On September 18, 2024, a panel of three Third US Circuit Court of Appeals judges heard oral argument from the National Labor Relations Board (NLRB) and Starbucks on the matter of consequential damages. At stake is the NLRB’s power to award damages for direct and foreseeable pecuniary harms that go beyond lost pay and benefits. The award of such things as credit card late payment costs and uninsured medical costs, fees for not timely paying other expenses, etc. are at issue. If such awards are within the NLRB’s authority, the damage awards in NLRB wrongful discharge cases could dramatically rise. Here is how we got to this point. In 2023, the NLRB ordered Starbucks to pay consequential damages in a case of the wrongful termination of two pro-union employees. Damages included “direct or foreseeable pecuniary harms incurred as a result of [the employees’ wrongful discharges.]” This case is one of many cases Starbucks faces alleging wrongful discharge of union supporters. If it losses, the monetary cost could be significant. By filing this appeal, Starbucks’s joins companies such as Amazon, SpaceX, and Trader Joe’s in challenging the NLRB’s constitutional authority to exert such enforcement powers. Traditionally, the Board would order reinstatement, backpay and lost benefits in a case of wrongful termination, however this was expanded in 2022. A Board decision in Thryv, Inc., 372 NLRB No. 22 (2021), held employees who are wrongfully terminated should also receive compensation for other pecuniary losses stemming from the termination. Examples include credit card cost, out of pocket medical expenses, mortgages related fees, etc. Such damages can quickly add up. In this latest Starbucks case, the Third Circuit considered Thryv  but also the US Supreme Court’s June ruling in Jarkesy v. U.S. Securities and Exchange Commission and its applicability to the NLRB. In Jarkesy, the Supreme Court found it was unconstitutional for the SEC to impose civil penalties in administrative cases. Such awards need to be awarded in a court. The Third Circuit must decide whether the expanded remedies sought by the NLRB would be considered “legal remedies” typically imposed by the courts as in Jarkesy or “equitable remedies” typically imposed by administrative agencies. Such administrative remedies are intended to benefit the worker rather than unfairly punish employers. The NLRB argued they have the authority to impose the remedies regardless of their status as legal or equitable. Not surprisingly, Starbucks argued allowing the NLRB to issue damages beyond backpay would violate their constitutional right to a jury trial and therefore was unconstitutional. The outcome is pending and regardless, it may well be appealed to the Supreme Court where the authority of various agencies is being curtailed. We will keep you informed. Brody and Associates regularly advises management on complying with the latest local, state and federal employment laws.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.454.0560  

Passed in June 2024 and signed into law by New York Governor Kathy Hochul on September 5, the Retail Worker Safety Act is set to take effect March 4, 2025. The law mandates protections for retail employees including panic buttons, workplace violence prevention policies, and training. Who is covered? The law explains: Covered employers: any person, entity, business, corporation, partnership, limited liability company, or an association employing at least ten retail employees. Retail employees: employees working at a retail store for an employer. Retail Store: a store that sells consumer commodities at retail and which is not primarily engaged in the sale of food for consumption on the premises. The state, any political subdivision of the state, a public authority, or any other government agency is not covered by the law. Key Requirements The Act’s key requirements are the installation of panic buttons, implementation of workplace violence prevention policies, and training. The panic button requirement does not take effect until January 1, 2027, while the other requirements are effective March 2025. Panic Button Employers with more than 500 retail employees nationwide must provide employees with access to panic buttons across the workplace. Employers may opt for a physical button or mobile phone-based buttons. The requirements for each are slightly different. If the employer chooses to use a physical panic button it must contact the local 911 public safety answering point when pressed. Pressing the button must provide the answering point with the employee’s location and dispatch law enforcement. The button must be accessible or wearable. The mobile phone-based approach requires the button to be installed on employer provided equipment and is wearable. The mobile button may not track employee locations unless pressed.   Workplace Violence Prevention Policy Employers must adopt a written workplace violence prevention policy to be provided to employees upon hire and annually. The NY Department of Labor (NYDOL) will draft a model plan which will be evaluated every four years from 2027 onwards. Employers may adopt the NYDOL policy or create their own equivalent policy. The policy must: List factors or situations in the workplace which may increase the employees’ risk of workplace violence. Examples given include working late at night or early morning hours; exchanging money with the public; working alone or in small numbers; and uncontrolled access to the workplace. List methods of preventing workplace violence, including but not limited to establishing and implementing a reporting system. Provide information on federal and state laws regarding violence towards retail workers and remedies available for victims of workplace violence. Explicitly state that it is unlawful to retaliate against employees who report workplace violence or factors which place employees at risk of workplace violence. Workplace Violence Prevention Training Employers must provide training upon hire and annually. The NYDOL will provide interactive training which will also be evaluated every four years starting in 2027. Again, employers may opt to use the state provided training or provide their own equivalent. The training must: Include information on the Retail Worker Safety Act; Examples of steps employees can take to protect themselves; De-escalation strategies; Active Shooter drills; Emergency procedures; Instructions on how to use security alarms, panic buttons, and any other emergency devices; and A site-specific list of emergency exits and meeting places to be used in emergencies. Takeaways New York State retail employers should look at the state provided training and policies to adopt as their own or to ensure their own materials are compliant. For employers outside of New York it is important to keep your eyes peeled for creation of similar laws in your own state. Brody and Associates regularly advises management on complying with the latest local, state and federal employment laws.