 In a widely anticipated move, the Colorado Supreme Court has struck down as unconstitutional Colorado’s Amendment 54, which prohibited political contributions from unions and no-bid government contracts. Dallman v. Ritter (Colo. 2010).
Amendment 54, which took effect on December 31, 2008, sought to slash "pay-to-play" contracts from state government. To accomplish this goal, the amendment prohibited directors of companies with sole source or no-bid contracts from making campaign contributions. Top shareholders and extended family members were also barred from giving political donations. Amendment 54 expressly included collective bargaining agreements within the definition of “sole source” government contracts.
In striking the measure, the Colorado Supreme Court noted that the amendment “impermissibly abridge[d]” the First Amendment right of union members to speak freely. Per the majority, collective bargaining agreements “hav[e] none of the characteristics of pay-to-play contracts the Amendment was drafted to combat.” Accordingly, the court called the provision overly broad as it “treat[ed] unions differently than other entities without compelling justification.”
The Dallman ruling restores campaign contribution rights temporarily lost since Amendment 54 went into effect at the end of 2008.
 Employers may file a new H-1B petition for a new foreign worker beginning on April 1, 2010. Now is the time to begin preparing new petitions.
The H-1B visa program allows employers to hire foreign national employees to work in professional positions in the United States. Only 65,000 H-1B visas are available annually, with an additional 20,000 visas available to foreign nationals who have earned an advanced degree from a university in the United States. New H-1B visas are released at the start of the federal fiscal year – October 1 – and employers may petition for a new H-1B six months in advance – on April 1. In most years, all H-1B visas are allocated during the first week of April.
"While it is difficult to project exactly when the H-1B cap will be reached, employers should note the consequences of missing this year's filing," says Ryan Adair, Manager of Immigration Services at MSEC. "Once all H-1B visas have been allocated, employers will have to wait until October 1, 2011 to employ new H-1B workers."
 This year, the Office of Federal Contract Compliance Programs (OFCCP) is changing how it chooses federal contractors for audit and revamping the Federal Contractor Compliance Manual.
Those changes are just a warm up for next year, when the OFCCP will implement aggressive enforcement efforts, which will result in more full compliance reviews. Individual cases of discrimination—including harassment, retaliation, termination, and failure to promote—will be subject to additional scrutiny. The OFCCP will also increase monitoring of government contractors' internal self-auditing processes and correction of identified problems.
Though the American Recovery and Reinvestment Act (ARRA)—which is partially responsible for the shift in OFCCP's focus—has created projects for many construction companies, it has also created compliance obligations. If a company receives ARRA funds, it must comply with Executive Order 11246, Section 503 of the Rehabilitation Act of 1973, and the Vietnam Veterans' Readjustment Assistance Act of 1974.
The best way to prepare for this shift is to determine your company's affirmative action obligations, if any, and then ensure your company has an up-to-date affirmative action plan containing all the required elements. If your company is scheduled for a compliance review, you will have only 30 days to return a complete affirmative action plan to your compliance officer, so being prepared makes the whole process much smoother.  President Obama signed a bill yesterday that extends the eligibility for the COBRA premium assistance through March 31, 2010 and adds another group of assistance eligible individuals (AEI’s).
This means that AEI’s who are involuntarily terminated on or before March 31, 2010, will be eligible for 15 months of government-subsidized premium assistance.
The new group of AEI’s are individuals who are involuntarily terminated and who have previously lost eligibility for group health care coverage due to a reduction in hours. Dependents of this new group of AEI’s are also now eligible. MSEC will provide more information about how plan sponsors must treat these new AEI’s once we have completely analyzed the bill.
Legislation is currently pending in both houses of Congress that would expand the already far-reaching Family and Medical Leave Act. One bill, the Family Medical Leave Inclusion Act (H.R. 2132), would amend the FMLA to allow employees to take leave to care for a same-sex spouse or domestic partner who suffers from a serious health condition. Another bill, the Family Leave Insurance Act (H.R. 1723), would establish a family and medical leave insurance program at both federal and state levels. Some states such as California currently have a similar insurance fund. This legislation would provide 12 weeks of paid benefits to employees who need time off to care for a new child, an ill family member, a service member returning from combat, or their own illness. Employers and employees would share the cost of funding this program by paying taxes and premiums based on employees’ earnings. Participation in this fund would be mandatory for all employers that are covered by FMLA.
Additionally, the legislation would convert leave provided in Colorado under parental involvement or domestic violence laws into paid leave. Please contact MSEC for more information on these pending bills.
 Last week, the Department of Homeland Security announced the results of a multi-year study into the effectiveness of E-Verify. The report highlights an alarming byproduct of E-Verify: identity theft.
E-Verify is an online program that allows employers to verify the identity and work authorization of newly hired employees. The program is primarily voluntary but is required for certain federal contractors. Some states, including Arizona, mandate that employers use E-Verify.
The study reveals a staggering inaccuracy rate for unauthorized workers of approximately 54 percent.
The report attributes these false-positives to identity theft, something that comes as no surprise to those familiar with the E-Verify system. E-Verify has no way to detect identity theft,” says MSEC Manager of Immigration Services Ryan Adair. “If the information inputted into the system belongs to someone—even if it does not belong to the worker—E-Verify is likely to confirm employment eligibility."
