Legislative Update for the Week of April 7, 2014

Leg Roundup Image 132 by 140.jpgLittler Shareholders Maury Baskin and Michael Lotito Testify at NLRB Public Meeting
Nearly 50 speakers have or are slated to testify during the National Labor Relations Board's 2-day public meeting on the proposed expedited or "ambush" election rule. The Board sought input on approximately 20 different issues stemming from the proposed rule, which would make significant changes to pre- and post- representation election process. Among the speakers were Littler Shareholders Michael Lotito and Maury Baskin, who testified specifically about the proposal's expedited timing of the pre-election hearing; the requirement that an employer identify all potential bargaining unit issues in its statement of position or forever waive them; the types of matters that should be resolved at the pre-election hearing; and how the rules should address voter lists.  Read the full post here. (April 11, 2014)

Congress: Heal Thyself
Many private employers, and the agencies under the federal executive branch, provide regular sexual harassment training to their employees.  Yet, one notable employer, the United States Congress, does not. Rep. Jackie Speier (D-CA) seeks to bridge that gap. On Tuesday April 8, 2014, she introduced a resolution to amend the Rules of the House of Representatives to require members and their staff to take "a specific program of training in the prevention and deterrence of sexual harassment in employment." The annual training would be two hours for new members and employees, and one hour thereafter. Read the full post here. (April 10, 2014)

Continue Reading...

Recent Puerto Rico Court of Appeals Rulings Provide Guidance Regarding What Constitutes a Transfer of Going Business

By Elizabeth Pérez-Lleras, Ana Beatriz Rivera-Beltrán

Two recent rulings from the Puerto Rico Court of Appeals provide guidance as to what constitutes the transfer of a going business vis-à-vis the closing of a business, to determine whether the employer is liable for payment of severance to employees who are discharged within the context of those transactions.  

In Quintero v. Bestov Broadcasting, Inc., plaintiff was a sales executive who worked at Radio Puerto Rico, a radio station owned and operated by Bestov Broadcasting, Inc. ("Bestov").  Due to its economic difficulties, Bestov entered into a three-year lease with an option to buy agreement ("Agreement") with Boricua Broadcasting Corp. ("Boricua"), to lease its facilities, equipment and on-air radio time. Pursuant to the Agreement, Bestov retained the control over its policies, as well as the authority and power over its operations and programming, including the right to refuse or cancel programming or advertising that did not comply with Bestov's policies.  As the Agreement required Boricua to hire its own staff and pay their salaries, Bestov discharged all of Radio Puerto Rico's employees.  Boricua, in turn, hired several of Bestov's employees, although plaintiff was not amongst them.  Plaintiff sued Bestov alleging unjust dismissal and claiming severance.  In response, Bestov alleged that it had just cause to dismiss plaintiff because its operations had partially or completely closed due to its financial difficulties. 

The Court of Appeals looked at the interplay between Act 80 and the labor code to determine whether Bestov had established that plaintiff's termination of employment should be deemed for just cause.  Puerto Rico Act 80 of May 30, 1976 ("Act 80") provides that any person hired for an indefinite period of time, and discharged without just cause, is entitled to receive a severance payment, in addition to any wages owed.  The law also provides that just cause exists for the discharge of an employee in the case of a full, temporary or partial closing of the operations of the establishment.  However, in the case of transfer of a going business, if the buyer chooses not to continue with the services of all or any of the employees, and hence does not become their employer, the former employer shall be liable for the compensation. 

Continue reading this entry at Littler's Puerto Rico Workplace Counsel. 

US and Mexico Sign Agreement to Promote Enforcement of Employment Laws that Protect Migrant Workers

Imm Roundup Image 134 by 131.jpg

By Carlos Ferrán Martinez Carrillo

The Secretary of the U.S. Department of Labor (DOL) and the Secretariat of Labor and Social Welfare of Mexico (STPS) signed an agreement on April 3, 2014, to strengthen the relationship between both nations and promote compliance of the labor laws of both countries, especially as it relates to the protection of migrant workers. Through this joint effort, both governments seek to ensure that migrant workers become more knowledgeable of their legal rights, as well as of the employer's obligations.