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.454.0560      

Under the National Labor Relations Act, employers have the right to require their workers to attend meetings on the company’s position on unions (called captive audience meetings). Employers have also used mandatory meetings to discuss issues involving politics and religion. Such practices are now under attack. In July 2024, both Hawaii and Illinois joined New York, Connecticut, Minnesota, Maine, and Oregon in enacting laws which prohibit employers from mandating attendance at employer sponsored meetings on political (including unions) or religious matters. Enforceability of these laws is unknown. Hawaii Hawaii’s Captive Audience Prohibition Act (Hawaii Revised Statutes § 377-6) took effect July 2, 2024. The law prevents employers from penalizing or threatening any adverse action against employees who decline to attend an employer sponsored meeting which communicates the employer’s opinion on political matters. The Act defines political matters as “anything related to an attempt to influence a future vote by persons in an audience.” Such meetings are allowed as long as employee attendance is entirely voluntary. Illinois On July 31, 2024, Illinois Governor J.B. Pritzker signed the Worker Freedom of Speech Act (SB 3649) into law, which is set to take effect January 1, 2025. The Illinois law prevents employers from disciplining employees who choose not to attend employer sponsored meetings relating to political or religious matters. Attendance must be entirely voluntary which also means that the meeting is not “incentivized by a positive change in any employment condition.”  The Illinois law provides a more detailed definition of political matter: “matters relating to elections for political office, political parties, proposals to change legislation, proposals to change regulations, proposals to change public policy, and the decision to join or support any political party or political, civic, community, fraternal, or labor organization.”  Religious matters are defined as “matters relating to religious belief, affiliation, and practice and the decision to join or support any religious organization or association.” Under the Act, employees may bring a civil action seeking: injunctive relief; reinstatement to the employee’s former position or an equivalent position; back pay; reestablishment of any employee benefits, including seniority, to which the employee would otherwise have been eligible if the violation had not occurred; any other relief as deemed necessary by the court to make the employee whole; and reasonable attorney’s fees and costs if the employee prevails. Furthermore, the Illinois Department of Labor may impose a civil penalty of $1,000 dollars per violation. Each employee subject to a violation constitutes another separate violation. This law was challenged nearly immediately by the Illinois Policy Institute, which filed a federal lawsuit early this month. They argue the law infringes on employer’s freedom of speech and claim the law is too broad. Are bans on captive audience meetings legally enforceable? Despite National Labor Relations Board (NLRB) General Counsel Jennifer Abruzzo’s efforts to the contrary, the National Labor Relations Act (NLRA) currently allows employers to hold mandatory meetings where management campaigns against unions. Historically, bans on such captive audience meetings have failed. Section 8(c) of the NLRA states “[t]he expressing of any views, argument or opinion… shall not constitute or be evidence of unfair labor practice… if such expression contains no threat of reprisal or force or promise of benefit.” Furthermore, the NLRB ruled in Babcock v Wilcox Co., 77 NLRB 577 (1984) that employers under the NLRA may hold captive audience meetings. But note, none of this addresses banning non-union related mandatory meetings. In 2010, a similar law in Wisconsin was struck down in, Metropolitan Milwaukee Association of Commerce v. Doyle. The law was found preempted by federal law. More recently, in late July 2024, a federal judge permanently blocked part of Florida’s stop WOKE Act which attempted to prevent employers from holding mandatory meetings on viewpoints the state deemed offensive. Minnesota and Connecticut currently face ongoing challenges to their analogous version of the Illinois law. While precedent suggests these laws are not enforceable, this cannot be said concretely as there are many pending challenges. This leaves Employers in a difficult position; comply with state law to avoid any potential penalties, take the risk of penalties for violating the laws, or challenge the law in court.  Regardless of your choice, employers should follow the legal challenges these bans face, while keeping an eye on their own state’s regulations. As a final thought, Employers may consider holding non-mandatory meetings. While this avoids the real issue, it may be a good solution until this controversy is resolved, especially if attendance is not impacted. Seek legal counsel on how to do this. Brody and Associates regularly advises management on complying with the latest local, state and federal employment laws.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.454.0560.