Hunton Employment & Labor Perspectives

On June 14, 2023, Texas Governor Greg Abbott signed HB 2127, the Texas Regulatory Consistency Act (“TRCA”), into law. Once the TRCA goes into effect on September 1, 2023, it will preclude all municipalities and counties in Texas from adopting or enforcing ordinances regulating conduct with respect to certain subject matters, including labor.

On August 25, 2023, in response to concerns regarding the timely implementation of SECURE 2.0’s Roth catch-up contribution requirement, the IRS issued Notice 2023-62, which provides that 401(k), 403(b) and 457(b) plans now have until December 31, 2025 to comply.  

California employers: take notice.  On July 24, 2023, the Office of Administrative Law approved changes to the Fair Employment and Housing Act (FEHA) regulations governing how California employers can use and consider criminal history in employment decisions.  These new changes, modifying Cal. Code Regs. Tit. 2, § 11017.1, go into effect on October 1, 2023.

The Office of Federal Contract Compliance Programs (OFCCP) recently published a final rule titled “Pre-enforcement Notice and Conciliation Procedures.”  This rule rescinds the evidentiary standards from the 2020 rule titled “Nondiscrimination Obligations of Federal Contractors and Subcontractors: Procedures to Resolve Potential Employment Discrimination,” which required specific pre-determination notice requirements and certain evidentiary standards. In a blog post, the OFCCP explains that the “new final rule restores flexibility to OFCCP’s pre-enforcement and conciliation procedures, promotes efficiency in resolving cases, strengthens enforcement and promotes alignment of the standards of Title VII of the Civil Rights Act of 1964.”

Although the Pregnant Workers Fairness Act (“PWFA” or the “Act”) has been in effect since June 27, 2023, the Equal Employment Opportunity Commission (“EEOC” or the “Commission”) last week, published proposed rules regarding the enforcement of the Act. The PWFA has been covered in a previous blog post, but in short, the law requires employers to provide a reasonable accommodation for pregnant employees, regardless of whether that pregnancy has resulted in a disability as was the case under the Americans with Disabilities Act. 

Recently, in Restaurant Law Center, et al. v. U.S. Dep’t of Labor, the U.S. District Court for the Western District of Texas affirmed the validity of a new Department of Labor (DOL) rule, known as the “80-20-30” or “dual jobs” rule, which limits the ability of employers to satisfy a portion of tipped employees’ wages with earned tips.

Federal contractors have had a flurry of headlines to keep up with over the last few months. Most prominent among them is the Federal Acquisition Regulatory Council’s interim rule barring federal agencies and contractors from using TikTok or any other ByteDance product (the “Covered Applications”). 

A National Labor Relations Board Administrative Law Judge dismissed the General Counsel’s allegation that the employer violated the National Labor Relations Act by not giving the union representing its employee notice and opportunity to bargain over the discharge of an employee it represented. Starbucks Corp., 02-CA-303077, et. al. (July 24, 2023). In doing so, the Administrative Law Judge teed up the issue for the Board to change the law on appeal. The law at issue is the Board’s prior precedent under Total Security Management Illinois 1, LLC, 364 NLRB 1532 (2016). The Board in Total Security created a new bargaining obligation which employers did not have prior to the case. Under Total Security, discretionary discipline is considered what is known as a “mandatory” subject of bargaining. Specifically, the Board held that prior to imposing serious discretionary discipline, such as a suspension or discharge, an employer must provide notice and opportunity to bargain with a union representing the employee at issue regarding what, if any, discipline to impose. Id. at 1536.

In Harris et. al. v. Medical Transportation Management, Inc. et. al., the D.C. Circuit Court of Appeals held that a putative class cannot be certified as an “issue” class under Rule 23(c)(4) without also satisfying the requirements in Rule 23(a) and (b).  This ruling is important because it prohibits putative classes from using the “issue” class mechanism of Rule 23(c)(4) to skirt the important procedural requirements in Rule 23(a) and (b) that are meant to protect both the litigants and absent parties.  The court also encouraged the use of the partial summary judgment mechanism, rather than Rule 23(c)(4), to resolve discrete legal issues common to many class members. 

Since the United States Supreme Court issued its decision in Viking River Cruises, Inc. v. Moriana in June 2022, trial courts in California have grappled with how to address the non-individual portion of a plaintiff’s PAGA claim that remains in court when a plaintiff’s individual PAGA claim is compelled to arbitration.[1]  Most trial courts have found it appropriate to stay the non-individual portion of the PAGA claim until the arbitration’s conclusion because that outcome would determine whether the employee retains standing to proceed in court.  On July 17, 2023, in the highly anticipated decision of Adolph v. Uber Technologies, the California Supreme Court addressed several questions in the post-Viking River landscape, including the propriety of staying non-individual PAGA claims pending the completion of arbitration.