March 13, 2023

On Friday, March 10, 2023, regulators shut down Silicon Valley Bank (“SVB”) and seized its deposits, resulting in the second largest U.S. banking failure since the 2008 financial crisis.  Specifically, SVB was closed by the California Department of Financial Protection and Innovation, and the Federal Deposit Insurance Corporation (the “FDIC”) was named receiver.  Since the FDIC insures deposits of up to $250,000, that amount was immediately available; however, the fact that deposits above and beyond the $250,000 limit were not immediately available alarmed many.  After a weekend of chaos as many businesses scrambled for a solution to the illiquid funds, on Sunday, March 12, 2023, in a joint release among the Department of Treasury, Board of Governors of the Federal Reserve System and the FDIC, Treasury Secretary Janet Yellen instructed the FDIC to guarantee SVB customers access to all deposits, including the uninsured funds.  The release further stated that New York-based Signature Bank was closed by its chartering authority and that its customers would also receive access to all deposits, including the uninsured funds.  While this may have provided relief to many, it is important to keep in mind the lesson and best practices in the event of such a liquidity crunch.Continue Reading Payroll Obligations During Liquidity Crunch Crisis – Implications and Responses

Yesterday, the Federal Trade Commission proposed a sweeping new rule that would ban employers from including non-compete terms in employment agreements with virtually all of their workers – from janitors to senior executives. Describing such agreements as an “exploitative practice that suppresses wages, hampers innovation, and blocks entrepreneurs from starting new businesses,” the FTC’s rule deems non-compete agreements to be an “unfair method of competition” under Section 5 of the FTC Act, without regard for any business justifications or reasonableness. Potential rulemaking against non-compete clauses has been percolating for some time and has support from the White House, but the breadth of the proposed rule is nonetheless surprising.

The FTC’s push for this rule under its Section 5 authority surely will spark legal—including constitutional—challenges that could delay implementation of any final rule for months, if not years. Companies need not immediately start rescinding or avoiding reasonably tailored non-compete agreements with employees, but should take note that the FTC is not likely to sit on the sidelines and wait for a final rule to come into effect before taking further action against some employers based on the scope of their non-compete agreements.  The proposed rulemaking and the FTC’s recent enforcement actions  targeting specific companies’ use of non-compete provisions as violations of Section 5 reflect the FTC’s and DOJ’s aggressive approach to antitrust enforcement in the labor markets – including the FTC’s desire to bring enforcement actions in this area even before any final rule goes into effect. Continue Reading FTC Proposes Rule to Categorically Ban Non-Compete Agreements

On September 27, 2022, California Governor Gavin Newsom signed SB 1162, which  requires employers with more than 15 employees to disclose pay scales to current employees and on job postings beginning January 1, 2023. The bill also requires private employers with more than 100 employees to submit significantly more pay data to the California Civil Rights Department (CRD, formerly known as the DFEH) beginning in May 2023.

Pay Scale Disclosure Requirements  

With SB 1162, California joins Colorado, Washington, and New York City in requiring employers with more than 15 employees to disclose the pay scale for a position in any job posting. “Pay scale” means the salary or hourly wage range that an employer reasonably expects to pay for the position. The bill does not specify how or if this requirement applies to postings for remote jobs that may or may not be performed in California. We expect the CRD to issue additional guidance on this and other key issues in the coming months.Continue Reading California Requires Disclosure of Pay Scales in Job Postings and Significant New Pay Data Reporting

On May 12, 2022, New York City Mayor Eric Adams signed into law the Amended New York City Pay Transparency Law, Int. 134-A, extending the effective date of that statute from May 15, 2022 to November 1, 2022.  The pay transparency law (“Law”) requires New York City employers and employment agencies with four or more employees, or employees or agents thereof (“Covered Employers”), to include compensation information in postings for new employment opportunities, internal promotions and transfers that they choose to post. The amendments clarify that (1) positions “that cannot or will not be performed, at least in part, in” New York City are exempt from the pay posting requirement; (2) either annual salary or hourly wage information must be disclosed in the posting; (3) a Covered Employer has a 30-day opportunity to cure, with no penalty, in response to a first administrative complaint of non-compliance; and (4) only current employees have a private right of action against their employers. The New York City Commission on Human Rights (“Commission”) recently issued updated guidance to assist Covered Employers with the recent amendments.
Continue Reading Effective Date of the New York City Pay Transparency Law Extended to November 1, 2022

