Job Applicant Fairness Act.

Employers need not accommodate medical marijuana users

The Oregon Supreme Court has ruled that workers who use marijuana to relieve pain or nausea may be fired for drug use even if they hold a valid state-issued medical marijuana card. In a 5-2 decision, the court held that Oregon’s medical marijuana program must yield to federal law prohibiting illegal drugs.

The Oregon Medical Marijuana Program, approved by voters in 1998, created a gray area for employers hoping to adopt tough illegal drug use policies. The decision, which overturns an earlier Oregon Court of Appeals ruling and BOLI decision, means that employers need not accommodate medical marijuana users in the workplace. A spokesperson for Associated Oregon Industries said the decision “could not be better” for employers, and added that they should now feel free to apply “zero tolerance” drug policies and refuse to hire applicants who fail drug tests regardless of medical marijuana registry status.

Employers should:

• Review policies to ensure they can – to the extent permitted by applicable federal, state and local law – discover, investigate and respond appropriately to the illegal use of drugs by employees.
• Avoid simply assuming that every employee who asks for an accommodation for the use of medical marijuana is currently using it. For example, an employee may be investigating treatment options without having used marijuana.
• Interact in the same way with all employees seeking accommodation. Some employees may be qualified employees, and there may be a duty to accommodate them with legal alternatives.
• Carefully train managers to understand the law, the rules that apply to their workplaces, and the consequences of violating those rules. There is much disinformation about medical marijuana, but the proliferation of state medical marijuana laws attests to the wide support for the limited use of marijuana for medical purposes. Managers and employees may know someone whom they believe has benefited from the use of medical marijuana. As a result, they may take actions or fail to take actions that may undermine their employer’s policies and expose those employers to civil or even criminal liability.
• If an employer does make an accommodation based on an employee’s use of medical marijuana – even though it has no legal obligation to do so – the decision may affect how it conducts its drug testing program and how it provides accommodations to similarly-situated employees. Accommodating the employee may expose the employer to civil liability for negligent hiring, supervision, or retention; violations of workplace safety rules; and violations of agreements with third parties to provide a drug-free workplace. That decision also may pose a risk to the organization or its managers of criminal liability. Accordingly, such an employer should first discuss with its legal counsel the serious ramifications of making such an accommodation.

Health care reform

The Patient Protection and Affordable Care Act of 2010 will have significant impacts on employers. After Jan. 1, 2011, new and existing employer group health plans that become effective based on the calendar year:

• may not impose pre-existing condition limitations on covered individuals under 19 years of age, and must provide dependent coverage to children until age 26. Existing plans need only cover adult children if they are not eligible to enroll in another employer-sponsored plan.
• must provide notice of any material modification to the terms of the plan, 60 days before the modification becomes effective.
• may not rescind coverage except in cases of fraud or misrepresentation.
• may not establish lifetime or annual dollar-value limits on “essential health benefits.” (The new law does not define “essential health benefits,” but guidance is expected soon from the Secretary of Health and Human Services.)

In addition, new employer group health care plans must provide coverage with no co-payments and/or deductibles for preventative care services and recommended immunizations, and must implement an appeals process for appeals of coverage or claims.  The appeals process must comply with the claims and appeals process contained in the Employee Retirement Income Security Act of 1974.

For new and existing plans that become effective between Oct. 1 and Dec. 31, these new regulations will become effective on the effective date of the plan.

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-889-8861 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post In the Oregon Legislature: Job fairness, medical marijuana and health care reform appeared first on Daily Journal of Commerce.

Here is a look at legislation affecting the building industry.

The Patient Protection and Affordable Care Act, better known as the health care reform bill, was signed into law in March. Several of the new law’s provisions impacting employers become effective this year.

Small business tax credit

A company that employs 10 people or fewer and offers health benefits may be eligible for a tax credit of up to 35 percent of its premium costs. To be eligible, a company must pay its workers an average of $25,000 or less and contribute at least 50 percent of the health coverage premium costs. The credit is reduced as the number of employees and the average wage increase. Companies that either employ more than 25 people or pay an average wage of $50,000 or more are not eligible. The credit takes effect for the 2010 tax year.

Break for nursing mothers

Effective immediately, nursing mothers must be given “a reasonable break time” and a location free from intrusion to express milk for up to one year after childbirth. Oregon law already mandates an unpaid break of 30 minutes to express milk for every 4 hours worked.

