The COVID-19 pandemic has changed the workplace in Indiana and elsewhere in the world, likely permanently. Employers realize their workplaces must be prepared for not only current, but also future, airborne and other viral outbreaks. The highly contagious nature of SARS-CoV-2 (the new coronavirus that causes COVID-19) has affected employers, employees, their workplaces, and their families, all while federal, state, and local governments and health authorities have struggled to mitigate the spread and protect public health.
Some employers have faced downturns, closures, and reductions in force; others have struggled to keep up with consumer demand and to overcome worker shortages. In the process, employers have changed the way workers interact with each other in traditional, shared workspaces and non-traditional remote locations (ie, home work spaces). Many have become adept at remote means of handling employee onboarding, training, transfer of information, supervision, investigations, and other processes.
Employers will continue to try to protect their employee populations and limit the risk that their workplaces become sites of community spread. Remote work has allowed for some employers to maintain productivity and service, potentially becoming – at least to some degree – the new “norm.” Employees are likely to proactively seek out employers that offer some type of remote work to avoid or limit long commute times, public transit, or even relocations.
The success of videoconferencing on platforms such as Zoom and WebEx during the pandemic has likely permanently changed the way employees communicate with each other and the outside world.
The impact of the COVID-19 pandemic is also likely to have long-term implications on workplace safety and health. In response to the pandemic, most employers developed or updated existing infection control policies and sick leave policies (in addition to incorporating additional protective measures for their workforces, including physical barriers, additional spacing, and staggered shifts).
In the pandemic, “normal” compliance concerns (wage and hour, safety, benefits, etc) have been emphasized in a challenged business and legal framework.
2020 brought to the global forefront as never before the "Black Lives Matter," "Me Too," and other social justice movements. Global entities, including those operating in Indiana, continue to take a hard look at anti-discrimination and anti-harassment policies, and commitment to social justice and diversity.
In an increasingly illuminated stage, with pressures for transparency, employers have been re-examining how they manage their workforces and interact with their local and broader communities.
Many employers have long been on a path of reframing how they view sensitive issues, with many shifting the focus from simply preventing illegal conduct to adopting a proactive approach in promoting a more respectful and inclusive work environment. Now global businesses have taken their commitment to diversity, inclusion, and equity beyond their own walls, emphasizing their commitment to societal change.
Traditional training has focused on legal requirements, civility, respect, and bias (including unconscious bias), and on educating workers on multiple avenues to identify concerns to employers.
Global employers that do not make it clear that their organizations actively oppose discrimination, racism, and sexism risk diminishing their reputations and may seriously damage their ability to recruit, hire, and maintain a diverse workforce.
The Black Lives Matter and Me Too movements have placed the spotlight on discriminatory actions and practices, including systemic racism and implicit bias, leading employers to provide additional support and training to their existing workforces in an effort to mitigate or eliminate bias, thereby enhancing their abilities to recruit, hire, and develop diverse workforces.
The law has struggled to keep up with rapid advances across industries. Before the COVID-19 pandemic, employers had already warmed to the "gig" economy approach, sometimes relying heavily on transient, temporary, and short-stint workers, many focused on particular projects or ventures. COVID-19 pushed that emphasis as consumers make demands on gig-heavy economies. Indeed, many workers have indicated a desire to remain in the gig framework, but at the same time many want the protections and security of traditional employment.
With the steady and perhaps increasing emphasis on the gig economy, employers must understand the challenges and risks of contracting for services and promoting contracted services. While the economy has drastically changed, applicable US law has not.
Employers (or entities contracting for services or personnel) must consider the costs, savings, and potential risks related to particular choices in this framework. Misclassifying workers as "independent contractors" who should be classified as "employees" leads to the following potential legal issues: collective bargaining, taxes, wage and hour compliance, benefits, and anti-discrimination laws.
Independent contractors typically have no such protections under federal and most state employment laws. The question regarding whether a worker or group of workers is properly classified can easily lead to disputes before administrative agencies, and state and federal courts. See more detailed information on the independent contractor relationship in 2.1 Defining and Understanding the Relationship.
Most companies prefer to operate union-free for various reasons, such as avoiding limitations on dealing directly with their employees, general workplace flexibility, and minimizing the risk of work stoppages. Union membership has been on a significant decline in the United States for decades, with private sector union membership hovering around 6.3%. Their ranks remain strongest on the coasts (eg, New York and California). The South historically has the lowest unionization rate, but many states in the Midwest, including Indiana, have seen their union numbers dwindle increasingly in recent years.
In Indiana, the percentage of workers represented by unions dropped from 9.8% in 2019 to 9.5% in 2020, which continues the downward trend in Indiana in recent years.
Indiana is a right-to-work state. As such, it is unlawful for a collective bargaining agreement in Indiana to require employees to pay union dues.
In 2021, there has continued to be a national uptick in unionization efforts in the COVID-19 pandemic, and after the change in the presidential administration, which is now dramatically more favorable to unions. To the extent that workers feel their workplace is unsafe or believe they should receive things such as “hazard pay,” or oppose employers making COVID-19 vaccines mandatory, companies are seeing unions try to exploit these issues to gain entry to the company.
The National Labor Relations Board (NLRB, or "Board") is vested with enforcing the National Labor Relations Act (NLRA), which provides workers with certain rights with respect to unionizing and discussing, protesting, etc their terms and conditions of employment. The NLRB governs private sector labor relations in the United States, and its regulations and administrative decisions apply to all 50 states. Consisting of five members appointed by the president, their views can change from administration to administration. Because the law is national in scope, no specific region, generally speaking, has a "leg up" on another when it comes to US labor law.
In August 2021, President Biden was able to get a majority of pro-union members appointed to the NLRB. As a result, it is widely expected that many labor-friendly decisions are forthcoming that will restrict the rights and abilities of management when it comes to unions.
Furthermore, legislation pending in Congress entitled the “Protecting the Right to Organize Act” (the “PRO Act”) will, if passed, overhaul the National Labor Relations Act, making it much easier for unions to organize employees in the US, among other significant changes. Accordingly, companies looking to start or augment their business in the USA should continue to closely monitor important decisions coming out of the NLRB. Decisions coming out of the NLRB and legislation being contemplated, especially in light of the recent change in the presidential administration, are likely to favor unions and expand employee rights to organize unions, collectively bargain and engage in protected concerted activity.
It is important that the parties agree on the terms and conditions at the outset of their relationship, and ensure that the agreement reached is consistent with applicable law.
