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2018 HR INDIANA ANNUAL CONFERENCE
Date of Presentation
Title of Presentation
Name of Presenter
Presenter Contact Info
August 2018
KEYNOTE – 2018 SHRM
Kenneth Yerkes
Barnes & Thornburg LLP
317-231-7513
kyerkes@btlaw.com

Kenneth J. Yerkes
Partner
317-231-7513
317-231-7433 Fax
ken.yerkes@btlaw.com
11 South Meridian Street
Indianapolis, Indiana 46204-3535
For 35 years, Ken Yerkes, chairman of the Labor and Employment
Department, has successfully fought for his clients' business objectives at the
bargaining table; in federal and state court matters; in arbitrations; and on the
ground in facilities throughout the U.S., including California, Florida, Georgia,
Illinois, Indiana, Kentucky, Michigan, Mississippi, Missouri, New Hampshire,
New Jersey, New York, Ohio, Pennsylvania, Tennessee, West Virginia,
Washington, D.C., Wisconsin and Wyoming. Ken's ability to transform complex
matters into workable strategies has earned him his clients' trust and acclaim
as a recognized leader in labor and employment law.
It is no surprise, then, that Ken is a Fellow in both The College of Labor and
Employment Lawyers and the Litigation Counsel of America, and has received
the highest rating in every edition of Chambers USA: America's Leading
Lawyers for Business. In addition, Ken, who has been chair of the Labor and
Employment Department since 2000, is rated AV Preeminent® by Martindale
Hubbell™ and listed as a “Top Rated Lawyer in Labor & Employment.” Ken
has been recognized on multiple occasions as one of Indiana's “Top 50”
lawyers in Indiana Super Lawyers; has been listed in Best Lawyers in America
for 20 years and was named “Lawyer of the Year” by Best Lawyers; and has
been interviewed and quoted in numerous publications, including the Wall
Street Journal; Inside Counsel Magazine; Corporate Counsel Magazine; and
Law360. Ken has also been named a “Distinguished Barrister” by The Indiana
Lawyer.
Because of his desire to always remain a full-service resource for his clients,
Ken has designed his practice to be well-balanced between litigation,
counseling, and traditional labor matters. With respect to collective bargaining,
in addition to negotiating countless contract renewals (some over several
contract terms with the same client), Ken's experience runs the gamut from
first contract negotiations to pattern agreements, managing strikes, and
successfully implementing lockouts without union charges resulting in a
complaint. He has bargained with and run union-avoidance campaigns against
virtually every union in the country, and regularly trains employers on the best
practices for remaining union free.
On the traditional labor law side, Ken functions as chief negotiator in contract
bargaining and employer advocate in grievance and arbitration procedures.
Since 1987, Ken has consistently helped his clients achieve successful
outcomes in arbitration. His first-hand knowledge of clients’ bargaining history
and the evolution of their contract language enable Ken more effectively to
interpret and preserve key provisions in the resolution or adjudication of
contract disputes. Importantly, Ken’s relationship with union representatives in
these processes is one of mutual respect. Although a fierce defender of
Bar Admissions
Indiana, 1983
Pennsylvania, 1987
Tennessee, 2008
Other Court Admissions
U.S. Supreme Court
U.S. Court of Appeals for the
Sixth Circuit
Seventh Circuit
Eighth Circuit
District of Columbia Circuit
U.S. District Court for the
Southern District of Indiana
Northern District of Indiana
Eastern District of
Pennsylvania
District of Colorado
Education
B.A., Earlham College, 1980
J.D., Indiana University -
Bloomington, 1983

employers’ vested interests and cherished ideals, Ken is well-regarded among
union adversaries for his hard bargaining, forthrightness, transparency, and
integrity.
On the employment law side, Ken has been an active litigator and trial
attorney. Ken's numerous reported decisions over his three decades of
practice demonstrate his effective collaboration with clients in planning and
executing litigation strategies. On those rare occasions when summary
judgment or an acceptable settlement is not forthcoming, Ken is willing and
able to take cases to trial. He has done so successfully in multiple jurisdictions.
Understanding how cases are tried to juries has been instrumental in Ken's
development as a trusted counselor and advisor when critical employment
decisions need to be implemented.
That Ken is equally comfortable litigating, counseling, arbitrating, or bargaining
is only one distinct aspect of his practice. Another is his dedication to client
service and partnering. Ken understands that in order to be good at what you
do, you have to enjoy the work and the people you are working with. Ken’s
passion for the practice makes him a willing partner and collaborator with his
clients. These relationships also have helped him develop a keen
understanding of what clients value in each matter. While many lawyers “talk
the talk” of value and partnering, Ken has walked the walk:
 Ken has been a featured speaker and presenter at numerous law
partnering conferences as well as in-house law training programs –
including programs in New York, Chicago, Washington, DC, and
Toronto, which focused on managing litigation as a business and
effective strategies to manage the cost of legal services.
 Ken presented on the topic “Reconnecting Cost with Value” at the
ACC Corporate Counsel University and previously participated in the
ACC Value Challenge program, where he had the opportunity to
interact with participants on best practices for collaborating with in-
house counsel.
 Ken has been selected as a “BTI Client Service All-Star” based on
clients anonymously singling out attorneys who deliver superior client
service via client focus, understanding the clients' business and
delivering results.
At the end of the day, Ken seeks to offer clients what they value most: the
highest caliber of legal representation in the context of a relationship based on
trust and the ability to recognize and execute on business objectives.

