14 Employment Law Briefing - Current Trends

Transcription

1 LOS ANGELES 2014 EMPLOYMENT LAW BRIEFING PRESENTATION January 21, 2014 Presenters: Eric Beane, Partner, Los Angeles Mark Boxer, Partner, San Francisco David Durham, Partner, San Francisco Ute Krudewagen, Partner, Palo Alto Nick Pujji, Associate, Los Angeles Maria Rodriguez, Partner, Los Angeles Ben Gipson, Of Counsel, Los Angeles Caroline Donelan, Associate, Los Angeles Katharine Liao, Associate, Los Angeles Michelle Kunihiro, Associate, Los Angeles *This presentation is offered for informational purposes only, and the content should not be construed as legal advice on any matter.

2 ROADMAP Class Actions: Trends and Hot Topics The Mobile Workforce Social Media: NLRA Section 7 Rights, Protecting Trade Secrets and Company Image National Labor Relations Board Trends and Organized Labor Activity Health Care Reform and Your Bottom Line Workforce Mobility, Turnover and Non-Solicitation Global Workforce Issues, Data Privacy Developments and International Privilege The 2014 Management Report: Recruiting and Managing Millennials 2014 Employment Law Briefing 2

3 CLASS ACTIONS: TRENDS & HOT TOPICS

4 CLASS AND COLLECTIVE ACTIONS: TRENDS & HOT TOPICS Fewer class actions The trend predates Dukes & Brinker Dukes & Brinker provide defenses Plaintiff s bar believes the pendulum is swinging back we disagree Shifting of Claims - more focus on company practices Time spent on community events or time ancillary to work Expenses Attacks on unique compensation systems Off the clock specific to PDA and work outside of work hours Defeating cases at early pleading stages PAGA has not been fully utilized 2014 Employment Law Briefing 4

5 THE PENDULUM IS IT SWINGING AWAY? Do cases like Faulkinbury or Networkers constitute signs of a new trend? Faulkinbury is fact-specific Networkers does create a bright-line rule Lack of policy may be basis for certification What significance, if any, do the depublished cases have Tenet Health Care Lamps Plus Brinkley Chipotle Radio Shack 2014 Employment Law Briefing 5

6 PAGA Seeing some pure PAGA cases, but not yet big numbers Included more often in class action filing Can wind up with a pure PAGA case when class claims are defeated Procedure is still unclear Practical tips to attack PAGA: Take advantage of safe haven to change practices Challenge the pleadings Force plaintiff to show the actual violation against him/her before they can represent other aggrieved employees Challenge the exhaustion with the LWDA 2014 Employment Law Briefing 6

7 CLASS AND COLLECTIVE ACTIONS: PROCEDURAL TRENDS Company s policy of denying pay for pre-shift work may satisfy predominance/commonality requirements for class certification that supersedes issues with varying workloads and commute times. Jones v. Farmers Ins. Exchange, 221 Cal. App. 4 th 986 (2013) Not enough to argue under Dukes that certification cannot proceed because defendant has a right to litigate defenses as to the claims of each individual class member. Williams v. Super. Ct., 221 Cal. App. 4 th 1353 (2013) Relying on Dukes, the Supreme Court held that courts must consider whether the plaintiff s proposed damages model could show damages on a classwide basis before certifying a Rule 23 class action. Comcast Corp. v. Behrend, 133 S.Ct (2013) Courts still upholding class action waivers and hesitant to find waiver of the right to compel arbitration. Richards v. Ernst & Young, LLP, 734 F.3d 871 (9 th Cir. 2013) 2014 Employment Law Briefing 7

8 CLASS AND COLLECTIVE ACTIONS: MORE HOT TOPICS CEOs may be deemed the employer and held personally liable in FLSA wage and hour collective actions -- according to the Second Circuit. Irizarry v. Catsimatidis, 722 F.3d 99 (2d Cir. 2013) Why, besides upsetting CEOs is this important? Adds pressure to be in compliance and avoid claims 2014 Employment Law Briefing 8

9 CLASS AND COLLECTIVE ACTIONS: LOOKING INTO THE CRYSTAL BALL Cases that will continue to be prevalent: Pay practices & technical violations (e.g., wage statements, pay card and check requirements, etc.) Meal & rest periods to some extent Independent contractor & intern misclassification Compensable time (e.g., off the clock) Claims based on recent or new laws: Wage Theft Act Notice Commission agreements New minimum wage Misclassification based salary basis test (new minimum wage) 2014 Employment Law Briefing 9

10 ACTION ITEMS Review and strengthen policies and practices Ensure employee responsibilities are clearly stated Address any technical issues (usually the easiest to fix) Ensure proper manager training Have a deliberate and thoughtful employee communication plan Strategically address any discovered potential liabilities Have a plan for dealing with liabilities that may turn into claims, before changes are implemented 2014 Employment Law Briefing 10

