Supreme Court’s Upcoming Decision on FLSA Exemption: Financial Impact on Employers
The U.S. Supreme Court is about to rule on a critical issue regarding the evidentiary standard employers must meet to classify employees as exempt from the Fair Labor Standards Act’s (FLSA) overtime requirements. The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting private, federal, State, and local government employees. This decision could significantly impact employers in states within the 4th U.S. Circuit Court of Appeals’ jurisdiction, which includes Maryland, by potentially overturning stringent standards and reducing FLSA compliance costs. Employer’s Burden of Proof The Supreme Court will decide whether employers must provide “clear and convincing” evidence or just “some” evidence to prove an FLSA exemption. Currently, the 4th Circuit mandates the higher “clear and convincing” standard, making it more challenging for employers in that region to classify employees as exempt. A decision favoring the 4th Circuit’s standard could increase lawsuits from employees aiming to collect backpay, with employers facing penalties for FLSA violations. At the very least, a decision favoring the 4th Circuit will increase the administrative burden for HR professionals and raise the risk associated with employee classification decisions. Financial Implications for Employers The FLSA exempts 19 job categories, and disputes over these exemptions are common in litigation, often resulting in significant financial consequences for employers. However, implementing a uniform standard that rejects the 4th Circuit’s stringent approach could lead to cost savings and streamlined processes, offering a more optimistic outlook for employers operating across different jurisdictions. The Supreme Court’s impending decision carries considerable implications for employers. A ruling that lowers the evidentiary burden could streamline exemption analyses and reduce compliance costs, providing advantages for businesses within and outside the 4th Circuit. For more information about the FLSA case before SCOTUS and how it can affect your business contact (410) 522-1020, email info@luchanskylaw.com, or visit our office at 606 Bosley Avenue, Suite 3B, Towson, Maryland 21204. About Luchansky Law Luchansky Law specializes in resolving workplace disputes for employers and employees across Maryland. Our attorneys bring extensive experience and a practical approach to protecting your rights, navigating new regulations, and ensuring compliance. Our team combines legal expertise and practical experience to solve workplace challenges and effectively meet legal and business needs. References Smith, Allen. “Upcoming Supreme Court Decision May Make HR’s Exemption Analysis Less Costly.” SHRM, June 19, 2024.
Deciphering Trade Secrets: What Qualifies as Confidential Information in Your Business?
In the competitive business landscape, maintaining a competitive edge often hinges on safeguarding valuable assets. Among these assets are trade secrets – confidential information that provides a distinct advantage to companies. Understanding what constitutes a trade secret is paramount for businesses aiming to effectively protect and leverage these assets. In this article, we’ll discuss trade secrets and how you can legally protect them. We’ll provide tips to help you recognize, guard, and make the most of these critical components of intellectual property. What are trade secrets? Trade secrets are confidential information that give a company an edge over its competitors and are protected as intellectual property. For something to be called a trade secret, it must be valuable because it’s kept secret, known only by a small group, and the company needs to take reasonable steps to keep it confidential. Trade secrets can be technical details like how things are made or software algorithms, or they can be commercial information such as distribution methods and advertising strategies. Why are trade secrets important? Trade secrets are indispensable for companies as they safeguard valuable information necessary for the company’s survival and profitability. They provide a competitive edge and are vital for innovation and fair market functioning. How are trade secrets different from patents? Trade secrets protect information that may not meet patentability criteria, such as commercial information or manufacturing processes, ensuring their confidentiality and competitive advantage. Unlike patents or copyrights, which require public disclosure, trade secrets thrive on discretion, letting companies retain exclusive control over valuable information. What types of information qualify as trade secrets? The types of trade secrets are vast, reflecting the diverse nature of information critical to businesses. Formulas for products, manufacturing processes, customer lists, and proprietary algorithms are just a few examples of what can qualify as trade secrets. Famous examples of trade secrets range from the closely guarded Coca-Cola recipe and Google’s Search Algorithm to the WD-40 formula. Even the process behind compiling the New York Times Bestseller List is considered a trade secret, involving complex algorithms and data sources to determine book rankings. For a business, it’s essential to know about all the different kinds of secrets it might have to protect and use them well. What are the criteria for trade secret classification? To qualify as a trade secret, the