Pregnancy Disability Update. Sort of.

As some of you know, Jennifer Shaw is my partner, chief rainmaker, and employment lawyer extraordinaire, over here at Shaw Valenza. As a partner, she is not entitled to Pregnancy Disability Leave under California law. You can read about that in this article I recently wrote for the SF Daily Journal, here.

Of course, this is just my sneaky way of announcing the arrival of Baby Shaw, female, on January 21. "What's New in Employment Law?" you ask? "Jennifer's baby," I reply. See what I did there? Huh?

Please send her well wishes and presents if you're so moved. Her favorite color is pink. The baby's favorite color also is pink. (Even if it isn't, the baby doesn't read the blog.) So, go with pink.

DGV

More Employment Law from the Defense Appropriations Act

Yep, the recent extension of the discount on COBRA premiums is part of our national defense effort. The 2010 Defense Department Appropriations Act contained an extension of the COBRA premium discount (enacted in Feb. 2009 as part of the ARRA stimulus bill) through February 28, 2010. A US DOL announcement regarding the extension is here.

Arbitration of Employment Law Claims - Going Away?

Did you know that the 2010 Defense Appropriations Bill is actually an employment law bill?

Well, when Congress keeps passing laws over with 100's of pages of text, you're going to see some hidden gems in there. So, the 2010 Defense Appropriations Act, which was H.R. 3326, appears to make the first cut of the 1000 that eventually will end arbitration of individual employment claims.

The new law applies only to defense contractors that receive more than $1,000,000 under the Defense Dept. Appropriations Act. The new law prohibits arbitration of certain claims for covered defense contractors But the contractor can't arbitrate covered claims with any of its employees, whether or not they are paid by contract money.

Here's the text of the section of the law:

Sec. 8116. (a) None of the funds appropriated or otherwise made available by this Act may be expended for any Federal contract for an amount in excess of $1,000,000 that is awarded more than 60 days after the effective date of this Act, unless the contractor agrees not to:

(1) enter into any agreement with any of its employees or independent contractors that requires, as a condition of employment, that the employee or independent contractor agree to resolve through arbitration any claim under title VII of the Civil Rights Act of 1964 or any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention; or

(2) take any action to enforce any provision of an existing agreement with an employee or independent contractor that mandates that the employee or
independent contractor resolve through arbitration any claim under title VII of
the Civil Rights Act of 1964 or any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention.

The secretary of defense may grant a waiver of this provision when needed for national security.

So, defense contractors, check your arbitration agreements. Everyone else, don't start your own arbitration administration company. I think demand for arbitration services may go down if this Congress acts quickly to abolish pre-dispute arbitration. The window of opportunity could be narrower after November, though.

The text of this portion of the bill is here, in Title VIII. By the way, if you care about such things, this portion of the law is known as the Franken amendment.

DGV

California WARN's Faltering Business Exception Explained

Happy new year everyone!

The director of California's Department of Industrial Relations issued an opinion letter clarifying one of the provisions of California's baby WARN Act. In essence, the law requires employers to provide 60 days' notice of a shutdown, relocation, or mass layoff under certain circumstances. However, there are some situations in which notice is not required. One is when the employer is actively seeking capital or business when the notice was required to be given (at least 60 days before the triggering shutdown):

1402.5. (a) An employer is not required to comply with the notice requirement contained in subdivision (a) of Section 1401 if the department determines that all of the following conditions exist:
(1) As of the time that notice would have been required, the employer was actively seeking capital or business.
(2) The capital or business sought, if obtained, would have enabled the employer to avoid or postpone the relocation or termination.
(3) The employer reasonably and in good faith believed that giving the notice required by subdivision (a) of Section 1401 would have precluded the employer from obtaining the needed capital or business. . . . .
(d) This section does not apply to notice of a mass layoff as defined by subdivision (d) of Section 1400.

Note that the defense does not apply to layoff notices, only to shutdown notices. So, if a company is looking for a buyer, is that the same as seeking capital or business? No, said the Director. The opinion letter surveys the analogous federal case law and concludes that the employer should have given the notice even though it was trying to obtain a buyer before it went out of business.
The opinion letter is here.