On November 8, 2016, voters in Youngstown, Ohio approved a measure to amend their city charter and provide a “Part-Time Workers’ Bill of Rights,” which will impose significant added requirements on employers of part-time workers throughout the city. City council in Cleveland, Ohio refused to add a similar measure to its ballot. Both “get out the vote” efforts were spearheaded by Grand Rapids, Michigan business owner Robert Goodrich. Passage in Youngstown may prove to be a testing ground for future measures elsewhere in the country.

The amendment will create a Part-Time Workers’ Rights Commission to be comprised of five individuals who will serve two-year, uncompensated terms. Two members shall be representatives of employers, two shall be representatives of part-time employees, and one member shall represent the general public, all of whom will be appointed by Youngstown City Council. The Commission shall have the power, authority, and duty to do such things as advise and consult with City Council on workplace policies and conditions, recommend additional legislation to affect part-time workers, employ a staff to carry out its duties, and receive complaints regarding violations of the Bill of Rights provisions and enforce its workplace requirements.

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Marijuana PlantMarijuana ballot initiatives passed in seven out of nine states on November 8, 2016. California, Massachusetts, and Nevada, states where medical marijuana is already legal, passed ballot initiatives to legalize recreational marijuana. A similar initiative in Arizona failed. Maine’s effort to expand beyond medicinal to legalize recreational marijuana is still too close to call. Arkansas, Florida, and North Dakota all voted to legalize medical marijuana. Montana voted to loosen restrictions on the existing medical marijuana laws.

The results were as follows:

Recreational

  • Arizona – 52% No, 48% Yes
  • California – 56% Yes, 44% No
  • Maine – 50% Yes, 50% No (local outlets are declaring victory for legalization, but it is still too close to call)
  • Massachusetts – 54% Yes, 46% No
  • Nevada – 54% Yes, 46% No

Medical

  • Arkansas – 53% Yes, 47% No
  • Florida – 71% Yes, 29% No
  • North Dakota – 64% Yes, 36% No

Loosened Restrictions on Medical Marijuana Laws

  • Montana – 57% Yes, 43% No

Medical marijuana is now legal in 29 states and the District of Columbia. In seven of those states and the District of Columbia, with Maine pending, recreational marijuana is also legal.

On October 28, 2016, the Supreme Court of the United States said that it would decide whether the Obama Administration’s interpretation of Title IX as requiring schools to allow students to utilize restrooms that correspond to their gender identities is proper. The case of Gloucester County School Board v. GG, involves the claims of a biologically female high school student, who identifies as a transgender boy, seeking access to the boys’ bathroom at school. While the school board initially allowed the student to use the boys’ bathroom, it later adopted a policy requiring students to use bathrooms that correspond to their biological sex or a separate single-stall restroom.

Although the Gloucester County case relates to students, the Supreme Court’s decision should also have a significant impact on employers. Recently, both the EEOC and OSHA have taken new positions with regard to LGBT rights, including restroom access. The EEOC has taken the position that Title VII’s prohibition of sex discrimination protects lesbian, gay, bisexual and transgender applicants and employees against employment bias. The EEOC has aggressively enforced its new position. Recently, the EEOC announced that it had entered into a settlement with a West Virginia hospital requiring the hospital to make same-sex spouses eligible for employer-sponsored benefits. Similarly, both the EEOC and OSHA have issued guidance indicating that all employees, including transgender employees, should have access to restrooms that correspond to their gender identity.

Presumably, the Supreme Court’s decision in the Gloucester County case will provide clarity as to whether the courts will show deference to these agencies’ interpretations of the law. Employers seeking guidance regarding LGBT issues in their own workplace should contact any of the attorneys in the Frantz Ward Labor and Employment Practice Group.

Texas courts continue to be the focus of anti-regulation filings as the next election approaches. In August, a U.S. District Court for the Northern District of Texas issued a nationwide injunction barring the enforcement of Department of Education guidance requiring schools to allow transgender students to use bathroom and changing facilities consistent with their gender identity. In September, 21 states and the U.S. Chamber of Commerce filed two lawsuits in the U.S. District Court for the Eastern District of Texas to enjoin the implementation of the new Department of Labor rules on overtime compensation and classification practices under the Fair Labor Standards Act.

