Most of our readers are aware of the fact that the COVID era policy which allowed employers to remotely examine documentation provided by employees for completing the form I-9 ended as of July 31, 2023. All employers will now have until August 30, 2023 to physically examine the I-9 documentation presented by the employees who were previously allowed to present their documentation remotely. Like everything else the government does, DHS and USCIS wanted to make the I-9 process fun for all. As a result, USCIS has issued a new I-9 form and DHS has established an alternative for review of I-9 documents in person.

The new I-9 form is considerably shorter than the old form. It is one page long and the instructions are eight pages instead of fifteen pages. Employers were allowed to start using the new form as of August 1, 2023. You may continue to use the current I-9 form dated 10/21/2019. Beginning November 1, 2023, however, all employers must use the new I-9 form. A copy of the new I-9 form may be found using this link: Form I‑9, Employment Eligibility Verification (PDF, 483.6 KB)

It is important to note that the alternative procedure for verifying I-9 supporting documents is only available to those employers who are E-Verify users in good standing. If a qualified employer chooses to use the alternative procedure, the employer must do so consistently for all employees at that site. An employer may also choose to use the alternative procedure only for those individuals working remotely, while still requiring in person review for all employees who work on site. Employers use the information provided on the I-9 form to enter information into E-Verify. E-Verify then confirms that the documents presented by the potential employee are consistent with the records held by DHS and the Social Security Administration.

Qualified employers who choose to use the alternative procedure must retain a clear and legible copy of all documents presented by the employee seeking to establish his/her identity and employment eligibility for the form I-9. These documents will allow DHS to assess the documents that were presented to, and remotely examined by, the employer in the event of an audit. This will also help DHS to determine whether the documents examined by the employer reasonably appear on their face to be genuine and to relate to the employee.

Should you have further questions about completing the new I-9 form, in person inspection of I-9 supporting documents, or use of the alternative review procedure for I-9 documentation, please contact one of our experienced employment lawyers.

McNees’ Benefits Group will be issuing a “Did you know?” series throughout the year providing short compliance reminders.

Did you know that beginning in January 2024, participants may only make Roth catch-up contributions to their 401(k) (and may not make pre-tax catch-up contributions) if they earned more than $145,000 (as adjusted by the Secretary of the Treasury) in the previous year? If the participant made less than $145,000 in the previous year, the participant may continue to make pre-tax catch-up contributions.

For more information regarding compliance for your benefit plans, contact any member of the McNees Labor and Employment Group.

Effective July 1, 2023, Maryland became the 21st state to legalize recreational cannabis.  Individuals 21 and over may now purchase, possess, and use cannabis products without fear of criminal repercussions in the state.  Cultivation of no more than two plants is also permitted.  Because Maryland has a developed dispensary system for medical cannabis, progressing from the legalization of recreational cannabis (last fall) to implementation (on July 1) was relatively straight forward.  Several dispensaries in Maryland have been granted dual use licenses, and on July 1 were allowed to sell cannabis products to anyone over the age of 21 – medical certification is no longer needed.

What does this mean for employers in Maryland and its surrounding states?

Neither the initial ballot measure approving the use of recreational cannabis, nor the subsequent laws passed to implement such approval, specifically address use by employees or the impact of such use on the workplace.  Nonetheless, we can glean some information from what is and what is not included in the new law.

First, the law provides that cannabis may not be consumed in a vehicle.  Thus, it follows that employers can implement policies that prevent the use or possession of cannabis in company vehicles, vehicles used for work purposes, or in private vehicles on the employer’s property.

Second, the law requires that businesses subject to Maryland’s Clean Air Act take steps to add cannabis and hemp products to the list of substances that may not be smoked or vaped indoors.  Accordingly, employers can and must implement policies prohibiting the smoking and vaping of cannabis and hemp products in the workplace.  Likewise, individuals have no affirmative right to use cannabis at work and employers can enact – and should enact – general policies prohibiting all use at work and during work hours.  Drug and alcohol policies should specify that employees may not be under the influence of or impaired by cannabis while working.

