Last November, we issued an update alerting readers of this blog that in last fall’s budget bill, the Occupational Safety and Health Administration had been given authorization to increase its penalties by up to 82%, to account for inflation for several decades.  In order to implement the increase, OSHA had to issue an interim final rule by July 1 that would go into effect by August 1.  As expected, OSHA has indeed taken advantage of this authorization to increase its penalties. As of August 1, OSHA’s new maximum penalty structure is as follows:

• Other-than-Serious violation:  increased from $7,000 to $12,471;
• Serious violation:  increased from $7,000 to $12,471;
• Repeat violation:  increased from $70,000 to $124,709;
• Willful violation:  increased from $70,000 to $124,709; and
• Failure-to-Abate violation:  increased from $7,000 to $12,471 per day.

These penalties are a significant increase, and when these new maximum penalties are combined with OSHA’s new enforcement priorities, they may result in citations with total penalty amounts that are higher than previously common.

Employers in New York are familiar with the requirement, imposed by the Wage Theft Prevention Act, that every new hire must be provided with notice of their rate of pay (including overtime rate of pay if applicable), how the employee will be paid (i.e., by the hour, shift, day, etc.), the regular payday, and information regarding the employer.  Employers are obligated to provide an additional written notice anytime that information changes, unless the employee's wage rate is increased and the next pay stub reflects the increase.  Each time notice is given, the employer is required to obtain a signed acknowledgment from the employee, and must keep that signed acknowledgement on record for six years.  Upcoming changes to the white collar exemptions under the Fair Labor Standards Act may implicate a need to issue new notices if employees are reclassified from exempt to non-exempt. As the law currently stands, employees must earn a minimum salary of $455.00 per week ($23,660 per year) to qualify for one of the white collar exemptions (administrative, executive, or professional) under the FLSA.  New York currently has a higher salary threshold of $675.00 per week ($35,100 per year) for an employee to qualify for the administrative or executive exemptions.  The current threshold for employees to meet the "highly compensated employee" exemption under the FLSA is $100,000 per year. Starting on December 1, 2016, however, these thresholds will rise substantially.  The increased salary threshold for the administrative, professional, and executive exemptions will be $913.00 per week ($47,476 per year).  The new threshold for the highly compensated employee exception will be $134,004 per year.  These thresholds are set to increase every three years after that, with the first increase taking effect on January 1, 2020. This change will force many employers to reclassify employees who are currently exempt, but do not meet the new salary threshold, as non-exempt.  Any such reclassification will affect the rates those employees are paid, how they are paid, and their eligibility for overtime pay.  Given this impact, what legal obligation will the reclassification trigger?  You guessed it -- the WTPA’s notice requirement. Accordingly, employers should be mindful of this notice requirement when reclassifying employees in order to comply with the updated regulations, or when making any other changes to employee’s rates or method of payment.  Although the "pay stub exemption" may apply in some limited instances, the best practice is to provide employees with formal written notice that complies with the WTPA when making any such changes.

Temporary, contracted-for, or leased employees who are employed by a “supplier,” but are assigned to work at another employer’s premises, currently comprise as much as 5% of American workers, and are among the fastest growing sectors.  Noting this trend, the National Labor Relations Board, in its Miller & Anderson, Inc. decision this week, announced a new standard that makes it much easier for unions to organize these temporary employees working at another employer’s facility; and further, allows them to be organized in a single bargaining unit together with the host employer’s employees who perform similar functions, if both groups share a “community of interest.” The case addressed a petition by the Sheet Metal Workers for a union election among a group of (a) Miller & Anderson’s workers at its Pennsylvania construction site, together with (b) a second group of sheet metal workers employed by a separate company, Tradesmen International, who had supplied additional workers at the site on a contract basis. Under the Board’s newly-liberalized “joint employer” standards promulgated in its recent Browning-Ferris decision, Miller & Anderson was deemed to be the joint employer of its own sheet metal workers on the site and also those provided by contract with Tradesmen International.  By contrast, however, Tradesmen International had no employment relationship at all with the Miller & Anderson employees.  Both groups -- and both employers -- were included by the Board in a single unit, on the ground that they shared a “community of interest” since they worked side-by-side under common working conditions. Thus, the Board’s decision allowed a single bargaining unit of employees even where there would be two different employers at the bargaining table -- with potentially differing interests -- without the consent of both employers.  Further, it authorized for the first time a bargaining unit with two employers, where one (the “supplier” of temporary help) employed only a portion of the unit, but had no employment relationship with the remainder.  The Board’s majority, however, brushed aside concerns raised by dissenting Board Member Miscimarra that this result would be “unworkable” and lead to “confusion and instability,” holding instead that each employer will be expected to bargain over “jointly employed workers’ terms and conditions which it possesses the authority to control.” This decision should be viewed together with the Board’s newly-expanded joint-employer standards articulated in Browning-Ferris (holding that “indirect” or “potential” control over terms and conditions suffices to show joint employer status; “actual” or “immediate” exercise of control are no longer required).  Together, these cases allow proliferation of combined units including not only employees directly employed by an employer, but also temps performing similar functions, in circumstances that may involve only indirect control by the host company, or incidental collaboration with the temp agency.  The decision appears to be yet another element of the Board’s program to broaden opportunities for unionization. At a minimum, employers who are supplied by agencies with temporary, contract or leased personnel -- and agencies who supply these personnel -- must be wary that these arrangements are now targets for union organizing, and that the user of these personnel is more likely to be viewed as jointly employing both groups.  Employers using these personnel, and agencies who supply them, should closely review their contractual arrangements, and the level of control assigned to each employer in practice, with these issues in mind.