The default service relationship in the United States is that of employer and employee. Most states, including Indiana, are "at-will" employment jurisdictions, meaning either party (the employer or the employee) can terminate the relationship at any time and without having to provide a reason; provided, of course, that the termination decision is not otherwise prohibited by law (ie, due to discrimination or retaliation). Indiana is an employment-at-will jurisdiction, but an employer may forfeit its at-will right in certain circumstances. For instance, employees may have contracts specifying the terms and conditions of their employment. Such contracts are not required in Indiana, but may be warranted depending on the type of employee in question (ie, an executive).
Barring a formal written contract, terms defining the relationship are typically relegated to documents such as offer letters, job descriptions, employment policies, or employment handbooks. To avoid any unintended obligation to employment for a specific term or for termination only under certain circumstances (for instance, “good cause”), employers should incorporate a carefully crafted disclaimer throughout employment documents.
Joint employment is not the norm and applies only in limited circumstances, usually in a legal proceeding as a mechanism by which an employee attempts to recover damages against a third party. However, to show that a third party is a joint employer, they must do more than simply allow another employer’s employee to work at its facility; the third party must have exerted significant control over the employee and codetermine matters governing the essential terms and conditions of employment. Factors to consider in determining joint employer status are:
Under the NLRA, the NLRB currently may find two or more entities are joint employers if they are both employers within the meaning of the common law and if they share or codetermine matters governing the essential terms and conditions of employment. The NLRB has changed the standard it uses in this context several times over the years and may look to do so again under the new administration, so it is important to keep abreast of all changes on this front.
Contracting is commonplace in the United States and has become more prevalent in light of COVID-19 as more people have become comfortable working from home. The increase in the popularity of contracting has been matched by increased scrutiny from lawmakers and courts. There is no nationwide standard for determining whether a person is an independent contractor or an employee. Accordingly, most jurisdictions have come up with their own rules for determining employment status. For example, California recently adopted the “ABC” test, which requires that the worker be free from control and operate their own business, and that they also perform work that is outside the usual course of the hiring entity’s business. This last part can be difficult to meet.
For its part, Indiana has adopted a flexible approach, distinguishing employees from independent contractors based on various factors:
While no one factor is dispositive, the extent of control over the work performed by the worker is regarded by Indiana courts as the single most significant factor in determining the existence of an employer-employee relationship.
The federal Biden administration has signalled its approval of the California ABC employee/independent contractor test, which, if implemented by the US Department of Labor at the federal level, would make it more challenging for employers to classify their workers as independent contractors. If adopted by the US Department of Labor, it is likely that such an interpretation would begin to be followed by the Indiana federal courts tasked with interpreting federal employment laws.
Internships have been subject to considerable scrutiny in the past few years – notably from the standpoint of whether private businesses can rely on unpaid interns. The US Department of Labor’s Wage and Hour Division has developed a test for evaluating whether an individual constitutes a "trainee" (intern) for the purposes of the Fair Labor Standards Act (FLSA). The factors considered in determining whether a for-profit employer lawfully can utilize an unpaid intern are the extent to which:
See Fact Sheet #71: Internship Programs Under The Fair Labor Standards Act. Indiana does not have different enforcement guidance.
The COVID-19 pandemic continues to negatively affect the ability of employers to attract and retain foreign national talent. The pandemic, and the federal government’s response, has disrupted virtually every aspect of the US immigration system. The processing of immigration benefits by US Citizenship and Immigration Services (USCIS) has dramatically slowed, visa processing abroad by the US Department of State (DOS) is sporadic, and entry into the US is sometimes impacted by geographic travel bans based on local COVID-19 conditions and often requires an approval of a “National Interest Exception” based on critical infrastructure needs for a foreign national employee to enter under a waiver to the COVID-19-related travel bans.
Corporate Structure and Relationships
Employers are finding it increasingly difficult to sponsor foreign nationals for employment in the US. Increased scrutiny by USCIS and DOS has resulted in lengthy delays in the adjudication process and greater rates of visa denials. Local USCIS field offices have reopened but many have lengthy processing times due to staffing issues and a backlog from their closure earlier in the pandemic. The pandemic has impacted the ability of US embassies and consulates to offer appointments for visas. In addition, various geographic travel bans have encumbered a number of foreign national employees from seeking entry to the US to initiate or return to employment.
Employers often consider the H-1B and L visas when sponsoring foreign nationals for employment in the US. However, due to increased scrutiny and changes in the immigration processes for the above visa classifications, employers may also wish to consider the H-1B1, E, and TN visas in addition to the H-1B and L.
The H-1B visa is generally reserved for specialty occupations – positions requiring the theoretical and practical application of a body of highly specialized knowledge and that require the attainment of a bachelor’s degree or higher in a specific specialty or its equivalent, as a minimum for entry into the occupation in the US. New H-1B petitions are sometimes subject to an annual lottery due to high demand and USCIS has conducted a lottery in recent years. In 2020, the lottery underwent a significant processing change that resulted in the implementation of an additional fee for employers. This classification has experienced increased scrutiny in recent years, resulting in lengthy processing delays and increased rates of denial.
The L visa is generally reserved for international companies seeking to transfer executives, managers, or specialized workers to the US. Like the H-1B visa, the L visa has experienced heightened scrutiny, resulting in lengthy processing delays and increased rates of denial. In addition, a change in the immigration process for renewals has added to the length of time required for a renewal and increased costs. As with the H-1B visa, various presidential proclamations, including Presidential Proclamation 10052, have restricted the ability of employees in the L-1 visa classification to enter the US to initiate or resume employment.
Due to the challenges of securing visa sponsorship for foreign national employees through H-1B or L visa classifications, employers are exploring alternatives to include the H-1B, E, and TN visa classifications.
The H-1B1 visa is reserved for citizens of Chile and Singapore. Like the H-1B visa, the H-1B1 is generally restricted to specialty occupations. Similar in many respects to the H-1B visa, the H-1B1 is attractive to many employers due to the relative ease and reliability of the H-1B1 sponsorship process. This visa classification is generally a more reliable and faster option than the H-1B visa, although there is concern with timing due to the suspension of routine visa services at US embassies and consulates because of the pandemic.
Another option for sponsorship of foreign national employees is the E visa. The E visa category includes treaty traders (E-1), treaty investors (E-2), and Australian specialty occupation workers (E-3). To qualify as an employee of a treaty trader or treaty investor, the employee must share the same nationality as the employer, and the employee be engaged in the duties of an executive, manager, or specialized worker. The E-3 visa applies to Australian nationals performing services in a specialty occupation similar to the H-1B visa category but is more easily attainable. As with the H-1B visa, employers have generally found the E visa to be reliable, fast, and cost-effective, although there is concern with timing due to the suspension of routine visa services at US embassies and consulates because of the pandemic.