Stay connected
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including breaking labor and employment topics
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www.btlaborrelations.com
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other than the intended recipient(s), and may not be reproduced,in any form, without the express written consent of the author or presenter. The information on this page is intended for informational purposes only and shall not be construed as legal
advice or a legal opinion of Barnes & Thornburg LLP.
Agenda
• Class Action Waivers
• Public Sector Union Fees
• #MeToo
• Title VII Update – Sexual Orientation, Gender Identity & Mutable Characteristics
• ADA Update – Unlimited Leave
• DOL Update
– 2018-2022 Strategic Plan
– DOL PAID Pilot Program
– DOL Opinion Letters Reinstated
• FLSA Update – “Service Advisors” Exemption
• EEOC Update
– 2018-2022 Strategic Plan
– Pay Data Rule
• Federal Policy/Legislation
– Workforce Mobility Act
– Workflex in the 21st Century Act
• NLRB Update
Class Action Waivers

Epic Systems Corp. v. Lewis
• Background
• Facts
• Discussion
• What Does It Mean?
Supreme Court of the United States
• In 2012, the National Labor Relations Board (“NLRB”) asserted
for the first time that the National Labor Relations Act (“NLRA”)
prohibits the use of class action waivers in arbitration
agreements.
• This was a distinct shift from the NLRB’s stance in 2010 that
arbitration agreements do not involve any consideration of the
policies of the NLRA.
• This change in policy led to a six-year period of uncertainty
regarding the legality of employee class action waivers.
• The Second, Fifth, and Eighth Circuit Courts all held that
employers can lawfully include class action waivers in arbitration
agreements. The Sixth, Seventh, and Ninth Circuit Courts either
agreed with the NLRB or deferred to the board’s view on this
issue.
Background

• Three cases (Epic Systems Corp. v. Lewis, Ernst &
Young LLP v. Morris, and NLRB v. Murphy Oil, USA,
Inc.) addressing class action waivers were before the
court. Justice Gorsuch discussed the facts underlying
Ernst & Young in the majority opinion.
• Stephen Morris, a junior accountant at Ernst & Young,
entered into an agreement providing he would
arbitrate any dispute with Ernst & Young.
• This agreement required Morris to pursue individual
arbitration because claims pertaining to different
employees could not be heard in the same
proceeding.
Facts
• Morris instead chose to sue Ernst & Young for violating the
Fair Labor Standards Act in federal court on behalf of a
nationwide class.
• Morris claimed Ernst & Young violated the FLSA and
California law by misclassifying junior accountants as
professional employees who were not eligible to receive
overtime pay.
• Ernst & Young replied to Morris’ lawsuit with a motion to
compel individual arbitration as required by their original
agreement.
• The district court granted this motion and required
arbitration. The Ninth Circuit reversed, and Ernst & Young
appealed the decision to the Supreme Court.
Facts

• The Supreme Court’s 5 to 4 majority found that class action waivers included
in arbitration agreements must be enforced as written.
• The Court held that neither the NLRA nor the Savings Clause of the Federal
Arbitration Act (FAA) render class action waivers in arbitration agreements
illegal.
• In explanation of its decision, the Court discussed the following:
̶ Congress enacted the FAA to require courts to respect parties’ agreed upon
arbitration procedures.
̶ Although Section 7 of the NLRA guarantees workers the right to engage in “other
concerted activities for the purpose of . . . other mutual aid or protection,” the
majority concluded this did not include the right to file class action lawsuits.
̶ The Court also concluded that arbitration agreements can only be invalidated
under the FAA by defenses that apply to all contracts (e.g., fraud or duress). The
employees argued a defense specific to arbitration proceedings, causing this claim
to fail under the FAA.
• The Supreme Court also reversed the related decisions from the Seventh
and Ninth Circuits Courts and remanded for further proceedings in
accordance with the ruling.
Discussion
WHAT DOES IT MEAN?

WHAT DOES IT MEAN?
Janus v. AFSCME, Public Union Agency
Fees
• Background
• Facts
• Discussion
Public Sector Unions
Janus v. AFSCME

Janus v. AFSCME
• In 1977, the Supreme Court in Abood v. Detroit Board
of Education held that public employers could require
non-union workers to pay “fair share” agency fees in
union-represented bargaining units.
– Under Abood, non-union employees were charged for a
portion of union dues attributable to activities that are
necessary for the union’s duties as collective-bargaining
representative.
– Non-union employees could not be required to fund the
union’s political and ideological projects.
• Janus directly challenged the precedent established
by Abood.
Background
Janus v. AFSCME
• Under the Illinois Public Labor Relations Act (IPLRA), if a majority
of employees in a bargaining unit vote to be represented by a
union, that union is designated as the exclusive representative of
the employees.
– Once a union is designated, they have sole authority to negotiate
wages and other issues with the employer. Employees, whether or not
they are union members, cannot use other representation or negotiate
directly with the employer.
– Non-members do not pay full union dues but are assessed an “agency
fee.”
• Mark Janus is employed by the Illinois Department of Healthcare
and Family Services as a child support specialist.
– The employees in Mark’s unit are all represented by the American
Federation of State, County, and Municpal Employees, Council 31
Union (AFSCME).
Facts