11 THE MOBILE WORKFORCE

12 WHAT DO YOU DO WHEN YOU FIRST WAKE UP? Always Connected, IDC Study, Sponsored by Facebook, March Employment Law Briefing 12

13 POLICIES AFFECTED BY MOBILITY: MOBILE APPS PERMEATE Data Privacy & Security Harassment, Discrimination & EEO Workplace Safety Time Recording and Overtime Acceptable Use of Technology Compliance and Ethics Records Management Litigation Holds Confidentiality & Trade Secret Protection 2014 Employment Law Briefing 13

14 MOBILE DEVICE RISKS Loss of control over corporate data Violation of regulatory compliance obligations, e.g. SEC, HIPAA, GLBA, FINRA Security breaches Misappropriation of trade secrets and confidential information HR/Employment Risks Off the clock wage and hour claims Potential privacy-based claims, particularly with medical information Workplace safety issues, including distracted driving Records management and e-discovery challenges 2014 Employment Law Briefing 14

15 BYOD POLICIES BYOD Policies: User Policies that govern ownership and use User Policies that govern payment for the service plan, technology allowances or reimbursement Information Security Policies that attempt to manage risk HR Policies to address impact of mobile devices on workplace behavior Selection, installation and deployment of mobile device management software Applicable disciplinary procedures for non-compliance Significant privacy implications Training regarding all of the above 2014 Employment Law Briefing 15

16 BYOD: EMPLOYEE PRIVACY Issuing a remote wipe command get consent Employees have a reasonable expectation of privacy in their personal device All 50 states have computer trespass laws Potential liability under the Computer Fraud & Abuse Act if the unauthorized access causes damages > $5,000 Accessing an employee s personal or cloud account Access to medical information, personal financial information and life choices Lifestyle Statutes 2014 Employment Law Briefing 16

17 IMPLICATIONS OF TECHNOLOGY USE Options for Managing Wage & Hour Concerns Limit non-exempt employees from accessing or making work-related calls outside of scheduled hours Limit access/program participation to employees who are exempt from OT Create process for reporting work performed outside of working hours Training Employees Managers Compliant policy requiring pay for all hours worked Must pay for all time worked, approved or not Can treat time worked without authorization as a disciplinary issue Address questions of who pays for device and expenses 2014 Employment Law Briefing 17

18 EEOC RECOMMENDED BEST PRACTICES EEOC s View of Employer Best Practices for Background Checks Eliminate blanket exclusions based on any criminal record Develop narrowly tailored written policy/procedures excluding individuals from particular jobs based on a criminal history record (1) Identify essential job requirements (2) Identify specific offenses tied to unfitness for job (3) Identify time limits applicable to exclusion (4) Document research/consultations to support policy/procedures (5) Provide for individualized assessment before final hiring decision When asking questions about criminal records, limit inquiries to records job related/consistent with business necessity Make inquiries of criminal record post application (e.g. ban the box approach) Train managers, hiring officials, and decision-makers on how to implement the policy and procedures consistent with Title VII. Maintain confidentiality of criminal records 2014 Employment Law Briefing 18

19 GEOLOCATION TRACKING AND TELEMATICS FTC: Geographic location is sensitive information CA Penal Code No person or entity in this state shall use an electronic tracking device to determine the location or movement of a person Tread carefully, legal support for limitations on use of location data is growing Source: CTIA The Wireless Association, Best Industry Practices and Guidelines for providers of location based services Employment Law Briefing 19

20 SOCIAL MEDIA

21 THE WORLD KEEPS CHANGING 1. The fastest growing demographic on Twitter is the year age bracket million of Facebook s users are "mobile only 3. YouTube reaches more U.S. adults aged than any cable network 4. Every second two new members join LinkedIn 5. LinkedIn has a lower percentage of active users than Pinterest, Google+, Twitter and Facebook 6. Social media has overtaken porn as the no. 1 activity on the web 7. 93% of marketers use social media for business 8. 25% of smartphone owners ages say they can t recall the last time their smartphone wasn t next to them 9. 25% of Facebook users don t bother with privacy settings million websites have integrated with Facebook (Fast Company, 2013) 2014 Employment Law Briefing 21

22 NLRB GUIDANCE NLRB continues to expand its reach beyond unionized workforces NLRB 2013 Decisions and Trends Social media policies Terminations based on conduct via social media 2014 Employment Law Briefing 22

23 WHAT ELSE IS NEW? Password Protection Laws Corporate Espionage Privacy Rights Ownership of Social Media Wage and Hour Cases Interplay with Other Policies and Sector-Specific Regulations 2014 Employment Law Briefing 23

24 NEW LIFE FOR WORKPLACE PRIVACY: PASSWORD PROTECTION STATUTES Numerous states have enacted legislation to prohibit employers from asking applicants or employees for social media passwords or other log-in credentials, including CA, CT, CO, HI, IL, MD, MI, NV, NM, OR, UT, VT and VI. Others have pending legislation and federal legislation has also been introduced. California s statute provides an exception that permits employers to request an employee to divulge personal social media reasonable believed to be relevant to an investigation of allegations of misconduct. California also has an exception for usernames and passwords used to access employer-issued devices. Be aware of tensions between State laws and FINRA obligations to supervise and retain records Employment Law Briefing 24

