What Every Employer Should Know About the Pregnant Workers Fairness Act

By: Michael P. Sawicki, Esq.

The Pregnant Workers Fairness Act (PWFA) is a new law that requires covered employers to provide “reasonable accommodations” to a worker’s known limitations related to pregnancy, childbirth, or related medical conditions, unless the accommodation will cause the employer an “undue hardship.”

On August 11, 2023, the U.S. Equal Employment Opportunity Commission (EEOC) issued a Notice of Proposed Rulemaking (NPRM) which was posted by the Federal Register for public comment. The 60-day public comment period closed on October 10, 2023.

The PWFA applies only to accommodations. Existing laws remain in force that make it illegal to fire or otherwise discriminate against workers on the basis of pregnancy, childbirth, or related medical conditions. In addition, the PWFA does not replace federal, state, or local laws that are more protective of workers affected by pregnancy, childbirth, or related medical conditions. More than 30 states have laws in effect that provide accommodations for pregnant workers.

In Maryland, Chapters 547 and 548 of the 2013 Acts of the Maryland General Assembly and State Government Article § 20-609 require an employer, if the employee requests a reasonable accommodation for a disability caused or contributed to by pregnancy, to explore with the employee all possible means of reasonably accommodating the disability, including changing the employee’s job duties; changing the employee’s work hours; relocating the employee’s work area; providing mechanical or electrical aids; transferring the employee to a less strenuous or less hazardous position; or providing leave.

Congress and federal agencies, employment agencies, labor organizations, private employers with 15 or more workers, and state and local governments with 15 or more workers are subject to the law, according to the EEOC. Under the PWFA, pregnant workers should be able to make requests for reasonable accommodations, such as closer parking, uniforms in their size, and additional rest time.

The PWFA is similar to the Americans with Disabilities Act (ADA) in that it does not require an employer to provide an accommodation if doing so would bring it “undue hardship,” which means that it would come at great difficulty or expense to the employer. Unlike the ADA, where the employee must be able to do the essential functions of their job or they no longer qualify for accommodations, the PWFA says that workers do not always have to be able to perform an essential function temporarily because of their pregnancy as they will be able to resume those duties in the near future, generally up to 40 weeks.

Lactation, potential pregnancy, miscarriage, infertility and fertility treatments, and having an abortion are also under the purview of the PWFA. An employee who needs to take leave because of a limitation due to a condition related to pregnancy and childbirth should qualify for that leave under the PWFA.

What does this mean for employers? Employers cannot deny work to an applicant or employee because of their need for an accommodation, make a decision for a pregnant worker without any discussion on which accommodation they will receive or force them to go on leave if there is an accommodation that can be made to continue working. They also cannot retaliate against workers for advocating for themselves under the law and reporting discrimination nor can they try to stop workers from utilizing their legal protections.

The PWFA may be challenged and interpreted by the courts in future litigation. For now, the PWFA is the law and must be abided by employers.

If you have any questions or would like to get more information regarding the Pregnant Workers Fairness Act, please contact Batoff Associates, P.A. at 410-864-6211.

Classification as an Employee or Independent Contractor: What Every Employer Needs To Know

By: Michael P. Sawicki, Esq.

Effective March 11, 2024, the Department of Labor’s (DOL) new rules become effective to provide additional information to employers regarding the proper classification of workers as independent contractors or employees under the Fair Labor Standards Act (FLSA). These new rules will rescind the rules established on January 7, 2021, under the Trump Administration which focused on two core factors: (i) the nature and degree of the worker’s control over the work; and (ii) the worker’s opportunity for profit or loss based on their initiative or investment.

The new rules under the Biden Administration will broaden the analysis based on an “economic reality” test which focuses on the extent to which a worker is economically dependent on the employer. This test evaluates seven multiple factors equally to determine the nature of the working relationship alongside the core factors set forth above:

  • The extent to which the services rendered are an integral part of the employer’s business;
  • The permanency of the relationship between the worker and the business;
  • The amount of the alleged contractor’s investment in facilities and equipment;
  • The nature and degree of control by the business;
  • The alleged contractor’s opportunities for profit and loss;
  • The amount of initiative, judgment, or foresight in open market competition with others required for the success of the claimed independent contractor; and
  • The degree of independent business organization and operation.

