In C.S. v. Brick Recycling Co., the New Jersey Appellate Division vacated a trial court decision requiring the disclosure of documents relating to an attorney-led workplace investigation into sexual harassment. In doing so, the court provided important guidance on the discoverability of documents relating to such investigations.

Background

The plaintiff, a former employee of the employer, made an internal complaint of sexual harassment. The employer retained outside counsel to investigate the complaint. The law firm prepared a lengthy investigation report summarizing interviews with the complainant, witnesses, and the accused, analyzing information and documentation, and evaluating credibility. The report substantiated the plaintiff’s harassment claim.

The employee later filed suit alleging sexual harassment and constructive discharge under the New Jersey Law Against Discrimination. In response, the employer raised several affirmative defenses, including that it exercised reasonable care in responding to the internal complaint. During discovery, the defendant employer produced nearly 600 documents, including the final investigation report. However, the employer withheld various documents on the basis of privilege, including a draft of the investigation report, attorney notes made during the investigation process and the retainer agreement between the law firm and the employer. The trial court held that none of the withheld documents were privileged and ordered that the documents be turned over to the employee. The employer obtained leave to appeal.

New Jersey Appellate Division Decision

The Appellate Division vacated the trial court’s decision regarding privilege and remanded to the trial court with further instruction to review. The Appellate Division opinion offers several key takeaways regarding the privilege protections that may apply to workplace investigations:

Timing is Not Determinative

The Appellate Division explained that the trial court was mistaken in finding that privilege could not be invoked since the investigation had begun several weeks before the employee filed suit. Instead, the Appellate Division found that there was a “sufficiently close temporal nexus between the claims, the undertaking of the investigation and the filing of the complaint.”

“Tenuously Related”

In a 1997 decision, the New Jersey Supreme Court explained that certain documents created or identified during an investigation may be so “tenuously related” to an employer’s affirmative defense that they need not be produced, but it did not define what exactly is meant by “tenuously related.” Here, the Appellate Division provided additional guidance on when a document is sufficiently related to the defense to warrant disclosure. According to the court, a document may be related enough to require production if it could: (1) show the reasonableness or thoroughness of the attorney-led investigation; or (2) impeach the affirmative defense, such as by showing that the employer undermined the independence of the investigation.

Draft Reports

The Appellate Division likened draft investigation reports to draft reports by expert witnesses, which are generally non-discoverable. In doing so, the Appellate Division questioned whether draft investigation reports should be disclosed at all and directed the trial court to reconsider its decision on the issue.

Wholesale Inclusions or Exclusions Disfavored

The Appellate Division rejected the employer’s request to entirely exclude attorney notes from production. Instead, the Appellate Division explained that the trial court must carefully analyze documents line-by-line and, where appropriate, redact privileged material.
 

Important Considerations for Employers

The decision underscores several practical considerations for employers:

• Employers should strongly consider hiring outside counsel to perform workplace investigations to preserve any possible protection afforded to the investigation.
• While timing is not dispositive, employers should be thoughtful about when they choose to retain an outside law firm for a workplace investigation.
• Employers should clearly identify and maintain draft investigation reports as drafts to avoid possible production.
   

If you have any questions or would like additional information, please contact Jason Kaufman, Mallory Campbell, any attorney in Bond’s labor and employment practice or the Bond attorney with whom you are regularly in contact.

New Jersey employers face significant financial exposure for misclassifying workers as independent contractors rather than employees. The New Jersey Department of Labor and Workforce Development (NJDOL) recently reached a settlement with STG Logistics Inc., STG Drayage LLC and other subsidiaries (STG), requiring STG to pay at least $2.775 million to resolve claims that it misclassified truck drivers as independent contractors in violation of the state’s wage and hour laws. This settlement follows a lawsuit the NJDOL filed in New Jersey Superior Court, pursuant to a 2021 law that authorizes the state to file suit against employers for employee misclassification.

Under the settlement, $2.22 million will go directly to the misclassified truck drivers, while the remaining $555,000 will go to the state of New Jersey. In the event STG fails to comply with the terms of the settlement agreement, it will owe an additional $7.5 million in penalties to the state.

The STG settlement resolves the first lawsuit filed under New Jersey’s 2021 misclassification law, but it is part of a broader enforcement trend and follows two other recent large settlements with the NJDOL for employee misclassification — a September 2025 settlement with Lyft for more than $19.4 million for the misclassification of over 100,000 drivers as independent contractors and a March 2026 settlement with PDX NorthInc. for $7 million for the misclassification of its delivery drivers as independent contractors.

New Jersey continues to take an aggressive approach against worker misclassification. Employers should review and understand the final regulations effective October 1, 2026, clarifying the application of the ABC test for determining independent contractor classification, and should consult with counsel to assess whether their workers are properly classified.

If you have any questions or would like additional information, please contact Jason Kaufman, Mallory Campbell, any attorney in Bond’s labor and employment practice or the Bond attorney with whom you are regularly in contact.

On July 15, 2026, the U.S. Court of Appeals for the Second Circuit (Second Circuit) issued a decision in Bergin v. New York State Unified Court System (Bergin), holding that the United States Supreme Court's 2015 decision in EEOC v. Abercrombie & Fitch Stores, Inc. (Abercrombie) effectively overruled the Second Circuit's longstanding framework for analyzing religious accommodation claims under Title VII of the Civil Rights Act of 1964 (Title VII).

Background

In September 2021, Jessica Bergin (Ms. Bergin), a court officer for the New York State Unified Court System (UCS), submitted a request for religious exemption from UCS’s COVID-19 vaccine requirement.  Because Ms. Bergin’s request identified concerns about stem cells and bodily integrity, as well as some non-religious objections to the vaccine requirement, UCS requested that she submit a supplemental form.