E-Verify was created to curb illegal immigration in an effort to protect U.S. workers. That the system has the unintended consequence of harming workers by encouraging identity fraud is a trend that will only worsen. “E-Verify is going to encourage even more identity theft, as unauthorized workers learn of the system and try to circumvent it,” says Adair. To cope, employers should make sure they know what genuine documents look like and reject those that do not reasonably appear to be genuine.
The full study is available here.
 Sound familiar? Not too long ago the Colorado Front Range experienced record breaking snowstorms. At that time, the Colorado State Patrol announced interstate closures and prohibited driving unless it was an emergency. More recently, Gov. Markell of Delaware declared a state of emergency there due to major blizzards and snow accumulation. As in Colorado, a driving ban was enforced limiting driving to emergency vehicles only. While state government officials strongly encouraged employers to consider their employees’ safety and close their businesses for the duration of the state emergency, nothing prohibited employers from staying open during the blizzards.
In these instances, employers should consider more than just employee safety when choosing to open their businesses during a blizzard or other state of emergency. While the general rule is that an employer is not responsible for an employee’s injuries if those injuries are sustained outside of the employer’s property, there are many exceptions. In some cases, an employer may be liable for an employee’s injuries sustained while traveling to the employer’s property. While no court has ruled on this specific issue, some courts have noted that an employer could be liable for an employee’s injuries if the employee was called in to work during a driving ban or other state of emergency. While business closures may be financially costly, employer liability for employee injuries could cost more.
 As of February 16, 28 states have borrowed approximately $31.8 billion from the federal government to continue paying unemployment insurance benefits. The Office of Unemployment Insurance within the Labor Department’s Employment and Training Administration projects that between 35 and 40 states will eventually borrow a total of about $90 billion from the federal government.
Many states’ unemployment trust funds were vulnerable heading into this recession because of their emphasis on low payroll taxes and low taxable wage bases. As a result, unemployment insurance taxes in many states will increase in 2010.
A survey conducted by the National Association of State Workforce Agencies (NASWA) forecasts that unemployment insurance taxes paid by employers will increase in 35 states. Twenty-four of those states will increase their taxable wage base, or the amount of each employee’s wages that is subject to payroll taxes. As an example, Colorado’s taxable wage base is $10,000, which means employers are taxed on the first $10,000 each employee makes.
“Employers should prepare for potentially significant increases in their unemployment costs,” says Mark Parcheta of MSEC’s Employment Law Services group. “The Colorado Legislature is working with employer groups to address the issues facing the state’s unemployment trust fund.”
Arkansas, Florida, Indiana, New Hampshire, Tennessee, Vermont, and West Virginia have already passed legislation to increase the taxable wage base. Legislation is currently pending in California.
 The Employee Free Choice Act appears dormant in the wake of the recent Massachusetts election. As a result, unions are using creative measures to increase membership. One tactic involves stacking the NLRB with pro-labor individuals willing to change the law by regulation to avoid the challenges of passing legislation. Unions have also won elections giving them the right to represent some workers before the workers were aware an election was even underway.
Recently, the American Federation of State County and Municipal Employees (AFSCME) and the Service Employees International Union (SEIU) in Michigan were able, through subterfuge, to gain the right to represent some 40,000 private day care workers, most of whom own their own businesses. Only 6,000 of the day care workers voted. Most of the remaining 34,000 weren’t aware of the campaign. This allowed pro-union voters to dominate the election despite their relatively low numbers. The union used a state agency called the Michigan Home Based Child Care Council as a shell corporation to organize against.
As dishonest as the voting was, the dues collection process was worse. The Michigan Department of Human Services was directed to automatically withhold the union dues for these workers from the child care subsidies the state receives from the federal government.
When pressed to explain what they do for the workers they now represent, the union responded that they have been pressing the legislature to increase child care payments. These business owners did not need a union to lobby for them.
“We’ll see more creative organizing efforts as the unions continue to struggle with membership,” says MSEC attorney Andrew Joppa.
 A trucking company that successfully defended a sexual harassment suit against the Equal Employment Opportunity Commission could recover up to $4.56 million in attorneys’ fees, costs, and expenses, as a result of a ruling by the U.S. District Court for the Northern District of Iowa. EEOC v. CRST Van Expedited Inc. (N.D. Iowa 2010).
The court dismissed the EEOC’s case against CRST in August 2009, allowing CRST to petition the court for an award of attorneys’ fees.
Judge Linda R. Reade took the agency to task for filing suit without bothering to investigate the claims of the 67 alleged discrimination victims, and without attempting to settle their claims.
“EEOC’s failure to investigate and attempt to conciliate the individual claims constituted an unreasonable failure to satisfy Title VII’s prerequisites to suit,” Judge Reade wrote.
A 1978 Supreme Court decision permits a court to award attorneys’ fees to a prevailing Title VII defendant if the court finds the plaintiff’s lawsuit to be “frivolous, unreasonable, or without foundation.”
The EEOC is appealing the dismissal of its case to the Eighth Circuit Court of Appeals. |
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ABOUT HOT TOPICS
MSEC's Hot Topics Blog is intended to provide our members with updates and expert assistance in governmental regulations, employee relations, employment law, and management development that leverages top trends in training. We have been helping organizations reach their strategic goals as we strive to accomplish our vision...effective, successful employers.
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