25 SOCIAL MEDIA PRACTICES: RECRUITING, HIRING AND PROMOTIONS Build a process for lawful use of social media data Determine how to use in recruiting candidates Determine when on-line searches will be used in hiring and promotion process (ex. after initial screening interviews) Determine scope of review: what sources will be checked and what information will be collected? Decide whether to inform applicants about on-line searches and whether to ask for addresses, user names and blog posts Give notice and obtain consent where needed and comply with FCRA if using third parties to conduct search Do not engage in unauthorized access to password protected sites, shoulder surf or require users to disclose passwords unlawfully Isolate protected class information from the decision-maker Update forms for recording information, maintain contemporaneous documentation and comply with applicable retention requirements 2014 Employment Law Briefing 25

26 ACTION ITEMS Review your social media policy Review other relevant policies to make sure they are consistent with your social media policy (e.g., computer use, confidentiality, right to privacy, harassment, etc.) 3. Review recruiting, hiring, and interviewing practices 4. Evaluate employee use of electronic devices for work purposes 5. Evaluate employee time spent posting on or maintaining Company social media page 2014 Employment Law Briefing 26

27 NATIONAL LABOR RELATIONS BOARD TRENDS AND ORGANIZED LABOR ACTIVITY

28 NLRB TRENDS Looking to boost its relevance and impact, the National Labor Relations Board sees non-union employers as low hanging fruit Understands realities of current workforce Many employers do not realize so-called Section 7 Rights already extend to many non-union workers So, what are they looking for? Discipline & Discharge: Beyond social media cases, any instances of adverse action against employees for concerted activities (from griping about wages, to breaks, to lack of toilet paper in the bathroom) Investigations: Overbroad imposition of confidentiality Class Arbitration Waivers: Including them in agreements and policies 2014 Employment Law Briefing 28

29 NLRB TRENDS But the NLRB has not forgotten about unionized (or likely to unionize) employers Flurry of major decisions in past year will help unions get a foot in the door; and then, once they are there (or if they already are), help them leverage for richer collective bargaining agreements How? Access Rights: information, organizing drives, meetings Dues Check-Off: keep funds flowing Micro Units: do not accidentally recognize a union! Notice Posting: On Jan. 6, 2014, NLRB raised the white flag in announcing it will not seek review of appellate courts invalidation of employee rights notice posting rule 2014 Employment Law Briefing 29

30 UNION TRENDS What are private sector unions up to these days? Continued focus on health care sector (esp. with its increasing industry consolidation) Kaiser: in May, SEIU won war with NUHW for 44,919 dues-paying workers in California Expect battles in ongoing county privatization efforts More secondary pressure (pickets, hand billing) Tech Companies (Google, Twitter) Retailers (Walmart) More high profile media events SEIU as new political animal union model Will be careful in light of opinion backlash post BART strikes 2014 Employment Law Briefing 30

31 PUTTING UPCOMING LABOR NEWS IN CONTEXT Wiping the Slate: 318 NLRB decisions going back to Aug could be erased in 2014 by the Supreme Court in Noel Canning ABHOW (witness statements); DR. Horton (arbitration); WKYC-TV (dues checkoff); COSTCO (social media); MARRIOT (off duty access); ALAN RITCHEY (bargaining re disc.); BANNER HEALTH (investigations) So what? Minimal long-term impact, Board likely remand and/or renew (albeit over a period of time) like it did in New Process Steel in 2010 Upcoming DOL Persuader Rule Regulatory Change Indirect pressure for neutrality agreements 2014 Employment Law Briefing 31

32 KEY ACTION ITEMS Preparing The Labor Law Front: Do not consider concerted activity in misconduct investigations; if present, disclaim and neutralize When performing confidential investigations, explain the reasons why you are requiring/providing confidentiality Do not bargain with groups of employees; you might actually be recognizing a union or otherwise committing an Unfair Labor Practice Be creative and proactive: when facing litigation, you may be able to resolve a lawsuit via preemption under the National Labor Relations Act 2014 Employment Law Briefing 32

33 HEALTH CARE REFORM AND YOUR BOTTOM LINE

34 COST OF COVERING THE UNINSURED & CRITICISMS OF THE ACA Can you guess what the estimated cost of uncompensated care was in 2013? Can you guess what the estimated cost of uncompensated care will be with the ACA in 2019? Can you guess who said a deterioration in quality of care is inescapable? Can you guess who said this will end the progress of a great country? One last quote Never in history of the world has any measure been brought here so insidiously designed as to prevent business recovery 2014 Employment Law Briefing 34