Ms. Bergin returned the form without answering many of the questions. She instead attached a statement regarding her faith and medical privacy concerns. On Dec. 29, 2021, UCS denied her application for a religious exemption and instructed her to submit proof of vaccination by Jan. 10, 2022. When Ms. Bergin failed to do so, she was placed on administrative leave and subsequently terminated on April 7, 2022, for failure to comply with the vaccination requirement.

On Sept. 2, 2022, Ms. Bergin filed suit under Title VII, alleging that UCS failed to accommodate her religious beliefs. The U.S. District Court for the Eastern District of New York (EDNY) granted partial summary judgment for Ms. Bergin, holding that there was no genuine dispute that she had made out a prima facie case of religious discrimination: (1) Ms. Bergin held a bona fide religious belief conflicting with a work requirement, (2) Ms. Bergin informed her employer of that belief and (3) Ms. Bergin was disciplined for failure to comply with the requirement. UCS appealed, arguing that EDNY failed to modify the prima facie test for failure to accommodate religion claims in light of Abercrombie.

Second Circuit’s Decision

Prior to Bergin, the Second Circuit assessed whether a plaintiff established a prima facie case of failure to accommodate a religious belief or practice under Title VII by asking whether the plaintiff (1) held a bona fide religious belief conflicting with a work requirement, (2) informed their employer of that belief and (3) was disciplined for failure to comply with the requirement. In Bergin, the Second Circuit was tasked with deciding whether the Supreme Court abrogated this test in Abercrombie. The Second Circuit held that it did.

In Abercrombie, the Supreme Court considered whether an employer violated Title VII when it refused to hire a prospective employee who the employer believed would a religious accommodation to its dress code. The Supreme Court held that the applicant did not have to actually request an accommodation; rather, the applicant need only show that their need for an accommodation was a motivating factor in the employer’s decision. The Supreme Court explained that failure to accommodate religion claims fall within Title VII’s disparate treatment provision, which prohibits certain motives regardless of the actor’s knowledge. Accordingly, the Supreme Court held that an employer with actual knowledge of the need for a religious accommodation does not violate Title VII by refusing to hire an applicant if avoiding that accommodation was not their motivation.

Given Abercrombie, the Second Circuit in Bergin concluded that the Supreme Court rejected one requirement of the Second Circuit’s old rule (that the plaintiff inform an employer of their need for an accommodation) and clarified that the plaintiff must plead and ultimately prove that the employer was motivated in part by the desire to avoid offering a religious accommodation.

The Second Circuit held that, going forward, for a plaintiff to state a prima facie case for failure to accommodate a religious belief or practice under Title VII, they must demonstrate (1) that they actually required an accommodation of their religious practice, and (2) that the employer’s desire to avoid the actually required prospective accommodation was a motivating factor in (3) an adverse employment decision. Although an employer’s knowledge of the need for an  accommodation may be evidence of motive, the absence of such knowledge is not dispositive.

Since the EDNY declined to apply the Abercrombie standard, the Second Circuit vacated its judgment and remanded the matter for further proceedings.

Why Bergin Matters for Employers

The Bergin decision changes the legal standard for Title VII religious accommodation claims in the Second Circuit. By shifting the focus from employer knowledge to employer motivation, the decision will likely increase scrutiny of how religious accommodation requests are evaluated and documented. As a result, employers should ensure that religious accommodation decisions are supported by legitimate, well-documented business reasons.

Employer Takeaways

Employers should take several steps to comply with the Bergin decision:

• Review religious accommodation policies and practices to ensure they reflect the Abercrombie and Bergin standards.
• Train managers and human resources personnel on handling religious accommodation requests and documenting decisions.
• Document the legitimate, nondiscriminatory business reasons supporting religious accommodation decisions.
• Ensure religious accommodation requests are evaluated on an individualized basis.
• Recognize that evidence relating to employer motive may play a greater role in future religious accommodation litigation.
   

Please contact Adam P. Mastroleo, Anthony A. Levitskiy or any attorney in Bond’s labor and employment practice with whom you normally work, for questions, concerns and tailored consultation. 

The New York Legislature recently passed a bill that would amend the Cannabis Law and the Labor Law regarding labor-related requirements for cannabis businesses. The bill, which is currently before the governor for action, would repeal the requirements for license holders and applicants to have labor peace agreements in place, impose new public disclosure obligations regarding ownership and workforce data (including wage ranges), and establish a Cannabis Industry Wage Board to study and recommend minimum wages for the industry, similar to what has been put in place for farm laborers.

Key Statutory Changes

Repealing Labor Peace Agreement Requirements

The bill would eliminate labor peace agreements as express statutory conditions across several key provisions of the Cannabis Law. Cannabis businesses would no longer be required to enter into or maintain labor peace agreements as a condition of obtaining or retaining cannabis licenses, certifications or registrations. However, the bill would preserve broader labor law compliance considerations, including review of New York labor law violations and protection for existing collective bargaining agreements.

Transparency Requirements Related to Ownership and Worker Conditions

The bill would require each applicant or renewal applicant to provide the full ownership structure of the licensee and any management service agreements, including the full ownership structure of any company providing those services. Applicants also would be required to submit a publicly available report identifying the range of salary and hourly rates for each job title and the average number of hours scheduled or offered for each position.

Establishing a Wage Board

The bill would establish a Cannabis Industry Wage Board within the Labor Law framework. Under New York’s Minimum Wage Law, the minimum wage may be raised administratively by the commissioner of labor upon the recommendations of a wage board. The new wage board would consist of one representative of the licensed cannabis industry, one representative of the New York State AFL-CIO and one member of the general public appointed by the commissioner to serve as chairperson. The wage board would be required to hold its first hearing by March 1, 2027.