The TN (NAFTA) visa allows employers to sponsor citizens of Canada and Mexico for employment in the US in a professional capacity. While the North American Free Trade Agreement (NAFTA) has been replaced by the United States–Mexico–Canada Agreement (USMCA), USMCA retains the TN visa classification. To be eligible for the TN classification, the profession must be noted on the treaty (list) and the foreign national employee must satisfy the qualifications for eligibility for employment in that profession. Employers have generally found this visa classification to be reliable, fast, and cost-effective. Of note, an employer seeking to sponsor a Canadian citizen for employment under this visa classification may simply have the sponsored employee present an application package directly to a US Customs and Border Protection agent. Unfortunately, Mexican citizens requiring a visa are generally required to attend an appointment at a US embassy or consulate and there is concern with timing due to the suspension of routine visa services at US embassies and consulates because of the pandemic.
To remain union-free, it is critical to establish a positive culture and get buy-in from the employer’s leadership team. The vast majority of union campaigns start because of perceived toxicity in the workplace (eg, favoritism or no outlets for employees to express their views). Being union-free vests the organization with the autonomy to make decisions about policies and other terms and conditions of employment. If employees are represented by a union and/or ever vote a union into the workplace, an employer has a legal obligation to bargain virtually every potential change to workers’ terms and conditions of employment with the union.
Reaching a collective bargaining agreement with a union after being organized also can be a lengthy process. According to a recent analysis by Bloomberg Law, on average, it takes 409 days between the time a union is certified and the time a collective bargaining agreement is finalized with the employer. During this period, employers are not permitted to make unilateral changes in employee wages, hours, and working conditions. Accordingly, many employers strive to remain union-free in order to enjoy maximum flexibility.
The pre-hire and interviewing process is a significant opportunity for Indiana employers to wisely identify and hire the strongest candidates for the available positions. Before the employment interview, employers should consider requiring applicants to complete an employment application that accurately describes prior educational and work history, reasons for leaving prior employment, references, and any special skills.
As a best practice, the employment application should include a certification by the applicant that they provided complete, accurate, and truthful information on the application. This certification provides employers with a means to limit or mitigate damages in an employment discrimination case. The employment application should also contain an affirmation of the at-will nature of the employment relationship, and employers should refrain from making verbal or written assurances of "long-term" or "permanent" employment, or other statements that could adversely affect the employer’s ability to successfully assert that the employee was employed at-will at a later time. In addition, to the extent that any post-offer testing is to be conducted, employers should include that information in the employment application to ensure that applicants are aware of the requirements and allow them to request reasonable accommodations, if needed.
The employment application and the interview process should not ask questions or elicit information about legally protected characteristics such as age, national origin/race, religious practices, pregnancy or desire to have children, sex, sexual orientation or gender identity, or medical conditions/disabilities, and similarly should avoid questions that would elicit this type of information.
Background Checks and Physical Assessment
A common aspect of the hiring process is a limited criminal background check for the successful candidate. While this due diligence provides benefits for employers, such as a defense to a negligent hiring claim and the avoidance of a high-risk hire, this is an area of the law that is evolving on the national, state, and local level. The Equal Employment Opportunity Commission (EEOC) has taken the position that, given that minorities are disproportionately adversely affected with regard to convictions and arrests, a criminal conviction should only be considered if it is job-related to the particular position being sought. Employers should consider doing a case-by-case analysis, and review the type of conviction, the date of the conviction, the nature of the job in question, and any exceptional circumstances before making a decision about employment based on a criminal conviction.
Indiana has enacted a law that makes it unlawful for employers to refuse to employ or discriminate against a person because of a conviction that has been expunged. In addition, numerous cities across the country have been enacting "ban the box" laws that prohibit even having questions about criminal backgrounds on the employment application. For example, Indianapolis has enacted an ordinance applicable to any company doing business with the City. Thus, requests for background checks and the process must be appropriately tailored to the state and local laws, and proper authorization must be acquired when third-party vendors are used for this purpose prior to completing the background checks.
Another common component of a background check involves credit checks. Again, because credit checks tend to disproportionately disqualify minorities, it is best practice to conduct a similar analysis of the job-relatedness of a credit check to the position in question to avoid unnecessary legal exposure.
The Americans with Disabilities Act (ADA) also imposes restrictions on employers with regard to what information can be sought or discussed during the hiring process. The ADA generally prohibits employers from any pre-employment inquiries about an applicant’s medical condition. Thus, the employer may not ask any questions designed to elicit medical information prior to a conditional job offer being made.
After a conditional offer of employment has been made, the employer may then conduct a post-offer medical examination, provided that this is required of all applicants for the position. However, to withdraw an offer of employment, the employer must be able to demonstrate that the individual is unable to perform the essential functions of the job in question, even with reasonable accommodations. Thus, to the extent that post-offer testing is to be completed, employers should ensure that the components of the test directly correlate to the essential functions of the position. As this is a highly technical area of the law, employers are well advised to seek legal assistance with these determinations.
The Genetic Information Nondiscrimination Act (GINA) similarly imposes restrictions on employers during the hiring process (and afterward), making it unlawful for employers to request genetic information with respect to employees. Because genetic information is defined broadly to include family medical history, employers should ensure that any post-offer medical examinations, even those conducted by occupational doctors, do not elicit this information.
Finally, the ADA requires employers to provide reasonable accommodation to disabled applicants to permit them to participate equally in the hiring process. While reasonable accommodations may take many forms – such as having an interpreter for a hearing-impaired applicant, and administering a test in an accommodated format (more time, reading the questions, answering in a different format (eg, dictating), ensuring access to the testing site, etc) – the employer is not required to "carve off" essential functions of the position in question as such an accommodation would not be reasonable.
COVID-19 Creates New Issues
The COVID-19 pandemic has not changed this basic process, but it has raised a host of new issues that might arise during the interactive process as well as caused employers to revisit what are the essential functions of a job.
An applicant may have an underlying condition (asthma, diabetes) for which they seek reasonable accommodations that may not have been discussed pre-pandemic. In addition, while attendance at the workplace on a day-to-day basis has historically been recognized as an essential function of the job, the success of remote work has forced many employers to revisit whether remote work may serve as a reasonable accommodation for a particular applicant/employee.
The pandemic has led employers to begin asking basic health questions related to whether an applicant/employee has had symptoms relating to COVID-19 (eg, a fever over 100.4 degrees) and as the country continues to experience the spread of variants, it seems more likely that some employers will being implementing mandatory vaccination policies. Inquiring into an applicant's/employee’s vaccination status is permissible. However, the employer would still have a duty to reasonably accommodate non-vaccinated applicants/employees if they have a sincerely held religious belief that prevented them from getting vaccinated, or a disability covered by the ADA.