35 WHO IS SUBJECT TO THE MANDATE? Businesses subject to the mandate How to calculate whether you have 50 full-time equivalent employees Special rules for seasonal employees Total number of Full-Time Employees + Total Hours Worked By Part-time Employees = Total Number of Full-time Equivalent Employees Employment Law Briefing 35

36 DETERMINING FULL-TIME EMPLOYEES Who must be offered coverage determining full-time employees Penalty amount turns on who is considered a full-time employee How to make the calculation of full-time employee Hours of service rules 2014 Employment Law Briefing 36

37 FULL-TIME EMPLOYEES, CONT D Determining full-time status optional safe harbor Look-back measurement period Administrative period Stability period Transition relief Variable hour employees Interplay between shared responsibility rules and waiting period rules 2014 Employment Law Briefing 37

38 EMPLOYER MANDATE Effective in 2015 and after Employer mandate tax penalty for large employers that don t offer minimum essential coverage to full-time employees (and their dependents) A large employer (employer with 50 or more full-time equivalent employees) is subject to penalty if at least one fulltime employee receives a subsidy for exchange coverage and the employer: Fails to offer coverage to substantially all fulltime employees (and their dependents) (the no coverage penalty ); or Coverage is unaffordable (employee contribution must be less than 9.5% of income) or does not provide minimum value (the inadequate coverage penalty ) 2014 Employment Law Briefing 38

39 INADEQUATE COVERAGE PENALTY Penalty amounts Inadequate coverage penalty: $3,000 per year, per full-time employee for whom coverage is unaffordable or does not provide minimum value and who receives a subsidy to purchase coverage through an exchange 2014 Employment Law Briefing 39

40 OFFER OF COVERAGE COST & VALUE Affordability general rule Safe harbors W-2 wages Rate of pay Federal poverty line Minimum value Plan must pay at least 60% of cost of benefits Actuarial test Based on standard population 2014 Employment Law Briefing 40

41 NEW FEES AND NOTICE Reinsurance contribution $63 per year for each covered person Paid for 3 years beginning in 2014 Patient-centered outcomes fee $1 per year for each covered person Paid for 7 years beginning in 2012 Health insurance industry fee Only affects insured plans 2 2.5% of premium in 2014 Permanent, annual fee Notice of state exchanges Due October 1, 2013 Two model-notices one for employers who offer a health plan and one for employers who don t Model notices available at Employment Law Briefing 41

42 NEW MARKET REFORMS Additional mandates No pre-existing condition exclusions 90-day limit on waiting periods Limits on cost-sharing Clinical trial coverage Wellness programs Incentive will increase to 30% (50% for tobacco programs) 2014 Employment Law Briefing 42

43 60 DAY NOTICE OF MATERIAL MODIFICATION & AUTOMATIC ENROLLMENT 60 Day Notice of Material Modification Effective September 23, 2012 Part of SBC Regulations Notice provided if change occurs other than at time of renewal of coverage, affects the SBC and change not reflected in the SBC. Restated SBC Penalty - $1,000 for each failure each covered individual equals a separate offense. Automatic Enrollment Delayed Auto enrollment applies to employers with over 200 employees Auto enroll all new employees and dependents and re-enroll those already enrolled 2014 Employment Law Briefing 43

44 SMALL EMPLOYER PROVISIONS Provisions of the ACA affecting small employers SHOP exchange: Small businesses with fewer than employees (depending on state) can select and pay for coverage through special insurance marketplace. Exchange will manage administration for employers Small employer tax credit: A small employer tax credit may be available to small employers with fewer than 25 FTEs with average wages of less than $50,000 per FTE if the employer provides coverage and pays at least half of the cost of employee-only premium 2014 Employment Law Briefing 44

45 STEPS FOR EMPLOYERS Compliance steps for employers All employers were to distribute exchange notice by October 1 Employers with health plans to ensure compliance with 2014 market reforms and pay fees Determine whether business is subject to mandate and penalties Determine number of full-time employees Large employers to review health insurance offerings and determine whether employer will incur a penalty consider substantial compliance rule, dependents and spouses, affordability, minimum value Large employers to determine the amount of the penalty versus cost of coverage, and decide whether to pay or play 2014 Employment Law Briefing 45

46 SAME-SEX MARRIAGE ISSUES As a consequence of the Windsor decision all federal tax provisions will apply where marriage is a factor, including filing status, employee benefits, IRA contributions, earned income, child tax credits etc regardless of where they live Federal tax benefits do not apply to domestic partners unless the domestic partner is considered a dependent Employers and employees may file for refunds for overpayments made in 2013 and prior years 2014 Employment Law Briefing 46

47 SAN FRANCISCO HEALTH CARE SECURITY ORDINANCE Purpose provide health care coverage for the uninsured. Employers with 20 or more employees are affected (nonprofits with 50 or more employees) Employers with 100+ employees must provide $2.44 per hour of health care coverage (not to exceed 172 hours per month) Employers with less than 100 employees must provide $1.63 per hour of health care coverage (not to exceed 172 hours per month) 2014 employers may no longer employ a stand alone HRA 2014 Employment Law Briefing 47