information needs to meet specific requirements. Secrecy is paramount – the information must be something that’s not easy for others to find out. Also, it has to be valuable because it’s kept secret, giving a business an advantage over its competition. Businesses must also show they’re making reasonable efforts to keep the secret safe, whether through physical safeguards, contractual agreements, or other measures. Upholding these criteria ensures the information remains a trade secret protected under relevant laws. What does the new NLRB ruling mean for business owners? From a business owner’s perspective, this rule change necessitates a more comprehensive review of their relationships with other entities involved in employment arrangements. They may need to reassess contracts, policies, and practices to ensure compliance with the updated standard. Additionally, it could lead to increased scrutiny and potential legal exposure regarding employment practices, requiring proactive measures to mitigate risks and maintain compliance with labor laws. For instance, the original Kentucky Fried Chicken recipe (KFC) is a prime example of a trade secret. The iconic blend of herbs and spices has remained closely guarded since its inception by Colonel Sanders. The recipe is kept under tight security, known only to a select few people within the company. KFC has taken extensive measures to maintain its secrecy, including storing the recipe in a secure vault and limiting access to it. Employees involved in preparing the seasoning are often required to sign strict confidentiality agreements, ensuring that the recipe remains confidential. By safeguarding the original recipe as a trade secret, KFC maintains a unique selling proposition in the competitive fast-food industry, distinguishing its product from competitors’ offerings. What legal safeguards and laws protect trade secrets? Trade secret laws and regulations exist at state and federal levels in the U.S. These laws impose penalties for trade secret misappropriation, defined as the improper acquisition, disclosure, or use of a trade secret. State laws generally allow trade secret owners to seek damages or injunctive relief in cases of misappropriation. Many states have adopted the Uniform Trade Secrets Act (UTSA) to standardize trade secret laws across different jurisdictions. The Economic Espionage Act of 1996 makes it a crime to steal trade secrets for foreign spying or commercial gain, with the Department of Justice imposing penalties for violations. Additionally, the Defend Trade Secrets Act of 2016 lets people sue in court to protect trade secrets uniformly across the country, and they can choose to do it in either state or federal court. State laws generally allow trade secret owners to seek damages or injunctive relief in cases of misappropriation. Many states have adopted the Uniform Trade Secrets Act (UTSA) to standardize trade secret laws across different jurisdictions. The Economic Espionage Act of 1996 makes it a crime to steal trade secrets for foreign spying or commercial gain, with the Department of Justice imposing penalties for violations. Additionally, the Defend Trade Secrets Act of 2016 lets people sue in court to protect trade secrets uniformly across the country, and they can choose to do it in either state or federal court. Understanding these laws is vital for businesses to keep their secrets safe and use the law to their advantage. How can I protect my trade secrets? Protecting and maintaining trade secrets demands a comprehensive approach. By adopting various strategies and practices, companies can maintain the confidentiality of valuable information and reduce the risk of unauthorized disclosure or use. By implementing these protective measures, companies can enhance the security of their trade secrets and reduce the risk of authorized disclosure or use, helping them stay ahead in the market. Protecting Trade Secrets: A Strategic Imperative for Business Growth To sum up, trade secrets are invaluable business
How Does the New NLRB Rule Change on Joint Employers Impact Subcontractors
The New NLRB Ruling on Joint Employers for 2024 The National Labor Relations Board (NLRB) recently finalized a significant rule change regarding the Standard for Determining Joint-Employer Status. Effective December 26, 2023, the new NLRB rule represents a seismic departure from previous standards, promising far-reaching implications for labor relations and legal obligations. But what does this rule actually entail, and why should it matter to you? Let’s unravel the intricacies of this transformative shift and explore its profound significance in shaping the landscape of employment dynamics. What is the new NLRB rule? The new NLRB rule clarifies when multiple entities can be considered joint employers of a group of employees under the National Labor Relations Act (NLRA). According to the new standard, if two or more entities have an employment relationship with the same group of employees and they share or have a say in determining one or more essential terms and conditions of employment for those employees, they can be considered joint employers. The new joint employer test Under the new rule, two or more entities are joint employers when they “share or codetermine one or more of the employees’ essential terms and conditions of employment (see link below).” An ‘entity’ in this context refers to any organization, such as a corporation, partnership, or