After a nearly eight-month delay, the New York State Department of Labor once again published draft Regulations governing the payment of employee wages via payroll debit cards, direct deposit, and other means.  As we previously reported, these proposed Regulations would impose several new requirements for New York employers, even for those who merely pay employees by direct deposit.  These proposed Regulations – now NYSDOL’s third version – are currently open for public comment. The most recent version is almost identical to the version last proposed in October 2015, with NYSDOL making only two substantive changes:  (1) the newly-proposed Regulations make clear that the requirement to provide employees with a “list of locations” -- where they can access and withdraw their wages -- only applies to the use of payroll debit cards; and (2) the newly-proposed Regulations remove language included in the October 2015 version, which provided that, when paid by check, employees must have at least one means of no-cost local access to the full amount of wages through check cashing or deposit of a check at a financial institution (but NYSDOL nevertheless stated that employers must still “ensure that employees are able to access their wages in order for payment to be effective in accordance with the requirements of Section 191 of the Labor Law”).  Notably, NYSDOL reiterated that the proposed Regulations will not be effective until six months after they are published and adopted in final form. The reason for the eight-month delay on the part of the NYSDOL in issuing these revised draft Regulations is unclear, but it is expected that final rule-making will now proceed in a timely manner.

Last month, the United States Court of Appeals for the Fifth Circuit affirmed the lower court’s decision upholding the National Labor Relations Board’s “quickie” election rule.  As we previously reported, the final rule, among other things, significantly reduces the time period between the filing of an election petition to the date of the election, narrows the issues that may be raised at a pre-election hearing, and requires disclosure of employees’ personal information, including personal telephone numbers and e-mail addresses.  The rule was effective as of April 14, 2015. The Associated Builders and Contractors of Texas, Inc. (“ABC”) mounted the challenge to the rule’s lawfulness, asserting that the Board both exceeded its authority under the National Labor Relations Act (the “Act”) and violated the Administrative Procedure Act.  ABC first argued that the rule unlawfully postpones the resolution of certain voter eligibility issues until after the election is complete, in contravention of the Act.  The Fifth Circuit rejected this argument, reasoning that under the plain language of the Act the purpose of the pre-election hearing is to determine whether a question of representation exists -- not to resolve all voter eligibility issues. Next, ABC contended that the rule arbitrarily and capriciously requires the disclosure of employees’ personal information to the petitioning union in violation of the Administrative Procedure Act.  The Fifth Circuit found that the Board had sufficiently considered employees’ privacy concerns as well as the burden on employers when it expanded the disclosure requirement, and thus, the requirement was not arbitrary and capricious in violation of the Administrative Procedure Act. ABC also challenged the rule on the grounds that faster elections interfere with an employer’s right to free speech during organizing campaigns.  In rejecting this argument, the Fifth Circuit found that there is no language in the Act which requires a specified waiting period between the filing of the petition and the date of the election.  Additionally, the Fifth Circuit noted that the Board’s Regional Directors, who are responsible for setting the date of the election, are to consider the interests of both parties when setting an election date, which may include an employer’s opportunity to communicate its views concerning unionization to its employees. Now that the Fifth Circuit has joined an earlier decision from the United States District Court for the District of Columbia upholding the Board’s “quickie” election rule, employers must be prepared to respond before an election petition is even filed.  The time employers have from date of petition to date of election has been effectively cut in half (from about 6 weeks to about 3 weeks), making a successful counter campaign extremely difficult to mount without advance planning and preparation.  We recommend regular supervisory training and the creation of a tentative campaign blueprint that is ready for immediate activation in the event of a union petition.  As before, an employer’s best opportunity to remain union-free comes from early awareness of organizing activity and an effective pre-petition campaign that discourages employees from signing the number of union authorization cards needed for the union to trigger an NLRB election.