Janus v. AFSCME
• Janus refused to join the Union because he opposed
many of the public policy positions the Union
advocates.
– Janus believed the Union’s position in collective bargaining
was not in the best interests of Illinois citizens.
• Janus was charged an “agency fee” by the Union
amounting to 78% of full union dues.
– Non-members were told they had to pay for lobbying, social
and recreation activities, advertising, and litigation.
• The Governor of Illinois initially challenged the statute
that authorized union agency fees. Janus later
intervened.
Facts
• The Supreme Court’s 5 to 4 majority overruled the holding in Abood
and held that non-members cannot be forced to pay any form of union
fees.
• The majority determined that this requirement compelled speech by forcing
a person to subsidize the speech of other private speakers.
• Although the government offered reasons for this requirement, the majority
determined that there were significantly less restrictive ways to achieve their
goals.
• This type of compelled speech violated longstanding ideas about the First
Amendment and required the court to overrule their prior decision in Abood.
• In order to have union fees deducted from their paycheck, employees
must affirmatively consent to pay. The court determined this would be
sufficient to waive the First Amendment right to not be compelled to
subsidize the Union’s speech.
Discussion
Janus v. AFSCME

WHAT DOES IT MEAN?
Janus v. AFSCME
#MeToo

Agenda
• Harassment Legal Update
• Arbitration Agreements
#MeToo
• #MeToo was promulgated in response to the countless number of
accusations of sexual harassment against high profile men.
– During the first 24 hours of its existence, #MeToo was used in 12
million posts on Facebook.
• Various studies report that at least one-half of women have experienced
sexual violence, unwanted sexual advances/touching, and verbal sexual
harassment (across different settings, not just workplaces).
• Women who spoke up and discussed their encounters with sexual
harassment were heralded as the Time Magazine Person of the Year –
the “Silence Breakers.”
• Studies also report that 90% of companies have an anti-harassment
policy and over 2/3 conduct anti-harassment training.
Background
#MeToo
Harassment Legal Update

• The #MeToo culture may give way to more harassment
complaints.
• Companies need to be prepared to handle the potential increase
in harassment complaints. Observers are forecasting that
employers will need to go beyond just re-emphasizing what they
are already doing and instead take a holistic approach to anti-
harassment training.
• Potential areas of concern for employee training:
– Technology: social media, instant messaging, and texting
– Social events: office parties, networking events, company retreats
– Work relationships: project teams, workplace partners, mentorship roles
Discussion
#MeToo
• Employers should reiterate the anti-harassment policy
– and that the Company stands behind the policy.
• Investigate complaints seriously and quickly.
• Conduct anti-harassment training:
–Employees, especially management, must
understand that it’s everyone’s responsibility to
prevent and correct harassment.
–Consider the bigger picture – i.e. the workplace
culture that the employer wants to foster.
• Strongly consider implementing policies that prohibit
romantic or sexual relationships between supervisors
and the employees whom they supervise.
#MeToo
Harassment: Four Tips

#MeToo
Arbitration Agreements
• Arbitration Clauses
• Epic Systems vs. #MeToo
#MeToo
Background
• Arbitration agreements provide that employees must bring
employment claims before arbitrators rather than in court.
– Arbitration offers a trial setting without the time and expense
of litigation.
– Employee advocates argue that arbitration can deprive
workers of the opportunity to present their claims to impartial
juries and can include discovery restrictions which make it
harder for workers to prove their harassment claims.
• Epic Systems Corp. v. Lewis (2018)
– Following the Supreme Court’s decision, employers can now
depend on the enforceability of their arbitration agreements.
– The Court upheld the enforceability of arbitration agreements
containing class and collective action waivers.

#MeToo
Discussion
• Despite the Supreme Court’s decision in Epic Systems, the #MeToo
movement has spurred public backlash and federal and state legislators
are taking aim at mandatory arbitration.
• State Legislation:
– New York and Washington have enacted laws prohibiting mandatory
arbitration of sexual harassment and discrimination claims.
– The following states have introduced or are considering similar
legislation: Arizona, Indiana, Kansas, Louisiana, Maryland,
Massachusetts, Minnesota, Missouri, New Jersey, Pennsylvania, Rhode
Island, South Carolina, Vermont and Virginia.
• Federal Legislation:
– The Ending Forced Arbitration of Sexual Harassment Act, a bipartisan
bill, would prohibit pre-dispute arbitration agreements requiring
arbitration of all sexual discrimination claims.
WHAT DOES IT MEAN?
#MeToo

Title VII Update
Another Federal Court Extends Title VII
Workplace Protections to Include Sexual
Orientation
Agenda
• Zarda v. Altitude Express and Sexual Orientation Update
• Stephens v. Harris Funeral Homes – Transgender
Protected Status
• EEOC v. Catastrophe Management Solutions (SCOTUS)
Title VII Update

