In 18 years on the federal bench, President Obama’s first Supreme Court nominee Judge Sonia Sotomayor has authored a number of published opinions in employment and labor cases.  In addition to the usual range of Title VII discrimination lawsuits, as a district court judge for the Southern District of New York, Sotomayor handled FLSA class actions, Equal Pay Act claims, and a variety of traditional labor cases involving strikes, grievance-arbitration procedures, collective bargaining, and pre-emption. Perhaps her most famous decision in the labor arena occurred in Silverman v. MLBPRC, whereshe issued an injunction sending the parties back to the bargaining table and ending the Major League baseball strike that had caused the cancellation of the playoffs and World Series in 1994.  As an appellate judge on the Second Circuit Court of Appeals, Sotomayor sat on the three-judge panel that heard Ricci v. DeStefano, currently under review by the U.S. Supreme Court, and affirmed the district court’s ruling that the City of New Haven, Connecticut, properly threw out the results of a promotional exam on the grounds that the exam had a disproportionately negative impact on African-American firefighters.

Some patterns emerge from Sotomayor’s decisions. For example, while she regularly granted summary judgment in favor of the employer in race and age discrimination cases, she ruled in favor of the employee in the four disability discrimination cases and the two sexual harassment cases she considered while on the Court of Appeals.  And, while she ruled against management in the Silverman case, more of her labor decisions have favored the company, including decisions upholding arbitration provisions and management’s right to bargain for restraints on trade.  Given her broad experience in this area of the law, it seems likely that Judge Sotomayor will play a key role in future employment and labor decisions should she be confirmed.

Two bills were recently introduced that would amend the Family and Medical Leave Act ("FMLA") and its regulations.  The Family and Medical Leave Restoration Act would repeal and revise FMLA regulations implemented in November 2008.  Generally, the Family and Medical Leave Restoration Act would give employees more rights under the FMLA.  The Family and Medical Leave Inclusion Act would expand the reasons an employee could take FMLA leave.  We have added both bills to our Watch List.

On April 28, 2009, a bill to expand the coverage of the Fair Labor Standards Act (“FLSA”) was reintroduced in the House and Senate.  The Fair Pay Act is intended to address the issue of unequal pay in jobs traditionally held by members of a particular gender, race, or national origin.  For example, sponsors of the bill note that women earn roughly 78 cents for every dollar earned by men and attribute this difference in part to lower pay for jobs traditionally held by females.  The bill would attempt to remedy that pay differential by requiring employers to pay equal wages to workers in jobs that are different, but involve similar skills, responsibilities, and working conditions.  We have added the bill to our Watch List.

The National Labor Relations Board has been understaffed since January 2008, when two of the Board’s four sitting members stepped down as their terms expired.  Since that time, the vacated seats have remained open and relatively unnoticed, while the Board’s two remaining members continued to issue decisions and orders in representation and unfair labor practice cases.  On Friday, May 1, the Seventh and D.C. Circuits simultaneously issued conflicting decisions governing the NLRB’s ability to issue two-person decisions, placing the 400+ decisions and orders issued by the two-member panel over the past 16 months in jeopardy.

The Circuit Courts came to opposite conclusions after reviewing the same section of the NLRA which addresses when the Board may operate with fewer than three members.  According to the Seventh Circuit, § 3(b) of the NLRA permits a two-member board as long as a group of no fewer than three members delegated its power to the two-member board, which occurred before the two appointees stepped down in January 2008.  The D.C. Circuit disagreed, ruling in a separate case that § 3(b) requires a quorum of not less than three members at all times.  Because any NLRB decision can be appealed to the D.C. Circuit, there is serious concern that parties who had decisions issued by the two-person panel will appeal, placing 400-plus decisions and orders at risk of being invalidated.  At least ten other lawsuits questioning the legality of decisions issued by the two-member Board have been filed in various federal appeals courts, and cases are pending in the Second and Eighth Circuits.

With the announcement of Justice David Souter’s impending retirement, the speculation regarding the effect his departure will have on the composition of the United States Supreme Court begins.  Given that Justice Souter commonly votes with the liberal wing of the Court, and that Mr. Obama will presumably nominate a reliably liberal jurist to replace him, the common wisdom is that Souter’s resignation is unlikely to change the Court’s current 5-4 conservative/liberal balance.  However, a closer examination shows Souter’s record to be a mixed one.  While Souter has been a consistent defender of civil liberties and his rulings in the employment context are generally pro-employee, he has also sided with law enforcement and business on a number of occasions.  Souter recently authored employment opinions that increased the evidentiary burden on employers defending certain types of age discrimination cases and expanded Title VII’s anti-retaliation provision to cover statements employees make during internal investigations.  However, Souter also authored the majority opinion in last year’s Exxon-Valdez case that slashed Exxon’s liability for punitive damages by 80% -- from $2.5 billion to around $500 million.  A different vote would have allowed the original damage award to stand.  Thus, it’s apparent that, on some issues important to business, Souter’s replacement on the bench will not be entirely inconsequential.