One of the many joys of parenthood is the opportunity to relive one’s childhood.  To a parent who grew up on the old-school comic books, the steady roll-out by Marvel Studios of big budget super-hero movies offers a unique bonding opportunity with one’s children, which can take place over a uniquely unhealthy massive bowl of movie theater popcorn (with the glee from the experience outweighing the fear of the hyper-caloric intake). My kids frequently ask me about my favorite superhero.  To me it is undoubtedly Hulk, a character who metes out just-desserts -- an admirable goal for a management-side employment lawyer (the side of angelic innocence).  Hulk is not Hulk unless provoked.  As Bruce Banner he is a quintessential good guy, just like all of us in the world of Human Resources. That brings us to Hulk’s relationship with employment law.  We need a Hulk when our employees steal from us, harass other employees, take our trade secrets, and secretly compete against us.  But in the real world where does one find a muscle-bound green skinned superhero that is pretty much indestructible?  Enter the faithless servant doctrine. In New York, the faithless servant doctrine is more than one hundred years old.  This doctrine, a subspecies of the duty of loyalty and fiduciary duty, requires an employee to forfeit all of the compensation he/she was paid from his/her first disloyal act going forward.  The doctrine applies to a wide-array of employee misconduct, including unfair competition (Maritime Fish Products, Inc. v. World-Wide Fish Products, Inc., 100 A.D.2d 81, 474 N.Y.S.2d 281 (1st Dep't 1984)), sexual harassment (Astra USA Inc. v. Bildman, 455 Mass. 116, 914 N.E.2d 36 (2009)), insider-trading (Morgan Stanley v. Skowron, 2013 WL 6704884 (S.D.N.Y. 2013)), theft (William Floyd Union Free School District v. Wright, 61 A.D.3d 856, 877 N.Y.S.2d 395 (2d Dep’t 2009)), and off-duty sexual misconduct (Colliton v. Cravath, Swaine & Moore, LLC., 2008 WL 4386764 (S.D.N.Y. 2008)). As the faithless servant doctrine becomes more well-known, the full breadth of its power continues to be litigated.  Specifically, just how much damage can this doctrine inflict?  Disloyal employees have argued that forfeiture under the doctrine should be limited to a so-called “task-by-task” apportionment.  Under this argument, if an employee earns for example $200,000 a year and steals $20,000 over five months in four separate transactions, the remedy is a return of the stolen funds and a salary forfeiture of a day’s pay on each of the four days of misconduct.  But, whatever superficial appeal this argument may have, once the employee steals we enter Hulk’s world, and Hulk does not deliver justice with surgical precision.  Rather, in the immortal words of Captain America, Hulk “smashes.” In William Floyd Union Free School District v. Wright, 61 A.D.3d 856, 877 N.Y.S.2d 395 (2d Dep’t 2009) (argued by the author of this article), the Second Department rejected the task-by-task apportionment argument, holding:  “Where, as here, defendants engaged in repeated acts of disloyalty, complete and permanent forfeiture of compensation, deferred or otherwise, is warranted under the faithless servant doctrine.”  The forfeiture in that case included all salary and deferred compensation, including paid health and life insurance in retirement.  Turning back to our hypothetical, the faithless servant doctrine requires not only the return of the $20,000 stolen, but also forfeiture of all of the salary paid to the employee after the first theft and any related deferred compensation, such as contractual payments owed upon retirement. Despite the William Floyd decision, disloyal employees have tried in earnest to limit the scope of the forfeiture.  On June 2, 2016, the Third Department added strength and vigor to the faithless servant doctrine in a case where an employee committed repeated acts of theft.  In City of Binghamton v. Whalen (also argued by the author of this article), the Court reaffirmed the strict application of the faithless servant doctrine:  “We decline to relax the faithless servant doctrine so as to limit plaintiff’s forfeiture of all compensation earned by the defendant during the period of time in which he was disloyal.”  The Court specifically noted that the faithless servant doctrine is designed not merely to compensate the employer, but also to create a harsh deterrent against disloyalty by employees.  The Court ordered the disloyal employee to pay back $316,535.54 (which was all of the compensation earned by the employee during the nearly six-year period of disloyalty), and held that the employer was relieved of the obligation to provide the disloyal employee with health insurance benefits earned through his employment. The City of Binghamton decision solidifies the Hulk-like power of the faithless servant doctrine -- a remedy that serves up justice with “smashing” deterrent impact.