Keeping pace in October, hours before the Fair Pay and Safe Workplaces rule was set to take effect last week, the Eastern District issued a preliminary injunction halting its enforcement. The rule, promulgated through a 2014 Executive Order, would require government contractors and subcontractors to disclose mere allegations of labor law violations, including alleged violations before the NLRB, EEOC, OSHA and the OFCCP, when bidding for contracts over certain dollar amounts, with a goal toward disqualifying contractors or requiring that they enter into premature labor compliance agreements in order to obtain or retain federal contracts.

The nationwide injunction—issued by Judge Marcia A. Crone—resulted from a complaint and emergency motion for a temporary restraining order and preliminary injunction filed by three national and local trade associations representing construction industry employers. Judge Crone found that the Executive Branch exceeded its rule making authority in enacting the rule, focusing primarily on the potential disqualification of federal contractors for alleged (rather than proven) violations of federal labor laws. To that issue, Judge Crone wrote:

In a majority of the labor laws cited in the Executive Order (specifically NLRA, FLSA, OSHA, Title VII, ADEA, and ADA), Congress spelled out in precise detail what agency or court would be empowered to find a violation, how such a finding would be determined, and what the penalty or remedy would be. None of these laws provides for debarment or disqualification of contractors for violations of their provisions; none of them provides for such determinations to be made by unqualified agency contracting officers (or ALCAs); and certainly none of these laws provides for any such action to occur based on non-final, unadjudicated, “administrative merits determinations.”

Judge Crone also found merit in the trade associations’ argument that the disclosure requirements will cause contract bidders to “suffer an infringement of their First Amendment rights in the form of ‘compelled speech.’”

While Judge Crone’s decision provides the beginning of what may become a reprieve for federal contractors, an appeal to the Fifth Circuit Court of Appeals is certain. In addition, the injunction does not relieve federal contractors from the requirement to provide wage statements and notice of independent contractor status, a portion of the rule that is now scheduled to go into effect on January 1, 2017.

legalization-go-feds-09-01As the November 8, 2016 election deadline looms, marijuana legalization in one form or another is on the ballot in nine states throughout the nation. Seven states seek to expand what is already legal and two states seek to enter the medical marijuana field. Below is a list of what is on the ballot and where the current polling stands in these states.

Legalization of Recreational Marijuana

  • Arizona – Although medical marijuana is already legal, Proposition 205, which would legalize recreational marijuana for adults 21 years or older and institute a 15% tax, has a 50% approval among registered voters against a 40% opposition, while 10% of voters are undecided, according to a recent Arizona Republic/Morrison/Cronkite News poll.
  • California – Medical marijuana has been legal in California since 1996. Proposition 64 would legalize recreational marijuana for adults over 21 and establish a 15% sales tax at the retail level and a $9.25 per-ounce cultivation tax.  Proposition 64 has a 60% approval in a Field Poll/Institute for Government Studies against a 31% opposition, while 9% are undecided.
  • Maine – Medical marijuana has been legal in Maine since 1999. Question 1 is a ballot initiative to enact the Marijuana Legalization Act which legalizes recreational marijuana and allows individuals over the age of 21 to possess, transport, transfer, or furnish 2.5 ounces of marijuana or 6 immature plants or seedlings and imposes a 10% retail tax. In a Portland Press Herald poll, 53% of registered voters would vote in favor of Question 1, 38% would vote against, and close to 10% are still undecided.
  • Massachusetts – Medical marijuana is legal in Massachusetts. Voters will decide on Question 4, The Regulation and Taxation of Marijuana Act, which would legalize recreational marijuana and allow people 21 and older to possess up to 10 ounces of cannabis and to grow up to six plants for non-commercial purposes. According to a new poll by WBUR/MassINC Polling Group, 55% are in favor of Question 4.
  • Nevada – Nevada already has legalized medical marijuana. Question 2 is a legislative initiative to legalize recreational marijuana by allowing a person 21 or older to purchase, cultivate, possess, or consume up to an ounce of non-concentrated marijuana or 1/8 of an ounce of concentrated marijuana, to cultivate up to six plants, and establish a 15% excise tax on wholesale sales of marijuana. A recent poll by Suffolk University showed that 57% are in favor of the initiative, while 33% oppose.

