July 31, 2024

Second Decision on FTC’s Noncompete Ban Is In

Annie Stuller

On July 23, 2024, a federal judge from the Eastern District of Pennsylvania declined to issue a preliminary injunction that would block the Federal Trade Commission’s (“FTC”) rule banning most noncompete agreements, current and future, that is set to take effect on September 4 (“Rule”).

In reaching this decision, the judge concluded that the plaintiff failed to demonstrate a substantial likelihood of success on the merits. First, the judge rejected the plaintiff’s argument that Section 6(g) of the Federal Trade Commission Act (“FTC Act” or “Act”) only authorizes procedural rulemaking, explaining it “is inherently inconsistent and therefore untenable” to read the word “procedural” but not “substantive” into the FTC Act when neither word appears within the Act. She explained, “it [is] clear that the FTC is empowered to make both procedural and substantive rules as is necessary to prevent unfair methods of competition.” Second, unpersuaded by the plaintiff’s supporting reasons, the judge rejected the plaintiff’s alternative argument that—even if the FTC Act empowers the FTC with authority to make substantive rules—the FTC exceeded its authority by banning all noncompete agreements. Read more >>

July 10, 2024

FTC’s Noncompete Ban On Hold…For Parties Involved in Lawsuit

Mark Wiletsky

By Mark Wiletsky and Annie Stuller

On July 3, 2024, a federal judge from the Northern District of Texas barred the Federal Trade Commission (“FTC”) from enforcing its Rule banning noncompete agreements and paused the Rule’s effective date of September 4, 2024. However, the judge limited the scope of her preliminary order to the plaintiff (Ryan LLC) and plaintiff-intervenors (the U.S. Chamber of Commerce and other business associations), declining to pause the Rule nationwide. As a result, for all other employers, this Rule is still set to take effect on September 4, absent further action by this court or another court in which a challenge to the Rule is pending.

Annie Stuller

The challenged Rule broadly bars employers from entering noncompete agreements with employees, invalidates existing agreements except for highly compensated individuals in a policymaking position, and requires employers to provide notice to current and former employees bound by existing agreements that the agreement will not be enforceable once the Rule takes effect.

In siding with the plaintiff and plaintiff-intervenors, the judge reasoned that the FTC lacked statutory authority under Section 6(g) of the Federal Trade Commission Act (“FTC Act”) because it is a “housekeeping statute” that only authorizes procedural—not substantive—rulemaking. She reached this conclusion by looking to “the text, structure, and history of the FTC Act.” The judge further concluded that the Rule violates the Administrative Procedure Act’s prohibition against arbitrary and capricious rules “because it is unreasonably overbroad without a reasonable explanation.” Employers should keep in mind that these conclusions were based on a “substantial likelihood” of success on the merits, signaling the judge will likely (but not certainly) rule in favor of the plaintiff and plaintiff-intervenors. Read more >>

July 1, 2024

Nevada’s New Minimum Wage Starts Today

by JT Washington

Nevada employers may be happy to learn that as a result of a November 8, 2022, ballot measure passing, Nevada’s two-tier minimum wage will be no more. The two-tier minimum wage system reduced the required minimum wage if an employer offered qualifying health benefits. This change means that all employees will be entitled to the same minimum hourly wage regardless of whether they receive qualifying health benefits. Starting July 1, 2024, the minimum wage will increase to $12 per hour for all Nevada workers who are not exempt from minimum wage requirements, regardless of whether the employer offered qualifying health benefits. See 2024 Minimum Wage Bulletin. Read more >>

June 28, 2024

IRS Issues Final Prevailing Wage and Apprenticeship Regulations

By Adam Cohen, Colin J.A. Oldberg, and Melissa Braun

On June 25, 2024, the Internal Revenue Service and U.S. Department of Treasury published final Treasury Regulations (“Final Regulations”) in the Federal Register on the prevailing wage and registered apprenticeship requirements (“PW&A Requirements”) under Sections 30C, 45, 45L, 45Q, 45U, 45V, 45Y, 45Z, 48C, and 179D of the Internal Revenue Code of 1986 (the “Code”). The PW&A Requirements provide rules for taxpayers intending to claim increased amounts of Federal income tax credits or an increased deduction as well as certain recordkeeping and reporting requirements and are comprised of prevailing wage requirements (“Prevailing Wage Requirements”) and apprenticeship requirements (“Apprenticeship Requirements”).

Adam Cohen

Colin J.A. Oldberg

Melissa Braun

June 26, 2024

The Significance of Pay Transparency: A Persistent Legislative Trend and Its Relevance for Employers

By Janae Ruppert

Janae Ruppert

The 2023 and 2024 legislative landscape witnessed a surge in states and cities implementing diverse pay transparency requirements. Despite the progress in recent years in reducing the wage gap, gender pay disparities persist, with current studies indicating that women, particularly women of color, earn only 84 cents for every dollar earned by men. Pay transparency laws aim to rectify these disparities by providing salary and other benefit information to applicants during the hiring process. This additional information is intended to equip applicants with the tools to negotiate compensation, which theoretically may reduce the gender wage gap. In response to this trend and the intent to further address the gender wage gap, several states have introduced varying levels of pay transparency regulations. Read more >>

June 24, 2024

Restrictions On Intermittent FMLA Leave

By Janae Ruppert

Question: If an employee takes FMLA leave to bond with his new child, would he be able to take additional bonding time later the same year if he still had FMLA time available?