On May 18, the New York State Division of Human Rights adopted a new regulation prohibiting employment discrimination based on an individual’s relationship or association with a member of a protected category covered by the New York Human Rights Law.  The proposed rule was published in the State Register on March 9.  The agency did not receive any public comments regarding the proposed rule, and adopted the rule without making any changes. According to the Division, the purpose of the new regulation is to confirm long-standing precedent supporting anti-discrimination protection for individuals based on their relationship or association with members of a protected class.  The new regulation applies to employment discrimination and all other types of discrimination protected under the New York Human Rights Law, including housing, public accommodations, access to educational institutions, and credit.  In order to prove a claim of employment discrimination in this context, an individual must prove that he or she was subjected to an adverse employment action based on the individual's known relationship or association with a member of a protected class. This latest expansion of the protections afforded by the New York Human Rights Law underscores the importance of basing all employment decisions on legitimate reasons that can be supported by objective facts, and documenting the legitimate reasons for those decisions.  Supervisors should also be trained to apply workplace policies and standards fairly and uniformly among all employees, to further reduce the risk of discrimination claims.

In theory, employers are all generally familiar with the “interactive process” and the need to provide disabled employees with reasonable accommodation absent undue hardship.  But in practice are employers actually complying with these legal obligations?  Maybe not, says the EEOC. On May 9, 2016, the EEOC issued a strong reminder to employers about their legal obligations under the Americans with Disabilities Act related to accommodation of disabled employees.  According to the EEOC, it continually receives complaints that indicate employers may not be fully aware of their legal obligations:  "For example, some employers may not know that they may have to modify policies that limit the amount of leave employees can take when an employee needs additional leave as a reasonable accommodation.  Employer policies that require employees on extended leave to be 100 percent healed or able to work without restrictions may deny some employees reasonable accommodations that would enable them to return to work.  Employers also sometimes fail to consider reassignment as an option for employees with disabilities who cannot return to their jobs following leave." The EEOC has recently taken a particularly close look at employer leave policies to ensure they are not so inflexible as to foreclose the possibility of a leave of absence being provided as an accommodation. So what exactly is a “reasonable accommodation”?  Generally, a reasonable accommodation is “any change in the work environment or in the way things are customarily done that enables an individual with a disability to enjoy equal employment opportunities.”  But what this means in any given situation will necessarily depend on a number of factors, including for example the particular position held by the employee, the particular restrictions the employee’s disability places on his/her ability to perform that job, and the projected duration of the restrictions.  Perhaps for one employee reasonable accommodation means providing a leave of absence after he/she has already exhausted any leave available under the Family and Medical Leave Act so that the employee is able to recover from a serious health condition before returning to work.  Or perhaps it means allowing an employee to return to work from a leave of absence in a light duty capacity while he/she completes recovery.  For another it could mean moving an employee’s work location to an area where he/she has easy access to a restroom, or restructuring an employee’s marginal (or non-essential) job duties so he/she does not have to lift items over a certain weight. It is also important to remember that although it will never be deemed “reasonable” for an employee, as an accommodation, to be excused from having to perform the essential functions of his/her job, whether something actually is an essential function is not always intuitive.  For example, is it an essential function of a firefighter’s job to be physically able to fight fires?  Perhaps not.  In Stone v. City of Mount Vernon, the Second Circuit Court of Appeals reversed a decision granting summary judgment to the employer in an ADA lawsuit filed by a former fire department employee, holding that there was a genuine issue of material fact warranting a trial regarding whether fire suppression was an essential function of the job.  Or is heavy lifting necessarily an essential function of a manual laborer’s job?  Again, perhaps not (according to the 1993 decision of the U.S. District Court for the Northern District of New York in Henchey v. Town of North Greenbush). A key take-away when dealing with accommodation issues is that there is no one-size-fits-all approach.  That is why it is so important for an employer to engage in the “interactive process” with the employee and find out exactly what his/her limitations are and whether there is an accommodation that can reasonably be provided to enable the employee to perform the essential functions of his/her job.  It may be that the interactive process reveals there is no accommodation that can be provided without imposing an undue hardship on the employer, or that will enable the employee to perform the essential functions of his/her job.  If that is the case, accommodation need not be provided under the law.  But the employer will not know that unless and until it engages in the interactive process and finds out. Following predetermined policies and rules might seem to be the essence of fairness.  But when it comes to accommodations of disabilities, employers who follow rules too inflexibly can get into trouble.  One rule that employers should always follow is to engage in good faith in the “interactive process.”