Third, there are no provisions in the new law, or any other law in Maryland, restricting an employer’s ability to test for cannabis/THC.  Unlike New York and New Jersey, for example, employers in Maryland may include marijuana/THC on their testing panels, including for pre-employment or random tests.

Finally, there are no employment protections for off duty use by employees.  Accordingly, employers – for now – may continue to administer and follow drug and alcohol policies that strictly prohibit use of recreational cannabis by employees.  If an employee tests positive, does not have a medical certification for use of cannabis, and the employer has a policy providing for discipline or termination in the event of a positive test, the employer may follow its policy – at least for now.  Notably, several states are starting to include or enact protections for off duty use, requiring that employers show impairment before issuing discipline.  Maryland has not yet done so, but employers should keep an eye out for further developments in this space.

For employers in neighboring states, such as Pennsylvania, there is nothing in the law that would require those employers to make an exception to their policies for legal recreational use in another state.  Recreational cannabis remains illegal in Pennsylvania and Pennsylvania employers may continue to adopt and enforce zero tolerance drug policies for recreational cannabis use.

Of course, just because an employer is allowed to test for cannabis under all circumstances or terminate an employee for legal off duty use, does not mean the employer has to do these things.  Employers who are not subject to federal regulation may decide to relax their drug policies for cannabis use and focus only on reasonable suspicion testing and termination for impairment at work.  Why?  Work force issues and employee retention are big reasons.  Employers should, if they haven’t already, assess their organizational temperament for off duty recreational use and how the legalization of cannabis might impact their hiring and retention programs.  Additionally, employers should ensure they have a detailed reasonable suspicion policy and that supervisors and managers are trained regarding impairment detection, documentation, and the procedures for reasonable suspicion testing.

As always, if you have any questions about cannabis legalization in Maryland, your company’s drug testing policy, or workplace health and safety generally, you should reach out to Denise Elliott or another member of the McNees Labor and Employment team.

In a unanimous decision, the U.S. Supreme Court recently clarified the circumstances under which an employer may deny a request for a religious accommodation under Title VII.  Specifically, in Groff v. DeJoy, the Court held that in order to justify denying a request, an employer must now demonstrate that granting a religious accommodation would result in “substantial increased costs in relation to the conduct of its particular business.”  Prior to the Groff decision, employers could deny a religious accommodation request when it would simply result in “more than a de minimis cost” to an employer, a standard set forth in 1977 by the Supreme Court in Trans World Airlines v. Hardison.

In Groff, the petitioner, Mr. Groff, was a Postal Service employee whose religious beliefs prevented him from working on Sundays.  The Postal Service initially accommodated Groff by re-distributing his Sunday shifts to other employees, but eventually began to progressively discipline Groff for failing to work on Sundays.  Groff ultimately resigned and sued the Postal Service under Title VII, alleging that they could have accommodated his religious beliefs without an undue hardship.  Both the district court and the Third Circuit Court of Appeals applied the previously-applicable “de minimis cost” standard, and found in favor of the Postal Service.

In reversing, the Supreme Court did not go so far as to overturn the Hardison decision, which has been in effect for almost 50 years.  Instead, the Court found that the lower courts misinterpreted the Hardison decision by focusing on the “de minimis cost” language when, in actuality, the Hardison court repeatedly referred to “substantial burdens,” “substantial additional costs,” and “substantial expenditures” when describing what “undue hardship” means for an employer.  Based on a more detailed analysis of the Hardison case and the “ordinary meaning” of the term “undue hardship,” the Court clarified that under Title VII, when denying an accommodation request, an employer must demonstrate that the burden of granting an accommodation would result in “substantial increased costs in relation to the conduct of its particular business.”  After clarifying the standard, the Court remanded the case back to the lower courts for further review.

In light of the Groff decision, and while awaiting further guidance from the courts on the revised standard, employers should update their current process as it relates to evaluating religious accommodation requests and ensure that when denying an accommodation request, the revised “substantial cost” standard can be met.

If you have any questions about the Groff decision and how it impacts a company’s review of religious accommodation requests, or if you need assistance with updating your policies and procedures, please contact a member of the McNees Labor & Employment Group.

