New York Labor and Employment Law Report : New York Employment Lawyer & Attorney : Bond Schoeneck & King Law Firm : NY Labor Relations, Employee Benefits

Foreign nationals frequently approach employers with a request to sponsor them for permanent residency based on employment. As many employers know, the first step in the sponsorship process consists of obtaining an approved labor certification application from the U.S. Department of Labor (DOL). This permanent labor certification program (often referred to as the “PERM” program) was redesigned by the federal government in 2005 and contains very specific rules and regulations detailing how employers must conduct any recruiting for a permanent residency position.

One requirement for obtaining certification is proof that there are no minimally qualified U.S. workers for a specific job vacancy within a specific job pool. In order to satisfy that requirement, it is very important for the employer to clearly and properly define the qualification threshold below which the employer is not willing to hire any job applicant - the employer's actual minimum requirements for the position. As a result, PERM recruiting differs significantly from the normal hiring practices of most employers, who seek the most qualified candidate for the job, not just one that meets the job's minimum requirements. Employers should strictly comply with DOL’s regulations and keep the following points in mind when drafting minimum job requirements.
 

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During the debate on health care reform, proponents of the legislation stressed that employees who were happy with the health benefits currently provided by their employers would be able to keep them. To that end, the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act ("PPACA"), provides that group health plans existing as of March 23, 2010 (the date that PPACA was enacted) are not subject to certain provisions of PPACA. PPACA referred to such plans as "grandfathered plans," and directed that regulations be issued to define what constitutes a grandfathered plan and what changes to such a plan might result in the loss of grandfathered plan status. On June 14, 2010, the Department of the Treasury, the Department of Labor and the Department of Health and Human Services jointly issued interim final regulations regarding grandfathered plan status.  The regulations further define what a grandfathered plan is and what changes to a plan will result in the loss of grandfathered plan status. The regulations are effective for plan years beginning on or after September 23, 2010.

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On June 17, 2010, the U.S. Supreme Court issued a decision in a closely watched case involving discipline of an employee for improper text messaging, City of Ontario v. Quon. Although the Court’s ruling is narrow in scope, finding that the public employer’s search of the text messages was a reasonable search within the meaning of the Fourth Amendment, the Court clearly implied that an employee’s reasonable expectation of privacy will be shaped by a clearly communicated employer policy governing the use of each particular type of employer-provided technology.

The case involved the Ontario Police Department’s review of text messages sent and received by one of its officers on a department-owned electronic pager. The Department had a “Computer Usage, Internet and E-mail Policy” that gave the department the right to monitor employee Internet and e-mail use and all network activity. Although the policy did not explicitly cover text messaging, the department had officially stated that text messages on department owned pagers would be treated the same as e-mails under that policy.
 

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Social networking sites (e.g., Facebook, MySpace, LinkedIn, Twitter, etc.) are fast becoming a popular tool for employers seeking information about job applicants. It has been reported that the number of employers currently using social media during the recruitment and hiring process has more than doubled in the past two years. According to the same source, 45 percent of employers currently use social networking sites to screen potential job candidates and 35 percent of those employers have rejected an applicant because of information they discovered, such as inappropriate pictures, information regarding alcohol or drug use, and postings in which the applicant “bad-mouthed” a former employer, bragged about prior acts of misconduct or made discriminatory remarks.

The incentives for an employer to use a social networking site are clear: It is fast, free and easy. There can be little doubt that social networking sites contain a potential treasure trove of information about an applicant’s character. Employers want the best fit for the organization and the particular position, and online information may help in making that determination. However, employers should be aware that online profiles often contain inaccurate information and information that may be easily taken out of context or misunderstood. An individual may have little control over the information on his or her “wall” or message board.
 

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Less than two months after signing legislation which provided an early retirement incentive to members of the New York State United Teachers (“NYSUT”) (reported on here), Governor Paterson has signed another early retirement incentive into law. Unlike the prior early retirement incentive which was limited to members of NYSUT only, this legislation is open to public employees across the State regardless of union affiliation. In addition, public employers have the option of deciding whether to offer this early retirement incentive to their employees. Finally, unlike the prior legislation, which spread the cost of funding the legislation across all public employers, only employers who choose to offer this early retirement incentive to their employees are obligated to fund the cost related to their employees over a five year period, with the first payment due on February 1, 2012. According to the Governor, this Legislation will save the State alone approximately $320 million by the close of the 2011-12 fiscal year.