individual, involved in employment arrangements. The NLRB can say two entities are joint employers if one of them controls or has the power to control necessary job conditions of the other’s employees, even if it doesn’t actually use that power. **https://www.law.cornell.edu/cfr/text/29/103.40 The types of essential job conditions covered by the rule are broad: 1. Wages, benefits, and other compensation 2. Hours of work and scheduling 3. The assignment of the performance of duties 4. The supervision of the performance of duties 5. Work rules and directions governing the manner, means, and methods of the performance of duties and the grounds for discipline 6. The tenure of employment, including hiring and discharge 7. Working conditions related to the safety and health of employees An entity can be a joint employer if it has the power to control any of these seven things, even if it doesn’t actually do it. As long as a company has the authority to step in and control one of these important terms, it’s considered a joint employer. What was the NLRB rule before? Before the NLRB’s recent change, a 2020 standard had established a higher threshold for determining joint-employer status. Under this rule, businesses needed a significant level of direct and immediate control over employees’ work conditions to be classified as joint employers. This allowed businesses to distance themselves from certain liabilities, like labor disputes or wage violations, by demonstrating a lack of direct control. Under the 2020 standard, businesses could avoid joint-employer classification if they lacked substantial, direct control over essential employment terms. However, the December 2023 rule expands this scope, including factors beyond direct control. Even if a business doesn’t directly oversee aspects like wages or work schedules, it could still be deemed a joint employer if it has the authority or ability to influence these factors. This adjustment may increase businesses’ accountability for employment-related issues, even when third-party entities like contractors or staffing agencies are involved. Why did the rule change? The NLRB adopted the new rule to align more closely with established common-law agency principles, departing from the 2020 standard. The previous rule set a higher threshold for determining joint-employer status, which the NLRB found lacked a foundation in common law. By rescinding the 2020 standard and implementing the new one, the NLRB aims to provide more precise guidance to parties involved in joint-employer situations and ensure a more accurate reflection of traditional legal principles. What does the new NLRB ruling mean for business owners? From a business owner’s perspective, this rule change necessitates a more comprehensive review of their relationships with other entities involved in employment arrangements. They may need to reassess contracts, policies, and practices to ensure compliance with the updated standard. Additionally, it could lead to increased scrutiny and potential legal exposure regarding employment practices, requiring proactive measures to mitigate risks and maintain compliance with labor laws. Does the NLRB ruling apply to independent subcontractors? Yes, the new NLRB ruling extends to independent subcontractors, establishing that if entities share or influence essential employment terms, they can be deemed joint employers. This broadens the scope of joint employment under the NLRA, affecting employers, particularly those utilizing staffing agencies or subcontractors. Consequently, subcontractors may be deemed joint employers if they influence vital employment conditions for workers, even indirectly through intermediaries. What does this mean for subcontractors? This rule change holds significant implications for subcontractors. It makes it easier to protect workers’ rights and ensure they’re treated fairly by all the companies involved. Subcontractors, along with the other entities involved, now have a clearer understanding of their responsibilities towards jointly employed workers. By requiring joint employers to negotiate and discuss important work-related matters together, the rule promotes transparency and accountability in labor relations. It fosters a fair and responsible environment for all parties involved, ultimately benefiting workers and businesses alike. How can employers and subcontractors ensure compliance with the new NLRB joint employer rule? To ensure compliance with the new NLRB joint employer rule, subcontractors and employers should consider the following measures based on the information available: Review contracts and practices: Subcontractors should review their contracts and practices to ensure they align with the new joint employer rule. This includes assessing the level of control over essential terms and conditions of employment, such as wages, benefits, and working conditions, to determine potential joint-employment status. Consult legal counsel: It is advisable for subcontractors to seek legal counsel to analyze service contracts and other documents to identify any potential areas of concern regarding the new joint employer rule. Understand collective bargaining obligations: The new rule requires joint employers to participate in the collective bargaining process. Subcontractors should be aware of their potential obligations in this regard. Stay informed:
A Renaissance for Private-Employer Unions – Real or Fake News?
