EEOC Releases Guidance in Workplace - Employer Liability for Harassment

The Equal Employment Opportunity Commission (EEOC) has released official Enforcement Guidance on Harassment in the Workplace, which is effective immediately. 

The Guidance, EEOC-CVG-2024-1, is designed to "serve[] as a resource for employers, employees, and practitioners; for EEOC staff and the staff of other agencies that investigate, adjudicate, or litigate harassment claims or conduct outreach on the topic of workplace harassment; and for courts deciding harassment issues."

This resource includes an explanation of the definition of each covered protected characteristic, including race, color, national origin, religion, sex, age, disability, genetic information, and retaliation. More so, for each protected characteristics are numerous examples of what type of harassment is actionable. 

In evaluating the examples, the Guidance provides:

These are key questions that typically arise in evaluating a hostile work environment claim and whether it amounts to unlawful harassment:

• Was the conduct both objectively and subjectively hostile?
  • Objective hostility: was the conduct sufficiently severe or pervasive to create a hostile work environment from the perspective of a reasonable person?
  • Subjective hostility: did the complainant actually find the conduct hostile?
• What conduct is part of the hostile work environment claim?
• Can conduct that occurred outside the workplace be considered?
• Can conduct that was not specifically directed at the complainant be considered?

As a reminder, the Guidance provides, at Example 39, that a hostile environment needn't cause a resulting decline in work ability or psychological injury to be actionable. Specifically, it states: "Based on these facts, Irina was subjected to a hostile work environment. Although the harassing conduct did not result in a decline in her work performance or in psychological injury, the nature of the conduct and Irina’s reactions to it were sufficient to establish that the ongoing sexual conduct created a hostile work environment because the conduct made it more difficult for a reasonable person in Irina’s situation to do her job."

That said, the Guidance goes into declining work ability and injuries across the board. It discusses employer liability for acts of alter-egos, supervisors, and co-workers. It explains systemic harassment and how a pattern or practice of harassment needs to be addressed by an employer. 

Overall, this is the go to resource of Title VII discrimination and best practices in the workplace moving forward. 

New Overtime Time and a Half Final Rule under the Fair Labor Standards Act

Ready for a big jump in being entitled to overtime pay, which is 1.5 times pay?

The Department of Labor has set new effective earnings thresholds to be entitled to overtime pay per 29 CFR 541.  

Starting on January 1, 2025, we are moving the Fair Labor Standards Act (FLSA) from an entitlement to overtime pay for those making under $35,586 to those making under $58,656 per year ($1,128 per week). Note that this threshold does not apply to employees who are "bona fide executive, administrative, or professional capacity . . . or in the capacity of [an] outside salesman," which terms are defined at 29 CFR 541.

These numbers are particularly important because a worker who is not paid properly can recover 2X back wages (liquidated damages) on unpaid overtime from the prior 2 years. 

New Sex Discrimination Federal Regulation Effective August 1, 2024

Title IX's anti-discrimination obligations on elementary schools, secondary schools, postsecondary institutions, and other recipients of federal financial assistance have been updated and become effective August 1, 2024, by regulation 89 FR 33474 (34 CFR 106)

Title IX states that “No person in the United States shall, on the basis of sex, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving Federal financial assistance,” absent certain exceptions. 20 U.S.C. 1681.

Consistent with Title VII's SCOTUS decision in Bostock v. Clayton County, the regulations define sex broadly to "include[] discrimination on the basis of sex stereotypes, sex characteristics, pregnancy or related conditions, sexual orientation, and gender identity" in § 106.10.

The regulations have been updated for the following purposes:

• "to provide greater clarity regarding: 
• the definition of “sex-based harassment”; 
• the scope of sex discrimination, including recipients' obligations not to discriminate based on sex stereotypes, sex characteristics, pregnancy or related conditions, sexual orientation, and gender identity; and 
• recipients' obligations to provide an educational environment free from discrimination on the basis of sex."
• to ensure that "recipients' procedures for investigating and resolving complaints of sex discrimination are fair to all involved." 

In fact, the regulations require grievance procedures under § 106.45.