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A recent decision by the New York Court of Appeals will significantly impact New York City employers. On May 6, 2010, New York’s highest court held that employers covered by the New York City Human Rights Law ("NYCHRL") can be held strictly liable for discriminatory acts or harassment by an employee who “exercised managerial or supervisory responsibility.”

In Zakrzewska v. The New School, the Plaintiff alleged that her “immediate supervisor” subjected her to sexually harassing e-mails and conduct for over a year. She sued her employer in United States District Court, alleging violations of the NYCHRL. The New School moved for summary judgment arguing that it could not be held liable for the supervisor's actions because it had a strict policy against sexual harassment and the Plaintiff waited more than one year to come forward before making her complaint. The District Court held that the claim would indeed by barred under the affirmative defenses articulated in Faragher v. City of Boca Raton and Burlington Industries, Inc. v. Ellerth, applicable to federal law Title VII claims, if those affirmative defenses applied under the NYCHRL.  In those cases the United States Supreme Court held that an employer is not liable under Title VII for sexual harassment committed by a supervisory employee if it proves that: (1) no tangible employment action was taken as part of the alleged harassment; (2) the employer exercised reasonable care to prevent and correct promptly any sexually harassing behavior; and (3) the employee unreasonably failed to take advantage of preventive or corrective opportunities provided by the employer.

The District Court also concluded, however, that the language of the NYCHRL suggested that these affirmative defenses were not available for NYCHRL claims and so denied the New School’s motion for summary judgment.  The case was then certified for appeal to the United States Court of Appeals for the Second Circuit, which in turn certified the question of whether the defenses were available to the New York Court of Appeals.
 

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The United States Department of Labor (“USDOL”) recently published a final rule in the Federal Register, which requires covered federal contractors and subcontractors to inform employees of their rights under the National Labor Relations Act (“NLRA").  The final rule is effective June 21, 2010, and the corresponding regulations will be codified at 29 C.F.R. Part 471.

Under the final rule, federal agencies must include a clause in contracts for “personal property” and “non-personal services” requiring certain contractors and subcontractors with which they do business to post specific notices informing employees of their NLRA rights. This new posting requirement does not apply to prime contracts under the Simplified Acquisition Threshold of $100,000 or to subcontracts below $10,000. Additional exemptions are also set forth in the final rule.
 

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Effective for plan years that begin after September 23, 2010, the recently-enacted health reform legislation ("Health Reform") generally requires group health plans and health issuers that provide dependent coverage for children to continue to make such coverage available to an adult child until the child reaches age 26. Health Reform also modifies the Internal Revenue Code ("Code") to extend the income exclusion for medical care reimbursements under an employer-provided accident or health plan to an employee's eligible children who have not attained age 27 as of the end of the taxable year. In Notice 2010-38 ("Notice"), the Internal Revenue Service ("IRS") provides employers with helpful guidance regarding the federal income tax issues associated with extending medical coverage to an employee's eligible adult children.

Background

The extension of health coverage to adult children until age 26 is among the first provisions to take effect under Health Reform. Plans that operate on a calendar year basis (including self-insured plans and so-called "grandfathered" plans) will be required to make such coverage available effective January 1, 2011. The coverage must be made available regardless of the child's marital status, but (until 2014) generally need not be provided to an adult child who is eligible to enroll for coverage under a group health plan of the child's employer.

Prior to Health Reform, health coverage generally could be extended tax-free to a child of an employee only if the child was the employee's "dependent," as defined under Section 152 of the Code. In many cases, adult children cannot qualify as a dependent under Code Section 152 because they cannot satisfy applicable age, support, residency or other requirements of Code Section 152. As a result, an employer that provided coverage to an adult child generally was required to include the fair market value of the health coverage provided to the child in the employee's income.

As further explained below, the changes to the Code made by Health Reform and the guidance provided in the Notice clarify the circumstances under which adult children may now be eligible for tax-free health coverage, regardless of whether they are considered a dependent of the employee under Code Section 152.
 

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