The wage board would have meaningful investigatory and procedural powers, including the authority to conduct public hearings, consult with cannabis employers and workers and their representatives, administer oaths, issue subpoenas for testimony and records, and take depositions.

The wage board would be required to report to the governor and Legislature with recommendations regarding minimum hourly wages and prospective wage increases for workers in cultivation; processing and packaging; distribution; and retail and delivery. The board also could recommend wages for additional classifications, recommend an industrywide minimum wage for workers not captured within a specific classification, or determine that wages in the industry are already adequate.

When Would the Bill Take Effect?

If enacted, the bill would take effect immediately, except that the disclosure obligations and the Cannabis Industry Wage Board provisions would take effect Jan. 31, 2027. The repeal of labor peace agreement provisions would become operative immediately upon enactment. The wage board’s first hearing would then need to occur by March 1, 2027, and its report would be due by Dec. 31, 2027.

Labor and Employment Implications

While the bill remains subject to the governor’s approval, the bill, if enacted, would remove labor peace agreements as express statutory conditions of cannabis certification, registration, renewal and licensure. Employers that have already entered into labor peace agreements, however, should review them with counsel, as existing agreements remain governed by their own terms, including any ongoing obligations, notice requirements or termination provisions.

Public reporting of pay ranges by job title and average hours by position could subject wage setting, scheduling practices and compensation consistency to increased scrutiny as they are more easily identifiable to regulators, workers, organized labor, competitors and the public. Such increased scrutiny may impact negotiations and pay-rate demands.

The wage board provisions may have the most significant wage-and-hour consequences. The bill does not set a new cannabis-specific minimum wage; rather, it creates a process under which a wage board would hold hearings, collect evidence and issue recommendations regarding minimum hourly wages, prospective increases and sector-specific classifications. Because the wage board may recommend different wage rates for cultivation; processing and packaging; distribution; and retail and delivery, cannabis employers may eventually face a more segmented industry-specific wage structure than under general minimum wage rules. Any such set wages also would become the floor for any collective bargaining negotiations.

More broadly, the proposed Cannabis Wage Board follows the Legislature’s use of similar boards for farm laborers and fast-food workers, signaling a continued pattern of industry-specific wage-and-hour regulation and raising questions about which sector may be next for such treatment.

If you have questions about these proposed amendments, please contact Erin M. Callahan, Rebecca J. LaPoint, any attorney in Bond’s labor and employment practice or the attorney at the firm with whom you regularly communicate.

On May 28, 2026, the Associated General Contractors of New York State (AGC of NY) and several other trade associations filed a complaint in the U.S. District Court for the Northern District of New York seeking injunctive relief to block enforcement of New York’s new prevailing wage law governing off-site custom fabrication. On June 8, 2026, the court entered a consent order preliminarily enjoining enforcement of the law pending further proceedings.

Background

In December 2025, Governor Kathy Hochul signed legislation amending New York Labor Law Section 220 to expand the definition of “public work” to include certain “custom fabrication” performed off-site, even when the fabrication takes place outside New York. As we previously reported, the law was originally set to take effect on June 18, 2026, and applies to contracts put out to bid on or after that date.

Prior to this amendment, New York regulators advised that prevailing wage requirements applied to off-site fabrication only if the work was “usually and customarily performed at the project site.” Under that framework, off-site fabricators were often treated as material suppliers and fell outside the statute's coverage.

The new law significantly changes this landscape. As originally enacted, the amendment broadly defined “custom fabrication” as including “but not limited to” the following categories:

• Exterior and interior wall panel systems;
• Woodwork;
• Electrical systems;
• Plumbing systems;
• Heating, cooling, ventilation or exhaust duct systems;
• Rebar cages; and
• Mechanical insulation.

The original version also required that the covered work constitute a “significant portion of the building or work” as delivered for installation or assembly.

Before the law’s effective date, the legislature amended the law in important ways. The precise effect of these amendments is not entirely clear and may reflect both narrowing and expansion of the statute’s scope in different respects. On the one hand, the legislature appears to have intended to limit the scope of coverage, while on the other hand, the amendments also indicate a broader intended reach.

Regarding the first point, the revised version removed the “but not limited to” language, which suggests that the statute may now be limited to the specifically enumerated categories as “custom fabrication” under the law. The amendments also included limiting exemptions for certain transportation and affordable housing projects. Regarding the second point, the amendment eliminated the “significant portion” requirement, which may broaden the reach of the statutory provision.

Under the current version of the statute, covered “custom fabrication” is defined by three criteria: (1) the work must involve fabrication of one of the enumerated categories—exterior or interior wall panel systems, woodwork, electrical systems, plumbing systems, heating, cooling, ventilation or exhaust duct systems, rebar cages or mechanical insulation; (2) the work must be “solely and specifically designed and engineered for a specified public work project”; and (3) the work must not involve components, portions, modules or materials that are “otherwise stocked or readily available absent a specified public work project.”

The Federal Court Challenge

AGC of NY, joined by several national and regional trade associations and construction companies, filed a federal lawsuit seeking to block enforcement of the amended law.

The complaint alleges that the custom fabrication law is extraterritorial, protectionist, unconstitutionally vague, practically impossible to administer and disruptive to supply chains and existing collective bargaining arrangements. These issues were previously identified in our prior update.

More specifically, AGC of NY and its fellow plaintiffs argue that the law impermissibly reaches beyond New York’s borders by regulating manufacturers for fabrication work performed entirely outside the state, in violation of constitutional principles governing both interstate and foreign commerce. The complaint also raises constitutional due process and equal protection concerns, contending that key statutory terms such as “custom fabrication” and “solely and specifically designed and engineered” are impermissibly vague, and that exemptions for transportation, affordable housing and modular construction arbitrarily exclude materially similar work. Additionally, plaintiffs allege that the law effects an unconstitutional regulatory taking of established business interests and impairs existing collective bargaining agreements in violation of the federal Contract Clause.