Zarda v. Altitude Express
• Facts
• Discussion
Title VII Update
Zarda v. Altitude Express (Apr. 2017)
Second Circuit Court of Appeals
• Last year, we discussed the growing number of federal appellate
courts faced with sexual orientation discrimination claims, including
the Zarda case.
– In 2017, the Second Circuit determined that Zarda had not raised a valid
claim under Title VII, but it granted en banc review.
• Title VII prohibits employers from discriminating against employees
on the basis of sex, race, color, national origin, and religion.
– Courts also recognize a claim for “gender stereotyping” sex
discrimination, where an employee is discriminated against for failing to
conform to existing gender stereotypes.
– For example, a female employee who is discriminated against for refusing
to wear a skirt or makeup may have a gender stereotyping Title VII claim.
– Male employees who are discriminated against for failing to act in a
stereotypically “masculine” manner may also have a valid gender
stereotyping sex discrimination claim.
Background
Title VII Update

• The EEOC has interpreted Title VII’s “on the basis of sex” provision to
include sexual orientation. However, the EEOC’s opinions are not
binding on federal courts.
• Until 2017, no federal appellate court had ruled Title VII protects against
sexual orientation discrimination.
• In Hively v. Ivy Tech, the Seventh Circuit’s en banc panel overturned
circuit precedent and held that sexual orientation discrimination is a form
of sex discrimination under Title VII.
– The court reasoned that discrimination on the basis of sexual
orientation is necessarily discrimination on the basis of sex.
– The court reasoned that gay, lesbian, and bisexual individuals break
the gender stereotype that people should be in romantic relationships
with members of the opposite sex.
– Because gender stereotyping discrimination is already recognized by
courts as a form of sex discrimination, the court noted that sexual
orientation discrimination was also a form of sex discrimination.
• It remained to be seen whether other Circuits would follow suit.
Background
Title VII Update
• Zarda sued Altitude Express for sex discrimination, alleging that
Altitude Express fired him because of his sexual orientation.
• Altitude Express claimed that it fired Zarda after a client
complained about Zarda’s behavior.
– Allegedly, Zarda discussed his romantic relationship with one of
his skydiving students, which made another student
uncomfortable.
• Zarda asserted that he acted appropriately at all times.
• Zarda sued his employer for sexual orientation discrimination in
federal and state courts.
• The Eastern District Court of New York held that Zarda failed to
state a Title VII claim, and Zarda appealed.
Facts
Title VII Update

• The Second Circuit, finding that Zarda had only claimed
sexual orientation discrimination, held that it was not a valid
Title VII claim.
• The court also held that Zarda’s claims did not qualify as
“sex stereotyping” discrimination.
– Zarda’s claims were solely based on his sexual orientation.
• Because of appellate court procedure, the Second Circuit
followed court precedent.
• However, in May 2017, the Second Circuit granted en banc
review of Zarda’s case.
Discussion
Title VII Update
• Notably, the EEOC and the Department of Justice (“DOJ”) have
each weighed in on the Zarda case, coming down on opposite
sides of the issue.
• In June of 2017, the EEOC filed an amicus brief telling the
Second Circuit that sexual orientation discrimination is
inextricably linked to discrimination based on:
– Gender;
– The gender of whom a person associates with; and
– Gender stereotypes and non-conformity.
• The DOJ then filed an amicus brief in late July 2017 saying the
opposite. The DOJ noted Congress’ choice to decline to amend
Title VII and said that firing a person for being gay is not the
same as firing him or her due to gender.
Discussion
Title VII Update

• Just as the Seventh Circuit’s en banc panel did in Hively, the Second
Circuit’s en banc panel overturned Circuit precedent and held that sexual
orientation discrimination is a form of sex discrimination under Title VII.
– The Court determined that sexual orientation discrimination is motivated, at least in part,
by sex and is thus a subset of sex discrimination.
– Sexual orientation discrimination, in the Court’s view, is also based on assumptions or
stereotypes about how members of a particular gender should be, including to whom
they should be attracted.
– The Court held that sexual orientation discrimination is associational discrimination. An
adverse employment action motivated by the employer's opposition to association
between members of particular sexes discriminates against an employee on the basis of
sex.
• Finally, the Court said that, although sexual orientation discrimination is
"assuredly not the principal evil that Congress was concerned with when
it enacted Title VII," "statutory prohibitions often go beyond the principal
evil to cover reasonably comparable evils."
Discussion
Title VII Update
WHAT DOES IT MEAN?
Title VII Update

WHAT DOES IT MEAN?
Title VII Update
Stephens v. R.G. & G.R. Harris Funeral
Homes
• Facts
• Discussion
Title VII Update
EEOC v. R.G. & G.R. Harris Funeral Homes (March 2018)
Sixth Circuit Court of Appeals