McNees’ Benefits Group will be issuing a “Did you know?” series throughout the year providing short compliance reminders.

Did you know that if you maintain a cafeteria plan, you have to complete annual non-discrimination testing?

For more information regarding compliance for your benefit plans, contact any member of the McNees Labor and Employment Group.

In a 6-3 ruling, the U.S. Supreme Court in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College all but banned the use of race as a factor in college admissions.  The majority opinion turned on the idea that race-based admissions violated the Equal Protection Clause of the U.S. Constitution. Twenty years ago, the court upheld the use of race as a factor in college admissions in Grutter v. Bollinger, 539 U.S. 203 (2003). Today’s decision makes it clear that race may not play a role in admissions, whether directly or indirectly. In making this clear statement, the court signaled its intent to thwart expected efforts by universities to skirt the decision by using race proxies in admissions. Specifically, applicants will no longer be able to check a “race” box in the admissions process. They will, however, be able to discuss race in admissions essays.

Many critics and news agencies are touting this decision as signifying the beginning of the end for Affirmative Action, and many companies may be wondering what the decision means for their Affirmative Action policies. The fact of the matter is that this decision is not a decision on Affirmative Action and it will have no effect on government contractors’ AA obligations. The schools at issue, Harvard and UNC, used race as a direct factor in selecting for admissions and as the court duly noted, “Both programs lack sufficiently focused and measured objectives….”  Affirmative Action planning, as required of federal contractors, focuses on providing a pool of applicants for the hiring manager that mirrors the population in specific job groups in the recruiting area.  It forbids the use of quotas or requirements to hire due to race.

The Office of Federal Contract Compliance Programs defines an affirmative action plan as an “obligation on the part of the contractor to take action to ensure applicants are employed, and employees are treated during employment, without regard to their race, color, religion, sex, sexual orientation, gender identity, national origin, disability or status as a protected veteran.”  While colleges and universities are no doubt struggling with how to modify their admissions policies, rest assured that private sector Affirmative Action obligations are untouched by today’s decision.

On June 1, 2023, the United States Supreme Court held that a company could sue a union over intentional damage caused during a labor dispute. In Glacier Northwest v. International Brotherhood of Teamsters Loc. Union No. 174, a concrete company, Glacier Northwest, alleged that the Union intentionally destroyed company property during a strike. Specifically, Glacier claimed that the Union called for a work stoppage while concrete was being mixed, resulting in the hardening of the concrete, which not only ruined the concrete batch but also damaged company trucks. Seeking to hold the Union responsible, Glacier sued the Union in state court. The Union argued that because this was a labor dispute matter, the National Labor Relations Act (NLRA) preempted any state court claims.

The Washington state court agreed with the Union, and that decision was upheld by the Washington Supreme Court, which reasoned that “the NLRA preempts [the company’s] tort claims related to the loss of its concrete product because that loss was incidental to a strike arguably protected by federal law [the NLRA].” Following the Washington Supreme Court’s decision, the United States Supreme Court decided to hear the case. In an 8-1 decision, the Supreme Court sided with Glacier, holding that because the Union “took affirmative steps to endanger Glacier’s property … the NLRA does not arguably protect its conduct.” The Supreme Court recognized that the NLRA protects the right to strike; however, it also noted that the National Labor Relations Board “has long taken the position – which the parties accept – that the NLRA does not shield those who fail to take ‘reasonable precautions’ to protect their employer’s property from foreseeable, aggravated, and imminent danger due to the sudden cessation of work.”

In light of this limitation on the right to strike, the Supreme Court held that the Union did not meet its burden in asserting that the NLRA preempted the matter. Writing for the majority, Justice Amy Coney Barrett noted that, based on the allegations, “the Union executed the strike in a manner designed to compromise the safety of Glacier’s trucks and destroy its concrete. Such conduct is not ‘arguably protected’ by the NLRA; on the contrary, it goes well beyond the NLRA’s protections.” Accordingly, the Supreme Court reversed the judgment of the Washington Supreme Court and remanded the case for further proceedings.

