Employment Law 2021… and Beyond: What Happened, What’s Next, and What to Do About It

During our 14^th Annual HR & Employment Law Conference, Michael G. Trachtman, Esquire kicked off our event with a discussion on Employment Law. Specifically, Trachtman discussed 6 topics that he believes will be the most impactful to businesses in the near future. He also gives helpful insight into what businesses can do to combat and deal with these issues. Before introducing his six topics, Trachtman explains that politics will drive employment law in the middle market and day to day business lives.  

Trachtman’s 6 Topics on Employment Law

Worker Misclassification in Relation to Independent Contractors

According to Trachtman, there has been a plethora of employers classifying employees as independent contractors during the Trump Administration. Classifying employees as independent contractors takes away their right to benefits, overtime, protection under employment laws in many cases, and the right to organize in a union. This has become a high priority issue for the Biden Administration. Because of this, Biden has set out to end this misclassification.  

To combat this issue, the government has re-implemented the Economic Realities Test, which was limited during the Trump Administration. With this test, workers can be classified as independent contractors if they perform functions of independent contractors. However, Trachtman believes that this form of testing will be replaced by ABC testing in the future. ABC testing has three major requirements that need to be met for someone to be classified as an independent contractor. First, the individual must be free from the employer’s control over performance of the work. Second, and most importantly, the individual must perform tasks outside the usual course of the business. And lastly, the individual must be engaged in personal trade.  

What To Do About It:

• Begin auditing worker classifications  
• Prepare to transition improperly classified independent contractors to employees  
• Revisit employment agreements  

Attack on “Wage Theft”

As a part of his presidency, Biden has also pledged to attack “wage theft,” which occurs when employees are not accurately paid for their work. To fight this, the federal government has increased the enforcement budget and has discussed the possibility of criminal penalties for wage theft. Although these actions have been taken, Trachtman believes that the federal government likely will not raise the minimum pay for exempt employees.  

What To Do About It:

• Put in place procedures that monitor hours worked 
• Train managers on legal requirements  
• Audit your exempt and non-exempt classifications  
• Create/update job descriptions that accurately reflect job responsibilities    

Increased Focus on Workplace Discrimination

Trachtman explains that we should expect to see an increase in enforcement when it comes to workplace discrimination, likely as a result of greater awareness by employees and the public and more emphasis on these issues by Democrats.  The Biden Administration is looking to expand enforcement by upping both EEOC funding and staffing. Adding new team members will not only heighten the enforcement priority, but also pave the way for more cases to be processed.  

What To Do About It:

• Audit workplace practices regarding hiring, discipline and termination 
• Update policies and procedures, including those on EEO, anti-discrimination and anti-harassment 
• Focus on diversity, equity, and inclusion  
• Train managers on legal requirements  
• Utilize internal enforcement  
• Be consistent when implementing policies  

Reverse Discrimination Risks

With this increasing focus on diversity in the workplace, majority workers have started to claim that they are being discriminated against based upon their race and gender. Trachtman explains that yes, it is legal to address workplace discrimination and increase diversity; however, he argues that we must be mindful that discrimination based on race, nationality, and gender is unlawful, whether used against majority or minority workers.  

What To Do About It:

• Be mindful that discrimination is discrimination  
• Be careful using race, gender, and nationality as sole criteria for hiring  
• Be careful to give even the appearance of utilizing quotas  
• Seek guidance from legal and human resources professionals to lessen and avoid risk  

Increased Focus on Workplace Safety

With the pandemic, there has been a newfound focus on safety in the workplace. During COVID-19, the CDC and OSHA have informed and updated employers and the greater public on mask wearing, social distancing, and safety measures. Congress has approved a $75 million budget to ensure and enforce workplace safety. In the future, we can expect more OSHA inspections and enforcement penalties.  

What To Do About It:

• Hire an OSHA supervisor  
• Train management and workers to be knowledgeable of comply with OSHA requirements  
• Learn how to handle worker complaints  

6. Focus on Retention of Key Employees

Lastly, Trachtman explains that the success or failure of your business has to do with your ability to retain your employees. Remote work has permanently altered the working world positively and negatively. Unfortunately, the implementation of remote work has promoted less personal engagement between employees and has, in some cases, lessened the feeling of company culture. On the flip side, not offering remote work has led many employees to seek out this option with another employer, sometimes leading them to work for the competition. Right now, employees want the best deal they can get.  

What To Do About It:

• Review and revise noncompetes 
• Consider implementing non-solicitation agreements  
• Institute intellectual property protections  
• Implement policies and practices that will make your employees want to stay  

Conclusion

To conclude, Trachtman left everyone with a three-step plan to lead by:  

1. Get Vaccinated: Do the things in your business that can lead to strategic prevention.  
2. Create Your Armor: Build up your policies to protect yourself and minimize future consequences.  
3. Be Creative, Be Strategic: Do the unexpected and stand out against the competition.