Hunton Employment & Labor Perspectives

On December 6, 2012, New Jersey Assembly Bill 3581 was introduced and referred to the Assembly Budget Committee.  The Bill would amend New Jersey’s current statute concerning enforcement, penalties and procedures for law regarding failure to pay wages and provide for enhanced penalties, among other things.  The Bill is part of the Assembly’s recent push to promote job creation and economic development through a series of legislative initiatives.

The Second Circuit this week overturned the conviction of a pharmaceutical sales representative for conspiracy to engage in “off-label” marketing in violation of the Food, Drug & Cosmetic Act (the “Act”) in a decision that has implications for “whistleblower” cases brought against pharmaceutical employers by their employees.  In United States v. Caronia, No. 09-5006-cr, 2012 WL 5992141 (2d Cir. Dec. 2, 2012), a divided panel held that the Act could not be interpreted to criminalize truthful “off-label” marketing because such a reading would render the Act an unconstitutional violation of the drug manufacturer’s First Amendment rights.  “Off-label” marketing occurs when a drug or device is approved for one purpose but is marketed for other, non-approved purposes.

Michigan GOP leaders announced plans on December 6, 2012, to fast track “right to work” legislation during the lame duck session.  Just hours after the legislation was introduced and amid protests at the state Capitol, both the state Senate and House of Representatives approved bills prohibiting private-sector unions from requiring non-union employees to pay union dues as a condition of employment.  The Senate also quickly voted to approve a bill banning public-sector unions, except those representing police officers and firefighters, from requiring non-union members to pay union dues. 

Last Monday, the United States Supreme Court heard oral argument in Vance v. Ball State University in order to resolve a circuit split over how much authority an alleged harasser must have to be considered a supervisor.  The definition of supervisor is important because two earlier Supreme Court cases, Faragher v. City of Boca Raton, 524 U.S. 775 (1998) and Burlington Industries, Inc. v. Ellerth, 524 U.S. 742 (1998), establish that employers may be found vicariously or strictly liable for the conduct of supervisors who discriminate against or harass subordinate employees.

The growth of social media as a low-cost, widely-accessible form of communication has made it an ideal tool for businesses large and small to market themselves and reach out en mass to consumers in a manner more direct, personal, and in many ways effective than traditional media.  With Americans spending more time on-line than ever before, the value of such social media accounts can be considerable.  So when an employee who has used social media to develop his employer’s business and goodwill resigns, who owns the account, the contacts, and valuable consumer data that come with it?

The Patient Protection and Affordable Care Act provides that group health plans may not apply a waiting period of more than 90 days for plan years beginning after December 31, 2013 (January 1, 2014 for calendar year plans).  IRS Notice 2012-59, which was issued earlier this year, provides guidance on how employers should apply this rule.

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Arbitration provisions are increasingly a focus in non-competition litigation these days and are being used in a variety of strategic ways to assist with the enforcement of non-competition clauses.  The United States Supreme Court recently held that an arbitrator, not a state court, should have decided the enforcement of non-competition clauses.  The employer filed for arbitration when two of its employees, who had arbitration provisions in their employment contracts, went to work for a competitor.  The employees filed a state court action challenging the enforcement of the ...

In an opinion issued on October 18, 2012, the Federal District Court of Massachusetts provided clarity and relief for private equity firms on the significant, but murky, question of whether a private equity fund can be liable for the ERISA pension obligations (including multiemployer withdrawal liability and defined benefit pension plan underfunding) of its portfolio companies.

In September, the Newark Municipal Council passed Ordinance 12-1630, which prohibits any employer with five or more employees from asking job candidates before or during the application process about their criminal history (i.e., the ordinance “bans the box” from an employment application). 

The employer shared responsibility rules under the Patient Protection and Affordable Care Act will go into effect in 2014.  Government guidance was issued earlier this year on an important aspect of these rules – the determination of who is a full time employee.