Justice Jackson authored the lone dissenting opinion in the case. In her dissent, Justice Jackson cautioned that the majority’s decision would confuse lower courts as to how preemption applies and that this decision “risks erosion of the right to strike.” Justice Jackson also noted that the Supreme Court should have suspended its adjudication on this case because a complaint against the company is pending before the NLRB.

The upshot of the Supreme Court’s decision is that unions may be exposed to lawsuits based on work stoppages that damage company property. Although unions were previously capable of being sued in state court for violent or threatening conduct, the Supreme Court’s decision here goes a step further in finding that a union can be sued in state court if it is alleged that the Union enacted a work stoppage in an attempt to damage company property intentionally. Moving forward, employers should be aware of their right to sue a union when a work stoppage intentionally damages company property.

If you have any questions about the Glacier decision or how it impacts a company’s right to sue, please contact a member of the McNees Labor & Employment Group.

It’s no secret that non-compete agreements have recently come under greater scrutiny by the federal government.  In July 2021, President Joe Biden signed an Executive Order on “Promoting Competition in the American Economy” that, among other things, directed the Federal Trade Commission (“FTC”) to consider curtailing the use of non-compete agreements.  Then, in January of this year, the FTC responded to the Executive Order by proposing a broad and sweeping rule that would prohibit employers across the country from entering into non-compete agreements with their workforce.  Now, Jennifer Abruzzo, the General Counsel of the National Labor Relations Board, has joined this growing chorus, stating that non-compete agreements violate the National Labor Relations Act (“NLRA” or “Act”), except in limited circumstances.

On May 30, 2023, the General Counsel issued GC Memorandum 23-08 in which she argued that non-compete agreements are overbroad, and may violate the NLRA, “when the provisions could reasonably be construed by employees to deny them the ability to quit or change jobs by cutting off their access to other employment opportunities that they are qualified for based on their experience, aptitudes, and preferences as to type and location of work.”  She reasoned that this denial of access to employment opportunities purportedly chills protected activity under Section 7 because: (1) employees know they will have greater difficulty finding another job if they are discharged for exercising their rights to organize and act together to improve working conditions; (2) their bargaining power during strikes, lockouts, and other labor disputes is undermined; and (3) as former employees of an employer, they are unlikely to “reunite” at a local competitor and encourage each other to exercise statutory rights to improve working conditions at their new employer.

Moreover, the General Counsel argued that non-compete agreements chill employees from engaging in five specific types of protected activity:

  • They chill employees from concertedly threatening to resign to demand better working conditions.
  • They chill employees from carrying out concerted threats to resign or otherwise concertedly resigning to secure improved working conditions.
  • They chill employees from concertedly seeking or accepting employment with a local competitor to obtain better working conditions.
  • They chill employees from soliciting their co-workers to go work for a local competitor as part of a broader course of protected concerted activity.
  • They chill employees from seeking employment, at least in part, to specifically engage in protected activity (e.g., union organizing) with other workers at an employer’s workplace.

In the General Counsel’s view, the “proffer, maintenance, and enforcement” of non-compete agreements that would reasonably tend to chill employees from engaging in these activities would violate the Act unless they are “narrowly tailored to special circumstances justifying the infringement on employee rights.”  The General Counsel did not explain what she believes might constitute “special circumstances,” although she provided examples of what likely would not: avoiding competition from former employees, retaining employees, and protecting special investments in employee training.  Those activities, according to the General Counsel, would not justify the use of a non-compete agreement.

The General Counsel also acknowledged that employers have a legitimate business interest in protecting proprietary or trade secret information, but noted that such interests can be protected by narrowly tailored “workplace agreements.”  She also allowed that some non-compete agreements might not violate the Act if they don’t restrict employment relationships, such as if they restrict ownership interests in a competing business or independent contractor relationships, or under “special circumstances” (again, undefined) that justify a narrowly-tailored non-compete.

Importantly, the General Counsel’s memorandum is not binding, and thus does not change existing law or render all non-compete agreements unlawful.  Furthermore, while the NLRA protects “employees” (union and non-union), it does not protect “supervisors” who are excluded from Section 7’s protections.  As such, non-compete agreements with supervisors or managers should not be affected by her memorandum.  That said, the General Counsel is looking for a case to bring to the Board, and in that regard, directed the Regional Offices to submit to the Division of Advice cases involving non-compete agreements that are “arguably unlawful” under her analysis.