The enforceability of restrictive covenants is heavily dependent upon state law, which can vary dramatically on this subject. Some states – such as California and North Dakota – consider non-competition and non-solicitation covenants to be void and unenforceable under almost all circumstances, whereas other states – such as Louisiana and Oklahoma – will enforce contractual restrictions, but only if they meet specific criteria set forth by state statute. Accordingly, careful attention should be paid to the state law controlling the covenant at issue, either set forth by the parties in the contract or that may be determined by the various jurisdictions where the parties are located.
Conditions for the Enforcement of Restrictive Covenants
Indiana will enforce restrictive covenants only if reasonable in scope and where the covenants do not unnecessarily interfere with a person’s livelihood. Accordingly, in order for a restrictive covenant to be enforceable, an Indiana employer must establish that it has a legitimate interest to be protected by the agreement, and that the restrictions imposed on the employee are reasonable as to time, activities and geographic area. To show a legitimate, protectable interest, the employer has to demonstrate that the former employee has gained a unique competitive advantage or ability to harm the employer before it can seek the protection of a covenant. In other words, not all employees in a company would be subject to a valid restrictive covenant – post-employment restrictions on workers such as menial laborers who have no knowledge that could harm the employer (ie, such as a janitor or cashier) likely would be disregarded as unreasonably overbroad. On the other hand, if an employee has unique knowledge of a company’s trade secrets or proprietary business practices and methods that could be used for a competitor, an Indiana court may enforce the restrictions – provided that they also are reasonable in terms of time, geography, and the activities that are limited.
There is no definitive test for what is reasonable in terms of time; this depends on the facts of each particular situation. With respect to geography, the reasonableness of an agreement’s geographic scope depends on the interest of the employer that the restriction serves. Correspondingly, blanket clauses that prohibit an employee from calling on all customers of a company, including those that pre-date the employee’s employment or that the employee never serviced, likewise are considered overbroad and unenforceable. For the same reasons, prohibiting an employee from working for a competitor in any capacity also would be regarded as overbroad.
Another area in which states can vary wildly on this subject concerns what happens if a part of the covenant is determined to be unenforceable. Some states will throw out the entire covenant and refuse to enforce it, while others will permit the court to modify the terms to make it enforceable. Indiana adopts a middle-ground position, and will only strike out terms that are unenforceable, and will not alter or modify the text to make it enforceable.
Trends in the Enforcement of Covenants
Indiana has tightened its enforcement of such covenants. In 2020, the state enacted legislation adding restrictions to covenants involving physicians. Also, in 2019, the Indiana Supreme Court struck down a covenant that prohibited an employee from recruiting “any individual” employed by his former employer to work for a competitor. The court concluded that the ban on recruiting “any individual” did not serve a legitimate protectable interest of the former employer, was too broad, and also could not be repaired by striking out terms. As such, it was unenforceable. Consequently, employers that intend to have employees execute enforceable restrictive covenants in Indiana must pay close attention to changes in the law and carefully draft the provisions to comport with those changes and so they will not be perceived to be unreasonable.
Employees generally enjoy a certain zone of privacy, even while they are on an employer’s premises. For example, employers should refrain from searching an employee’s person or the interior of their private vehicle. An unwanted touching could be viewed as a battery that could subject the company and the particular manager to liability. Detaining an employee in a room and refusing to allow them to exit could be viewed as false imprisonment, resulting in the potential for liability.
Employers that provide electronic equipment for employees to use in connection with their job duties (ie, laptops and internet access) are generally permitted to adopt policies notifying employees of the right to monitor the use of such equipment and remind employees of their ownership interest in these devices. Employers also can impose reasonable requirements on how the employees use the equipment. For the most part, these policies have been upheld on the grounds that employees have no reasonable expectation of privacy while using company equipment. However, this is not without limits: employers cannot demand that an employee involuntarily turn over their private cell phone, divulge their password to a personal email or social media account, or attempt to hack into the employee’s personal accounts – even if the employee used company equipment to access the private accounts. In short, aside from issues relating to the terms and conditions of employment (ie, wage/hours) on non-working time, employers have had a fairly wide berth in terms of regulating access and content on the electronic devices and networks they make available for employees.
With respect to monitoring employee activities in the workplace, this generally is permitted under federal and state law; however, employers should exercise caution in doing so and should make sure that the employer’s actions are reasonable. Employees typically have no reasonable expectation of privacy on a factory floor. However, the same is not true for a bathroom or locker room. Thus, an employer can conduct video surveillance of work areas, lunchrooms, offices, parking lots, and any other area of its business, with the exception of those areas where employees have a reasonable expectation of privacy from visual observation (such as restrooms and showers).
COVID-19 has altered the application of some traditional privacy rules. Generally, conducting medical tests or examinations on employees is prohibited. However, in the wake of COVID-19, the Centers for Disease Control and Prevention (CDC), and state and local authorities permit reasonable measures, including temperature checks, asking questions regarding potential COVID-19 exposure, and even testing to check if an employee has an active case of COVID-19, to help curb the community spread of the virus. Indeed, under the ADA, mandatory testing to check for an active case of COVID-19 (but not to check for COVID-19 antibodies) is permissible if “job-related and consistent with business necessity.” Regulatory guidance from the EEOC confirms that COVID-19 testing meets these parameters due to the ongoing pandemic. Furthermore, while all medical information (including information related to COVID-19) normally must be kept confidential, an employer may discreetly disclose the name of an employee who is COVID-19 positive to a public health agency.
Various federal laws prohibit discrimination, harassment or retaliation based on legally protected characteristics or legally protected activity. Legally protected characteristics include age, gender (including sexual orientation and/or gender identity), pregnancy, race, color, national origin, disability, military or veteran status, genetic information, religion, or citizenship status. In addition to federal laws, many states – as well as local governmental entities such as cities, counties, and townships – have enacted laws that expand the coverage of legally protected characteristics. The Indiana civil rights laws generally follow their federal counterparts. Moreover, many counties and municipalities in Indiana have adopted ordinances covering protected characteristics such as gender identity, marital status, and sexual orientation. Thus, it is important to understand and abide by all the laws in the jurisdiction in which the employer is located.