Expansion of Medical Marijuana

  • Florida – Florida already allows patients with severe seizures to obtain low-tetrahydrocannabinol (“THC”), high cannabidiol (“CBD”) oils, and terminally ill patients to obtain full scale medical marijuana. Amendment 2 to the Florida Constitution would greatly expand the list of allowed medical conditions and requires a 60% super majority to pass. Of the eight polls conducted since January of 2015, all eight show an approval rating of at least 60%.
  • Montana – Montana legalized medical marijuana in 2004. However, Senate Bill 423, which went into effect on August 31, 2016, implemented laws that banned medical marijuana advertisements, limited dispensaries to three patients, and required a review of doctors who prescribed medical marijuana to more than 25 patients per year. Now, Initiative 182 is on the ballot and it would repeal the three patients per dispensary limit and the doctors’ review. Although there is no current polling on Initiative 182, over 65% of voters support allowing dispensaries based on an August 2015 poll conducted by Public Policy Polling paid for by Marijuana Policy Project.

Legalization of Medical Marijuana

  • Arkansas – Arkansas has two competing medical marijuana ballot initiatives, Issue 6 and Issue 7. Issue 6, the Arkansas Medical Marijuana Amendment, is an amendment to the Arkansas state constitution, while Issue 7, the Arkansas Medical Cannabis Act, is an initiated state statute. The two issues also differ in that Issue 7 would allow patients to grow their own marijuana and Issue 6 would not. A 2012 medical marijuana ballot initiative narrowly lost, and a major organizer of that effort believed the reason to be the “grow your own” provision. He split off from the Issue 7 organizers and formed the competing Issue 6 that doesn’t contain the “grow your own” provision. The Talk Business & Politics-Hendrix College poll found that 49% favor Issue 6 and 43% oppose. Further, 36% favor Issue 7 while 53% oppose.
  • North Dakota – Initiated Statutory Measure 5, the North Dakota Compassionate Care Act, would legalize medical marijuana in North Dakota not to exceed three ounces per patient, and all dispensaries would have to be vertically integrated non-profit entities with not more than 1,000 growing plants and 3,500 ounces (218.75 pounds) of “usable” marijuana at any given point. Like Montana, there are no recent polls regarding medical marijuana in North Dakota, but a 2014 poll by the University of North Dakota College of Business and Public Administration found that 47% of voters supported legalizing medical cannabis, with 41% opposed and 9% neutral.

Sick-Leave-Sign-2-smallThe U.S. Department of Labor recently released its final rule requiring federal contractors and subcontractors to provide their employees with paid sick leave each year. This rule implements Executive Order 13706, which President Obama signed in September 2015. The rule takes effect on November 29, 2016, though generally it applies only to new contracts that are awarded on or after January 1, 2017. Nevertheless, covered contractors should begin taking steps to comply with the rule soon.

Under the rule, employees are entitled to one hour of paid leave for every 30 hours worked, up to a maximum of 56 hours of leave per year. Alternatively, contractors may provide 56 hours of leave to employees at the beginning of each year. In either case, the leave must generally carry over from year to year. In some situations, however, the amount of available leave can be capped at 56 hours.

Employees may use the leave for their own illness, preventative treatment or other health care needs, or to care for a family member or domestic partner. Employees may also use the leave in certain domestic violence, sexual assault, or stalking situations.

The rule does not apply to all employees of a covered contractor, but only to those who perform work in connection with a covered contract. There is also a short-term exemption for employees who are governed by a collective-bargaining agreement, if the CBA provides at least 56 hours of paid time off that may be used for sickness- and health- related reasons. These contractors have until the CBA expires or January 1, 2020 (whichever comes first) to comply with the rule.

Because non-compliance can result in significant penalties, including a possible three-year debarment, contractors should review their existing sick leave policies and ensure compliance with the rule before it takes effect. Contractors should also familiarize themselves with the various procedures governing leave administration, including leave tracking, employee notice, and health care-provider certifications.

In a development that may be of interest both to those who follow Fair Labor Standards Act (“FLSA”) developments and to those interested in mediation, the U.S. District Court of the Southern District of New York has mandated early mediation for all FLSA cases. The pilot program responds to the surge in FLSA case filings by sending cases to mediation immediately upon the appearance of the defendant.

The mediation is to be scheduled within four (4) weeks of the Court’s issuance of its standard order. Limited disclosures are required as follows:

  1. Both parties to produce any existing documents describing plaintiff’s duties and responsibilities
  2. Both parties to produce records of pay and hours worked by plaintiff
  3. Plaintiff to produce spreadsheet of alleged underpayments and other damages
  4. Defendant to produce documents describing compensation policies
  5. If claiming inability to pay, defendant to produce proof of financial condition

If the mediation is successful, the parties are then required to provide a memorandum to the Court so that it can perform its function of approving the FLSA settlement.