Now, employers will be required to weigh all the relevant factors equally based on a totality of the circumstances to determine whether a worker is an independent contractor or an employee. The rule provides guidance on proper classification and seeks to combat employee misclassification that impacts a workers’ rights to minimum wage and overtime pay which can affect competition.

 In withdrawing the prior rule, the DOL relied on over 1,000 comments received from state officials, members of Congress, labor unions, social justice organizations, worker advocacy groups, and individual commenters. The good news for employers is that the same test the DOL has been using remains in effect, but now additional factors come into play providing guidance to employers in making the classification of employee versus independent contractor.

Once the new rules come into effect, the courts will provide additional interpretation of the application of the rules to specific fact patterns which are challenged by litigants as they try to apply the new rules. Employers should keep an eye on any developments in such litigation that may result in another change in the independent contractor analysis.

If you have any questions or would like to get more information regarding the classification of employees versus independent contractors, please contact Batoff Associates, P.A. at 410-864-6211.

Employment Trends for 2024

By: Michael P. Sawicki, Esq.

The biggest employment law trends for 2024 include more employers requiring employees to return to the office, the importance of workplace culture and the increasing use of artificial intelligence (AI) in the hiring process and human resources function.

Return to the Office

The COVID-19 heath pandemic changed the way most companies operated with liberal work from home policies. With the pandemic under control, employers may continue the trend of a modified work from home policy while instituting a mandatory return to work policy for at least a few days a week. A recent study found 90% of employers plan to implement a return to the office policy in 2024. Employers are balancing the complexities in a post-pandemic world of employee wellbeing, operational efficiency and the changing dynamics of the workplace. Most companies are leaning towards a hybrid policy mandating a certain number of days each week in the office.

Importance of Workplace Culture

Return to work policies are having an impact on workplace culture. Being in the office provides a better connection for employees, and fosters an environment for collaboration. It also decreases an employee’s autonomy of a home office environment and self-management of tasks, while adding a commute to the employee’s daily routine. The reviews are mixed. Some employees welcome a return to the office environment, at lease part of the week, while others claim more productivity working from home.

Employers should give thought to drafting a policy that is fair and that will be consistently applied to reduce the risk of claims that the policy is discriminatory or selectively enforced.  Employers should also pay careful attention to requests from employees for exemption or variation from a return-to-work policy as a reasonable accommodation for a disability. A healthy workplace culture reduces the risk of discrimination and harassment claims by ensuring all employees are treated equally and fairly.

Use of Artificial Intelligence

A third trend employers should be aware of is the expanded use of AI in the workplace through the hiring process and automation of certain HR functions. AI is being increasingly used in the hiring process to screen applications and resumes or for pre-screening questionnaires or automated interviews. Employers may face the risk of unrecognized racial and gender bias.

In order to minimize these risks, the Biden Administration created the AI Bill of Rights which provides a set of guidelines for the responsible design and use of AI. The AI Bill of Rights outlines five key principles to guide the development and deployment of AI systems, focusing on safety, fairness, privacy, transparency, and human alternatives:

  1. Ensuring Safe and Effective Systems
  2. Combating Algorithmic Discrimination
  3. Upholding Data Privacy
  4. Providing Notice and Explanation
  5. Prioritizing Human Alternatives and Fallbacks

The enactment of federal and state laws will be on the horizon in 2024 regarding the use of AI.

If you have any questions or would like to get more information regarding employment law, please contact Batoff Associates, P.A. at 410-864-6211.

Maryland Law and Non-Compete Agreements: Are They Still Enforceable?

By: Michael P. Sawicki, Esq.

Non-compete agreements are contracts between employers and employees that prevent employees from competing with their employers for a specific period of time after termination of employment. These agreements are meant to protect the employer’s business interests, trade secrets, and confidential information. The enforceability of such agreements is usually tied to a duration and reasonableness standard.

There has been a nationwide movement, however, regarding the enforceability of employment-related non-complete agreements and certain restrictive covenants.  New York is poised to become the fifth state in the nation to impose a complete ban on employment-related noncompete agreements, joining California, Oklahoma, North Dakota, and Minnesota.