The plaintiffs initially filed an emergency motion for a temporary restraining order, with a hearing scheduled for June 16, 2026—just two days before the law was set to take effect. However, on June 8, 2026, the parties entered a consent order voluntarily agreeing to the preliminary injunction, and to a revised briefing schedule on the merits. Under the consent order, the effective date of the amendment is “suspended and stayed” unless and until the court enters a subsequent order denying the plaintiffs’ emergency motion, granting a motion to dismiss or otherwise terminating the suspension.

 

Significantly, the order provides broad interim relief. The state is barred from enforcing any aspect of the amendment, and no public owner—including agencies, municipalities and school districts—or private owner of projects subject to New York prevailing wages is required to comply with the amendment or include its terms as a condition of their contracts. Similarly, no general contractor, subcontractor, fabricator or other project participant, regardless of location, is required to comply with the amendment or any of its conditions. The consent order extended the briefing schedule through late August 2026. We will continue to monitor developments in this litigation closely.

What Employers Should Do Now

In light of the consent order, the custom fabrication amendment will not take effect on its originally scheduled date of June 18, 2026, and no party is currently required to comply with its terms. Enforcement is suspended until the court rules on the merits of the plaintiffs’ challenge. However, the injunction does not guarantee that the law will ultimately be struck down. A court ruling in defendants’ favor could revive the amendment, potentially with limited advance notice. Employers should therefore continue to assess the law’s potential impact:

• Audit current and upcoming public work contracts to identify off-site fabrication components;
• Evaluate whether any fabrication work meets the statutory definition of covered “custom fabrication”;
• Develop contingency plans for wage compliance in case the injunction is lifted and the law takes effect; and
• Stay informed about further developments in the federal court challenge, including the briefing schedule (defendants’ opposition due July 21, 2026; plaintiffs’ reply due August 18, 2026) and any subsequent court rulings.

Although the preliminary injunction suspends the amendment’s effective date, the outcome of the litigation remains uncertain. Impacted businesses should work with legal counsel to assess their potential compliance obligations if the amendment is ultimately upheld. Further, contractors should keep in mind that, even under New York’s prior enforcement position (which presumably remains in effect), certain off-site custom fabrication work may be covered under the state’s prevailing wage law. If you have questions about the legislation discussed above or the current status of the federal litigation, please feel free to contact Andy Bobrek or Rebecca J. LaPoint or any attorney in Bond’s labor and employment practice whom you are regularly in contact.

On May 19, 2026, the New York Assembly passed S.3460, a bill that, if signed into law, would expand employee access to personnel records, require notice of negative information placed in those records and an opportunity to respond, and allow employees to add certain information to their records. The bill passed the state Senate in April and is modeled after Massachusetts’ Personnel Record Law. Prior attempts to pass similar legislation, including in 2025, were unsuccessful. If Governor Kathy Hochul signs S.3460 into law, employers will have 60 days from the date of enactment to implement policies and procedures necessary to comply with the new requirements.

Access to Personnel Records

The legislation would grant all New York employees, both public and private, the right under New York State Labor Law to access their workplace personnel records twice per year. Under the law, employers would be required to furnish records within five business days of receiving an employee’s written request.

Notification of “Negative Information”

If enacted, employers would be required to notify an employee within ten days after placing “negative information” in the employee’s personnel record. Under the bill, negative information includes information affecting the employee’s qualification for employment, promotion, transfer, additional compensation or potential for discipline. Employees would also be permitted to submit a written statement in response to any such “negative information,” which must also be included in their personnel file.

Enforcement and Remedies

The legislation would also permit employees to seek injunctive relief to remove information from their personnel records that their employer knew or should have known was false.

The New York Attorney General would be authorized to seek civil penalties ranging from $500 to $2,500 against violators of the proposed statute. Employees facing discrimination or retaliation for asserting their rights under the statute would also have a private right of action.

What Employers Should Consider Now

Employers should review their employee records access policies and monitor legislative developments to assess how this legislation may affect operations. The bill will next be delivered to the Governor for consideration. Employers are encouraged to consult with counsel to understand how these changes may affect their operations and to ensure policies remain compliant and aligned with business needs.

Employers should also consider providing additional HR training regarding these potential new requirements and should be prepared to update employee handbooks and implement standardized procedures to ensure timely notice when “negative information” is added to an employee’s personnel file. If you have any questions or would like additional information, please contact Jason Kaufman, Samuel Dobre, Rachel Kreutzer or any attorney in Bond’s labor and employment practice or the attorney at the firm with whom you are regularly in contact.

On May 5, 2026, the New Jersey Department of Labor and Workforce Development (the Department) adopted final regulations clarifying the application of the ABC test for determining whether a worker is an independent contractor or an employee (N.J.A.C. 12:11). Effective Oct. 1, 2026, the rules do not create a new test; rather, they formalize how the Department expects employers to assess and defend independent contractor classifications and underscore the Department’s substance-over-form approach.

The ABC test governs worker classification under the New Jersey Unemployment Compensation, Wage and Hour and Wage Payment Laws. The regulations apply across multiple laws the Department administers or enforces, including the New Jersey Temporary Disability Benefits Law, Earned Sick Leave Law and Call Center Jobs Act.

What the Final Rules Emphasize

To classify a worker as an independent contractor under New Jersey law, the presumed employer has the burden of proving that all three prongs of the ABC test are met.

The ABC Test

A) The worker has been and will continue to be free from control or direction over the performance of services, both under the worker’s contract of service and in fact;

B) The work performed is either outside the usual course of the business for which the work is being performed, or the work is performed outside all the places of business of the enterprise; and

C) The worker is customarily engaged in an independently established trade, occupation, profession or business.