48 SAN FRANCISCO HEALTH CARE SECURITY ORDINANCE Ways to comply in 2014 Excepted HRA must contain vision, dental, LTC and specific disease coverage Skinny Plan with attached HRA Pre HRAs Can continue HRAs 24 month extension applies 2015 and beyond May be required to provide bronze coverage and additional benefit Currently no coordination between ACA and the SF Ordinance Excepted HRA must contain vision, dental, LTC and specific disease coverage Skinny Plan with attached HRA. After-Tax HRA 2014 Employment Law Briefing 48

49 TURNOVER, WORKFORCE MOBILITY AND NON- SOLICITATION

50 EMPLOYEE TURNOVER Costs of Turnover Under $30,000 = 16% of salary $50,000 or less (40% of US jobs) = 20% of salary Some say these figures are much higher when you take into account all costs associated Some say as high as 150% of salary Managerial and Executive turnover the most costly per employee Turnover rates in many industries averages between 30-40% 2014 Employment Law Briefing 50

51 TURNOVER: COST TO VALUE Fig: Economic Value of an Employee to the Organization over Time (C) Bersin by Deloitte 2014 Employment Law Briefing 51

52 WORKFORCE MOBILITY Trend toward more mobility The economic crisis Increasing global workforces Certain sectors and jobs (technology industry; salespeople; executives) Average employee stays at his/her job 4.4 years Bureau of Labor Statistics Job-hopping is the new normal for Millennials. Forbes, August 14, 2012 Millennials plan to stay at a job no more than 3 years Multiple Work (survey) 2014 Employment Law Briefing 52

53 NON-SOLICITATION PROVISIONS IN CA Non-solicitation of employees Non-solicitation of customers Trade secrets customer lists? When does a non-solicitation of customers provision look like a non-compete in CA? 2013 CA cases provide insight and guidance Knapp v. Depuy Synthes Sales, Inc. (E.D. Cal. Oct. 2013) Angelica Textile Services v. Jaye Park (Cal. Ct. App. Oct. 2013) 2014 Employment Law Briefing 53

54 MORE PROTECTIONS & STRATEGIES Strengthen trade secrets & confidentiality protections in agreements and policies be specific and define terms clearly Ensure proper practices to protect company assets and property Tighten policies and make their interrelation clear Technology Computer use Include Computer Fraud & Abuse protections Confidentiality Employee misconduct Social Media 2014 Employment Law Briefing 54

55 GLOBAL WORKFORCE ISSUES, DATA PRIVACY DEVELOPMENTS AND INTERNATIONAL PRIVILEGE

56 GLOBAL WORKFORCE ISSUES

57 GLOBAL DEVELOPMENTS AND TRENDS Global expansion to new jurisdictions Greater competition for talent Stronger need to protect the company Extra focus on alternative workers A more high-tech, mobile office Expanding employee data privacy protection Updates to social security, benefits and pension regulations New discrimination, harassment and gender equality laws Eyes on wage and hour and misclassification Ongoing workforce evaluation and restructuring More cross-border litigation and investigations Global focus on anticorruption and whistleblowing Increasingly global M&As Unions become more global 2014 Employment Law Briefing 57

58 ATTORNEY-CLIENT PRIVILEGE AROUND THE WORLD Attorney-client privilege for attorneys and in-house counsel No attorney-client privilege for in-house counsel No attorney-client privilege 2014 Employment Law Briefing 58

59 APAC UPDATES Korea Japan India China Hong Kong Taiwan EUROPE Updates AMERICAS Updates ME/AFRICA Updates Singapore Malaysia Indonesia Click each country label for detailed updates. Australia 2014 Employment Law Briefing 59

60 AUSTRALIA New, Important Bullying Laws, effective January 1, 2014 Employers should review policies, implement complaints mechanisms, train employees Allows employees to apply directly to the Fair Work Commission for an order to stop bullying Public Interest Disclosure Act, effective January 14, 2014 Public officials who make prescribed disclosures given protection under Act 2014 Employment Law Briefing Return to Map 60

61 CHINA Limitations on use of dispatch workers, effective July 1, 2013 Dispatch workers may be used only for temporary (up to 6 months), auxiliary (supporting the core business, or substitute positions (to replace an employee on leave, training etc.) Guidance from Supreme People s Court, effective February 11, 2013 Guidance on the topics of severance payments, compensation for noncompete obligations, and requirement to notify labor unions of terminations Exit-Entry Administration Law, effective July 1, 2013 Altered Chinese entry-exit procedures by creating new visa and work permit categories for foreigners traveling to or working in China Increased penalties and enforcement provisions 2014 Employment Law Briefing Next Page 61