Title VII Update
• Stephens, born biologically male, worked as a funeral director at Harris
Funeral Homes, a closely held corporation not affiliated with a church.
• Stephens informed the owner and operator, Rost, that Stephens struggled
with “gender identity disorder” and intended to have gender reassignment
surgery.
• Before Stephens left to receive the surgery, Ross said “this is not going to
work out” and offered Stephens a severance agreement.
• Rost testified that he fired Stephens because Stephens was “no longer going
to represent himself as a man.”
• Rost stated that he believes that he would be violating his Christian beliefs
were he to permit one of the funeral directors to deny their sex while
representing the organization.
Facts
• The Sixth Circuit Court of Appeals affirmed the district court’s holding
that Stephens was fired because of her failure to conform to sex
stereotypes in violation of Title VII.
• The district court erred, however, in finding that Stephens could not
alternatively pursue a claim that she was discriminated against on the
basis of her transgender and transitioning status.
• The Circuit Court held that discrimination on the basis of transgender
and transitioning status is necessarily discrimination on the basis of
sex.
• The Court further found that the EEOC should have had the
opportunity to prove that the Funeral Home violated Title VII by firing
Stephens because she is transgender and transitioning from male to
female.
Discussion
Title VII Update

WHAT DOES IT MEAN?
Title VII Update
EEOC v. Catastrophe Management
Solutions
• Facts
• Discussion
Title VII Update
EEOC v. Catastrophe Management Solutions (May 2018)

• Catastrophe Management Solutions does not hire anyone who
uses an “excessive hairstyle,” including dreadlocks.
• When Chastity Jones, an African American, refused to remove
her dreadlocks, CMS rescinded her employment offer.
• The EEOC sued on her behalf claiming that a prohibition
against dreadlocks constitutes race discrimination because
dreadlocks are physiologically and culturally associated with
people of African descent.
• The EEOC sought to expand the definition of “race” to include
anything associated with the culture of a protected group.
Facts
Title VII Update
• The Eleventh Circuit Court of Appeals affirmed the district
court’s dismissal of the suit. The EEOC did not allege that
dreadlocks were an immutable characteristic of black
individuals.
• The Court determined that banning dreadlocks under a race-
neutral grooming policy—without more—does not constitute
intentional race-based discrimination.
• In May 2018, the Supreme Court of the United States denied a
motion by Jones to intervene in order to file a petition for writ of
certiorari.
Discussion
Title VII Update

WHAT DOES IT MEAN?
Title VII Update
6th Circuit Court of Appeals
“Power of the Subpoena”
Following a Circuit Split, Supreme Court
Reviews EEOC Subpoena Standard
ADA UPDATE
Americans with Disabilities Act (“ADA”)

Severson v. Heartland Woodcraft
• Background
• Facts
• Discussion
ADA Update
Severson v. Heartland Woodcraft (Sept. 2017)
United States Supreme Court Cert Denied (April 2018)
Background
• Title I of the ADA requires employers to make “reasonable
accommodations” for “qualified individuals” with a disability,
provided the accommodations do not impose an “undue
hardship” on the employer.
• “Reasonable accommodations” may include, amongst other
alternatives, adjustments to the physical environment, job
restructuring, or part-time work.
• A “qualified individual” can, either with or without the aid of
reasonable accommodations, perform the essential
functions of the position.
ADA Update

• In 2005, Raymond Severson began having back pain and
was diagnosed with back myelopathy in 2010.
• In 2006, Severson began employment with Heartland
Woodcraft and worked there in several physically
demanding roles through May of 2013.
• In June of 2013, Severson wrenched his back at home
and subsequently requested and received a leave of
absence under the Family Medical Leave Act (“FMLA”).
• Severson exhausted his statutorily allotted 12 weeks of
leave under the FMLA and requested an additional three-
months of leave to recover from back surgery.
Facts
ADA Update
• Heartland denied the requested extension, terminated
Severson, and invited him to reapply to his position once
he was medically fit.
• Severson was medically cleared to work three months
later, but instead of reapplying for work, he sued
Heartland under the ADA for failing to accommodate his
physical disability.
• The district court granted Heartland’s motion for summary
judgment and entered judgment for Heartland holding the
requested accommodations were not reasonable.
• Severson appealed.
Facts
ADA Update

ADA Update
• Severson cited three accommodations Heartland could have
made:
– (1) a three-month leave of absence,
– (2) a transfer to a vacant job, or
– (3) an assignment to a temporary light duty position.
• Severson’s second claim was easily dismissed because he
offered no evidence that there were any vacant jobs available
when he was fired.
• Severson’s third claim was dismissed as well. An employer is not
required to create a new job or strip the employee’s current job of
essential functions in order to accommodate the employee unless
that is a policy of the company.
• Heartland had no such policy and no other light-duty positions
were available.
• The issue was whether Severson’s multi-month absence with a
definite return date of three months (after FMLA was exhausted)
is a reasonable accommodation that Heartland could have made.
Discussion
ADA Update
• The Seventh Circuit stated that the concept of reasonable
accommodations is flexible, but any accommodation must
make it possible for the employee to perform the job.
• Further, leaves for brief periods can be analogous to part-
time work.
• However, the employer is not required to excuse the
complete inability to work.
• Ultimately, the court distinguished the FMLA from the ADA by
defining FMLA as intended for those who cannot work and
defining ADA as intended for those who can work.
• The Court further held that the ADA cannot be transformed
into a medical leave statute, or “an open-ended extension of
the FMLA.”
Discussion