On April 30, 2009, the Department of Homeland Security (“DHS”) issued enforcement guidelines that direct the Immigration and Customs Enforcement (“ICE”) arm of the DHS to focus on criminal and civil prosecutions of businesses hiring undocumented immigrants.  The new enforcement program will focus on “criminal prosecution of employers who knowingly hire illegal workers in order to target the root cause of illegal immigration.”  The DHS Fact Sheet released to the press on April 30, 2009 notes that in 2008, nearly 6,000 people were arrested in workplace immigration raids in the United States, but only 135 of those arrested were employers.  The new enforcement guidelines aim to balance the disparity in those numbers. One of the new investigative standards promulgated in the guidelines directs ICE officers to obtain “indictments, criminal arrest or search warrants, or a commitment from a U.S. Attorney’s Office to prosecute the targeted employer before arresting employees for civil immigration violations at a worksite.”  In addition to criminal prosecution of employers, DHS will use other available civil and administrative tools, including civil fines and debarment from federal contracts.  In contrast to this new focus on employer-based enforcement, DHS plans to offer more protections to undocumented workers. For example, rules involving “humanitarian considerations,” which generally allow authorities to release detainees who are sick or sole caregivers for small children, may be taken into account in raids impacting worksites involving twenty-five or more undocumented workers, as opposed to previous rules requiring a threshold of 150 workers.

On April 23, 2009, House Representatives Sam Johnson (R-Texas) and Gabrielle Giffords (D-Arizona) reintroduced the New Employee Verification Act (NEVA) to create a mandatory national employee verification process for immigrants and U.S. citizens.  NEVA was originally introduced on February 28, 2008 and subsequently failed to make it out of committee.  NEVA would replace the government’s current E-Verify program with the Electronic Employment Verification System (EEVS).  E-Verify is an internet-based system that permits employers, on a voluntary basis, to verify employees’ work eligibility. The E-Verify system has been criticized for providing erroneous information, including incorrect eligibility results.  E-Verify relies on Social Security and Department of Homeland Security databases to verify employee eligibility.

EEVS would verify employment eligibility by utilizing the National Directory of New Hires, a new-hire database originally developed by the U.S. Department of Health and Human Resources to facilitate state child support enforcement.  In addition, the EEVS would still utilize the Social Security and Department of Homeland Security databases.  EEVS would also replace the paper-based I-9 employment verification system.  Employers seeking to verify their employees’ eligibility could access the EEVS system via the Internet or a toll-free telephone line.

Proponents argue that NEVA would enhance government efficiency by eliminating verification of U.S. citizen work authorization through the Department of Homeland Security.  U.S. citizens’ work authorization would be confirmed exclusively through the Social Security Administration.  Proponents also point out that NEVA would help combat ID theft.  NEVA would include a voluntary system called the Secure Electronic Employee Verification System (SEEVS), which in addition to EEVS verification, would include document screening tools and biometric identifiers.  The primary purpose of NEVA is to diminish the number of undocumented immigrants presently employed in the United States and provide for more effective enforcement of immigration and employment laws.  In addition to bipartisan support offered to the reintroduction of NEVA, several groups representing human resources professional have applauded the reintroduction of the bill.  This Act has been added to our Watch List.

A bill to expand the notification requirements of the Workers' Adjustment and Retraining Notification Act ("WARN") was introduced in the House of Representatives on April 23, 2009.  The bill would also increase penalties for employers that fail to give the required WARN notice.  We have added the bill to our Watch List.

A bill to expand the coverage of the Occupational Safety and Health Act ("OSHA”) was introduced in the House of Representatives on April 23, 2009.  The Protecting America's Workers Act would also increase penalties for OSHA violations, increase protections for whistleblowers, and allow families of injured employees to be involved in the investigation and settlement negotiations.  We have added the bill to our Watch List.

President Obama has announced his plans to nominate Mark Gaston Pearce and Craig Becker to the National Labor Relations Board (“NLRB”). If confirmed by the Senate, these union-friendly nominees would fill two of the NLRB’s five positions. Pearce and Becker would join current NLRB member Wilma B. Liebman, whom President Obama designated Chairwoman in January, creating a Democrat majority on the NLRB. Once the Democrat majority is established, the Board is expected to reexamine several pro-business precedents established by the Bush administration.

Mark Gaston Pearce, a State University of New York at Buffalo School of Law graduate, began his legal career with the NLRB as a district trial specialist in the Buffalo office.  After 15 years with the NLRB, he entered private practice and is presently a founding partner of Creighton, Pearce, Johnsen & Giroux, representing unions and individuals in labor and employment matters.  Mr. Pearce serves as a Board Member on the New York State Industrial Board of Appeals, is adjunct faculty at Cornell University School of Industrial Labor Relations, and is a member of an American Federation of Teachers (AFL-CIO) affiliate union.

Craig Becker serves as General Counsel to both the American Federation of Labor & Congress of Industrial Organizations and the Service Employees International Union (SEIU).  He served on the Agency Review Team overseeing the Department of Labor as part of President Obama’s transition team.  After graduating from Yale Law School, he clerked for the Honorable Donald P. Lay, Chief Judge of the United State Court of Appeals for the Eighth Circuit.  During his career as a labor lawyer, Mr. Becker has served as a Professor at the UCLA School of Law, taught at University of Chicago and Georgetown Law Schools, and has published a number of labor-related law review articles.