Employers should ensure that supervisors periodically receive training regarding – and understand – the types of behaviors that are inappropriate in the workplace, the methods to report concerns, their roles as members of the management team (both in communicating with applicants and employees, and in the investigatory process), and how to appropriately document and issue any discipline needed. Employees should also receive training on – and understand – the applicable policies, the types of behaviors that would violate the policies, the mechanism to report concerns, and the non-retaliation provisions of the policies.
Critically examining corporate culture and policies in these areas and ensuring that employees – and especially managerial personnel – are properly trained to root out bias, harassment, and prejudice has taken on even greater importance given the growing social awareness of these issues over the last few years. Coupled with the widespread use of social media, this has made many employers rethink their approach on these subjects, both from a legal and a general business standpoint. Part of that process has led companies to shift their focus from just preventing illegal conduct to actively promoting more inclusive and respectful workplaces. Notably, there has not yet been a general change in the legal standards by which employee performance is measured. However, many employers have taken it upon themselves to adjust how they view these sensitive topics, from adopting policies and training programs consistent with promoting a culture of inclusion, to paying more attention to equity and implicit bias concerns raised by employees.
The Occupational Safety and Health Administration (OSHA) is the federal agency charged with enforcing all applicable safety laws and regulations in the federal Occupational Safety and Health Act. Roughly 22 states have applied for, and have been granted, authorization to establish state plans to administer and enforce the applicable safety and health compliance program for private employers in their states. While state plans must be at least as effective as the federal standards, states can be stricter than their federal counterpart with regard to regulatory compliance, and some states are more restrictive, a factor that a potential employer should evaluate. Indiana has an approved state plan, and the Indiana Occupational Safety and Health Administration administers the OSHA statutory and regulatory mandates. Indiana OSHA adopts and enforces standards issued by federal OSHA 60 days after the standard is adopted by federal OSHA (I.C. § 22-8-1.1-16.2). While Indiana OSHA is required to enforce standards at least as effective as federal OSHA, by law, Indiana OSHA is prohibited from adopting or enforcing any standard that is more stringent than federal OSHA (I.C. § 22-8-1.1-17.5).
Generally, the employer’s obligation under the OSHA statute and regulatory framework runs to employees, not to third-party non-employees or members of the public. The COVID-19 pandemic has resulted in a barrage of employee complaints that the employer is not providing them a safe work environment, which has challenged the Agency given its current resources. Thus, employers are challenged both with staying current with federal, state, and local guidance, and quickly responding to these complaints as they arise.
The Indiana worker’s compensation framework has several advantages for employers, including relatively modest statutory caps on benefits available under the Act, the ability of the employer to direct authorized medical care, and a robust exclusivity provision. The Indiana Worker’s Compensation Act is adjudicated through an administrative law structure, with hearings being held by a single hearing member assigned to that geographic location. Appeals from the decision of the single hearing member may be appealed to the full Board.
Employers throughout the US face federal laws that address compensation (for instance, minimum federal wage and overtime). However, state and local governments impose broader and/or different mandates related to pay and benefits, including regarding paid time off, sick pay, vacation pay, minimum wage, reimbursement of business expenses, unemployment compensation benefits, workers compensation benefits, tax rates, and related areas. Quite simply, the cost of doing business in the US varies by location (state, county, and/or municipality).
The COVID-19 pandemic has brought changes to the federal statutory framework governing benefits and benefit plans, enhanced unemployment compensation benefits, and employee leave (paid and unpaid). Indiana, however, did not adopt any legislation specifically in response to the COVID-19 pandemic affecting compensation or benefits.
At-Will Terminations of Employment
Employment at-will should be disclosed to employees up front, preferably in writing (employment application, offer letters, and employee handbooks and acknowledgment forms), so there are no surprises if they are terminated at a later point in time. Care also must be taken throughout employment to ensure that the at-will status is maintained.
Terminations of Employment by Operation of Contract and Severance
If the employer and employee enter into an employment agreement that addresses how the employment relationship will end, the terms of the agreement will normally govern the situation. Employers should pay close attention to the language of the employment agreement, especially with defined terms addressing terminations for "cause," "change of control," and provisions describing the renewal of the contract. Employees typically are not entitled to severance unless the employer agrees to provide it pursuant to the terms of an agreement or policy. If the employer offers severance, best practices dictate that such payments be contingent upon the employee releasing and waiving any claims against the employer (unless a waiver is precluded by explicit operation of law).
Separation Agreements and Releases
Separation or release agreements are treated as contracts, and generally will be subject to enforcement in a similar manner. One significant caveat, however, concerns waivers for employees over age 40. The federal Age Discrimination in Employment Act (ADEA) prohibits discrimination against individuals over age 40 and applies to companies with 20 or more employees. In order for a waiver of claims under the ADEA to be valid, it:
In the case of a group termination – which can be as few as two employees – employees age 40 or over must have at least 45 days (not 21 days) to consider the agreement (with a comparable seven-day revocation period), and the affected employees must be provided with a memorandum identifying:
Beyond federal law, some states (although not Indiana) require additional provisions to ensure that a release is valid. As such, the current state of the law in the applicable jurisdiction must be reviewed before any release is prepared and presented to an employee.
Terminating multiple employees may trigger requirements under another federal law, the Worker Adjustment Retraining and Notification Act of 1988 (WARN), if a sufficient number of employees are affected. This law applies to any business that employs 100 or more employees (excluding part-time employees). Under the law, if an employment loss results in a "plant closing" or "mass layoff," a qualifying employer must provide affected employees and certain government officials at least 60 days' advance notice of the event. Employers that fail to provide the requisite notice can be required to pay the affected employees’ back pay for each day of the violation, reimburse them for the loss of benefits and any medical expenses they incurred, and may also have to pay civil penalties.
In addition to the federal WARN Act, many states have their own mini-WARN acts. Indiana does not have a mini-WARN statute and follows the federal law.
COVID-19 forced many employers to quickly shutter their businesses and lay off large numbers of workers as a result of government lockdown orders, resulting in a widespread failure to provide the required WARN notices. WARN (and many of the corresponding states with mini-WARN statutes), however, expressly recognizes an unforeseeable business circumstances exception where an employer is excused from the statutory timetable – provided exigent circumstances exist and the employer provides the applicable notices as soon as practicable.
Additional COVID-19 Considerations
COVID-19 presented several additional challenges with respect to terminations, including in relation to leave under the Families First Coronavirus Relief Act (FFCRA). At the time of writing, Indiana employers do not have any COVID-19-related leave obligations other than those under the federal Family and Medical Leave Act (FMLA) and potential reasonable accommodation requirements under the ADA.
Alternative Dispute Resolution
The law in the United States generally favors the private adjudication of disputes.