Depending on where you get your news, you might think that unionization at private employers is experiencing a drastic rise. Nearly every week, news articles highlight unionization efforts at high-profile companies like Starbucks, Amazon, and Mcdonald’s. Despite being only three-quarters of the way into FY22, union election petitions for FY22 have already exceeded the total number of election petitions filed in all of FY21. This represents a 58% increase in election petitions from FY21 if the trend holds for the remainder of FY22. The factors cited for the rise of union elections will not surprise any employer that has been following recent employment trends – post-COVID workplace dissatisfaction, greater availability of employment opportunities, and inflation are cited as central reasons why some employees feel emboldened to seek improved terms and conditions of employment through collective bargaining. For some employers, employees seeking improved conditions at work through collective bargaining may actually be a blessing in disguise. Studies show that many workers are more likely to increase their compensation by transitioning to a new job rather than negotiating a raise with their current employer. As a result, unionization may help employers struggling with employee retention. However, despite the possible benefits, few employers welcome unionization efforts. At-will employment, the ability to change policies, benefits, and pay without negotiations leads most employers to oppose union election petitions. With all that said, other studies suggest that the increase in union election petitions and news stories do not paint a complete picture. Only about 6% of private employees are union members, with government employees making up the vast majority of union members. Among government workers, as right to work laws for public employees have been passed in every state, union membership has declined to historically low levels. This suggests that, despite some high-profile unionization efforts, employee interest in union membership is low and that these high-profile cases are outliers being given undue attention by the media. At Luchansky Law, we recognize the challenges that employers with unionized workforces face. If your business would like assistance in responding to an election petition, negotiating a collective bargaining agreement, or implementing policies to keep your employees happy (and thereby avoiding a unionization push), give us a call at (410) 522-1020 to schedule a consultation.
How to Handle Freedom of Speech at Work
The end of the current session of the United States Supreme Court has seen the Court issue rulings on many hot-button political topics including gun control, abortion, immigration, and environmental protection laws. These rulings, along with the January 6th Commission’s ongoing public hearings, have created an environment of heightened political tension and stress. While the decisions themselves may be unrelated to an employer’s business, employers can still be impacted by these decisions through their employees’ reactions and interactions with one another. One major way that employers can be impacted is when employees’ political discussions move from civil debate and discussion to accusations of bullying and harassment. What then, if anything, can employers do to ensure that political discussions in the workplace do not result in lost productivity, damaged working relationships, and an overall loss of employee morale? Private Employers vs. Governmental Restrictions on Speech For many Maryland employers, the answer may seem counterintuitive. While the First Amendment and the Maryland Declaration of Rights create, with certain limitations, freedom of speech, that freedom only applies to governmental restrictions on speech. Neither the First Amendment nor the Maryland Declaration of Rights applies to private employers, whose ability to restrict certain workplace speech is broad, so long as such restrictions do not violate laws prohibiting discrimination or the rights of employees to collectively bargain. As a result, employers are permitted to implement and enforce policies designed to promote workplace harmony by preventing political arguments, bullying and harassment. For example, the First Circuit recently upheld Whole Foods’ right to discipline employees wearing “Black Lives Matter” masks in violation of their internal policies against employees wearing political paraphernalia at work. In doing so, the Court rejected the employees’ arguments that these policies violated their First Amendment rights and/or constituted racial discrimination. Instead, the Court upheld the long-standing notion that, so long as policies are not enforced in a discriminatory manner, employers may prohibit political speech at work. If you have questions about how to implement workplace policies promoting a harmonious workplace or preventing political arguments from occurring on company time, please contact one of our attorneys at (410) 522-1020 to set up an appointment.
When is Paid Sick Leave Coming to Maryland?