These regulations are the floor under which states and locales cannot go, but don't forget that local laws like New York State's Human Rights Law provide for emotional distress damages whereas Title IX does not. 

FTC Issues New Rule Banning Non-Compete Clauses - Retroactive Effect Raises Due Process Concerns

The Federal Trade Commission (FTC) has just issued a Non-Compete Clause Rule banning all Non-Competes. 

This Final Rule provides that it is an unfair method of competition for persons to, among other things, enter into non-compete clauses. While this Final Rule does not include a salary threshold, it does allow for non-competes when a business is sold, and also allows existing non-competes to be enforced for senior executives.

So, existing non-competes for workers, who are not senior executives, are no longer enforceable (retroactively undoing contracts). Is that a violation of due process / impermissible taking for employers? Are constitutional challenges next?  

Yet, the most interesting paragraph of the Final Rule reads:

Non-solicitation agreements are generally not non-compete clauses under the final rule because, while they restrict who a worker may contact after they leave their job, they do not by their terms or necessarily in their effect prevent a worker from seeking or accepting other work or starting a business. However, non-solicitation agreements can satisfy the definition of non-compete clause in § 910.1 where they function to prevent a worker from seeking or accepting other work or starting a business after their employment ends. Whether a non-solicitation agreement—or a no-hire agreement or a no-business agreement, both of which were referenced by commenters, as discussed previously—meets this threshold is a fact-specific inquiry. The Commission further notes that—like all the restrictive employment agreements described in this Part III.D—non-solicitation agreements, no-hire, and no-business agreements are subject to section 5’s prohibition of unfair methods of competition, irrespective of whether they are covered by the final rule. 

Moving forward, non-competes are mostly gone, but non-solicitation agreements, no-hire, and no-business agreements are clearly also on the chopping block where the utilization of each could easily result in protected litigation as to whether they are covered by the Final Rule or generally by section 5's prohibition of unfair methods of competition.

You can read the FTC's press release here.

You can read the Final Non-Compete Clause Rule here.  

Empowering Pregnant Workers: Inside the Pregnant Workers Fairness Act

The Federal Government recently passed the Pregnant Workers Fairness Act (PWFA), which significantly strengthens protections for pregnant workers and enhances the process for addressing discrimination claims related to pregnancy and related medical conditions in several ways including:

• Clear Prohibitions: The PWFA explicitly prohibits discrimination against pregnant employees, including adverse actions, denial of employment opportunities, and coercion. This clarity empowers pregnant workers to assert their rights without fear of retaliation.
  
• Mandatory Reasonable Accommodations: Covered entities are required to make reasonable accommodations for pregnant employees unless it causes undue hardship. This ensures that pregnant workers can continue working without facing unnecessary barriers due to their pregnancy or related medical conditions.

• Interactive Process Requirement: The Act mandates an interactive process between employers and employees to determine appropriate accommodations. This process promotes transparency and collaboration, ensuring that accommodations are tailored to meet the specific needs of pregnant workers.
  
• Expansive Definitions: The PWFA provides comprehensive definitions of terms such as "known limitation" and "related medical conditions," broadening the scope of protections for pregnant workers. This clarity reduces ambiguity and strengthens the basis for discrimination claims.
  
• Limits on Supporting Documentation: The Act imposes limits on the type of supporting documentation employers can request from pregnant employees seeking accommodations. This prevents employers from creating unnecessary barriers or burdens for pregnant workers seeking to exercise their rights.

Additionally, under the PWFA, delays in providing accommodations may lead to violations and failure-to-accommodate lawsuits. Employers are obliged to provide accommodations unless the pregnancy prevents an essential job function.

Covered Entities cannot force leave if other accommodations are feasible, and it bars adverse action against employees for requesting or using reasonable accommodations. 

Finally, the PWFA outlines remedies and enforcement procedures, including provisions for damages, costs, and attorneys' fees. Notably, it prohibits retaliation or coercion against employees exercising their rights under the PWFA. These regulations enhance protections for discrimination claims related to pregnancy, childbirth, or related medical conditions in the workplace.

The PWFA will go into effect on June 18, 2024. If you'd like to learn more about the PWFA, click here.