Automatic enrollment

Employers with 200 or more full-time employees must enroll all new full-time employees in the lowest premium health plan option offered unless the employee selects a different plan option or opts out of coverage. Employers should inform employees that they will be automatically enrolled unless they affirmatively opt out of coverage. While the new law does not establish an effective date for this provision, analysts advise that the requirement could become effective once implementing regulations are issued.

Reimbursement for early retirees

The new law will reimburse employers up to 80 percent of the cost of providing health care coverage to early retirees between ages 55-64. The reimbursement is a temporary measure that is set to become effective June 23, and end on Jan. 1, 2014 (or sooner if the allocated appropriation is depleted).

Coverage required until age 26

New regulations require that any group health plan currently providing coverage to a dependent child must make the same coverage available until the child reaches age 26. The interim final regulations, issued by the United States Department of Labor, implement the dependent coverage provision of the health care reform bill. Under the regulations, plans may not restrict, charge differently for, or vary the level of coverage based on age, prior to the child’s 26th birthday. The new regulations become effective with plans that begin or are renewed on or after Sept. 23.

A dependent child who lost coverage, was never eligible, or was never enrolled in the plan, and who was not eligible under the plan’s current age limit, is treated as a new dependent under the HIPAA special enrollment rules. These dependents must be given notice of enrollment rights on or before the effective date of the plan, and 30 days to enroll, retroactively to that date.

Covered plan sponsors and administrators should identify qualified dependent children and begin drafting the notice. For more information, visit www.dol.gov/ebsa/regs/unifiedagenda/spring-2010/1210-AB41.htm.

Lawsuit related to SB 519 is tossed

Oregon Senate Bill 519, sometimes called the employer gag bill, was signed into law last year by Gov. Ted Kulongoski. It prohibits employers from taking an adverse employment action against employees who refuse to attend meetings or participate in communications concerning the employer’s opinion about religious or political matters. As reported in this column in February, the U.S. Chamber of Commerce and Associated Oregon Industries filed suit against the Oregon Labor Commissioner and contended that the law violates federal labor law as well as the free-speech rights of employers to meet with employees on work-related matters.

On May 6, a U.S. district judge in Portland dismissed the suit on two grounds. First, the defendant, the Bureau of Labor and Industries commissioner, had no authority and claimed to have no intention of enforcing the law; and second, the USCOC and AOI couldn’t show they had suffered any harm as a result of the law.

The law grants private individuals the right to bring suit, and the court held that the law cannot be challenged in court until such a suit is filed.

New COBRA model notices

The American Reinvestment and Recovery Act of 2009 requires group health plans to provide eligible individuals with notice of the available COBRA premium and additional health care coverage election periods. The Continuing Extension Act of 2010 extended through May 31 the 65 percent premium COBRA subsidy for eligible individuals who are involuntarily terminated from employment. In addition, the CEA provides retroactive eligibility for individuals who lost their jobs after the prior COBRA subsidy expired on March 31.

On May 11, the Employee Benefits Security Administration announced the availability of new model COBRA notices incorporating the extension and eligibility information. To view and print the model notices, visit www.dol.gov/ebsa/COBRAmodelnotice.html.

75-year-old rule is amended

On May 11, the National Mediation Board amended its 75-year-old election procedure, making it easier for air and rail employees to unionize. Under the former procedure, a majority of eligible voters determined the outcome of representation elections. Eligible voters who did not vote were counted as “no union” votes. Under the new rule, election outcomes will be decided only by eligible voters who actually vote, as is the case in other industries not governed by the NMB. The NMB, which has received strong criticism over the radical change, defended its actions in claiming: “[t]his proposed change will allow the (NMB) to more accurately ascertain employee desires regarding representation.”

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-889-8861 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post Health care reform: help or headaches for employers? appeared first on Daily Journal of Commerce.

Here is a look at legislation affecting the building industry.

New Oregon law prohibits credit checks

On March 29, Oregon Gov. Ted Kulongoski signed into law , making it an unlawful employment practice for most Oregon employers to use credit history in making hiring decisions or any decisions affecting current employees. The law gives Oregon employees the right to file administrative complaints or private lawsuits for alleged violations. Employees who prevail in court may recover lost wages and attorneys’ fees.

