Five Key Federal Employment Law Developments from 2017

While Many Federal Employment Law Developments From Last Year Decreased the Compliance Burdens on New York and New Jersey Employers, They Have Also Resulted in Some Regulatory Uncertainty

The regulatory landscape has changed dramatically under President Donald Trump. For employers, 2017 was a year of big changes. While many federal employment law developments decreased the compliance burdens on New York and New Jersey employers, they have also resulted in some regulatory uncertainty.

Below is a brief summary of the key labor law decisions, policy changes and regulations of the past year:

(1) Expanded Reporting Requirements of EEO-1 Form: In September, the Office of Management and Budget (OMB) issued a memorandum indefinitely staying the expanded reporting requirements of the new EEO-1 form. Given the burdens associated with enhanced data collection, the announcement is great news for employers. Despite the stay, gender pay equity will remain a priority for the EEOC heading into 2018. The decision to stay the EEO-1 reporting requirements will also likely have no impact on state-level efforts to address the use of salary history and increase pay transparency.

(2) Increased ICE Workplace Investigations: The Trump Administration has made illegal immigration a top priority. In November, the U.S. Immigration and Customs Enforcement (ICE) announced plans to increase worksite inspections by “four to five” times the current levels. Given that minor Form I-9 violations can lead to costly fines, all employers would be well advised to have their documents in order should ICE come knocking.

(3) Transgender Discrimination under Title VII: The Department of Justice (DOJ) announced a new policy regarding gender identity discrimination in 2017. According to Attorney General Jeff Sessions, “Title VII prohibition on sex discrimination encompasses discrimination between men and women but does not encompass discrimination based on gender identity per se, including transgender status.” Notably, the DOJ’s position contradicts the position adopted by the Equal Employment Opportunity Commission (EEOC) and is at odds with several federal court decisions.

(4) Joint Employment: The Department of Labor (DOL) rescinded its 2016 guidance for determining when companies are “joint employers.” Under the Obama Administration, the DOL had advised that joint employment should be construed broadly for the purposes of the Fair Labor Standards Act and Seasonal Agricultural Worker Protection Act. While the DOL’s decision to the rescind the guidance does not erase the risk for liability, it does suggest that the agency will likely devote the majority of its attention to the most flagrant violations.

(5) Worker Misclassification: The DOL also rescinded prior guidance on the misclassification of employees as independent contractors. In July 2015, the DOL published guidance that broadly concluded that “most workers are employees under the FLSA’s broad definitions.” While the DOL’s policy shift is good news, employers should expect that state regulators and private litigants will continue to bring actions in this area.

What Can Employers Expect in 2018?

Additional changes in federal employment law are likely on the horizon. After the Obama Administration’s overtime rule was struck down, the DOL has announced that it plans to craft new overtime standards. The agency has also proposed rules to roll back the existing prohibition against tip pooling.

To stay on top of the latest developments, we encourage New York and New Jersey employers to regularly visit our website and contact one of our experienced employment attorneys with any questions about how new and proposed changes could impact your operations.

Do you have any questions? Would you like to discuss the matter further? If so, please contact me, Sean Dias, at 201-806-3364.