During the most recent legislative session, the Maryland General Assembly passed the Time to Care Act. The big takeaway from the passage of this law: Maryland will, eventually, have a paid leave program for employees who need time off due to childbirth or serious health conditions. Unfortunately, the coverage of the law’s passage has created confusion among employees and employers as to its effective date, who is responsible for funding the program, and its effective date. Contrary to some misconceptions, the law only establishes a framework for what the program will eventually look like—employees are not entitled to paid leave under the law until January 1, 2025, at the earliest. The program itself is akin to the unemployment insurance program—employees will apply for benefits through the state, not their employer. The funding for the program will come from contributions from employers (and employees) who employ more than 15 employees in the state. Employers with fewer than 15 employees will still be covered but will not be required to make contributions. Because the state agency still has not set up the program or determined the funds needed to run the program, the law provides that the contribution rates for employers will be set in June of 2023 with contributions beginning in October of 2023. These dates are tentative and dependent upon the passage of implementing regulations. Once employers start making contributions to the fund, October 2023 to December 31, 2024, will essentially be a funding period, where the program will build the reserves needed to provide benefits to qualifying employees. Again, employees will not be able to begin taking leave under the law until January 1, 2025, at the earliest. When employees take covered leave, they will file for benefits with the state. Once they do so, the employer’s obligation will be to maintain group health benefits in the same manner as they would under any other period of leave, with the employee continuing to pay their individual share. More importantly, unless doing so would create a “substantial and grievous harm” to the company, employers are required to reinstate employees once the period of leave is over. Employees may take up to 12 weeks of leave under the program. So, What Should Employers Do Now? For the time being, employers are not required to do anything new. Employers with 50 or more employees should continue to follow the requirements of the Family and Medical Leave Act and Americans with Disabilities Act when dealing with leave requests from employees. Employers with 15-49 employees should continue to follow the Maryland Parental Leave Act and Americans with Disabilities Act. As we learn more about how the law will be implemented, we will keep you updated. In the meantime, if you have questions about paid or unpaid leave requirements for your business, please contact one of our attorneys at (410) 522-1020 to set up an appointment.
Are Your Employees Ready to Go Back to “Normal”?
Across the country, government mask mandates are being lifted, students are attending schools without masks, and people are beginning to resume activities that were curtailed when the Omicron variant was spreading like wildfire only a few short weeks ago. Many employers are watching these trends carefully as they make plans to resume, expand, or modify their in-person work policies and practices. Many employers are asking the same questions… Should vaccination mandates remain? What about mask requirements? Should remote work be curtailed? Recent polls suggest that, while government mandates have scaled back, the majority of Americans still are not ready to go back to “normal”, pre-pandemic activities without restrictions. A recent Axios-Ipsos poll, published on March 1, suggests that a majority of American workers support keeping precautions in place. In fact, a slight majority still supported businesses requiring individuals to show proof of vaccination before entry. How Employers Can Handle the Return to “Normal” 1. Include Employees in the Decision-Making Process For employers looking to navigate these issues, these studies suggest that bringing employees back to the office and removing mask and vaccination requirements is likely to be unpopular with most employees right now. As we discussed in a recent article, most employees, whose jobs permit it, want to see remote work become a permanent fixture of their work life. Before removing mask or vaccination requirements, employers should solicit feedback from their employees as to whether they are comfortable with the company making such a move, particularly if it is coupled with a mandatory return to in-person work. Engaging your employees on this issue is likely to have benefits beyond ensuring that they feel safe at work. Studies show that a critical way to build employee morale and loyalty is to include them in decision-making processes at work. Allowing your employees to have a say in how the return to “normal” process is managed makes them feel like valued members of a team, rather than cogs in a machine. 2. Be Flexible to Future Changes Finally, keep in mind that any decision does not have to be permanent. The Axios-Ipsos poll also reflects that public sentiment continues to shift as case counts and hospitalizations decrease. What might feel like an unacceptable health and safety risk to employees today might not feel like a risk in two weeks’ time. Employers should keep this in mind and build flexibility into any policies that they revise or implement related to easing precautions surrounding COVID-19. If you have questions about how to revise or update your company’s mask or vaccination policies, please contact one of our attorneys at (410) 522-1020 to set up an appointment to discuss how your policies can be structured to meet your company’s goals.
Is Hybrid Remote Work the New Normal?