Discussion
• The question considered in Severson was whether an
employee’s finite absence for longer than a month
should be considered a reasonable accommodation.
• In denying certiorari, the U.S. Supreme Court declined
to weigh in.
• The First, Sixth, Ninth, Tenth and Eleventh Circuits
have held that this question should be answered on a
case-by-case basis, and that the employer must prove
a requested accommodation is not an undue hardship.
• In Severson, the Seventh Circuit held that multi-month
leaves of absence following expiration of FMLA leave
are per se unreasonable.
ADA Update
WHAT DOES IT MEAN?
ADA Update

DOL Update
• 2018-2022 Strategic Plan
• PAID Pilot Program
• Opinion Letters Reinstated
Agenda
DOL Update

2018-2022 Strategic Plan
• Background
• Strategic Goals
• Management Goal
• Priority Goals for FY 2018-19
• What Does it Mean?
DOL Update
• According to U.S. Secretary of Labor, R. Alexander Acosta, the
strategic plan outlines how the Department of Labor (DOL)
intends to increase employment opportunities for the U.S.
workforce, enforce workplace health and safety protections,
use DOL resources efficiently, and “bring commonsense to
regulations.”
• The plan sets out 3 Strategic Goals and 1 Management Goal:
– Strategic Goal 1: Support the Ability of All Americans to Find Good Jobs
– Strategic Goal 2: Safe Jobs and Fair Workplaces for All Americans
– Strategic Goal 3: Promote Strong Workers’ Compensation and Benefits Programs
– Management Goal: An Efficient and Effective Department of Labor
Background
DOL Update

• Strategic Goal 1, Support the Ability of All Americans to Find
Good Jobs, sets forth the following objectives:
– Create customer-focused workforce solutions for American
workers.
– Provide veterans, service members, and their spouses with
resources and tools to gain and maintain employment.
– Develop evidence-based policies, practices, and tools to foster a
more inclusive workforce to increase quality employment
opportunities for individuals with disabilities.
– Provide timely, accurate, and relevant information on labor market
activity, working conditions, and price changes in the economy.
– Formulate policies and initiatives to promote the interests of
working women.
DOL Update
Strategic Goals
• Strategic Goal 2, Safe Jobs and Fair Workplaces for All
Americans, sets forth the following objectives:
– Secure safe and healthful working conditions for America’s workers.
– Prevent fatalities, disease, and injury from mining and secure safe
and healthful working conditions for America’s miners.
– Secure lawful wages and working conditions for America’s workers.
– Improve the security of retirement, health, and other workplace-
related benefits for America’s workers and their families.
– Promote fair and diverse workplaces for America’s federal
contractor employees.
– Promote a fair global playing field for American workers and
businesses.
– Promote union financial integrity, transparency, and democracy.
DOL Update
Strategic Goals

• Strategic Goal 3, Administer Strong Workers’ Compensation
and Benefits Programs, sets forth the following objectives:
– Provide workers’ compensation benefits for workers who are
injured or become ill on the job.
– Support states’ timely and accurate benefit payments for
unemployed workers.
DOL Update
Strategic Goals
• The strategic plan also includes 1 Management Goal,
Administer Strong Workers’ Compensation and Benefits
Programs, which sets forth the following objectives:
– Improve human resources efficiency, effectiveness, and
accountability.
– Provide modern technology solutions that empower the DOL
mission and serve the American public through collaboration and
innovation.
– Maximize DOL’s federal buying power through effective
procurement management.
– Safeguard fiscal integrity and promote the effective and efficient use
of resources.
DOL Update
Management Goal

• Within the Strategic and Management Goals, the DOL has
identified the following 4 goals which take priority for FY 2018-19:
– Job Creation: Apprenticeship Expansion: DOL will enroll 280,000 new
apprentices as part of the agency’s broader efforts to promote and
expand apprenticeship.
– Worker Safety: Reduce Miner Injuries and Reduce Trenching and
Excavation Hazards: Increase the number of trenching and excavation
hazards abated by 10%; reduce the reportable injury rate associated with
powered haulage equipment, the primary cause of miners’ injuries, by
10% per year.
– Combat the Opioid Epidemic: Reduce initial opioid prescriptions and
duration of new opioid prescriptions for federal employees with work-
related injuries by 10%.
– Administration: Implement an Enterprise-Wide Shared Services Model
for DOL Core Administrative Functions by Sept. 30, 2019.
DOL Update
Priority Goals for FY 2018-19
DOL Update
WHAT DOES IT MEAN?