There are a few exceptions. Specifically, exemptions apply to federally insured banks and credit unions, businesses required by law to consider employee credit history, and police and other public employers hiring for law enforcement and airport security. In addition, the law includes an exception for employers conducting credit checks for “substantially job-related” reasons, so long as those reasons are disclosed to the employee in writing.

Agencies propose rule affecting federal contractors

The Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council published a proposed rule in April that would prevent federal contractors from being reimbursed for certain kinds of expenses relating to employee communications regarding unions. The proposed rule would implement Executive Order 13494, Economy in Government Contracting, which prohibits the use of federal funds to influence employees’ decisions regarding forming or joining a union or engaging in collective bargaining.

The proposed rule would disallow reimbursement for the cost of preparing and distributing materials, hiring or consulting legal counsel or consultants, holding meetings (including paying the salaries of the attendees at meetings held for this purpose), and planning or conducting activities by managers, supervisors, or union representatives during work hours.

Except as expressly disallowed by the regulation, allowable costs would include those incurred in maintaining satisfactory relations between the contractor and its employees, including costs of shop stewards, labor management committees, employee publications, and other related activities.

Comments on the proposed rule are due by June 14. For more information, go here.

Agencies no longer prohibited from requiring PLAs

On April 12, the General Services Administration, along with other federal agencies, published a final rule implementing Executive Order 13502, Use of Project Labor Agreements for Federal Construction Projects. The section of the Federal Acquisition Regulation prohibiting agencies from mandating Project Labor Agreements was rescinded last year when the rule was proposed.

After considering more than 700 comments to the proposal, the final rule: encourages agencies to consider PLAs early in the acquisition process; identifies factors for agencies to consider to determine whether PLAs will help meet the goals of economy and efficiency in the performance of a specific project; allows agencies to require that successful bidders to a federal contract become a party to a PLA; and gives contracting agencies the option of requiring bidders to submit the PLA with their offers.

The rule, which goes into effect on May 13, applies to projects with a total cost exceeding $25 million. For more information, go here.

OFCCP data is now available online

The U.S. Department of Labor has launched a new online database as part of its plan to make its operations more transparent. The searchable database, which compiles enforcement data from the Office of Federal Contract Compliance Programs, the Occupational Safety and Health Administration and three other agencies, includes OFCCP complaint investigations, OSHA inspection details and other compliance information.

provides a single entry point for previously unavailable enforcement data of five Department of Labor agencies.

The DOL states that the site is a work in progress and that it will add new features over time.

HIRE provides a payroll tax holiday

The Hiring Incentives to Restore Employment Act (HIRE) was signed into law on March 18. The new law provides qualified employers with incentives to hire new employees by exempting the employer from paying the employer’s share of the 2010 Social Security employment tax on certain new employees.

A “qualified employer” is any employer other than a federal, state or local government employer. Public institutions of higher learning are considered qualified employers.

The tax break applies to new employees hired between Feb. 3, 2010 and Jan. 1, 2011, who: 1, were not employed for more than 40 hours during the 60 days prior to their employment, and 2, are not replacing another employee, unless that employee voluntarily quit or was terminated for cause.

HIRE also provides an incentive to retain new employees by providing the employer with a $1,000 tax credit for every new employee employed continuously for 52 weeks. For more information, go here.

Howard Rubin is a shareholder in Littler Mendelson’s Portland office. Contact him at 503-889-8861 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post Building industry legislation appeared first on Daily Journal of Commerce.

Reverse discrimination

A 2009 U.S. Supreme Court decision arising from a lawsuit brought by firefighters against the city of New Haven, Conn., has left many federal contractors wondering whether the Office of Federal Contract Compliance Programs compliance reviews will be affected and whether the decision will change their obligations regarding the use and validation of job-related tests.

In 2003, New Haven prepared to promote a group of firefighters based on the results of a qualifying exam. The city invalidated the test, however, after it determined that no African-American applicants qualified for the promotion. The city feared it would subject itself to claims of race discrimination. The 17 white and Hispanic firefighters who would have been promoted filed suit, claiming they were denied promotion based on their race.

The Supreme Court held that New Haven’s decision to discard the test results violated Title VII of the Civil Rights Act of 1964, leaving federal contractors – who must implement affirmative action programs – to wonder about their obligations.

The OFCCP has posted on its Web site a set of frequently asked questions about the U.S. Supreme Court’s decision.