If the employer and employee have entered into an enforceable agreement to arbitrate a dispute, and the disputed matter is the type of claim that the parties agreed to arbitrate, courts typically will order the parties to proceed to arbitration. Arbitration can cover the full range of employment-related disputes.
Generally, in Indiana, and most other states, employers can easily retain workers on an "at-will" basis so that no "breach of contract" claims can be brought against the company upon an employee’s separation. Care must be taken, though, to ensure that a company follows a state’s requirements for keeping employees at-will. In Indiana, employees generally are presumed to be at-will absent an agreement with the company to the contrary. A best practice in Indiana is to have "at-will disclaimers" included in offer letters as well as any employee handbooks/manuals that state all employees remain at-will unless the company enters into a written agreement stating to the contrary. Having such disclaimers in all handbooks/employee manuals remains critical. In the event that the company offers employment contracts to some or all of its workers, a company that violates those agreements – for example, terminating the workers for a reason arguably not provided for in the agreement – may face contractual claims for breach of contract. To the extent that claims for contractual rights are brought, they most often are filed in court but can, depending on the contract, also be pursued in arbitration.
In union environments, the labor agreement between the parties controls employees’ terms and conditions of employment, including termination decisions. Violations of labor contracts most often are adjudicated in arbitration, including disputes over employee discharges.
Damages for contractual claims most often are tied to the alleged harm suffered. For instance, if an employee had a five-year employment agreement and argued they were terminated improperly three years prematurely, the employee, if successful, would be entitled to three years of pay. It is important to note, however, that some contracts may provide for one or both parties to receive attorney’s fees or other, additional categories of damages in the event they prevail in a dispute under the agreement, which can be significant sums.
Many federal laws prohibit discrimination, harassment or retaliation based on legally protected characteristics or legally protected activity (as listed in 4.3 Discrimination, Harassment, and Retaliation Issues). In addition to federal laws, many states – as well as local governmental entities such as cities, counties and townships – have enacted laws that expand the coverage of legally protected characteristics. The Indiana civil rights laws generally follow their federal counterpart. However, Indiana law will also protect the off-duty use of tobacco, for example, for which there is no federal counterpart. Moreover, many counties and municipalities in Indiana have adopted ordinances covering protected characteristics such as gender identity, marital status, and sexual orientation. It is important to understand and abide by all the laws in the jurisdiction in which the employer is located.
Employers are well advised to ensure that supervisory training and other programming is periodically provided to communicate behaviors that are inappropriate in the workplace, the methods to report concerns, their role as a member of the management team (both in communicating with applicants and employees, and in the investigatory process), and how to appropriately document and issue any discipline needed. Employees should also receive training on the applicable policies, the types of behaviors that would violate the policies, the mechanism to report concerns, and the non-retaliation provisions of the policies. In light of the Me Too and Black Lives Matter movements, many employers are also including enhanced diversity training and other programming designed to foster an inclusive, respectful, and discrimination-free workplace. Employers are wise to illuminate the varying perspectives employees bring to the workplace as a result of their life experiences. Employers are also becoming engaged in the social justice movement, supporting these movements in a variety of ways.
As a result of the COVID-19 pandemic, there has been an increase in claims arising under these federal anti-discrimination statutes. These claims include failure to accommodate disabilities under the ADA and interference or retaliation against employees requesting leave under the FMLA, as well as other discrimination claims if the employer takes an adverse action based on an employee’s protected characteristic, such as assuming that older workers should remain furloughed during the pandemic.
With few exceptions, the FLSA governs wage and hour claims brought by employees in Indiana. The FLSA requires that all covered, non-exempt employees be paid at least minimum wage for every hour worked, and receive overtime pay at no less than 1.5 times the regular rate of pay for all hours worked in excess of 40 within a workweek.
Potential federal wage and hour-related claims can include misclassification of a worker as an independent contractor or consultant (rather than as an employee), misclassification as exempt from overtime pay, payroll docking policies and practices, “off-the-clock” unpaid work hours, meal periods, breaks, overtime, record-keeping, deductions from pay and rounding.
Indiana law addresses when and how an employer can deduct money from an employee’s paycheck and the necessary timing of paychecks. An employer may not fine an employee and take any fine out of any employee’s paycheck. Subject to certain requirements, an Indiana employer may deduct the amount of overpayments from paychecks. Otherwise, deductions from paychecks must be pursuant to an agreement specified by law for a purpose listed by statute.
Indiana law also covers the payment of accrued vacation pay. An Indiana employee may be entitled to a pro rata share of accrued vacation at the time of termination. However, if there is a company policy or employment contract stipulating that certain conditions must be met before accrued vacation pay will be paid, these conditions must be met in order to receive accrued vacation pay. Vacation policies are generally left to the discretion of the employer.
In Indiana, an employer may require an electronic direct deposition and may provide pay statements to employees electronically.
Because an individual employee’s claim may be small, wage claims may be brought in a class action (referred to as a Rule 23 class) or a collective action under Section 216(b) of the FLSA. Through either framework, a large number of employees citing similar wage or compensation errors may join together to seek back pay, front pay, punitive or liquidated damages, and attorneys’ fees. Carefully crafted individual agreements to arbitrate claims, including a waiver of the right to proceed in a class or collective action, may help combat the risks and costs associated with class and collective actions, though certain lawmakers at the federal level have recently addressed potential laws to limit or eliminate employee arbitration agreements.
There are a variety of federal and state laws that protect employees who report perceived unlawful acts. Even if it is ultimately determined that the employee’s perception is wrong, the employee generally will still be protected unless the employer can establish that the employee knew they were making a false report. The types of conduct that afford this protection include:
To successfully defend against such a whistle-blower claim, the employer must typically provide substantial evidence of its non-retaliatory reason for the discipline or discharge.
The growth of social justice movements has created increased awareness of the ability to pursue government redress of grievances. While Indiana has not yet done so, some states have adopted laws prohibiting confidentiality provisions in separation agreements that would prevent employees from discussing the facts of a discrimination or harassment claim with government agencies. The impact of COVID-19 also has seen employees reach out to government officials to express concerns over a variety of health-related issues, including hygiene protocols and adherence to social distancing and mask mandates that have been adopted by government bodies. These contacts can result in investigations and potential actions by law enforcement, state health agencies, and the state and federal OSHA.
The growth of various social justice movements has caused many employers to reassess their training programs with respect to discrimination and harassment. The previous focus on simply preventing illegal conduct has shifted to one fostering a culture of inclusion. Part of that process involves giving greater emphasis to identifying bias, including unconscious or implicit bias; a greater awareness and sensitivity to these issues, particularly on the part of human resources personnel and managers; and strengthening the mechanisms by which employees can express concerns and by which those concerns will be evaluated. The promotion of environments that encourage reporting and offer multiple avenues to bring concerns forward, coupled with an appropriate response to the behaviors at issue, are important components of such a program.