Continue Reading...
Tags: Migration

Legislative Update for the Week of March 31, 2014

Leg Roundup Image 132 by 140.jpg

President Obama Poised to Enact Provisions of Paycheck Fairness Act Through Executive Action
Because the House of Representatives is not expected to consider the Paycheck Fairness Act (S. 2199) this term, President Obama will reportedly implement provisions of this measure applicable to federal contractors via Executive actions on Tuesday. The move will coincide with Equal Pay Day, and is the latest in a series of recent Presidential actions designed to implement employment law reform by bypassing Congress. Read the full post here. (April 7, 2014)

House Clears Bill Revising Definition of Full-Time Employee Under Affordable Care Act
As expected, the House of Representatives approved legislation on Thursday that would change the definition of "full-time employee" under the Affordable Care Act. Under the healthcare law's employer responsibility requirements, an employer with 50 or more full-time or full-time equivalent employees will be required to provide health insurance that meets certain ACA standards to their full-time employees starting in 2015, or pay a penalty. The ACA considers a worker "full time" if he or she works 30 hours or more per week, instead of the customary 40 per week. The Save American Workers Act (H.R. 2575) would specifically define "full-time employee" as an employee, "with respect to any month . . . who is employed on average at least 40 hours of service per week.'' The measure was approved by a vote of 248-179, with 18 Democratic lawmakers joining all Republicans in support of the bill. Read the full post here. (April 3, 2014)

Continue Reading...

Puerto Rico's ADA Counterpart, Law 44, Does Not Provide for Individual Liability

By Daniel Quiles and Jessica Earl

gavel.jpgA recent ruling by the United States District Court for the District of Puerto Rico clarifies that Law 44, Puerto Rico's counterpart to the federal American with Disabilities Act (ADA), applies only to employers and does not provide for individual liability.  Accordingly, claims brought against individual defendants under Law 44 are subject to dismissal.

In Van Praag v. DHL Exp. (USA), Inc., Civil No. 13-1128 (D.P.R. Mar. 10, 2014), the plaintiff worked as a pilot and an assistant director of operations for 14 years for his employer, a company that provided aircraft services for DHL Express (USA).  Around the same time that the employer informed plaintiff that due to the company's financial situation, his salary would be drastically reduced, plaintiff informed his superiors that he was seeking treatment for depression and was taking medication that made him tired, dizzy, and diminished his capacity to fly airplanes.  Due to his medical condition, plaintiff was unable to continue flying airplanes.  Approximately six months later, plaintiff's employment was terminated.  Plaintiff sued the company and his supervisor as an individual defendant, alleging, among other claims, disability discrimination in violation of Law No. 44, 1 L.P.R.A. § 502.  Plaintiff's supervisor moved to dismiss the complaint, arguing that neither the Puerto Rico Supreme Court nor the First Circuit has definitively ruled on the issue of individual liability under Law 44. 

Continue Reading...

The Puerto Rico Supreme Court Provides Guidance on Drug Testing Law

By Ana B. Rosado and Eddalee Quiñones

iStock_000016354947Small_petri_dish_pipette.jpgA recent ruling by the Puerto Rico Supreme Court interprets relevant sections of Act 59, known as the "Act to Regulate Controlled Substances Detection Tests in the Private Work Sector", to clarify that, when subjecting employees to undergo drug testing, hair samples can be used only when the circumstances justify not conducting the drug testing with a urine sample.  The High Court also elucidated as to when additional drug tests are permissible after the result of the first drug test has been deemed inconclusive or invalid.

In Ortiz v. Holsum of Puerto Rico, Inc., 2014 T.S.P.R. 35 (2014), the employer subjected the employee to a drug test.  The result was positive for cocaine.  The Company allowed the employee to undergo rehabilitation treatment, as required by law, and advised him that if he tested positive on a second occasion, he would be terminated from employment. 

Continue Reading...