According to the FAQs, the court’s decision does not change a federal contractor’s affirmative action obligations (nor its obligation to comply with Uniform Guidelines on Employee Selection Procedures) when using a test as part of its selection process. If such a test shows that it would have a disparate impact on a protected class, then the test must be validated for a particular job. Additionally, the contractor is required to investigate alternative selection procedures that would have a lesser impact on the particular race, ethnic group or gender.

The FAQs also explain that “to comply with its nondiscrimination obligations, a contractor must examine its tests and other selection procedures to identify whether there are any problem areas in terms of adverse impact on a particular race, ethnic group, or gender, and to prevent prohibited discrimination from occurring.” The OFCCP advises that federal contractors proactive in assessing their testing procedures are “more likely to avoid problems and successfully defend against any claim of disparate impact.”

For more information, visit .

Internet background checks

BeenVerified is a new mobile Web application that allows users to conduct background checks on any individual by merely entering the person’s name or e-mail address. Users get three free background checks monthly, and unlimited checks for a monthly fee of only $8. BeenVerified has been a smashing success, with more than 1 million checks run to date.

Human resources professionals, recruiters, managers, and co-workers may find BeenVerified hard to resist. According to the application, users can check an individual’s “criminal history, property records, current contact info, relatives, neighbors and more,” merely by entering an individual’s name. By entering an e-mail address, the user can discover the individual’s social networking activities and view “their online photos, Web sites, blog posts and entire online presence.” All of the data is compiled into a concise report.

Despite its ease of use and apparent low cost, the BeenVerified application may expose employers to liability under the federal Fair Credit Reporting Act and analogous state laws. These laws prohibit background checks for employment purposes without providing notice and obtaining the subject’s prior, written authorization, and include other requirements. The FCRA permits recovery of damages for willful violations, and attorney fees.

Although BeenVerified states that information obtained “should not be used for employment, tenant screening, or any FCRA related purposes,” the potential for improper use of the application exists. Financial, criminal and other personal information about subordinates, co-workers and applicants can be discovered without any safeguards to protect against violations of federal and state background check laws. As a result, employers should consider implementing policies that prohibit employees from using the application to obtain information about any other employee, unless the user has complied with the FCRA’s requirements.

For more information, visit .

Health-plan notices

On Feb. 4, 2009, President Obama signed into law the Children’s Health Insurance Program Reauthorization Act of 2009. It became effective for some employer health plans as early as Feb. 4, 2010.

Under CHIPRA, employers are required to provide notice to employees informing them of the potential opportunity for premium assistance. Failure to provide this notice may result in fines. The U.S. Department of Labor has now issued a model CHIPRA notice, which can be found . This notice will need to be tailored for each employer’s particular plan or plans and must be distributed by the first day of the first plan year beginning after Feb. 4, 2010 or May 1, 2010 (Jan. 1, 2011 for calendar-year plans).

Howard Rubin is the office managing shareholder of Littler Mendelson’s Portland office. He has represented public and private employers in employment and labor law matters for more than 20 years. His primary focus is traditional labor law matters such as representing employers in union organizing, negotiations, and labor arbitrations. Contact him at 503-889-8861 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post Building industry legislation appeared first on Daily Journal of Commerce.

As reported previously, , sometimes called the Employer Gag Bill or the Workplace Freedom Act, was signed into law last year by Gov. Ted Kulongoski. The law prohibits employers from taking an adverse employment action against employees who refuse to attend meetings or participate in communications concerning the employer’s opinions on religious or political matters.

The U.S. Chamber of Commerce and Associated Oregon Industries have now filed suit against the Oregon Labor Commissioner. The USCOC and AOI contend that the law violates federal labor law as well as the free-speech rights of employers to meet with employees on work-related matters. In a statement, AOI said the law “eliminates an employer’s federally protected right to conduct mandatory meetings with employees to provide information on the effects and drawbacks of a unionized workplace.”

In response, the AFL-CIO stated that the law “specifically protects both an employer’s right to free speech and a worker’s right to be free from unwanted communication.”

This case will likely continue to develop.

U.S. Department of Labor announces more investigations and enforcement

Employers, beware! That is the message from the Department of Labor. Secretary of Labor Hilda Solis recently announced dramatic increases in the DOL’s enforcement of federal employment laws, including 250 additional wage-and-hour investigators. This influx of new investigators boosts the departmental investigative staff by one-third.