Maryland recently enacted a revised partial restriction on employment-related non-compete agreements with the enactment of Senate Bill 591, effective October 1, 2023. Maryland has linked the enforceability of an employment-related non-compete with an employee’s earnings tied to the minimum wage, thereby protecting employees who fall below the mandated criteria from employer mandated non-competes. This public policy is designed to protect lower wage employees and allow unrestricted movement in the workforce, even if their employment competes with their prior employer.

Maryland employers are now prohibited from imposing a non-compete, conflict of interest, or similar agreements on employees earning 150% of the minimum wage. With the recent increase of the minimum wage rate to $15.00 per hour effective January 1, 2024, this translates to $22.50 per hour, or an estimated annual income of approximately $46,800. Importantly, the new threshold will automatically increase with any future increments in the minimum wage.  (Under the prior law, employers were prohibited from entering a non-compete agreement with employees who earn $15.00 per hour or less, or $31,200 annually.)

This newly revised Maryland law can have detrimental effects to employers seeking to protect their carefully earned business and client relationships. Until there is court interpretation of the new law, the application to salaried employees could be subject to interpretation and debate. The new law does not, however, apply to the enforceability of non-solicitation agreements protecting client lists and other proprietary client information. A business still has enforceable rights to protect its confidential information.

If you would like to get more information on the creation of a data security policy and speak to an attorney about your needs, please contact Batoff Associates, P.A. at 410-864-6211.

Setting Expectations: Why Your Company Needs an Employee Handbook

By: Alina Pargamanik, J.D.

You have recruited the “ideal” employee to meet your staffing needs. He/she was thrilled to accept your job offer. What happens when it is the employee’s first day of employment and your company has no employee handbook to offer? No expectations, no rules, no formality, the list goes on… In order to avoid these issues, every company should have a well-drafted employee handbook in place and enforced.

What is an Employee Handbook?

An employee handbook does not have to solely consist of a list of rules and procedures for employees to follow. An employee handbook offers employees a clear outline of your company’s history, mission, values, benefits, and, of course, policies and procedures. A well-drafted employee handbook should, at minimum, include policies for the following: harassment, discrimination, discipline for policy violations, social media, compensation/leave, standards of conduct, and privacy/confidentiality. It is also important for the employee handbook to discuss the company’s employee benefits such as 401(k) plans or health plans. The employee benefits policy/provision should encourage employees to review any documents related to employee benefits plans, such as summary plan descriptions.

When distributing an employee handbook to employees, it is important to have the employee(s) sign a statement acknowledging that they have received, reviewed and agree to the policies set forth in the employee handbook. It is also crucial for employers to regularly review the employee handbook to ensure that all policies and procedures align with the company’s standards and comply with any changes in federal or state law. At minimum, employers should review their company’s employee handbook annually. The handbook should be updated as needed, with all changes being communicated promptly to employees.

Examples of Employee Handbook Provisions

Below is a list of provisions that you should consider incorporating in your company’s employee handbook:

  • Equal Employment Opportunity Policy
  • Anti-Harassment Policy
  • Anti-Retaliation Policy
  • Disability Accommodations Policy
  • Religious Accommodations Policy
  • Payroll/Compensation Policy
  • Paid Time Off/Sick Leave/Jury Duty Leave Policy
  • Family and Medical Leave Policy
  • Travel and Business Expense Reimbursement Policy
  • Tuition Reimbursement Policy
  • Attendance Policy
  • Standards of Conduct Policy
  • Performance Review Policy
  • Dress Code Policy
  • Social Media Use Policy
  • Remote Work Policy
  • Smoke-Free/Drug-Free Workplace Policy

Each company should assess which policies should be included in its employee handbook on an individual basis. The list above is not all-encompassing, so it is important to discuss which policies your company should have in place with an employment attorney.  

The Importance of Having an Employee Handbook

A well-drafted employee handbook protects both the employer and the employee. From the employer’s perspective, the handbook may be used as protection against discrimination or unfair treatment claims. The handbook is also a very valuable tool for setting expectations and communicating company policies and practices.

An employee handbook can also serve as an important defense tool for employers in the case of litigation. A handbook can serve as valuable evidence in court to show that the employer was not discriminating against or retaliating against an employee. For employees, an employee handbook could also prove that the employer is not acting in compliance with its own policies and procedures.

If your company or organization needs assistance in drafting or reviewing an employee handbook, please contact Batoff Associates. P.A. at 410-864-6211.