If the recent and tragic shootings at an office holiday party in San Bernardino, California, and at a lawn care company in Kansas have taught us anything, it is that these unfortunate incidents of workplace violence are becoming more and more commonplace.  In addition to the devastating human cost of these tragedies, workplace violence can also bring significant liability for employers. According to the Occupational Safety and Health Administration, workplace violence is responsible for $55 million in lost wages each year.  When the cost of lost productivity, legal expenses, property damage, diminished public image, and increased security are factored in, workplace violence costs the American workforce approximately $36 billion dollars per year. Among other sources of potential liability, employers may be cited by OSHA for violating the “General Duty Clause” of the OSH Act, which requires employers to maintain workplaces free from “recognized hazards” that are likely to cause death or serious physical harm to employees.  OSHA has previously published guidance citing certain types of workplace violence as recognized hazards for “heightened-risk industries,” which include healthcare and social services, late-night retail establishments, and taxi and for-hire drivers.  But an employer in any industry may be considered to have a recognized hazard of workplace violence based on factors like previous incidents, employee complaints, injury and illness data, prior corrective actions, and its own safety rules and policies. Last month, Bond attorneys presented a breakfast briefing on workplace violence at 12 locations across the state, providing guidance on developing an action plan to address workplace violence, identifying the potentially violent employee, and best practices for responding to an incident of violence in the workplace.  To avoid liability and prevent the unthinkable, employers should start taking steps to develop a workplace violence prevention program.