62 CHINA New labor policy anticipated under China s New President, Xi Jinping Expected increase in the retirement age (currently, 60 for men and 50 or 55 for women) Relaxation of the one child policy for couples where one parent is an only child Greater emphasis on the role of trade unions, in particular with respect to collective wage bargaining Plan to narrow the income gap by limiting excessive salaries, identifying and eliminating sources of illegal income, increasing the minimum wage and tax reforms Reduction in employer social security contributions 2014 Employment Law Briefing Return to Map 62

63 HONG KONG Summary dismissal Recent case law shows difficulties of summary dismissals in Hong Kong Secondment arrangements Secondees may be entitled to statutory benefits provided to Hong Kong employees Minimum wage, effective May 1, 2013 HK $30/hour 2014 Employment Law Briefing Return to Map 63

64 INDIA Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act of 2013, effective December 9, 2013 Seeks to protect women in the workplace from harassment Requires employers to institute an internal complaints committee, organize awareness programs, post information about harassment 2014 Employment Law Briefing Return to Map 64

65 INDONESIA Minimum wage increases Increased by 40% in most regions in 2013 Restrictions on use of outsourced workers Only type of work that can be delegated to a labor supplier must be supporting services or activities that are not directly related to the main production process Two-year limitation on employee claims struck down Employers advised to properly document and process employee terminations since employees can file claims for longer than two years 2014 Employment Law Briefing Return to Map 65

66 JAPAN Reductions in force / performance terminations Case law continues to demonstrate the difficulties of terminations in Japan, even where employer documents performance issues Marked increase in power harassment (bullying) claims Survey by Ministry of Health, Labor and Welfare heightened public awareness, resulting in a rise in claims Retirement age Retirement age changing from 60 to 65 years old 2014 Employment Law Briefing Return to Map 66

67 KOREA Invention Promotions Act Amended, effective January 31, 2014 Requires employers to implement procedures in order to acquire a nonexclusive license to employee inventions Exemptions for SMEs Supreme Court weighs in on expanded scope of ordinary wages Regular bonus payments are considered ordinary wages Allowances excluded from ordinary wages 2014 Employment Law Briefing Return to Map 67

68 MALAYSIA Personal Data Protection Act 2010, effective November 15, 2013 Regulates the collection, processing and transfer of personal data Require employers in specific sectors to register with the PDPD 2014 Employment Law Briefing Return to Map 68

69 SINGAPORE Amendments to the Employment Act, effective April 1, 2014 Expands employees protected by Employment Act Increases government s enforcement power and penalties for noncompliance Personal Data Protection Act, effective January 2, 2013 Data protection law that governs the collection, use, disclosure and care of personal data Amendments to Workplace Safety and Health (Incident Reporting) Regulations, effective January 6, 2014 Changes trigger requirements for the reporting of accidents Increases scope of accidents that must be reported 2014 Employment Law Briefing Return to Map 69

70 TAIWAN Hourly and monthly minimum wage increases Hourly minimum wage increased to NTD 115, effective January 1, 2014 Monthly minimum wage increased to NTD 19,273, effective July 1, Employment Law Briefing Return to Map 70

71 EUROPE UPDATES Click here for European-wide updates Netherlands APAC Updates Belgium Ireland Switzerland UK Germany Poland Russia AMERICAS Updates ME/AFRICA Updates France Spain Italy Click each country label for detailed updates Employment Law Briefing 71

72 EU-WIDE Gender imbalance in corporate governance EU Parliament backed EU Commission s proposal for 40% female nonexecutive directors for listed companies by 2020 Will become law if adopted by the European Parliament and EU Member States New EU Data Privacy Regulation under discussion Proposals include substantial fines for violation Safe harbor under scrutiny 2014 Employment Law Briefing Return to Map 72

73 BELGIUM Removes distinction between blue and white collar workers, effective January 1, 2014 Significant changes to various aspects of employment law For instance, probationary period abolished, notice periods harmonized, termination of employees now for fair reason Royal Decree providing for salary freezes Average wage costs for 2013 and 2014 frozen (exception for indexation) 2014 Employment Law Briefing Return to Map 73

74 FRANCE Relaxation of Works Council Collective Redundancy Rules Time limits on works council consultation procedures Employers in companies with 50 or more employees may enact rules for consultation process Reducing the risk of litigation Reduction in time limits for filing labor claims to two years Article 21 of the Law for the Financing of Social Security Social security contribution imposed on severance payments for mutual termination French Supreme Court ruling on remunerations for inventors Remuneration must be determined when employees demands ownership, but must take into account the industrial and commercial utility of the invention 2014 Employment Law Briefing Return to Map 74

75 GERMANY Temporary workers Federal Court ruling on "permanent" leasing of temporary workers Coalition plans to cap employee leasing at 18 months Minimum Wage Law proposed, effective in 2015 Minimum wage would start at 8.50 an hour 2014 Employment Law Briefing Return to Map 75

76 IRELAND Change in state pension entitlement Employees with a contractual retirement age of 65 who expect to receive a state pension will no longer receive it until age Employment Law Briefing Return to Map 76