Prong A

The rules call for a totality-of-the-relationship analysis and identify common indicators of control, including set hours or assignments, control over how work is performed, personal service requirements, pay set by the company, lack of worker risk of loss, on-call obligations, restrictions on outside work and training provided by the employer.

Prong B

The rules state that a company’s usual course of business can include activities it regularly performs to generate revenue or to develop, produce, sell, market or provide goods or services. Places of business include locations where the enterprise has a physical plant or conducts an integral part of its business. A worker’s home office is not the employer’s place of business, which is a helpful clarification for remote freelancer arrangements.

Prong C

The rules focus on whether the worker is operating a real, independently established business. Factors include the business’s duration and viability, customer base, relative income from the putative employer and other sources, number of employees and investment in tools, equipment, vehicles, infrastructure and similar resources. These factors are not exhaustive. Multiple jobs, outside work, licensure, business registration and insurance alone are not enough.

The rules emphasize substance over form. Neither an agreement labeling a worker an independent contractor nor a Form 1099 controls. The Department may consider who drafted the agreement, whether it was negotiable, whether one side could make unilateral changes and whether the agreement was terminable at will. Employers therefore should not rely on independent contractor labels where the actual working relationship reflects employee-like control.

What Employers Should Do Now

The Department explains that the rulemaking is intended to help businesses assess classification before a worker complaint or claim leads to an audit or investigation and to reduce exposure for unpaid contributions, unpaid wages, interest, penalties and related litigation costs.

Before Oct. 1, 2026, employers using contractors should review relationships involving core revenue-generating services, reporting, training, scheduling, non-compete restrictions, remote freelancer arrangements and workers who depend on a single company for income. Employers should update agreements and day-to-day practices to reflect independence and document facts showing that the worker operates a viable business independent of the relationship.

As a practical matter, independent contractor arrangements are likely to face greater scrutiny where the worker performs the same services as the business sells, where the company sets the worker’s schedule and where the worker relies on the company for most of their income.

In short, the final rules do not change New Jersey’s ABC test, though they codify a more exacting, substance-over-form framework for applying the test across a broad range of employment laws. For employers with significant contractor populations, now is the time to conduct contemporaneous classification analyses and align agreements, supervision practices and supporting documentation with the facts needed to show genuine business independence.  

Employers are encouraged to consult with counsel to understand how these changes affect their operations and to ensure policies are compliant and strategically aligned. If you have any questions or would like additional information, please contact Jason Kaufman, Mallory Campbell, Rachel Kreutzer or any attorney in Bond’s labor and employment practice or the attorney at the firm with whom you are regularly in contact.

For several decades, private employers with 100 or more employees and certain federal contractors have been required to annually file the EEO-1 report. The EEO-1 report collected information about the race/ ethnicity and sex of large employers’ workforces at each location by job category. Similar reporting requirements exist for labor unions (the EEO-3), state and local governments (the EEO-4) and public and secondary school systems (the EEO-5). On May 14, 2026, the U.S. Equal Employment Opportunity Commission (EEOC) submitted a proposed rule to a division within the Office of Management and Budget (OMB) that would end the EEO-1 and other reporting mandates. This development comes at a time when employers have been waiting for the annual EEO-1 reporting portal to open for the 2026 filing cycle.

The proposed rule, which is titled “Rescission of EEO-1, EEO-2, EEO-3, EEO-4, EEO-5, and Reporting Requirement Under Title VII, the ADA, GINA, and the PWFA,” seems to align with the Trump administration’s policies and enforcement priorities targeting DEI. Employers often use EEO-1 reporting as a way to assist them in analyzing their own DEI progress or to identify areas of potential discrimination. The Trump administration has taken the position that employers should not be tracking race-based or sex-based data and that these and other DEI initiatives often cross the line into unlawful discrimination against white applicants and employees. This development is also being seen as consistent with the EEOC’s recent commitment to prioritizing civil rights cases focused on “anti-white” bias and investigating companies for their diversity programs.

The EEOC has not announced how this significant departure will impact employers’ obligations this year and it is unclear if or when the proposal will be finalized. While the proposal to eliminate the EEO-1 report introduces uncertainty, for now, the safest course of action is for employers to assume that EEO-1 reporting remains in effect. It is likely employers may still have to file EEO-1 reports sometime in 2026 (which will reflect demographic data from a workforce snapshot during the final quarter of 2025), because of the time-consuming process required to implement the EEOC’s proposed rule. The proposal must first be reviewed by OMB and then published in the Federal Register for public comment before any final rule can be adopted.

Bond continues to follow this development closely. Please contact Christa Cook, any attorney in Bond's labor and employment practice or the Bond attorney with whom you normally work, for questions, concerns and tailored consultation.

On March 26, 2026, President Trump signed Executive Order 14398 (the Order), which is titled “Addressing DEI Discrimination by Federal Contractors”. The Order is the latest move in the Trump Administration’s attempts to target and eliminate what it deems to be unlawful DEI programs, practices and initiatives across a wide array of U.S. businesses, including federal contractors.

The Order and accompanying Fact Sheet specifically prohibit “racially discriminatory DEI activities” by all federal contractors and subcontractors at any tier. The Order states that DEI activities are not only unethical and often illegal, but also create inefficiency, waste and abuse for those that engage in DEI practices by adding unnecessary costs, creating workforce turnover and jeopardizing employee collaboration and problem-solving. The Order conveys the Administration’s perspective that while the federal government has made great strides in ending racial discrimination resulting from DEI activities, “some entities continue to engage in DEI activities and often attempt to conceal their efforts to do so.”