The U.S. Department of Labor recently issued its final regulations revising the white collar exemptions under the Fair Labor Standards Act.  Although the final regulations significantly raise the salary threshold for the administrative, professional, executive, and computer employee exemptions, employers can take some solace in the fact that the increase is actually lower than the one proposed by the USDOL last summer.  In addition, employers who still have extensive work to do in order to prepare for the implementation of the final regulations will have more time to do so than expected.  The final regulations will not become effective until December 1, 2016, which gives employers more than six months to make decisions regarding whether to increase salaries to retain the exemptions or reclassify formerly exempt employees as non-exempt. The USDOL's proposed regulations issued last summer set the minimum salary to qualify for the white collar exemptions at the salary level equal to the 40th percentile of earnings for full-time salaried workers in the United States.  The final regulations set the minimum salary to qualify for the white collar exemptions at the salary level equal to the 40th percentile of earnings for full-time salaried workers in the lowest-wage Census Region of the United States.  So, instead of the salary threshold increasing to approximately $970.00 per week as anticipated, the salary threshold for the administrative, professional, executive, and computer employee exemptions will increase to $913.00 per week (which amounts to $47,476 per year) effective December 1, 2016.  Although this salary increase is slightly more palatable to employers than the proposed salary increase, it is still a significant increase from the current federal minimum salary level of $455.00 per week to qualify for the white collar exemptions and the current New York minimum salary level of $675.00 per week to qualify for the administrative and executive exemptions.  Teachers, lawyers, and doctors will continue to not be subject to this minimum salary requirement. The USDOL's proposed regulations set the minimum salary to qualify for the highly compensated employee exemption at the salary level equal to the 90th percentile of earnings for full-time salaried workers in the United States.  This did not change in the final regulations.  Effective December 1, 2016, the minimum salary to qualify for the highly compensated employee exemption will be increased from $100,000 per year to $134,004 per year. The USDOL's proposed regulations included a provision that would have automatically raised the minimum salary levels to qualify for the white collar exemptions from year to year without further rulemaking.  The USDOL's final regulations still provide for automatic increases, but instead of occurring every year, these automatic increases will occur every three years beginning on January 1, 2020.  The automatic increases will continue to be based on the 40th percentile of earnings for full-time salaried workers in the lowest-wage Census Region of the United States to qualify for the executive, administrative, professional, and computer employee exemptions, and the 90th percentile of earnings for full-time salaried workers in the entire United States to qualify for the highly compensated employee exemption.  Although this will still force employers to evaluate their exempt workforces on a periodic basis to determine whether to reclassify employees as non-exempt, going through this process every three years instead of every single year will ease this burden slightly. Currently, employers are not permitted to count commissions, bonuses, and other forms of incentive compensation toward the minimum weekly salary for an employee to qualify for the executive, administrative, professional, and computer employee exemptions.  However, the USDOL's final regulations allow employers to satisfy up to 10% of the new salary threshold by the payment of non-discretionary bonuses, incentives, and commissions that are paid quarterly or more frequently.  Employers should take this into consideration when deciding how to restructure the compensation of exempt employees in order to retain the white collar exemptions. The final rule does not include any revisions to the outside sales exemption, so employees who are engaged in the primary duty of making sales outside the workplace will continue to not be subject to a minimum salary requirement to qualify for the exemption.  In addition, although the USDOL solicited comments about whether revisions should be made to the duties tests for the white collar exemptions, the final rule leaves the duties requirements untouched. Employers should keep in mind that they have many options when evaluating compliance with the new white collar exemption regulations.  One of those options is to convert salaried exempt employees to hourly non-exempt employees and do so at an hourly rate that will not raise the total personnel expense for their business.  Of course, that means that the hourly rate will need to be set low enough to account for straight time pay for the first 40 hours per work week and overtime pay for hours worked in excess of 40 hours per work week, without raising an employee’s total average weekly earnings above the current salary.  In other words, many of the 4.2 million employees who will potentially now be eligible for overtime pay may find that they will not earn any more than they did when they were exempt employees who were ineligible for overtime pay.

President Obama on May 11 signed into law the Defend Trade Secrets Act (DTSA) of 2016. This is truly a landmark law; one that expands the federal remedies companies can pursue to halt the theft of trade secrets vital to a company’s operation and financial security. DTSA received unprecedented bipartisan support, with passage by 87-0 in the Senate, 410-2 in the House of Representatives.

This new law recognizes the vital role that trade secrets play in generating billions of dollars in annual revenues and millions of jobs as a key component of our national – and local – economy. It also comes in response to several high profile cases which demonstrate how vulnerable U.S. companies are from internal and external cyber-threats.

A trade secret is anything which gives a company a competitive advantage and is kept confidential, including a design, formula, manufacturing process, financial data, or customer information. Prior to DTSA, trade secrets did not receive the same protections afforded to other forms of intellectual property such trademarks, copyrights, and patents.

DTSA provides the first ever federal civil statutory remedies for theft of trade secrets. These remedies exceed those which may have been previously available under state law, including aggressive ex parte seizure mechanisms similar to those used to seize counterfeit goods under trademark law, exemplary damages, and attorney fees.

There is a caveat: imbedded within the text of DTSA is a warning that if you fail to include whistleblower immunity notice in any agreement with an employee that governs the use of a trade secret or other confidential information you will not be able to take advantage of the exemplary damages and attorney fees available under DTSA.

This notice must inform the employee, among other things, that he or she cannot be held liable under any trade secret law for the disclosure of a trade secret that is made (1) in confidence to a government official or to an attorney for the sole purpose of reporting a suspected violation of law or (2) in a document in a lawsuit or proceeding filed under seal.

Non-compete and non-disclosure agreements play a key role in protecting a company’s trade secrets. The law governing the enforceability of these agreements is constantly changing. Failure to revise these agreements periodically could have disastrous consequences. The passage of DTSA provides yet another reason why you need to review and revise your agreements to maximize the protections available. A simple and cost effective way to have your agreements reviewed, along with your physical and digital security measures, is through Bond Schoeneck & King’s innovative Trade Secret Protection Audit.  