Janae Ruppert

Answer: The Family Medical and Leave Act (FMLA) has some restrictions on when an employee can take leave for birth or bonding with a new child. First, leave to bond with a newborn child or for a newly placed adopted or foster child must conclude within 12 months after the birth or placement. Generally, both mothers and fathers have the same right to take FMLA leave to bond with a newborn child. However, intermittent FMLA leave to bond with the child throughout the 12-month period is subject to employer approval. “Intermittent leave” is leave taken in separate blocks of time due to a single qualifying reason. Read more >>

June 18, 2024

A Tale Of Two Rulings: This Week’s Conflicting Decisions On The Pregnant Worker’s Fairness Act

by Kody Condos and Leslie Perkins

Today, June 18, 2024, marks the effective date of the Pregnant Worker’s Fairness Act (“PWFA”) Final Rule, which is now effective in 48 states. The path to implementing the PWFA has been fraught with lawsuits, culminating in this week’s starkly opposing court decisions.

Leslie Perkins

Kody Condos

First, U.S. District Judge D. P. Marshall Jr. (Arkansas) dismissed a motion for preliminary injunction filed in April by attorneys general from 18 states against the Equal Employment Opportunity Commission challenging the provisions of the PWFA related to employers being required to provide reasonable accommodations for employees seeking elective abortions. Judge Marshall held the attorneys general lacked standing to sue and that the states could not show a likelihood of irreparable harm, an element required for a preliminary injunction to be successful. Because of the lack of standing and failure to meet a required element of a preliminary injunction, the Court denied the preliminary injunction as moot and ordered dismissal of the Complaint without prejudice. Read more >>

June 18, 2024

Looming Deadline For California Employers To Implement A Workplace Violence Prevention Program

By Robert Ayers and Erik Adams

Starting July 1, 2024, California will begin requiring employers to implement a workplace violence prevention program.

What are the New Requirements?

Erik Adams

Robert Ayers

California already requires nearly all employers to implement an Injury & Illness Prevention Plan (“IIPP”) that promotes “safe and healthy work practices.” The new mandate compels California businesses to also create a “workplace violence program” addressing “any act of violence or threat of violence that occurs in a place of employment… that results in, or has a high likelihood of resulting in, injury, psychological trauma or stress.” Employers must adhere to certain recording, recordkeeping, and training requirements related to their workplace violence prevention plan. The plan need not address remote workers, as long as they are “working from a location of the employee’s choice” that “is not under the control of the employer.” Read more >>

June 13, 2024

What Employers Should Know About The Pregnant Workers Fairness Act

by JT Washington

JT Washington

The U.S. Equal Employment Opportunity Commission (the “EEOC”) issued a final regulation to implement the Pregnant Workers Fairness Act (“PWFA”). The regulation goes into effect on June 18, 2024. The PWFA initially went into effect on June 27, 2023. A primary objective of the law is to allow pregnant employees to continue working as long as they are capable, benefitting both the employees and their employers. The PWFA requires covered employers to make affirmative efforts to provide “reasonable accommodations to the known limitations related to pregnancy, childbirth, or related medical conditions of a qualified employee” unless the accommodation would impose an undue hardship. “Covered employers” include private and public sector employers with at least 15 employees, Congress, Federal agencies, employment agencies, and labor organizations. The PWFA also prohibits employers from:

Requiring an employee to accept an accommodation without a discussion between the employee and the employer about the accommodation;
Denying employment opportunities to a qualified employee or applicant based on the person’s need for a reasonable accommodation;
Requiring an employee to take leave, paid or unpaid, if another reasonable accommodation can be provided to the employee;
Taking adverse action in terms, conditions, or privileges of employment against an employee because the employee requested or used a reasonable accommodation;
Retaliating against an employee who opposed any unlawful act or practice under the PWFA or because an employee made a charge, testified, assisted, or participated in an investigation, proceeding, or hearing under the PWFA; or
Coercing, intimidating, threatening, or interfering with any individual’s rights under the PWFA.

June 4, 2024

The Pregnant Workers Fairness Act aka the EEOC’s New Baby

Kody Condos

by Kody Condos and JT Washington

The Pregnant Workers Fairness Act (PWFA), the newest member of the family of federal anti-discrimination laws, is almost one year old! Instead of inviting employers over for cake and photo ops, after one year of accepting charges of discrimination under the law, the U.S. Equal Employment Opportunity Commission’s (EEOC) has gifted employers with its interpretive guidelines instead. If you do not know them already, keep reading. The PWFA differs from other anti-discrimination laws in some very important ways that employers will want, and need to understand.

JT Washington

The PWFA went into effect on June 27, 2023. The EEOC’s regulations governing the PWFA go into effect on June 18, 2024. Like the Americans with Disability Act (ADA), the PWFA requires covered employers to provide qualifying employees and applicants accommodations to perform their work duties safely and without discrimination or retaliation.

This post covers key provisions of the PWFA and the EEOC’s regulations governing the law. Read more >>