The DOL’s Wage and Hour Division investigates allegations that employers failed to pay minimum wage or overtime, as well as alleged misclassification of employees as independent contractors or exempt from overtime requirements. DOL investigations can be triggered by complaints from employees, unions or competitors, and routine audits are also performed, often focusing on a particular industry or type of employer.

The DOL has broad investigative powers, including the power to subpoena employment records. If wage-and-hour violations are discovered, the DOL will seek a settlement. If an out-of-court agreement is not reached, the DOL can sue to enjoin an employer’s violation of the law as well as to compel the payment of unpaid wages and overtime to employees. The DOL also has the power to seek reinstatement with back pay of any individual employee who was discharged for attempting to enforce the law.

Should the DOL bring suit and prevail, it can recover liquidated damages equal to the unpaid wages the employer owes, unless the employer can prove that it acted in good faith with a reasonable belief that its pay practices complied with the law. Interest and attorney’s fees are likely to be awarded as well, even if liquidated damages are not.

The federal government’s increased manpower and plans for stronger enforcement of federal labor standards should be a wake-up call to employers to ensure that their procedures and practices comply with federal labor laws.

Audits conducted by or through counsel can catch technical problems with pay practices, record keeping, and employee classification that can be corrected. Training managers in employment laws, such as when overtime is required, can help prevent violations caused by managers’ lack of knowledge or understanding of an employer’s legal obligations.

Such measures can save employers the expense and embarrassment of reacting to a government investigation or a costly class action.  For more information, visit .

COBRA subsidy extended

President Barack Obama in December signed legislation into law that extends the original federal COBRA subsidy created by the 2009 federal stimulus act. The law extends the total time an individual may receive the COBRA subsidy from nine months to 15 months, and also extends the subsidy to individuals who are involuntarily terminated between Jan. 1, 2010 and Feb. 28, 2010.

Additionally, the legislation allows certain individuals whose subsidy periods already expired and who failed to pay their full unsubsidized premiums to pay them retroactively.

Employers will need to revise documents and prepare new paperwork to meet the requirements of the new legislation. Among other things, employers will have to amend their current COBRA subsidy paperwork to reflect:

• the extra six months of coverage;
• the new February cutoff date to qualify for the subsidy; and
• the fact that individuals’ eligibility for the subsidy is conditioned only on the date of their involuntary employment termination (instead of the date of their employment termination and the date their COBRA coverage period begins).

Employers also should include the above information in their standard COBRA package.

Employers must also develop a notice for all affected employees informing them about the new legislation and advising that they can make retroactive premium payments to maintain their COBRA coverage. For more information, visit .

New requirements for employers sponsoring HIPAA plans

The 2009 stimulus act also amends the Health Insurance Portability and Accountability Act of 1996. The amendment requires employers that sponsor HIPAA-covered plans to notify affected plan participants of any breach of protected health information by the employer or its service provider within 60 calendar days of the breach.

Employers must also keep a log of all breaches involving fewer than 500 people and submit it annually to the Secretary of Health and Human Services. The secretary must be notified immediately if a breach involves more than 500 people. If the breach involves more than 500 residents of a state or jurisdiction, prominent media outlets must also be notified. This law becomes effective Feb. 17. For more information, visit .

Howard Rubin is the office managing shareholder of Littler Mendelson’s Portland office. He has represented public and private employers in employment and labor law matters for more than 20 years. His primary focus is traditional labor law matters such as representing employers in union organizing, negotiations, and labor arbitrations. Contact him at 503-889-8861 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post An update on Senate Bill 519 appeared first on Daily Journal of Commerce.

As 2010 begins, with the new year comes a new slate of proposed employment laws and regulations, and an appropriations bill that gives federal agencies the resources to enforce those laws and regulations.

Senate passes appropriations bill

On Dec. 13, 2009, the Senate approved by a vote of 57-35 the nearly $447 billion omnibus appropriations bill, which the House of Representatives had passed a few days earlier. The Consolidated Appropriations Act (H.R. 3288) will provide some federal agencies with a substantial increase in funding for fiscal year 2010.

Specifically, the bill allocates $13.3 billion to the Department of Labor, including $1.6 billion for worker safety and health initiatives. The Equal Employment Opportunity Commission is slated to receive $367 million and the National Labor Relations Board is due $283.4 million.

Agencies will now be able to carry out their stated plans to hire more personnel and boost their enforcement efforts. The DOL intends to hire more than 600 new full-time enforcement and compliance employees. Some of these workers will replace retired auditors, but others will expand the DOL’s ability to enforce compliance.

