Supreme Court Strikes Down Public Sector Union Agency Fees

By Kathleen J. Jennings (kjj@wimlaw.com)

In a highly anticipated decision (at least among labor law attorneys), the U.S. Supreme Court held that public sector unions cannot require nonmembers to pay “agency fees.” (Janus v. AFSCME , U.S., No. 16-1466, 6/27/18).

What is an “agency fee?” If a majority of the employees in a bargaining unit vote to be represented by a union, that union is designated as the exclusive representative of all the employees, even those who do not join. Only the union may engage in collective bargaining; individual employees may not be represented by another agent or negotiate directly with their employer. Nonmembers are required to pay what is generally called an “agency fee,” i.e., a percentage of the full union dues.

In a 5-4 decision, written by Justice Alito, the U.S Supreme Court held that neither a public sector union nor state law can require a non-consenting employees to pay agency fees because the First Amendment is violated when money is taken from nonconsenting employees for a public-sector union; employees must choose to support the union before anything is taken from them. Accordingly, neither an agency fee nor any other form of payment to a public-sector union may be deducted from an employee, nor may any other attempt be made to collect such a payment, unless the employee affirmatively consents to pay.

The Court rejected arguments by the union that all employees should help subsidize union activities, such as collective bargaining and grievance resolution, because those activities benefit all employees. The Court also expressly overruled Abood v. Detroit Bd. of Ed., 431 U. S. 209 (1977), which had upheld the assessment of agency fees.

This decision is expected to have a substantial financial impact on public sector unions; some estimate that they could lose tens of millions of dollars from the loss of agency fees. The loss of money could also result in a loss of effectiveness and political power. At present, a larger percentage of public sector employees belong to unions than private sector employees: unions represent about 34 percent of government workers, compared with about 6 percent of private sector employees.

Kathleen Jennings, Principal is a principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, & Stine, P.C. She defends employers in sexual harassment and other employment litigation and provides training and counseling to employers in employment matters. She can be contacted at kjj@wimlaw.com.

©2018 Wimberly Lawson

The materials available at this blog site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Wimberly Lawson and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

Happy Birthday, FLSA!

By Kathleen J. Jennings(kjj@wimlaw.com)

Today, the Fair Labor Standards Act (FLSA) turns 80 years old. In 1938, the FLSA, signed into law by Franklin Delano Roosevelt, established a federal minimum wage, the 40-hour workweek, overtime, and limits on child labor. Think about what the world of work must have looked like before those measures were implemented.

Moreover, think about how the world of work has changed since 1938. Back then, most workers clocked in and out of work on timeclocks usually actual time cards. Now, some workers simply sign in and out of work on an app on their phones. Indeed, the new “gig economy” is presenting challenges to the continued relevance of the FLSA, and some updates to the law are going to be necessary in order to keep up with the changing workplace. However, as demonstrated by the Obama administration’s attempt to expand the salary threshold for the overtime exemption, any changes are likely to draw opposition and pushback.

Members of the House and Senate marked the FLSA’s birthday by introducing bills to make farmworkers eligible for overtime pay. Under the current law, farmworkers are not eligible to receive overtime pay. The new bill is unlikely to pass this year but could gain support if Democrats win control of either the House or Senate following November’s midterm elections.

Here’s how your company can celebrate the FLSA’s birthday: review your exempt employees and their duties to make sure that they are correctly classified. And remember: simply paying an employee a salary does not automatically make the employee exempt.

Kathleen Jennings, Principal is a principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, & Stine, P.C. She defends employers in sexual harassment and other employment litigation and provides training and counseling to employers in employment matters. She can be contacted at kjj@wimlaw.com.

©2018 Wimberly Lawson

The materials available at this blog site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Wimberly Lawson and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

 

What They Can’t See Might Hurt You

By Kathleen J. Jennings (kjj@wimlaw.com)

Is your company’s website covered by Title III of the Americans With Disabilities Act? If so, is it accessible to persons with visual disabilities? Have you ever even thought about it? Take a lesson from Hooters and give your website a checkup.

This week, the U.S. Court of Appeals for the Eleventh Circuit revived a lawsuit filed by a vision-impaired individual under the Americans with Disabilities Act demanding that the Hooters restaurant chain make its website accessible for those with vision impairment. Hooters had urged dismissal of the case on the ground that it had already prepared and implemented a remediation plan to come into ADA compliance in response to a different lawsuit. While the district court below agreed with Hooters, the 11th Circuit Court of Appeals held that the remediation plan does not render the second lawsuit moot.

Website accessibility lawsuits are on the rise and need to be on your company’s radar. More companies are receiving demand letters and/or lawsuits alleging that a business denied a usually blind or vision-impaired individual access to its goods and services because the business’ website was not accessible, in violation of Title III of the Americans with Disabilities Act (ADA) and state laws. In 2017, plaintiffs filed at least 814 federal lawsuits about allegedly inaccessible websites, including a number of putative class actions. The majority were filed in New York and Florida (the Hooters cases, discussed above, were filed in Florida, as was a major case against Winn-Dixie).