The Order follows on the Trump Administration’s anti-DEI Executive Orders issued in January 2025 that were aimed to curtail “illegal DEI,” including Executive Order 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity.” EO 14173 was challenged and scrutinized by various courts for its failure to define what constitutes “illegal DEI.” That ambiguity left employers, higher education institutions and other organizations confused about their obligations and worried about the potential implications of crossing the line between what the Administration may interpret to be lawful and unlawful DEI practices.

Unlike the earlier Orders, this most recent Executive Order specifically defines the targeted conduct of “racially discriminatory DEI activities” as “disparate treatment based on race or ethnicity in the recruitment, employment (e.g., hiring, promotions), contracting (e.g., vendor agreements), program participation or allocation or deployment of an entity’s resources.” The Order further defines “program participation” as “membership or participation in, or access or admission to: training, mentoring or leadership development programs; educational opportunities; clubs; associations; or similar opportunities that are sponsored or established by the contractor or subcontractor.” While these definitions provide some guidance for federal contractors, ambiguity still exists as to how the Order will be applied with respect to contractors’ vendor agreements and the “allocation or deployment of an entity’s resources.” In addition, the Order does not make any reference to and is not tethered to any federal anti-discrimination laws. 

Contractual Certification Requirements Under the Order

Under the Order, all Federal agencies are required, “to the extent permitted by law”, to include specific contract provisions in all contracts and “contract-like instruments.” The required standardized contract language, which is expected to appear in contracts as early as April 25, 2026, is as follows:

“In connection with the performance of work under this contract, [the contractor/appropriate party (contractor)] agrees as follows:

1. The contractor will not engage in any racially discriminatory DEI activities, as defined in section 2 of the Executive Order of March 26, 2026 (Addressing DEI Discrimination by Federal Contractors);
2. The contractor will furnish all information and reports, including providing access to books, records and accounts as required by the contracting agency pursuant to the Executive Order of March 26, 2026 (Addressing DEI Discrimination by Federal Contractors), for purposes of ascertaining compliance with this clause;
3. In the event of the contractor’s or a subcontractor’s noncompliance with this clause, this contract may be canceled, terminated or suspended in whole or in part, and the contractor or subcontractor may be declared ineligible for further Government contracts;
4. The contractor will report any subcontractor’s known or reasonably knowable conduct that may violate this clause to the contracting department or agency and take any appropriate remedial actions directed by the contracting department or agency;
5. The contractor will inform the contracting department or agency if a subcontractor sues the contractor and the suit puts at issue, in any way, the validity of this clause; and
6. The contractor recognizes that compliance with the requirements of this clause are material to the Government’s payment decisions for purposes of section 3729(b)(4) of title 31, United States Code (False Claims Act).”

These provisions not only require contractors and subcontractors to certify that they will not engage in any “racially discriminatory DEI” activities, but they also place an affirmative obligation on prime contractors to monitor their subcontractors to ensure compliance with the Order and to report any potential violations. So, while the Order states that it is focused on preventing the inefficiencies of DEI practices, it imposes unusual flow-down obligations beyond the normal certification expectations with extensive monitoring and reporting duties to ensure that every subcontractor that they work with complies with the Order. Although the Order does not specify how contractors are expected to obtain this information, these policing mandates will likely lead to increased costs and risks for federal contractors.

Potential False Claims Act Liability and Other Penalties

The Order sets forth various penalties and enforcement mechanisms for contractors that engage in racially discriminatory DEI activities or otherwise fail to comply with Order. Federal contractors face cancellation, termination or suspension for noncompliance. The Order also authorizes suspension and even debarment for contractors that violate the Order.

Notably, violations of the Order may also place a contractor at risk of legal action from the Department of Justice (DOJ) through the False Claims Act (FCA), which carries the potential for significant financial damages. The Order expressly mentions that the contractual obligations are material to the government’s payments, which is an attempt to create a foundation for the materiality element under the FCA. The Order calls on the DOJ to consider bringing FCA claims against contractors that violate the Order and to conduct a prompt review of civil actions brought by private citizens, known as qui tam claims, under the FCA.

What to Expect and Next Steps

The Order clearly signals continued federal scrutiny of entities’ DEI programs and activities. Federal contractors will hopefully be gaining further guidance from the federal government regarding the Order’s expectations. The Order directs the Office of Management and Budget (OMB) to issue guidance to agencies to ensure compliance with the Order. While the Director of the OMB, the AG, the Assistant to the President for Domestic Policy and the Chair of the EEOC are directed to issue guidance on best practices for compliance with the Order, the Order also directs these agencies to identify economic sectors that pose a particular risk of engaging in “racially discriminatory DEI activities” based on current or past conduct.

The Order also directs the Federal Acquisition Regulatory Council (FAR Council) to amend the Federal Acquisition Regulation (FAR) to include the contract provisions of the Order and remove any conflicting or inconsistent terms in Federal procurement, solicitations and contracts subject to the Order. The FAR Council is also directed to, within 60 days, issue deviation and interim guidance regarding agency implementation of the Order’s contractual provisions prior to its finalization of the amendments to the FAR.

While the breadth of applicability of the Order to “contract-like instruments” is unclear, the Administration has pursued parallel, yet distinct efforts to impose similar certification mandates upon all recipients of federal financial assistance through proposed amendments to the System for Award Management (SAM). The General Services Administration (GSA)’s proposed amendments would require entities seeking federal grants and contracts to certify compliance with prohibitions against “illegal DEI.” Specifically, applicants utilizing the government’s award system would have to agree to: “Comply with the US Constitution, all federal laws and relevant executive orders prohibiting unlawful discrimination on the basis of race or color in the administration of federally funded programs.” The public comment period relative to those proposed changes closed on March 30. Once the Administration reviews and responds to that input, we may see new documents go into effect under the SAMS system.