President Obama is expected to sign this bill into law. Visit for more information.

Defense contractors prohibited from requiring arbitration

An amendment to the FY 2010 Defense Appropriations Bill (H.R. 3326) approved by the Senate on Dec. 19, 2009, would restrict federal contractors and subcontractors working on large defense projects funded by the appropriations bill from requiring their employees and independent contractors to sign, as a condition of employment, agreements to arbitrate certain employment-related claims.

The bill, which President Obama is expected to sign, prohibits defense contracts in excess of $1 million and awarded more than 60 days after the effective date of this act from requiring employees and independent contractors  to agree to resolve through arbitration any claim under Title VII of the Civil Rights Act of 1964 or any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, negligent hiring, supervision, or retention.

The bill also prohibits defense contractors from enforcing arbitration clauses in existing contracts for those claims.

Visit for more information.

New rule revokes employee notification requirement regarding union dues and fees

The DOL in December 2009 published a new rule that revoked a Bush-era regulation requiring federal contractors to inform employees of their rights regarding the payment of union dues or fees.

The former rule required that federal contractors post a notice to their employees informing them that: 1, they are not required to join or maintain membership in a labor union; and 2, those who are not union members – but are nonetheless required to pay dues or fees pursuant to a union security agreement – can object to paying a portion of those dues or fees to support activities that are not related to collective bargaining, contract administration, or grievance adjustment. The new rule eliminates the portions of the previous notification rule that informed union members of their right to pay limited union dues or fees.

With respect to the mandate that contractors post notices outlining an employee’s rights under federal labor laws, in August 2009, the DOL issued a proposed rule that describes what these notices should include, identifies which entities are covered, and explains the sanctions, penalties, and other remedies that may be imposed in the event of noncompliance. A final version of these requirements has not yet been issued.

Visit for more information.

Comprehensive immigration bill introduced

An immigration overhaul bill (H.R. 4321) introduced in the House of Representatives last month should receive serious consideration early this year. Included in the new bill are a revamped employment verification system, increased penalties for employer noncompliance, an overhaul of the employment-based visa system, and anti-discrimination provisions.

Title II of the new legislation would likely impact employers the most by expanding the E-Verify system in a manner that would eventually apply to all workers and new hires. This employment verification system would:

• Create significant civil penalties for employers that do not comply with the requirements under the new system, and establish serious criminal penalties for knowingly hiring unauthorized aliens;
• Include privacy protections by limiting the data that can be collected and stored in the database; and
• Forbid employers from using the new system to discriminate against applicants or employees on the basis of nationality, and prohibit employers from terminating employment due to a tentative non-confirmation, or using the system selectively.

Visit for more information.

EEOC announces its regulatory agenda

The Americans with Disabilities Act Amendments Act significantly expands the definition of disability, enabling more individuals to be covered by the Americans with Disabilities Act. In September 2009, the EEOC issued proposed regulations to reflect that the expanded ADA definition of disability should be interpreted broadly. The EEOC plans to issue a final rule by July.

In a 2009 opinion, the Supreme Court held that the employer bears the burden of production and persuasion when using “reasonable factors other than age” (RFOA) as a defense in an Age Discrimination in Employment Act case. The second item on the EEOC’s regulatory plan is a rule to be proposed in March to clarify the court’s meaning of RFOA.

Visit for more information.

Hopes are always high when a new year begins that much will be accomplished, needed reforms will take center stage and aging bills will be overhauled. However, the above issues may not be prioritized highly by some lawmakers amid a lagging economy and high rate of unemployment, and looming mid-term elections. In addition, the current focus on health care, climate change, and job creation legislation may push some reforms to the back burner. At a minimum, pay equity/gender equality issues, immigration reform and, perhaps, changes to union organizing law, should be considered by Congress in 2010.

Howard Rubin is the office managing shareholder of Littler Mendelson’s Portland office. He has represented public and private employers in employment and labor law matters for more than 20 years. His primary focus is traditional labor law matters such as representing employers in union organizing, negotiations, and labor arbitrations. Contact him at 503-889-8861 or hrubin@littler.com.

Don Stait, a paralegal in Littler’s Portland office, assisted in preparing this article. Contact him at dstait@littler.com.

The post Employment bills to watch appeared first on Daily Journal of Commerce.