In addition to wage and hour claims (addressed in 6.3 Wage and Hour Claims), certain forms of discrimination claims are often brought in a class action under Federal Rule of Civil Procedure 23. A class action allows a large number of employees citing similar alleged discriminatory practices to join against an employer to make claims for monetary and equitable relief.
Potential damages vary depending on the statute under which an employment-related claim is brought, but may include items such as unpaid wages, back pay, front pay, punitive or liquidated damages, and attorney's fees. The court can also order the employer to reinstate/rehire employees found to have been improperly discharged.
In class and collective actions, the remedies may be multiplied by the number of employees implicated. Seemingly minor errors in the payment of wages that by themselves would not cause concerns about litigation by an individual plaintiff can mutate into high-stakes litigation when large numbers of employees and former employees combine and become eligible for unpaid wages, liquidated damages and penalties, and attorney fees and costs, particularly when the potential minor errors span a number of years.
COVID-19 continues to impact employee benefits
It has been well over a year since the world was exposed to COVID-19, and employers are still evaluating, implementing, and/or complying with statutory and regulatory provisions impacting employee benefits, including the following.
Continuing impact of the COVID-19 pandemic on immigration operations
US Citizenship and Immigration Services (USCIS) continues to be impacted by the pandemic. The pandemic slowed immigration operations and has added to a pre-existing case backlog at USCIS. Many immigration benefit applications and petitions are experiencing significant delays in adjudication despite the resumption of in-person services.
In response to the pandemic, USCIS implemented several temporary policies to assist employers and applicants with the immigration process.
The agency began reusing previously captured biometrics to process applications for a renewal of an employment authorization document, allowed for copies of signatures on applications and petitions to be submitted rather than original signatures, and provided for a temporary 60-day extension to respond to an immigration request for additional evidence or notice of intent to deny.
In March 2020, the US Department of State suspended routine visa services as a result of the COVID-19 pandemic. Some US embassies and consulates are beginning a phased resumption of routine visa services; however, many US embassies and consulates continue to remain closed to routine visa services based on local COVID conditions.
The Biden administration has worked to undo many of the restrictive immigration policies implemented by the previous administration; however, the new administration has not undone all the actions instituted by the Trump administration.
The Biden administration revoked the “Buy American and Hire American” (BAHA) executive order of 2017. BAHA resulted in an increase in requests for evidence and denials issued by USCIS. The Biden administration also instructed USCIS to return to a longstanding policy providing deference to employers requesting extensions of previously approved petitions.
While the new administration revoked or otherwise declined to extend several presidential proclamations (PPs) from the previous administration limiting the ability of foreign nationals to enter the US, others remain in place. PP 9993 suspended the entry of foreign nationals who were physically present within the Schengen area during the 14-day period preceding their entry or attempted entry into the US. The Schengen area includes most all European nations. PP 9996 extended the restriction to cover the United Kingdom and Ireland. These bans were enacted in March 2020 and remain in place, without a set end date.
Labor Law Trends
Composition of the current National Labor Relations Board
As of this writing, the National Labor Relations Board (NLRB, or “Board”) is comprised of a three-member Republican majority (members John Ring, Marvin Kaplan and William Emanuel) to a one-Democrat (Chairman Lauren McFerran) minority. In late August 2021, after years of Republican control, the NLRB returned to a Democratic majority when Member Emanuel’s term expired and union-side attorneys Gwynne Wilcox (nominated for the current vacant seat) and David Prouty (nominated for Emanuel’s seat) joined McFerran. This shift will likely result in a return to more pro-labor Board decisions.
Changes with the NLRB General Counsel
The General Counsel for the NLRB exerts significant influence in determining the cases that reach the Board and for the day-to-day operations of the agency as a whole. In 2021, there were substantial changes in the General Counsel’s office. On his first day in office, President Biden terminated the prior General Counsel for the NLRB, Peter Robb (a Republican), even though Robb’s term had nearly ten months remaining. This is the first time in history a president has taken this step. Shortly thereafter, an interim General Counsel, Regional Director Peter Ohr, was put in place, while Jennifer Abruzzo (a Democrat), was nominated to permanently fill the position. During his interim term, Acting General Counsel Ohr issued a memorandum on March 31, 2021, advocating for an expansion of the types of employee conduct that would constitute protected concerted activity, including discussions concerning “political and social justice advocacy,” and “societal issues.”
Abruzzo’s nomination was approved by the Senate on July 22, 2021. Prior to her nomination, Abruzzo worked as special counsel for the Communication Workers of America (CWA) and was previously Acting General Counsel and Deputy General Counsel at the NLRB under Richard Griffin’s tenure as General Counsel. Abruzzo also will likely shift the Board to a more pro-labor stance. She is expected to reverse course on agency budget cuts and staffing reductions that had been implemented under Robb's tenure. In addition, Abruzzo is expected to seek the reversal of numerous Trump-era NLRB decisions, including those affecting non-union employers and employees, such as those pertaining to the legitimacy of employer workplace rules and policies, and the scope of protected concerted activity.
Potential impact of the PRO Act
With newly elected President Biden claiming to be the most “pro-labor” president in the nation’s history and the power in both houses of Congress shifted towards the Democrats, the current administration and Congressional majority has proposed passing the Protecting the Right to Organize Act (the "PRO Act").
If passed, this legislation will be arguably the most significant revision to labor law since the National Labor Relations Act (NLRA) was passed in 1935 and would significantly alter the law in favor of organized labor.
In part, the PRO Act would modify the joint employer standard, invalidate agreements mandating individual arbitration, ban state-passed right-to-work laws, implement monetary penalties for unfair labor practice violations, and require interest arbitration where an employer and union cannot agree on the terms of a first collective bargaining agreement.
While it initially appeared the legislation would not have sufficient support to overcome a filibuster in the Senate, it appears that provisions of the Act (including the monetary penalties) are being included in the Senate budget reconciliation bill, which could be passed by a simple majority of Democratic legislators.
Anticipated reversal and re-evaluation of Trump-era decisions
Despite its Republican majority and prior solicitation of briefs on the issue, the Board elected to maintain its longstanding contract-bar doctrine, under which the Board has historically held that it will not process any representation or decertification petition filed during the first three years of a valid collective bargaining agreement.