The basic questions that you need to ask to determine if your website is covered by Title III of the ADA are:

  1. Does your website engage in commercial activity for the benefit of the general public; and if so
  2. Will the law treat your website as a public accommodation, or as the service of a public accommodation?

At present, the parameters of what constitutes “commercial activity” are unclear. On one end of the spectrum is the company website that is purely informational or educational in nature; that website is not likely to be covered by Title III’s accessibility requirements. However, a website that sells goods or services directly to the public may be regarded either as a sales or service establishment in its own right, or as a service of such an establishment, and may be covered by the ADA or comparable state laws. Furthermore, a website that does not actually sell any goods or services but engages in some form of commercial activity may still be subject to the ADA or a comparable state law if it facilitates sales.

In addition to the public accommodation issues, companies also need to be aware of lawsuits filed by applicants challenging online applications as being inaccessible to vision impaired persons. Most of those suits are being filed in California, and we will see how the courts handle them. Keep in mind that the legal standard that applies to employment disability discrimination claims is different from the standard applied to disability discrimination claims brought against public accommodations. Title III, the public accommodation standard, generally requires (with exceptions) that businesses take affirmative, proactive measures to ensure individuals with disabilities are afforded equal access to their goods and services. In contrast, the prohibition against discrimination on the basis of disability in employment requires employers, upon notice that an employee or applicant for employment requires a reasonable accommodation to perform the essential functions of his or her job, or to apply for employment, to engage in the interactive process to devise such a reasonable accommodation. The employer does not need to provide the employee or applicant’s requested accommodation as long as the accommodation provided is effective.

Because there is a lack of clear regulations on the issue of website accessibility, and with no regulations coming from the Department of Justice in the near future, website accessibility lawsuits are likely to increase, and it’s going to be like the “wild, wild west” until courts can sort out some of the legal issues. In the meantime, it would be a good idea to consult with counsel about your company’s potential exposure to these types of lawsuits.

Kathleen Jennings, Principal is a principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, & Stine, P.C. She defends employers in sexual harassment and other employment litigation and provides training and counseling to employers in employment matters. She can be contacted at kjj@wimlaw.com.

©2018 Wimberly Lawson

The materials available at this blog site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Wimberly Lawson and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

A Signature Can Be Worth Thousands of Dollars

by Kathleen J. Jennings (kjj@wimlaw.com)

There is a lot of discussion about the utility and enforceability of arbitration agreements to resolve employee disputes with their employers. As we noted in a recent blog post, last month, the U.S. Supreme Court held that employment contracts that contain arbitration clauses and class action waivers are enforceable. Employers find these agreements attractive because arbitration tends to be faster and less expensive than court litigation. However, a recent case out of the 5th Circuit reminds us that an employer seeking to enforce a written arbitration should not overlook a small but important detail: the signatures of the parties to the agreement.

In Huckaba v. Ref-Chem, LP, No. 17-50341, (5th Cir. June 11, 2018), the 5th Circuit Court of Appeals reversed the district court’s judgment compelling arbitration. Why? Because the express language of the agreement at issue required for it to be signed by both parties and because it was undisputed that Ref-Chem did not sign the agreement. That’s right, the company did not sign the agreement it was seeking to enforce.

Whether or not all parties must sign a written agreement for it to be binding is a matter of state contract law. The 5th Circuit interpreted the agreement at issue under Texas contract law. In support of its decision, the Court noted that the arbitration agreement contained: (1) a statement that “[b]y signing this agreement the parties are giving up any right they may have to sue each other;” (2) a clause prohibiting modifications unless they are “in writing and signed by all parties;” and (3) a signature block for the employer, Ref-Chem. Thus, the Court concluded, this express language clearly indicated an intent for the parties to be bound to the arbitration agreement by signing. The agreement also identified the parties in the first line as “[t]he organization referred to above (‘Employer’) and the Employee, whose signature is affixed hereto.” The Court found that this clause made clear the parties’ intention that the employer would sign the agreement. (The Court also acknowledged that Texas courts have held that a signature block by itself is insufficient to establish the parties’ intent to require signatures).

What did the absence of this one signature cost the company? The company probably spent thousands of dollars in attorneys’ fees briefing this issue at the District Court and then at the Circuit Court. Now the former employee has the opportunity to pursue her claims in court, which is going to cost the company even more money. Expensive lesson.

The takeaway: Know and understand your agreement. If you are not sure who should sign it, ask your attorney.

Kathleen Jennings, Principal is a principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, & Stine, P.C. She defends employers in sexual harassment and other employment litigation and provides training and counseling to employers in employment matters. She can be contacted at kjj@wimlaw.com.

©2018 Wimberly Lawson

The materials available at this blog site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Wimberly Lawson and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.