Immigration Update for the Week of March 24, 2014

Imm Roundup Image 134 by 131.jpg

Employers Should Anticipate Tougher Worksite Enforcement Efforts in the Near Future
In a recent report entitled "U.S. Immigration and Customs Enforcement's Worksite Enforcement Administrative Inspection Process," Acting Assistant Inspector General for Audits Mark Bell discussed the results of an audit of U.S. Immigration and Customs Enforcement's ("ICE") worksite enforcement processes. The purpose for the audit was to determine whether ICE was meeting directives set out in the 1986 Immigration Reform and Control Act. The report concluded that ICE has been inconsistent in its enforcement policies and made recommendations to improve ICE's implementation of its worksite strategy and uniformly strengthen its fine and audit procedures. Read the full post here. (March 28, 2014)

Image credit: CDH Design

Legislative Update for the Week of March 24, 2014

Leg Roundup Image 132 by 140.jpg

Legislation would Effectively Prevent NLRB's Representation Election Rule From Moving Forward
As a preemptive strike against a final "ambush" representation election rule, Republican lawmakers in both chambers introduced legislation that would blunt its intended effects. In February, the National Labor Relations Board reissued its controversial proposal that would not only expedite union election procedures, but also fundamentally alter the way elections are carried out, and remove many employer due process rights. The reissued proposal was substantively the same as that initially introduced in June 2011, which triggered over 65,000 comments. The Board will hold public hearings on this proposed rule in the coming weeks. Read the full post here. (March 27, 2014)

Labor Secretary Discusses Persuader Rule, Overtime Regulations, OSHA Actions During House Budget Hearing
Labor Secretary Thomas Perez fielded questions about current Department of Labor rulemaking, past sub-regulatory actions, and future agency plans during a hearing before the House Committee on Education and the Workforce to discuss the DOL's FY 2015 budget proposal. Committee Chairman John Kline (R-MN) emphasized that "budgets are about priorities," and that the hearing would elucidate the areas and policies the Department deems most important. Read the full post here. (March 26, 2014)

Image credit: JuDesigns

Puerto Rico Governor Signs into Law the First Chance Youth Employment Act

interview_smaller.jpgOn March 7, 2014, Governor Alejandro García Padilla signed into law the First Chance Youth Employment Act ("Ley de la Primera Oportunidad de Empleo Juvenil") ("Law 36-2014").  Law 36-2014 aims to create employment opportunities for talented youth who have completed a college degree, so they can enter the workforce in Puerto Rico, rather than emigrate stateside to find employment.

The law incentivizes public sector employers, as well as participants from the business and industrial sectors, to create and identify available employment opportunities for young people. The program will be funded with a $1 million annual assignment, beginning with the 2014-2015 fiscal year.  Any qualifying employer under the Act, as well as under Law 1-2013, the "Employment Incentives Act," may receive benefits for hiring and maintaining qualified youth for positions in their business. 

To qualify, an employer must be an "Eligible Business Entity," which is defined as any natural or legal entity, including corporations, societies, limited liabil  ity companies or any other entity or organization that performs, or considers performing, business in Puerto Rico independent from its place of origin, whose principal operations are not eligible to receive other incentives under the law.  In addition, the entity must invest at least 15%, or deposit and maintain at least 1%, of its net sales generated in Puerto Rico, in local banks or trusts for a period of no less than three years. Eligible business entities also include those designated as a "new business entity," "expansion of existing business entity," or "developing business entity."

The Act goes into effect on June 6, 2014 and repeals the previous Program for Youth Employment Act.  

For any questions concerning this law, please contact any Littler Global Puerto Rico attorney.

Australian Supreme Court Decision Holds Important Lesson for Companies with Australian Operations Regarding Use of Post-Employment Restraints

By Naomi Sheridan

shutterstock_3213251_trade_secrets.jpgOn December 20, 2013, in Pet Tech Pty Ltd v Batson [2013] NSWSC 1954, Justice Young of the New South Wales (NSW) Supreme Court ruled that businesses that want to enter into enforceable post-employment restraint agreements in Australia must ensure those agreements are written in accordance with Australian law.  The decision holds an important lesson for any company with Australian operations.   

Pet Tech Pty Ltd brought proceedings against one of its former sales agents attempting to prevent the employee from using or retaining information that the company considered to be confidential.  Post-employment restraints like this are not uncommon in Australia, particularly for executive, management and sales employees.  However, in this case, the court noted that it was required to interpret the enforceability of a "very strange" agreement because the document appeared to be an "American document which has been adopted to Australia unthinkingly."  Accordingly, Justice Young said that "whatever its effect under American law might be I have to deal with its effect in New South Wales."  As such, the court advised the company "to get some local lawyers to draft an actually enforceable contract" to cover employees in the future.  

Continue Reading...