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Ninth Circuit Decides Not to Rehear Its Decision Requiring Arbitration of ERISA Claims

As we wrote in a previous On the Subject, the Ninth Circuit Court of Appeals had signaled that it might rehear its August 2019 decisions in Dorman v. The Charles Schwab Corp., in which the Court compelled arbitration of ERISA class-action claims relating to a 401(k) plan. After ordering additional briefing, however, the Ninth Circuit denied the plaintiff’s petition for rehearing, leaving the Court’s decisions unchanged and requiring the plaintiff to arbitrate his ERISA breach-of-fiduciary-duty claims.

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UK Tax Changes Shift Worker Classification Burden to Clients

The UK Government has confirmed that it will extend to the private sector tax rules designed to target tax avoidance by contractors who operate through an intermediary personal service company (PSC).

The UK Government has announced that new “off-payroll working” tax rules (commonly known as IR35) will apply to the private sector from April 2020. The move will shift responsibility for determining the tax status of individuals who personally provide services through an intermediary personal service company from that PSC to the end user client.

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Fla. Class Actions Show Why Correct COBRA Notices Matter

In Florida’s federal courts, there has been an epidemic of class actions alleging that employers failed to provide technically proper notice of the right to continued healthcare coverage under the Consolidated Omnibus Budget Reconciliation Act. A dozen such lawsuits have been filed (each by the same law firm) with mirror image allegations.

These cases illustrate why it is necessary to sweat the details in issuing COBRA notices, which McDermott’s Megan Mardy and Julie McConnell walk through in a recent analysis for Law360.

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Originally published by Law360, October 2019




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Responses to Gender Pay Inequity: A Quick World Tour

Most major jurisdictions have pay equity laws, but their approach is far from uniform. Global companies need to evaluate compliance with these laws on a country-by-country basis whilst simultaneously addressing their compensation policies globally.

A sample of the rules across several countries helps to identify trends that can drive effective global policies.

Australia

The Australian Workplace Gender Equality Act of 2012 mandates equal pay for equivalent or comparable work. There are annual reporting requirements for employers with 100 or more employees. Those reports must include the following indicators: gender composition of the workforce, gender composition of governing bodies, and equal compensation between men and women.

Employers are penalised by being publicly named if they fail to lodge a public report on time, or inform employees or other stakeholders that a public report was lodged, or give the requested compliance data under the Act.

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How Healthcare Employers Can Comply With OSHA’s Rules on Workplace Violence

OSHA’s general duty clause now applies to workplace violence in healthcare Sec. of Labor v. Integra Health Mgmt., Inc., OSHRC Docket No. 13-1124 (March 2019), requiring healthcare employers to maintain workplaces “free from recognized hazards that are causing or likely to cause death or serious physical harm.”

Abigail M. Kagan authored a primer for healthcare employers on the clause. In an article originally published on Bloomberg Law, she discusses:

  • The four criteria OSHA considers in determining whether a general duty violation has occurred
  • Engineering controls and administrative controls healthcare employers should take to protect workplaces
  • A checklist healthcare employers can utilize to begin protecting employees

Reproduced with permission from Copyright 2019 The Bureau of National Affairs, Inc. (800-372-1033) www.bloombergindustry.com.

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The Global Repercussions of Local Employment Risks

While campaigning for President in 1932, Franklin Roosevelt promised a crowd in Pittsburgh that he’d balance the federal budget while cutting “government operations” by 25 per cent. When he returned to Pittsburgh during his 1936 campaign, Roosevelt asked his staff how to answer questions about that unfulfilled promise and was told “deny you were ever in Pittsburgh.”

So much has changed since then: what is said and done is now instantly visible. This lesson came earlier to politicians, it is now unavoidable for business entities. There is no option to deny that you were there.

Let’s look at some consequences of this global visibility:

  • El Super, a small California-based grocery chain with approximately 600 unionized workers, failed to resolve a routine labor dispute at one store with the union representing those employees. As a result of this dispute involving just one store, El Super’s Mexican parent company, Chedraui Commercial Group, found itself subject to double barrel complaints filed by US and Mexican labor unions under the North American Free Trade Agreement labor agreement and Organization for Economic Cooperation and Development guidelines.
  • Vedanta found itself subject to a lawsuit by individuals living more than 5,000 miles away when an appellate court in the United Kingdom held that farmers from a Zambian village could bring a claim against Vedanta and its Zambian subsidiary (Lungowe and Ors. v Vedanta Resources PLC and Konkola Copper Mines PLC [November 2017] EWCA Civ 1528). The court’s decision expanded the potential “duty of care” that parent companies have under UK law to employees of their subsidiaries, to include even non-employees who might be affected by its subsidiaries’ operation.

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Global Employment Contracts: The Modern Tower of Babel

Although multi-jurisdictional compliance is a challenge in relation to every aspect of employment law, the structure of employment contracts and the enforcement of global policies require particularly careful consideration.

The need to coordinate individual country compliance across numerous countries whilst still maintaining a common company culture requires extensive knowledge of national laws and considerable flexibility.

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A New Landscape for Businesses with California Operations, Thanks to A.B. 5

This month, Assembly Bill 5 (A.B. 5) was signed into California law. A.B. 5 codifies the “ABC Test”—used to determine if a worker is an independent contractor—which is broader, harsher and more inclusive than the common law test with which most businesses are familiar.

A.B. 5 appears to be the death knell of convenience for retaining contractors in the Golden State, as well as the advent of a new wave of wage and hour litigation.

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Employment, Benefits and Compensation Forum: Control Your Own Headlines

In today’s high-stakes environment, in-house counsel and HR professionals are often on the frontlines, responding to headlines that threaten business and reputational objectives.

Join McDermott Will & Emery’s Employment and Employee Benefits practice groups at a half-day forum in our Chicago office on Oct. 10. This forward-looking program is designed to drive conversation around emerging trends to help employers craft their own narrative, instead of being held captive by it.

See full event details and register here.




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Transgender Health Benefits: Best Practices and Legal Considerations

A growing number of medical organizations, courts and administrative bodies have stated that transition-related medical care is medically necessary and should be covered by employer-sponsored medical plans. Access to employer-sponsored healthcare coverage for transgender workers has become an issue of focus for civil rights advocacy groups such as Lambda Legal and the American Civil Liberties Union, and there has been an uptick in discrimination lawsuits filed against health plans and insurers denying such care.

These trends highlight the importance of weighing the legal and business considerations that come with providing (or not providing) comprehensive health benefits for transgender workers. Health plan sponsors and insurers should consider how the decision to provide or exclude transition-related medical coverage will affect their legal compliance, overall costs and workplace culture—all of which are discussed in this article.

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Originally published in Benefits Magazine, August 2019.




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