Most employers traditionally have had little to no interaction with the Occupational Safety and Health Administration (OSHA), the federal agency tasked with overseeing workplace safety.  Unless they were inspected by OSHA -- and the 35,820 inspections conducted in FY 2015 pales in comparison to the tens of millions of employers across the country -- most businesses, particularly smaller businesses, may have gone for many years without interacting with the agency.  But that is about to change. Currently, most employers other than those in partially-exempt industries are required to maintain injury and illness reporting records on a log (OSHA Form 300), with supporting documentation (OSHA Form 301, or other equivalent document such as workers compensation records).  Each employer then summarizes that information each year onto OSHA Form 300A, which the employer then posts at the workplace from February 1 to April 30.  Other than serious injuries such as amputations, fatalities, or accidents requiring hospitalization, which require more immediate reporting, employers have not been required to submit injury and illness data to OSHA.  Now, however, many businesses will have to submit injury and illness information periodically to OSHA electronically.  Not only that, but OSHA also will post this information online. The reporting changes affect businesses depending on their size and classification:

• Businesses with 250 or more employees.  These businesses will have to submit the annual summary form 300A electronically by July 1, 2017; submit the Forms 300, 301, and 300A electronically by July 1, 2018; and then submit Forms 300, 301, and 300A by March 2 annually thereafter.
• Businesses with 20-249 employees in “high-hazard” industries.  OSHA has compiled a long list of high-hazard industries, including but not limited to hospitals, nursing homes, long-term care facilities, agriculture, utilities, construction, manufacturing, grocery stores, department stores, transportation companies, that must also submit information electronically if they have 20-249 employees, albeit less information than larger businesses.  These businesses need only submit Form 300A by July 1, 2017 and July 1, 2018, and then continue submission of Form 300A each year by March 2 thereafter.

In determining business size, the final rule states:  “each individual employed in the establishment at any time during the calendar year counts as one employee, including full-time, part-time, seasonal, and temporary workers.” OSHA claims that Personally Identifiable Information will be removed before the data it receives is released on its web site, but OSHA’s stated reliance on software to perform this function has raised concerns with employers and privacy advocates alike.  Also, it is unclear as to what form OSHA’s online publication will take, and how third parties may seek to utilize this information. The above rule revisions represent a sea change in employers’ interaction with OSHA regarding injury and illness reporting.  But OSHA did not stop there.  OSHA also published changes in its final rule, effective August 10, 2016, that affect all employers, regardless of size:

• Employers must establish a “reasonable” procedure for employees to report work-related injuries and illnesses, and inform employees of that procedure.  The rule states that “[a] procedure is not reasonable if it would deter or discourage a reasonable employee from accurately reporting a workplace injury or illness.”
• Employers must inform employees of their right to report work-related injuries and illnesses free from retaliation.  OSHA has issued a Fact Sheet stating this obligation may be met by posting the “OSHA Job Safety and Health — It’s The Law” poster from April 2015 or later.
• The rule also adds a provision prohibiting discrimination against an employee for reporting a work-related injury, filing a safety or health complaint, or asking to see the employer’s injury and illness logs.

These provisions have raised additional concerns for employers.  The rule regarding “reasonable” procedures is targeted at employers’ safety incentive plans.  If an employer has a safety incentive plan wherein employees get a bonus, or days off, or an award, if the employee, department, or company has a certain number of days without injury -- so the theory goes -- employees may be hesitant to report injuries and illnesses.  It is precisely these kind of incentive plans the new rule intends to eliminate.  In addition, Section 11(c) of the Occupational Safety and Health Act, which has certain requirements before OSHA can initiate enforcement action against an employer in federal district court, has been the exclusive provision for employees to make complaints about retaliation for exercising their rights under the Act.  To the extent that OSHA now intends to issue citations against employers under a different process -- and even if an individual employee has not alleged or filed a Section 11(c) retaliation complaint -- this will be another sea change in enforcement. The bottom line is this:  employers with 20 or more employees in “high-hazard” industries, and with 250 or more employees in all industries, will have to report their injury and illness information electronically by July 1, 2017, which will be made available to the public in some form with personally identifiable information about employees removed.  And, all employers, regardless of size, should review their handbooks, safety incentive plans, and incident reporting policies to ensure they provide a “reasonable procedure for employees to report work-related injuries and illnesses.”