Some see a conflict between the voluntary process of mediation and forcing parties to participate in it. However, getting parties to agree to mediate disputes before discovery has taken place is a tough sell, especially to lawyers. In FLSA cases, the key facts are often available and material/factual issues may be limited. FLSA cases should lend themselves well to early resolution, and mandating prompt mediation with limited, but relevant, disclosures is probably well worth the investment in the pilot project. It remains to be seen if other courts will follow along.

The Ohio Supreme Court recently held that employees need not prove they were actually injured on the job to prevail in a retaliation claim.

Employers should already be aware that, under Ohio law, they may not discharge or take punitive action against an employee for filing a workers’ compensation claim after sustaining an injury at work. The Ohio Supreme Court recently issued a decision that will deter employers from disciplining even employees who file bogus workers’ compensation claims. In Onderko v. Sierra Lobo, Inc., Slip Opinion No. 2016-Ohio-5027, the Court held that a Plaintiff in a retaliatory discharge claim is not required to prove that he or she was injured on the job, but only that he or she was discharged for filing a workers’ compensation claim.

In the Onderko case, the employee had been denied workers’ compensation benefits because the Industrial Commission found that he was actually injured outside of work, not on the job. After his claim was denied, his employer terminated him for his deceptive attempt to get workers’ compensation benefits for a non-work-related injury. The employee then sued his employer for retaliatory discharge.

It was undisputed that the employee had been fired for filing the invalid workers’ compensation claim. The employer argued that, because the employee’s claim had been denied, the employee could not prevail in a retaliation claim as a matter of law. The Supreme Court disagreed, clarifying that a retaliation claim requires only that the employee prove that he was discharged for filing a workers’ compensation claim for a work-related injury and that proof that a work-related injury actually occurred is not necessary.

The dissent warned of the implication of the Court’s decision, stating:

A court should not construe the statute in a manner to encourage fraudulent claims for workers’ compensation benefits, and here, the Bureau of Workers’ Compensation determined that there was no workplace injury. The evidence therefore supports the trial court finding that Sierra Lobo, Inc., fired Onderko for filing a fraudulent claim.

The majority clarified that its holding does not suggest that a fraudulent or false claim for workers’ compensation may be pursued without penalty and that such conduct still may provide grounds for termination. The filing of a false claim is a crime in Ohio. Whether fraud is valid defense to a retaliation claim, however, was not specifically addressed by the Court. In this case, the employer certainly felt that the claim was deceptive.

Onderko is one of a series of cases that have broadened the strike zone for retaliation plaintiffs. The case instructs employers to use caution when disciplining or discharging an employee who has filed an unsuccessful workers’ compensation claim, even where the claim appears to be bogus. To take such adverse action, the employer must have a legitimate non-retaliatory reason unrelated to the employee’s exercise of his or her rights under the workers’ compensation statutes.

On September 20, 2016, the Supreme Court of Ohio adopted an amendment to the Ohio Rules of Professional Conduct that clarifies the ethical responsibilities for attorneys under Ohio’s new medical marijuana law (H.B. 523).

Previously, on August 5, 2016, in a non-binding advisory opinion, the Supreme Court of Ohio’s Board of Professional Conduct ruled that attorneys could not counsel or advise clients regarding marijuana businesses in Ohio (Opinion 2016-6). After this opinion, the Supreme Court of Ohio moved quickly in order to clarify an attorney’s ethical responsibilities under H.B. 523. Thus, on August 30, 2016, the Supreme Court of Ohio proposed the following amendment to Prof. Cond. R. 1.2(d)(2):

A lawyer may counsel or assist a client regarding conduct expressly permitted under Sub.H.B. 523 of the 131st General Assembly authorizing the use of marijuana for medical purposes and any state statutes, rules, orders, or other provisions implementing the act. In these circumstances, the lawyer shall advise the client regarding related federal law.

After the commenting period ended on September 18, 2016, the Supreme Court of Ohio adopted the proposed amendment verbatim on September 20, 2016. Now, attorneys may counsel and advise clients regarding conduct expressly permitted under H.B. 523, and if they do, attorneys must also advise clients of related federal law.

However, Prof. Cond. R. 1.2(d)(2) does not address an attorney’s use of medical marijuana or ownership of a medical marijuana business. Therefore, pursuant to the advisory opinion, an attorney’s use of medical marijuana or ownership of a medical marijuana business may reflect adversely on the attorney’s honesty or trustworthiness and fitness to practice law.

A copy of the amendment can be found here.