Hunton Employment & Labor Perspectives

Many employers recognize the advantages of “alternative” work arrangements with independent contractors, consultants, freelancers, temporary staffers, and “as needed” workers.  Generally, employers utilize these arrangements because they hope to obtain cost savings and increased flexibility, particularly in an uncertain business climate.  In some companies, use of a contingent worker expands working capacity without increasing employee headcount, which can be particularly attractive during a hiring freeze.

Companies doing business in California, particularly retailers, should be aware of a recent revision to the California Financial Code that sets out new accessibility requirements for point-of-sale devices.  A point-of-sale device includes any device used by a customer for the purchase of a good or service with a debit, credit or cash card where a personal identification number (PIN) is required. 

Franchisors with operations in the State of Georgia are confronting a new challenge in their effort to enforce non-competition rights against franchisees.  In Atlanta Bread Co. v. Lupton-Smith (6/29/09), the Supreme Court of Georgia held that an “in-term” non-competition clause within a franchise agreement is held to the same strict scrutiny standard applicable to post-term and employment contract non-competition clauses.

Previously we have discussed the risks associated with contingent worker arrangements (engagements of independent contractors, consultants, freelancers, temporary staffers, and “as needed” workers, etc.).  These risks will continue to grow in the coming months, as more claimants emerge seeking damages, government agencies increase their enforcement efforts, and state and federal legislators create new restrictions and penalties associated with classifying workers as independent contractors.

President Obama recently nominated Victoria A. Lipnic for a seat on the five-member Equal Employment Opportunity Commission (EEOC).  Lipnic is Republican, with an extensive background in employment law.  During the prior Administration, she served as Assistant Secretary of Labor for Employment Standards from 2002-2009.  In that capacity, Lipnic oversaw the Department of Labor’s largest agency, and led the teams that revised the Part 541 overtime regulations under the Fair Labor Standards Act (FLSA), and the Family and Medical Leave Act (FMLA) regulations.
 

Government agencies are being urged to step up their efforts to address the potentially widespread problem of improper classification of workers as independent contractors, according to a recent study by the United States Government Accountability Office (GAO).  In a 70-page document, the GAO concluded that the U.S. Department of Labor (DOL) and the Internal Revenue Service (IRS) have not sufficiently focused on misclassification in the past, and that they have not consistently assessed penalties against companies found to have improperly classified workers.

The five-member National Labor Relations Board (NLRB) will undergo a dramatic makeover with the appointment of a new chairman, Wilma Liebman, and three new members, Craig Becker, Mark Pearce, and Brian Hayes.  Typically the Board consists of three members from the sitting President’s party and two from the other party.

The Administrative Task Force plays a critical role in keeping our OSHA practice current and vibrant.  We follow developments daily and we work together to analyze the impact that proposed and actual changes will have on the law in general and specifically on our client’s industries. Employers today face an unprecedented range of workplace safety and OSHA legal issues as government increases worker safety and health regulation and demands meticulous reviews by its OSHA inspection force.

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