77 ITALY New provision in Italian labor law: fixed-term contracts Employers no longer required to provide reasons for hiring FTC employees of no more than 12 months National collective agreements may provide different regulations in use of temporary contracts Recording employee conversations violation of privacy rights Supreme Court upheld dismissal of employee who recorded colleagues conversations without their knowledge 2014 Employment Law Briefing Return to Map 77

78 NETHERLANDS Changes to Dual Dismissal Program expected in 2016 Dutch government has proposed abolishing the system EUR 75,000 cap on severance Consecutive fixed-term contracts Effective January 2, 2015, consecutive contracts of no more than six months entered into within two-year period considered contracts for indefinite period Clawback of Bonuses Act, effective January 1, 2014 Enables NVS financial undertakings to adjust or claw back executive bonuses Taxation of severance pay, effective January 1, 2014 Severance payments to be taxed at normal tax rate 2014 Employment Law Briefing Return to Map 78

79 POLAND Labor Code amendment introduces new rules on working time schedules and parental leave, effective June 17, 2014 Settlement period for flexible working time schedules extended up to 12 months Maternity leave increased, new parental leave introduced 2014 Employment Law Briefing Return to Map 79

80 RUSSIA Legislature postponed draft bill on temporary work Bill addresses lack of regulations regarding temporary workers 2014 Employment Law Briefing Return to Map 80

81 SPAIN Substantial changes in collective bargaining agreements Employers can avoid the application of industry-level CBAs in three ways Retirement age to be raised From 65 to 67 Constitutional Court on employee monitoring Monitoring employee not found an infringement of employee s privacy in case at issue 2014 Employment Law Briefing Return to Map 81

82 SWITZERLAND Collective redundancy requirements increase burden for employers, effective January 1, 2013 Employer required to negotiate a social plan if it employs more than 250 employees and intends to effect at least 30 redundancies over 30 days Electorate votes down imposition of executive pay limit Law would have capped executive compensation at 12 times the wage of a company s lowest earner Referendum followed an earlier March 2013 referendum in which majority of voters supported ability of company shareholders to veto executive pay proposals and ban executives receiving compensation in advance or on departure 2014 Employment Law Briefing Return to Map 82

83 UNITED KINGDOM Implications of Usdaw v. Ethel Austin Ltd. on collective redundancy consultation Employers required to collectively consult when proposing to make 20 or more redundancies over 90 days, regardless of where employees are based Case under appeal Rules on collective redundancy relaxed, effective April 6, 2013 For employers downsizing 100+ employees, consultation period lowered from 90 to 45 days Unfair dismissal cap the lower of one year s salary or GBP 74,200 Cap is now the statutory maximum (currently, GBP 74,200) or 52 weeks' pay, whichever is lower 2014 Employment Law Briefing Next Page 83

84 UNITED KINGDOM TUPE reforms due in January 2014 Employers would have more flexibility in TUPE transfers, such as to change the terms and conditions of employment following a TUPE transfer Introduction of employment tribunal fees, effective July 29, 2013 Employment Tribunal started collecting fees from claimants 2014 Employment Law Briefing Return to Map 84

85 AMERICAS UPDATES Canada APAC Updates Mexico Colombia Venezuela EUROPE Updates ME/AFRICA Updates Brazil Click each country label for detailed updates. Argentina 2014 Employment Law Briefing 85

86 ARGENTINA New Same-Sex Marriage and Gender Identity Law Since 2010, same sex marriage recognized Since 2012, individuals can choose their own gender identity New laws could serve as the basis for employment discrimination 2014 Employment Law Briefing Return to Map 86

87 BRAZIL New Anti-Corruption Law, effective January 28, 2014 Establishes comprehensive system of corporate and individual liability for acts of corruption Employers should revisit codes of conduct and internal policies and conduct employee training sessions 2014 Employment Law Briefing Return to Map 87

88 CANADA Drug and alcohol testing further limited Supreme Court of Canada struck down random alcohol testing policy; held that testing of employees requires a balancing of interests Restrictive covenants: still useful, especially in transactional setting Supreme Court of Canada upheld covenant made during negotiations for a sale of a business; emphasized importance of context Ontario: health and safety awareness training and Accessibility for Ontarians with Disabilities Act Health and safety awareness training required effective July 1, 2014 Accessibility for Ontarians with Disabilities Act, 2005 requirements now in effect, additional obligations for companies with 50 or more employees in Ontario effective January 1, 2014 New Anti-bullying and harassment requirements in British Columbia, effective November 1, 2013 Employers must take reasonable steps to prevent/minimize, workplace bullying and harassment Employers must develop and enforce an anti-bullying/harassment policy 2014 Employment Law Briefing Return to Map 88