The Board also upheld the use of large inflatable figures in determining that they were not in violation of the NLRA’s ban on threatening or coercive conduct during union pickets and boycotts. However, following McFerran’s appointment to Chair of the Board, the Board withdrew its proposed rule regarding whether students who received financial compensation in connection with their studies were “employees” under the Act.
With Democrats taking majority control of the Board in August 2021, it is expected they will target prior Trump-Board decisions for reversal in several areas, including:
It is also anticipated that the Democratic majority will seek to redo administrative rules related to union election rules and joint employers. Furthermore, President Biden’s budget proposal for the 2022 fiscal year for the NLRB calls for USD2.1 million to allow the NLRB to launch programs to inform non-union employees about their rights under the NLRA, including the right to form unions and request that employers address workplace complaints.
Vaccines and the Return to the Workplace
Despite the availability of vaccines at the end of 2020/early 2021, the COVID-19 pandemic continues to cause significant disruption to employers and employees. With a large number of individuals initially hesitant to get vaccinated, employer strategies have varied when it comes to vaccines.
Guidance from the US Equal Employment Opportunity Commission (EEOC) has, however, indicated that employers can require employees to be vaccinated so long as they provide accommodations to those who cannot be vaccinated for religious or medical reasons. EEOC has also indicated employers may offer incentives to encourage staff to be vaccinated.
Requirements and incentives related to vaccines are, however, considered mandatory subjects of bargaining, requiring employers with union-represented workforces to provide notice and the opportunity to bargain before such a requirement can be required for union-represented employees.
As of this writing, momentum continues to build in support of employer vaccine mandates (subject to the conditions stated above) – even as the vaccines retain only emergency approval by the US Food and Drug Administration (FDA). Vaccine mandates have been supported in the healthcare and higher education settings by federal courts.
President Biden is considering vaccine mandates – the US Department of Justice issued an opinion on July 6, 2021 that COVID-19 Emergency Use Authorization status does not prohibit mandates. Most recently, President Biden required vaccines or testing and mask usage for federal workers and contractors.
Most employers have not mandated vaccinations (given the tight labor market), but require unvaccinated workers to continue wearing masks and have begun frequent testing of unvaccinated workers.
COVID-19 Occupational Safety and Health
In the spring of 2021, Indiana rescinded the majority of its previous executive orders issued in response to the COVID-19 pandemic, including orders limiting public gatherings and requiring mask usage.
On July 22, 2021, the Indiana Occupational Safety and Health Administration (OSHA) formally adopted the federal OSHA Emergency Temporary Standard for COVID-19 applicable to healthcare workers. Indiana OSHA applies existing rules and the general duty clause to address COVID-19 workplace enforcement, as it has since the beginning of the pandemic.
Indiana employers are strongly encouraged to follow applicable Centers for Disease Control and Prevention (CDC) and OSHA recommendations to mitigate potential workplace hazards related to COVID-19.
Remote work and its impact on the workplace
Before the pandemic, only 10% of full-time US employees worked remotely. However, the pandemic changed the workplace for millions of white-collar workers, as almost overnight nearly half began working remotely. With the subsiding of the pandemic, many employer and employees’ expectations about the future of work, and how and where it will be performed, appear to have reordered.
One clear carryover from the pandemic is that remote work platforms, in one form or another, are likely here to stay. It is estimated that nearly 37% of jobs in the US can be performed remotely, and predictions are that nearly a quarter of the US labor force will continue to work remotely.
While many employees have openly embraced the flexibility accompanying remote work, employers are also finding such models helpful when recruiting mobile young professionals, reducing capital expenditures and expanding access to talent on more regional or national levels. Regardless of these apparent “opportunities,” other employers are maintaining more traditional notions of work or are implementing hybrid workplace models where some employees return to the office and others continue working from home, either on a full- or part-time basis. Ultimately, businesses will have to make decisions based on what best suits the particular business, but such models themselves may result in greater workplace diffusion and fragmentation.
Regardless of the model, employers will need to understand the challenges in trying to coordinate permanent remote or hybrid work structure models. In terms of collegiality and access, remote work is not the same as being together physically. Another challenge for employers adopting such models will be less direct control over employees. Still another is the fragmentation of the workday due to a blurring of work and personal obligations, potentially compounded by diffusion of the workplace between those working from the office and those working remotely. Another concern regarding such models is the notion that there is not the same emphasis on collaboration or “group” innovation opportunities with remote work, as employees work more in silos. How these trends and competing interests will play out with US employers remains to be seen.
Remote work platforms have also changed rapidly during the pandemic, with more “visibility” for employers and monitoring of employee communication. Some platforms are now using cameras, artificial intelligence, and sensors to examine body language and recognize and track participants’ gestures with corresponding scoring of the effectiveness of meetings based on such factors. Others are creating automated to-do lists, features for individual employees to check in about action items they agreed to complete, and recording and searchable meeting transcripts. Thus, while employees may initially enjoy the perceived “flexibility” of the workplace, it may come with other constraints and corresponding privacy concerns.
Finally, employers adopting such models will have to consider how such models will change their policies and benefits, such as employee monitoring; timekeeping; compensation; the monitoring of breaks and lunch periods; how sick pay and paid time off (PTO) banks will apply; equality of treatment of employees; providing for work from home infrastructure, including compliance with any applicable OSHA requirements; accommodation of disabilities; and how benefit offerings may change to accommodate remote work models.
Continued and renewed focus on pay equity and employer accountability
The focus on pay equity, justice initiatives, and employer accountability has continued throughout the pandemic, and with support from the Biden administration and many state legislatures, that focus appears to be sharpening.
Pay equity has traditionally included the concept of “equal pay for equal work,” although this standard has more recently found disfavor in some quarters. The current trend is to push for consideration of “equal pay for work of equal value” or concepts of “comparable worth.”
The COVID-19 pandemic and racial justice movement is providing additional current leverage to pass new legislation to address such inequities, given the data demonstrates the uneven impact the pandemic has had on working women and workers of color. Job losses among women during the pandemic were higher, comprising nearly 55% of overall job losses.
Democrats in the House of Representatives have reintroduced the Paycheck Fairness Act in Congress. This legislation seeks to address issues of pay equity through transparency requirements that would show workers what others make. There are also proposals from federal agencies such as the SEC to increase disclosure requirements of certain workforce data such as pay information or diversity plans. However, given the current gridlock in the federal legislature, state and local level initiatives are more likely.
Companies are increasingly turning to performing pay equity audits (PEAs), which generally involve comparing the pay of employees doing similar work in an organization. Because PEAs have multiple levels of complexity and can disclose information regarding past inequities, many companies engage counsel or other outside resources to address such trends.