When the COVID-19 pandemic began in March 2020, no one could have predicted the ongoing transformation it would have on our home and work lives. This transformation is particularly obvious in how we talk about remote work and how many companies have adapted to, and in some cases embraced, remote work. Once a perk offered by a few tech-savvy companies, remote work became a necessity for many employers beginning in March 2020. While it had its hiccups to start overtime, more and more executives and managers became accustomed to remote work and remote management. As a result, a PwC survey taken in late 2021, reflected that 83% of employers felt that remote work had been successful for their companies. As the pandemic moves to an endemic stage, more and more employers are looking to implement permanent options for remote work. For many, this has taken on added importance as many employees are now looking to work for companies that offer remote work, at least on a part-time basis. Remote Work Considerations for Employers Employers implementing remote work must be careful not to adopt a one-size-fits-all approach. Some job duties and positions simply may not be a good fit for remote work and some employees may perform better in an in-person environment. Moreover, even for individuals who are primarily able to work from home, there are studies that show that in-person work and meetings help build a sense of collaboration, assist with employee training, and help build bonds within the company that creates loyalty. Those same studies suggest that employers who want to be successful with remote work evaluate their positions and determine how much of an employee’s time is spent on “collaborative” functions and how much is spent on independent, “working” functions. Employers can then schedule employees for in-person and remote work based on how much of their time is spent performing “collaborative” tasks that are better performed in person, and “working” tasks that can be successfully performed remotely. Based on these studies, most experts recommend “hybrid” work from home policies where employees split their time between working from home and the office. Hybrid Work Considerations for Employers Hybrid work from home arrangements are beneficial for employers because they allow for some of the traditional, in-person interactions that allow supervisors to evaluate and discipline employees effectively. Having at least some regular, in-person work hours ensures that employees are available and responsive to communications from co-workers and managers and may prevent improper moonlighting. Finally, requiring in-person work ensures that employees stay local. Many employers have experienced situations where remote workers relocate to another state and then are shocked to learn that they are suddenly subject to another state’s laws, including its local employment and sales tax laws. At Luchansky Law, we routinely assist employers with all facets of the implementation of policies and procedures governing remote work. If your business would like assistance in implementing a transition to a permanent remote work structure, give us a call at (410) 522-1020 to schedule a consultation.
Recent Circuit Court Split Creates Confusion About Mealtime Pay
How do three Federal Circuit Courts of Appeals hear separate but factually identical cases, yet come to three distinct holdings? That is what happened recently when one set of facts with different plaintiffs was litigated in the Ninth, Fifth, and Eleventh Circuits. The result? A split in the circuits regarding when employers must pay for employees’ mealtime. Akal Security, Inc. contracted with ICE to provide security officers for the deportation of detainees. The Air Security Officers (ASOs) were responsible for maintaining the safety and tending to the needs of deportees. On the “empty return leg,” the ASOs were mostly free to do whatever they wanted. Although Akal concedes that the empty return legs were compensable work, their policy was to automatically deduct a one-hour meal break from any return flight longer than 90 minutes. Over the past three years, several ASOs sued Akal in different federal district courts, claiming this policy violated the FLSA. The cases were appealed to three different federal circuits and, although the facts in each case were identical, each court applied a different test and issued different rulings. Under the FLSA, “bona fide meal periods are not worktime.” However, in the three cases brought by Akal employees, the circuits disagreed on the standard to be applied to determine whether mealtime is a “bona fide meal period.” The Ninth Circuit, in Alonzo v. Akal Security Incorporated, 807 Fed. Appx. 718 (9th Cir. 2020), held that Akal’s policy did not violate the FLSA because the ASOs were completely removed from duty and thus, the deducted mealtime was a bona fide, non-compensable meal period. The Fifth Circuit, in Dean v. Akal Security, Incorporated, 3 F.4th 137 (5th Cir. 2021), came to the same conclusion but applied a different standard. The court agreed that Akal’s policy did not violate the FLSA, but not because it satisfied the higher, “completely removed from duty” standard. Rather, the Fifth Circuit held that the proper test to identify a bona fide meal period is the more employer-friendly “predominant benefit” test. Applying that test, because the ASOs received the predominant benefit of the meal period, it was not considered compensable working time. Most recently, the Eleventh Circuit in Gelber v. Akal Security, Inc., 14 F.4th 1279 (11th Cir. 2021), agreed with the Ninth Circuit that the standard for a bona meal period is the higher “completely removed from duty” standard. However, even though it applied the same test, it held that Akal’s policy did violate the FLSA. The Eleventh Circuit reasoned that Akal could not satisfy its burden of proof that the ASOs were completely removed from duty simply by demonstrating that the ASOs were able