Payroll Audit Independent Determination
(PAID) Pilot Program
• Background
• Discussion
DOL Update
PAID Pilot Program
• In March 2018, the Wage and Hour Division (WHD) of the
DOL announced a new 6-month pilot program designed to
facilitate the resolution of inadvertent minimum wage and
overtime Fair Labor Standards Act (FLSA) violations.
• The PAID Program’s purposes are to:
–Expedite the resolution of overtime and minimum wage
claims without litigation;
–Improve employers’ compliance with overtime and
minimum wage obligations; and
–Ensure that more employees receive the back wages they
are owed more quickly.
DOL Update
PAID Pilot Program
Background

• The DOL identifies the following employer benefits
from the PAID program:
–Resolution of wage claims outside of litigation
–More streamlined process than a full investigation
–No liquidated damages
–No civil monetary penalties
DOL Update
PAID Pilot Program
Discussion
• The DOL also identifies the following benefits to
employees through the program:
–Faster receipt of back wages owed
–No litigation expense or delay
–No attorneys’ fees
–Employers correct practices going forward to further
protect employees
–Employees free to decide whether to accept
settlement or not
DOL Update
PAID Pilot Program
Discussion

DOL Update
PAID Pilot Program
WHAT DOES IT MEAN?
DOL Opinion Letters Reinstated
• Background
• Discussion
DOL Update
Opinion Letters Reinstated

• Opinion letters address specific questions submitted to the Wage and
Hour Division (WHD) and constitute an important form of guidance
for employers and employees with respect to applying the
requirements of the Fair Labor Standards Act (FLSA), Family and
Medical leave Act (FMLA), and other laws.
• The Portal-to-Portal Act of 1947 amended the FLSA to provide an
employer with an affirmative defense that protects it from liability
when the employer takes a certain action in reliance on any written
regulation, ruling, or interpretation of the WHD (e.g. Opinion Letters).
• The Obama Administration withdrew 17 opinion letters “for further
consideration” by the WHD on March 2, 2009, stating that it would
“provide a further response in the near future,” but never did.
Instead, the Obama Administration issued a handful of general
guidance documents that it referred to as “Administrator’s
Interpretations.”
DOL Update
Background
• Many of the Opinion Letters concern the exempt status of specific
positions in certain industries under section 13(a)(1) of the FLSA,
such as:
– Civilian Helicopter Pilots (FLSA2018-3).
– Client Service Managers of an Insurance Company (FLSA2018-8).
– Residential Construction Project Supervisors (FLSA2018-10 and FLSA2018-
17).
– Consultants, Clinical Coordinators, and Business Development Managers of a
Healthcare Placement Company (FLSA2018-12).
• Other topics include:
– Whether certain bonuses or other payments should be included in
calculating employees’ regular rates.
– Whether a plumbing repair and service business qualifies as a retail or
service establishment exempt from overtime.
DOL Update
Discussion

• FLSA2018-7: Salary Deductions for Full-Day Absences Based on Hours
Missed & Section 13(a)(1) Salary Basis
– This opinion letter addresses whether a hospital may take
deductions from the salary of an exempt Registered Nurse for
absences of one or more full days, but based on the number of
work hours missed, without running afoul of the requirements for
the professional exemption under section 13(a)(1) of the FLSA.
– Yes. When an employee misses an entire day of work, an employer
may make deductions based upon the number of work hours
missed.
• FLSA2018-14: Salary Deductions and Section 13(a)(1) Calculation
– Discussing appropriate ways to calculate salary deductions for
exempt employees.
DOL Update
Discussion
WHAT DOES IT MEAN?
DOL Update

FLSA Update
Fair Labor Standards Act
• Encino Motorcars v. Navarro (2018)
FLSA Update
Agenda

FLSA Update
Encino Motorcars v. Navarro (Apr. 2018)
Encino Motorcars v. Navarro
• Background
• Facts
• Discussion
• The FLSA contains an exemption from its overtime provisions for “any salesman,
partsman, or mechanic primarily engaged in selling or servicing automobiles” for an
auto dealer.
• In 1978, the DOL issued an opinion letter interpreting the exemption to include
dealership “service advisors” who sell “repair and maintenance services.”
• In 2008, the DOL issued a proposed rule which would have codified the longstanding
interpretation that service advisors are exempt from the FLSA overtime requirement.
• In 2011, however, the DOL issued the FLSA final rule which eliminated the automobile
dealership service advisors exemption.
• The Ninth Circuit applied the 2011 rule and held that service advisors are not covered
by the exemptions.
• The Supreme Court granted certiorari and ruled that courts cannot defer to the 2011
rules because it was procedurally defective. The case was remanded back down.
• In 2016, the Ninth Circuit, on the grounds that Congress did not intend to include
service advisors in the exemptions, held that service advisors are not covered by the
exemption and are therefore entitled to overtime. The Supreme Court again granted
certiorari.
Background
FLSA Update

• Encino Motorcars, LLC (“Encino”) sold and serviced
Mercedes-Benz automobiles.
• Hector Navarro, along with other similarly-situated
plaintiffs, sued Encino for failing to pay overtime
compensation when they worked more than forty hours a
week.
• They were required to be at work from 7 a.m. to 6 p.m. at
least five days per week, and to be available for work
matters during breaks and while on vacation.
• Service advisors were not paid a fixed salary or an hourly
wage for their work, instead receiving commissions on
the services they sold.
Facts
FLSA Update
FLSA Update
Discussion
• The Court interpreted the exemption and concluded that service
advisors are “salesm[e]n…primarily engaged in…servicing automobiles.”
– The term “salesman” is not defined in the FLSA, so courts give the term its ordinary
meaning.
– The Court further explained that the phrase “primarily engaged in servicing
automobiles” must include some individuals who do not physically repair
automobiles themselves but who are integrally involved in the servicing process,
including service advisors.
• In reaching its conclusion, the Court rejected the view of the Ninth
Circuit—as well as several appellate courts—that the exemptions should
be “construed narrowly.”
• Instead, the Court stated that the exemptions should be given a “fair
interpretation” and courts should not rely on the flawed premise that the
FLSA pursues its remedial purpose at all costs.
• Ultimately, the Court concluded that service advisors fall within the
exemption of 29 U.S.C. § 213(b)(10)(A) and are therefore exempt from
the overtime requirements of the FLSA.