Contractors should be aware of these requirements going forward and be prepared for the implementation of these new contractual provisions in future contracts. Additionally, it is yet to be seen what impact the provisions set forth in the Order will have on other obligations contractors may have under State contracts, such as requirements under the New York MWBE program. However, as previous Executive Orders targeting DEI have faced legal challenges, it is possible that this Order may face similar challenges.

Bond continues to follow these and related developments closely. Please contact Christa Cook, Gavin Gretsky, any attorney in Bond's labor and employment practice or the Bond attorney with whom you normally work, for questions, concerns and tailored consultation.

On March 31, 2026, U.S. District Judge Gerald J. Pappert of the Eastern District of Pennsylvania issued a significant decision enforcing an Equal Employment Opportunity Commission (EEOC) subpoena directed to the University of Pennsylvania (UPenn). Judge Pappert’s decision addresses the EEOC’s authority to obtain names and contact information for employees potentially affected by or witness to alleged antisemitic harassment. The ruling compels compliance with the subpoena, though it includes a limitation barring disclosure of any employee’s affiliation with any specific organization. The decision has potential implications for employers responding to EEOC investigations nationwide.

What the Court Held

The court held that the EEOC may compel production of employee names and contact information relevant to its charge alleging religious discrimination and hostile work environment, so long as UPenn does not reveal any employee’s ties to particular campus groups. In reaching its decision, the court emphasized the U.S. Supreme Court’s instruction to construe “relevance” in the subpoena context generously and rejected constitutional challenges to the demand. Notably, the decision reinforces the generous relevance and low burden standards governing EEOC subpoenas, confirming that courts will order compliance absent a showing of undue burden or clear overbreadth.

Background and Procedural Posture

• Facts: The EEOC is investigating allegations that UPenn faculty and staff faced antisemitic harassment, including incidents connected to campus protests after the Oct. 7, 2023 attack in Israel and the ensuing war in Gaza. Unlike data on race and sex, employers are not required to maintain employment data regarding religion. The agency therefore sought evidence of names and contact details for employees associated with campus groups and academic programs “related to the Jewish religion,” staff who filed complaints, attendees of 2024 listening sessions held by the University’s antisemitism task force and recipients of a survey on antisemitism.
• Prior Proceedings: After UPenn declined to produce certain categories—particularly contact information for employees whose identification could reveal their Jewish faith or affiliations—the EEOC filed a subpoena enforcement action. At a March 10, 2026 hearing, the court explained that the subpoena met the “low bar” for enforcement and has now granted the EEOC’s application, with a carveout precluding disclosure of affiliations with specific Jewish-related organizations.
• Scope: This federal district court order binds the parties in this matter. While not precedential nationwide, it applies well-established Supreme Court standards for EEOC subpoenas and will be persuasive for employers responding to similar requests in other jurisdictions.
   

Key Takeaways

• Legal Standard Clarified: Courts are likely to construe “relevance” to EEOC subpoenas generously and enforce requests for potential victim and witness contact information tied to a facially valid charge, rejecting constitutional challenges absent exceptional circumstances.
• Compliance Exposure: Employers may be compelled to produce sensitive employee-identifying information in religion-based harassment investigations; failure to comply may risk enforcement actions and potential sanctions.
• State-law Interaction: State privacy or employment laws rarely override federal subpoena obligations; however, employers should ensure awareness of applicable privacy requirements.
   

Who Is Affected

This decision primarily affects institutions of higher education and other employers facing EEOC investigations into religion-based harassment or hostile work environment allegations, in Pennsylvania and beyond. Employers operating across multiple jurisdictions should assess how local privacy frameworks and existing EEOC guidance intersect with the federal standards applied here.

Open Questions and Next Steps

Open issues include the contours of permissible privacy carveouts (such as limits on disclosing affiliations with specific organizations), the handling of highly sensitive identifiers and how courts will weigh undue-burden arguments tied to assembling contact lists. UPenn may seek further judicial review, and the EEOC may issue associated guidance. Employers should monitor any appellate activity in the case and be on the lookout for agency guidance.

Bottom Line

This decision reinforces the broad scope of the EEOC’s subpoena power and the low bar for the relevance standard governing enforcement. Employers should promptly review protocols and policies on how data on employees are maintained, update documentation where needed and train stakeholders on the applicable legal standards to reduce risk and position themselves for agency scrutiny under this framework.

Bond continues to monitor these developments and will provide further updates as they arise. For questions or assistance, contact Brit Schoepp-Wong, Rachel Kreutzer or any member of the higher education practice.

The National Labor Relations Board’s decision in Cemex Construction Materials Pacific, 372 NLRB No. 130 (2023) was a paradigm shift in the law impacting employers when faced with a union’s demand for recognition as the bargaining representative of its employees. Three recent holdings address the viability and scope of that seminal decision.

Briefly restated, and as we have previously discussed (NLRB Further Erodes Employer Rights and Promotes Unionization), the Board’s decision in Cemex established a new liberal standard for issuance of a bargaining order remedy against an employer that refused to recognize a union, upon request, as the bargaining representative, if in fact the union had majority support, even in the absence of a union election. The Cemex Board also held that the employer could defend against this outcome by filing its own election petition (RM petition) to test the union’s majority status within 14 days of the union’s demand for recognition.

On March 6, 2026, the Sixth Circuit Court of Appeals ruled that the NLRB exceeded its authority in promulgating the Cemex standard. In Brown-Forman Corp. v. NLRB, the Court refused to enforce a Board order, holding that Cemex was “an unexpected, unlawful turn” that “was neither derived from the case-specific facts nor in furtherance of fashioning a remedy that resolved the parties’ dispute.” In effect, the Cemex standard was an unlawful exercise of rulemaking in the context of an adjudicatory proceeding.

While this decision is not a national precedent, it does represent a significant challenge to the viability of Cemex and may serve as the basis for other appellate courts to reject Cemex or perhaps serve as a vehicle for U.S. Supreme Court review.