Whether the General Counsel’s position ultimately carries the day remains to be seen.  Although the current employee-friendly Board may be sympathetic to her position, the federal courts of appeals – which review Board decisions – may not.  We anticipate that there will be legal challenges by employers to an adverse Board decision.  Moreover, her memo sets up a clash with states, which have traditionally regulated non-compete agreements.  For example, under Pennsylvania law, employers have legitimate business interests in their investments in specialized employee training and trade secrets or confidential information that may be protected by non-compete agreements.  See, e.g., WellSpan Health v. Bayliss, 869 A.2d 990, 996 (Pa. Super. Ct. 2005).

We will be monitoring the NLRB and will provide updates on any action by the Board with respect to non-compete agreements.  If you have any questions about the General Counsel’s memorandum or other issues involving non-compete agreements, please contact any member of our Labor and Employment Practice Group.

McNees’ Benefits Group will be issuing a “Did you know?” series throughout the year providing short compliance reminders.

Did you know that qualified retirement plans may now allow a participant with a terminal illness to receive distributions from their retirement accounts without incurring the usual 10% penalty? The employer will need to amend the retirement plan to allow for such distributions.

For more information regarding compliance for your benefit plans, contact any member of the McNees Labor and Employment Group.

Now more than ever, it seems that employees are willing to express themselves.  While open communication with and among employees is usually a good thing, sometimes an employer’s rules are broken in the process.  A worker might call her supervisor a nasty name while complaining about her production team’s overtime assignments.  An employee could use profanity to describe working conditions in a social media post in which he also asks his co-workers to join a labor union. A striking employee may threaten a company executive while picketing.

In such cases, an employer is likely to consider disciplining employees for breaking its rules while otherwise engaged in activity protected by the National Labor Relations Act. Nearly three years ago, the NLRB announced that it would apply the same test when determining whether disciplinary action is lawful, regardless of the context in which the employee’s misconduct occurred.  In General Motors, LLC, the Board held that in order to prove that disciplinary action violates the Act, an employee was required to show that:

  1. the employee engaged in Section 7 protected activity;
  2. the employer knew of that activity; AND
  3. there is a causal connection between the discipline and the Section 7 activity.

If an employee met this initial burden, an employer could still avoid liability by proving that it would have taken the same action in the absence of protected activity.  Our discussion of General Motors, LLC can be found here.  Many employers welcomed this universal test, as it standardized the law regardless of the context in which the employee’s misconduct happened.  But, alas, the General Motors standard is no more.

On May 1, the Board issued its ruling in Lion Elastomers LLC II. There it overruled General Motors in favor of applying setting-specific tests to evaluate the propriety of employee discipline.  Now, the setting of an employee’s misconduct once again determines the standard by which disciplinary action will be judged.  The setting-specific tests are as follows:

First, when discipline arises out of an employee’s conduct toward management in the workplace, the Board will apply the test originally established in Atlantic Steel.  That test considers the following four factors:

  1. the place of the interaction between employee and management;
  2. the subject matter of the discussion;
  3. the nature of the employee’s outburst; AND
  4. whether the outburst was, in any way, provoked by an employer’s unfair labor practice.

Next, when discipline arises out of an employee’s misconduct on social media or while interacting with a co-worker in the workplace, the Board will apply its “totality of the circumstances” test without regard to any particular factor.  This test was originally enunciated in Pier Sixty, LLC.

Finally, when discipline arises out of an employee’s misconduct on the picket line, the Board will again consider the Clear Pine Mouldings standard.  Under that test, the Board examines the totality of the circumstances to assess whether non-striking employees reasonably would have been coerced or intimidated by the misconduct.  If so, discipline is proper.

As the current NLRB continues to unwind many of the employer-friendly rules established by the previous Board, employers must now remember that context matters when disciplining employees for conduct that occurs during otherwise protected activity.  One size no longer fits all.