to remain idle during that time because Akal had conceded that other idle time of the Empty Return Leg was indeed compensable. The court found it inconsistent of Akal to count other idle time as compensable work while also arguing that the idle time for a meal period satisfied the “completely removed from duty” test. Accordingly, the court held that Akal failed to meet its burden of showing that its employees were completely removed from duty during mealtime and that Akal’s failure to count the meal period as working time violated the FLSA. To summarize, while the Eleventh and Ninth Circuits agree that the proper test is the “completely removed from duty” test, they came to different conclusions on whether the ASOs’ idle time satisfied the test. The Ninth Circuit held that it did because ultimately the ASOs were idle and completely removed from duty. The Eleventh Circuit held that it did not because even though the ASOs were idle, Akal had conceded that idleness and free time were compensable, therefore idleness and free time could not factor into the “completely removed from duty” analysis. In contrast, the Fifth Circuit will apply the more lenient “predominant benefit” test, and since the ASOs were the predominant beneficiary of the mealtime, it qualifies as a bona-fide, non-compensable meal period. Following these decisions, whether an employer can deduct meal period pay, and what standard applies, will depend on the circuit where the employees work. The Fifth Circuit’s standard obviously favors employers while the Eleventh Circuit’s standard and rigid application of the “completely removed from duty” test favors employees. The Ninth Circuit, meanwhile, has staked out something of a middle ground between the two. While the facts of the Akal cases are somewhat unique, the standards applied by these courts affect all meal period compensation issues. The confusion surrounding meal period pay created by the circuit split is unlikely to be resolved unless the Supreme Court weighs in on the issue. If you want to have your employment practices reviewed to ensure that your pay practices, including compensation for meal periods, contact the attorneys at Luchansky Law at (410) 522-1020 or at www.luchanskylaw.com
How Employers Can Help Ease Mental Health Issues Due to the Pandemic
As the pandemic creeps on into year three, many are noticing a significant deterioration in their mental health—either through an exacerbation of their existing mental health conditions or simply from exhaustion. Fortunately, all is not lost! There are several strategies that employers may implement to assist their employees through this difficult time, and some are systems that the employer already has in place but are underutilized. The first strategy is to remind employees of existing programs that the employer offers, such as employee assistance programs (“EAP”). Many employees report that they have not sought any mental health treatment due to concerns about cost. These employees may be unaware of EAP that their employer may offer. EAP will help the employee find a mental health professional who also accepts the employee’s health insurance, at no cost to the employee. Additionally, an EAP may cover the costs of the first few treatment sessions with a provider, and for someone going through an acute episode, this may be all they need. If services are required beyond the initial sessions covered by EAP, the employee’s health insurance would then take over. Employers should periodically remind employees that any EAP is free, confidential, and dovetails with their existing health insurance to ensure continuity of care, if necessary. Employers should also remind the employees of its “open door policy” with respect to questions about the EAP. The second strategy is to highlight any mental health coverage or other insurance benefits (such as a prescription plans) that the employer offers. Many health insurance plans cover mental health treatment. However, certain plans require a referral to avoid out of pocket costs. A common refrain from employees is that they are unsure what items are covered through their employer sponsored health insurance, and therefore are hesitant to use their benefits for mental health treatment. To address this knowledge gap, the HR department for the employer can host periodic discussions or town hall meetings regarding benefit programs. Having these transparent meetings can alleviate confusion and makes employees more likely to utilize the benefits that the employer provides. Here, too, reminding the employees of the “open door policy” encouraging them to come forward with questions about benefits as they relate to mental health services can be helpful. The third strategy is to be creative. There is no “one size fits all” approach to mental health. Employers should encourage their employees to voice their concerns about their mental health and how it may be affecting their performance or the office culture. During these feedback sessions, brainstorm with the employees about solutions. Possible solutions include an audit of work assignments and redistribution or hiring additional staff to relieve overwhelmed employees, adjusting schedules, setting office “quiet hours,” one-on-ones, or a presentation by a mental health professional regarding coping strategies for certain types of stress. The focus here should be to collaborate with the employees and generate solutions that will work for both the business and its employees. As an added bonus, this approach can double as the required interactive process required by the ADA. There are many ways employers can assist their employees with their mental health. At Luchansky Law, we routinely assist employers with strategies and policies that address mental health. If you or your business would like to discuss additional strategies to assist your employees or would like a review of your existing policies, please contact us at (410) 522-1020 to schedule a consultation.