In a related development, the NLRB in St. John’s College clarified the holding in Cemex by confirming that the 14-day timeframe for filing an RM petition does not limit an employer’s ability to file an RM petition after the 14 days have expired. There, the union presented the employer with a demand for recognition on December 14, 2023. Three months later, on March 13, 2024, the employer filed an RM petition. The Regional Director, however, dismissed the RM petition on the grounds that it was not “promptly filed” pursuant to Cemex.

In reversing the Regional Director’s dismissal of the RM petition, the Board clarified that Cemex’s “timeliness requirements pertain only to when the filing of an RM petition may shield an employer from potential unfair labor practice liability under” Cemex, and that Cemex should “not be construed to require” dismissal of otherwise properly filed RM petitions. Cemex creates the potential for unfair labor practice liability for an employer that rejects a union’s demand for recognition which can be countered by a “promptly filed” RM petition. However, the Board ruled that an employer may file an RM petition even after the 14-day window and that petition will be processed, potentially leading to an election to decide the union’s status.

Significantly, the Board did not address the issue of whether an unfair labor practice charge alleging a refusal to recognize and bargain with the union could be used to block an RM petition filed outside of the 14-day defensive window recognized in Cemex.

Finally, the potential for a bargaining order remedy under Cemex remains current Board law. In St. John’s College, the NLRB declined to rule on the employer’s argument that Cemex should be overruled. Further, in Lodi Volunteer Ambulance Rescue Squad, another recent decision involving the Thryv remedy standard, the current Republican majority of the Board (Members Murphy and Mayer) agreed to apply Biden-era precedent in the absence of a three-member majority to overrule it. That result suggests that the Board is unlikely to revisit the Cemex decision any time soon because, as currently constituted, the NLRB has only three members and its traditional practice has been to require three members to overturn a precedent. (Member Prouty, who voted with the majority in Cemex, is not expected to vote to overturn that decision.)

While these decisions are positive steps toward limiting Cemex, employers should be attentive and seek professional advice promptly when presented with a union’s demand for recognition. There remains a clear and present risk of unfair labor practice liability and a bargaining order remedy.

If you have any questions about the information presented here, please contact Thomas Eron, Samuel Wiles or any attorney in Bond’s labor and employment practice or the Bond attorney with whom you are regularly in contact.

On Jan. 17, 2026, in one of his final acts in office, Governor Phil Murphy signed legislation amending the New Jersey Family Leave Act (NJFLA).  The amendments expand access to job-protected family leave for New Jersey workers through an employer‑size threshold reduction, shorter eligibility requirements and potential new job‑protection implications tied to New Jersey Temporary Disability Insurance (TDI).

While the NJFLA’s core framework remains intact, these changes broaden coverage to private employers with 15 or more employees, and employee eligibility thresholds—both service time and hours—are reduced.  Most changes take effect July 17, 2026, with employer‑size thresholds phased in through July 17, 2028.

NJFLA Overview

The NJFLA entitles eligible employees up to 12 weeks of unpaid, job‑protected family leave in a 24‑month period for the following purposes:

• bonding with a child (beginning within a year of birth, adoption or foster care placement);
• caring for a family member or someone who is the equivalent of family with a serious health condition;
• caring for a family member (or equivalent) who is isolated or quarantined because of suspected exposure to a communicable disease during a state of emergency; or
• providing care or treatment for a child whose school or place of care is closed by order of a public official due to an epidemic of a communicable disease or other public health emergency during a state of emergency.

Although NJFLA leave is unpaid, employees may be eligible for partial wage replacement through New Jersey Family Leave Insurance (FLI).  Employees are entitled to reinstatement to the same or an equivalent position upon return from leave, and employers are prohibited from interfering with or retaliating against employees who exercise NJFLA rights.

Key Changes

Lower Employer Size Threshold

Beginning July 17, 2026, NJFLA coverage expands to private employers with 15 or more employees, reducing the threshold from 30.  The threshold will decrease further on a phased basis: 1) July 17, 2027: 10 or more employees, and 2) July 17, 2028: 5 or more employees.  New Jersey employees working for state or local government agencies of any size remain covered by the NJFLA.

Reduced Employee Eligibility Requirements

The amendments reduce the employee length-of-service requirement for leave eligibility from 12 months to 3 months and the hours worked requirement from 1,000 hours to 250 hours in the preceding 12 months.

Interplay with FMLA, Family Leave Insurance, and Temporary Disability Insurance

Employees who are eligible for New Jersey Earned Sick Leave and TDI or FLI benefits may elect the order in which they use those benefits.  They may not use earned sick leave at the same time as TDI or FLI.  NJFLA leave may run concurrently with leave under the FMLA, where applicable.  However, unlike the FMLA, the NJFLA does not provide leave for an employee’s own serious health condition.

What New Jersey Employers Should Do Now

Employers should confirm whether they will meet the phased employer‑size thresholds in 2026–2028, therefore expanding NJFLA coverage to their employees.

Employers should also review and revise their existing leave policies to reflect the amendments by the effective date.  

In further preparation for compliance, employers should consider providing training to supervisors, managers and/or human resources professionals that are responsible for attendance enforcement within their organizations.  This will mitigate the risk of non-compliance, including retaliation claims, due to any misunderstandings of employees’ rights and protections under the NJFLA. 

The New Jersey Division on Civil Rights is expected to issue updated guidance closer to the effective date.  Employers should monitor developments closely.

Employers are encouraged to consult with counsel to understand how these changes affect their operations and to ensure policies are both compliant and strategically aligned.  If you have any questions or would like additional information, please contact Sam Dobre, Mallory Campbell, Rachel Kreutzer or any attorney in Bond’s labor and employment practice or the attorney at the firm with whom you are regularly in contact.