89 COLOMBIA Regulations to implement data protection laws, effective June 27, 2013 Regulations address privacy notices, consent requirements, collection and processing of personal data, and transfer of data internationally Employer social security contributions eliminated for some workers, effective January 1, 2014 Effective January 1, 2014, employers no longer need to make social security contributions for workers earning less than 10 times the minimum wage (approx. US$3.058) Immigration laws, effective July 1, 2013 Introduced new visa classifications, including ones for business and temporary work 2014 Employment Law Briefing Return to Map 89

90 MEXICO Labor implications: 2013 Tax Reform Effective January 1, 2014 Impacts social contributions for employers and employees and results in taxation of fringe benefits New privacy guidelines Effective April 17, 2013 Requires employers to implement data privacy notices and obtain consent before collection personal data Mexican Federal Labor Law: a Reminder Took effect December 1, 2012 For instance, new requirements on outsourcing; expanded hiring methods New training program requirements, effective September 15, 2013 Employers must create a joint commission on productivity and training, develop a skills and competency training plan, etc Employment Law Briefing Return to Map 90

91 VENEZUELA Organic Law of Labor and Workers, effective May 7, 2013 Imposes new restrictions for work hours and days of rest Provides for additional parental leave 2014 Employment Law Briefing Return to Map 91

92 ME/AFRICA UPDATES Israel Turkey UAE Egypt Saudi Arabia APAC Updates EUROPE Updates AMERICAS Updates South Africa Click each country label for detailed updates Employment Law Briefing 92

93 EGYPT New special allowance, effective July 1, 2013 Entitles all employees hired before July 1, 2013 to 10% increase in base salary, and for all new hires, a 10% yearly allowance needs to be planned in Implementation of maximum and minimum salaries in public sector anticipated in 2014 Minimum of EGP 1,200 and maximum 35 times the amount, but not exceeding EGP 42,000 Presidential decree No. 79/213 raises pension entitlements, effective August 13, 2013 Increase of end of service award to 2 months Participation in social security scheme raised to 6% (instead of 3%) 2014 Anticipated Changes: New labor unions law 2014 Employment Law Briefing Return to Map 93

94 ISRAEL Prohibition of employment discrimination on the basis of sexual preference under consideration Bill passed by the Ministerial Law Committee; sent to the full Knesset for approval If passed, would require all laws against discrimination to include a ban on gender or sexual preference discrimination 2014 Employment Law Briefing Return to Map 94

95 SAUDI ARABIA Immigration reform impacts recruitment and immigration procedures Employers required to consider KSA nationals for all vacancies prior to engaging a foreign national (Saudisation); certain roles reserved for KSA nationals Employers required to sponsor foreign employees to meet visa requirements or employees face penal measures and deportation Introduction of wage protection program, effective December 1, 2013 Companies with 3,000+ employees required to submit wage information to Ministry of Labor Changes to the working week, starting June 2013 Changed to Sunday to Thursday (from Saturday to Wednesday) to be in line with the UAE ad other GCC countries 2014 Employment Law Briefing Return to Map 95

96 SOUTH AFRICA Threshold for earnings raised under the Basic conditions of Employment Act, effective July 1, 2013 Raised from R183,008 (approx. $17,643) per year to R193,805 (approx. $18,684) per year Protection of Personal Information (POPI) Act Introduces data protection principles President to set effective date; once set, employers will have 12 months to comply Proposed amendments to Labor Relations Act Limitations on temporary work and fixed-term contracts New rules on strikes, lock-outs 2014 Employment Law Briefing Return to Map 96

97 TURKEY Regulation on Occupational Health and Safety Services, effective June 30, 2012 Requires every employer carry out risk assessment and hire occupational safety expert, workplace doctor and other health care personnel or outsource those roles 2014 Employment Law Briefing Return to Map 97

98 UAE New Health Insurance Law in Dubai Employers required to provide employees, spouses, dependents and domestic staff with compulsory health insurance coverage To go into effect in phases, starting in 2014 New residency requirements for Abu Dhabi company employees Employees sponsored by companies licensed and based in Abu Dhabi are now required to have Abu Dhabi residency 2014 Employment Law Briefing Return to Map 98

99 THE 2014 MANAGEMENT REPORT: RECRUITING AND MANAGING MILLENNIALS

100 2014 MANAGEMENT REPORT Managing Millennials What we know Only 7% place a high importance on a high paying career (versus 15% of previous generations) 75% admit that work-life balances drive their career choices 62.1% of current college graduates identify the opportunity for personal growth to be an extremely important factor in the job search There is no second chance once Millennials decide the organization is not a good fit, they will move on 2014 Employment Law Briefing 100

101 2014 MANAGEMENT REPORT Managing Millennials What to do Make a direct connection between the work and the benefit it provides to others Recognize their work: a pat on the back or any public acknowledgment Work collaboratively to create goals and help Millennials map out the skills they need to develop to succeed will succeed Create a team environment where Millennials can bounce ideas off of others and feel a part of a community Provide multi-tasking and job rotation, not a promotion track Provide constant feedback 2014 Employment Law Briefing 101

102 QUESTIONS?