FLSA Update
WHAT DOES IT MEAN?
EEOC UPDATE
U.S. Equal Employment Opportunity Commission

• Pay Data Collection: EEO-1 Report
Update
• EEOC Strategic Enforcement Plan
for 2018 - 2022
EEOC Update
Agenda
Pay Data Collection: EEO-1 Report Update
• Background
• Discussion
EEOC Update

Background
• Last year, we discussed the EEOC’s push to include pay date in
the EEO-1 reports.
• The EEO-1 report is a compliance survey mandated by federal
statute and regulations.
• This survey requires company employment data to be
categorized by race/ethnicity, gender, and job category.
• A 2016 change to the EEO-1 report required employers to add W-
2 earnings data for employees, including income and hours
worked, and was set to be implemented in March 2018.
• The goal of this change was to “improve the EEOC’s ability to
efficiently and effectively structure its investigation of pay
discrimination charges.”
EEOC Update
Discussion
• On August 29, 2017, the Office of Management and Budget
(OMB) issued a two-page memorandum informing the EEOC that
OMB was initiating a review and immediate stay of the
effectiveness of a portion of the EEO-1 report that was initially
approved on September 29, 2016.
• Specifically, the stay was ordered as to the portion of the EEO-1
report that required the reporting of aggregate W-2 income and
hours-worked data by employers with 100 or more employees.
– In other words, the stay did not impact the portion of the EEO-1 report
that requires filers to submit data on the race, ethnicity, and sex of their
workers, by job category.
• The stay was ordered citing concerns regarding the data’s lack of
practical utility, the burdensome nature of the collection process,
and the potential for privacy and confidentiality issues.
EEOC Update

Discussion
• In response to the OMB stay on pay data collection, the
National Women’s Law Center (NWLC) and the Labor
Council for Latin American Advancement (LCLAA) filed a
lawsuit against OMB and the EEOC, seeking to reinstate
the pay data collection portion of the EEO-1 report.
• The plaintiffs argue that OMB interfered with the EEOC’s
ability to enforce civil rights laws, violated the Paperwork
Reduction Act, and failed to respond to FOIA requests.
EEOC Update
WHAT DOES IT MEAN?
EEOC Update

EEOC Strategic Enforcement Plan for 2018 -
2022
• Background
• Discussion
EEOC Update
Strategic Enforcement Plan 2018 – 2022
• The EEOC recently updated its strategic enforcement plan (SEP)
setting priorities for fiscal years 2018 to 2022.
• This is the framework the Commission will use to prevent and
remedy unlawful employment discrimination and advance equal
opportunity for all in the workplace.
• In the new SEP, the agency reaffirmed its commitment to efforts
that have strategic impact in advancing equal opportunity.
• The EEOC defines strategic impact as a significant effect on the
development of the law or on promoting compliance across a large
organization, community or industry.
Background
EEOC Update

• Admittedly, the strategic objectives did not change substantially from the last version of
the plan, according to Cynthia Pierre, chief operating officer of the EEOC.
• The primary difference lies in the agency’s desire to move beyond simply laying out
enforcement goals.
• The Commission has indicated it will focus on providing employers with
recommendations and trainings they can utilize to prevent discrimination in the
workplace.
– “In this plan, we target ways to improve inclusiveness, not just in terms of goals or
strategies for our litigation and case investigations, but also internally, in the things we want
to model in the workplaces that we advocate for.”
– “We wanted to not just talk about diversity and inclusiveness, but also provide
education to employers and employees about exactly what it means to create
workplaces that are respectful and inclusive and to prevent discrimination where we
can.”
• While the last SEP focused heavily on systemic investigation and litigation, this new plan
seeks to take a more balanced approach by pursuing individual cases of discrimination,
harassment, or any other issues.
Discussion
EEOC Update
• In the new SEP, top priority has been given to two related areas.
• The first of the top priorities is to continue combatting sexual
harassment, a focus that has been intensified in light of the #MeToo
movement.
• While the EEOC’s Select Task Force on Harassment predated the
widespread scandals of 2017 by one year, Pierre says a number of
elements were incorporated in the new Strategic Plan specifically to
address the critically important workplace issue.
• Terms such as “unlawful harassment” were deliberately inserted, as
was the Commission’s commitment to rigorously and consistently
implement the Strategic Enforcement Plan, which includes the
objective of preventing systemic harassment and ensuring equal-pay
protections.
Discussion
EEOC Update

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