On November 4, 2021, the Occupational Safety and Health Administration (“OSHA”) released its much-anticipated COVID-19 Vaccination and Testing Emergency Temporary Standard (“ETS”) requiring employers with 100 or more employees to ensure that their employees are either vaccinated by January 4, 2022, or submit to weekly testing.  According to OSHA, employees who are unvaccinated face a “grave danger” from COVID-19, including the more contagious Delta variant.  The ETS notes that COVID-19 is highly transmissible—particularly in workplaces where multiple people interact throughout the day often for extended periods of time—and exposure to COVID-19 can result in death or illness, with some individuals experiencing long-term health complications.  OSHA has determined that vaccination is the most effective way to protect these employees.
Continue Reading OSHA Publishes Vaccine Requirements for Employers with 100 or More Employees

On August 20, 2021, China’s national legislature passed the Personal Information Protection Law (“PIPL”), which will become effective on November 1, 2021. As China’s first comprehensive system for protecting personal information, the PIPL is an extension of the personal information and privacy rights enshrined in China’s Civil Code, and also a crucial element of a set of recent laws in China that seek to strengthen data security and privacy. Among other things, the PIPL sets out general rules for processing and cross-border transfer of personal information. A number of provisions, notably various obligations imposed on data processors, restrictions on cross-border transfer, and hefty fines, will have significant impact on multinational corporations’ HR activities, including recruitment, performance monitoring, cross-border transfers, compliance investigations, termination of employment relationships, and background checks.

This alert will highlight specifically how the PIPL will apply to workplace scenarios in China and provide suggestions to help ensure data privacy compliance for multinational corporations’ China labor and employment operations.

Employee Consent and Exceptions to Consent

Under Article 4 of the PIPL, “personal information” is defined broadly as information related to natural persons recorded electronically or by other means that has been used or can be used to identify such natural persons, excluding information that has been anonymized. Specific types of personal information have been noted for additional protection under Article 28 of the PIPL as “sensitive personal information”. Sensitive personal information is defined under the law as personal information that is likely to result in damage to the personal dignity, physical wellbeing or property of any natural person, and includes, among others, information such as biometric identification, religious belief, special identity, medical health, financial account, physical location tracking and whereabouts, and personal information of those under the age of 14.
Continue Reading Employee Personal Information Protection in China – Are You Up to Speed?

Blind person using computer with braille computer display and a computer keyboard. Blindness aid, visual impairment, independent life concept.

After more than two years of deliberation, the Eleventh Circuit issued its decision in Gil v. Winn-Dixie on April 7, 2021.  Writing for the majority, Judge Elizabeth Branch reversed a trial court decision and found that Winn-Dixie’s website, which is incompatible with screen reading software used by the plaintiff, who is blind, did not violate Title III of the Americans with Disabilities Act (“ADA”).  In doing so, the court’s opinion in this closely-watched case advances the law in several frequently litigated issues in ADA Title III website accessibility disputes.

The Appellate Court’s Opinion

The Eleventh Circuit’s decision includes two key takeaways: (1) that websites are not “places of public accommodation” under the ADA; and (2) a rejection of the “nexus” standard, notably adopted by the Ninth Circuit.  In what it described as a strict textual reading of the ADA, the majority concluded that the retailer’s website was not a “place of public accommodation” within the meaning of the ADA.  Judge Branch emphasized that the statute includes an “expansive list” of examples of public accommodations—all of which are physical locations, not websites.  The court further reasoned that the website’s functionality did not interfere with the plaintiff’s right to “full and equal enjoyment” of a place of public accommodation, because he had visited its physical locations on many occasions.

The majority also rejected the plaintiff’s theory that the grocery store violated the ADA because its website was a “nexus” to its physical locations, and thus must be accessible to people with disabilities.  Among other courts, the Ninth Circuit adopted the “nexus” theory in its widely-publicized 2019 opinion in  Robles v. Domino’s.

The Eleventh Circuit also rejected the plaintiff’s alternative theory of liability under the ADA.  Gil argued that the website’s inaccessibility created an “intangible barrier” to the goods and services at the brick-and-mortar store.  The court rejected this claim, focusing on the fact that the website had “limited use” and was not the sole access point to the store.  Language in the majority opinion supports a relatively narrow interpretation of the statutory “auxiliary service” issue that is frequently litigated in ADA Title III cases.  See 42 U.S.C. § 12182(b)(2)(A)(i)-(ii).

Penning a dissent as long as the majority’s opinion, Judge Jill Pryor explained, “[t]he ADA is a sweeping piece of legislation; it is hardly surprising that its terms prohibiting discrimination are broad and inclusive.”  By narrowing the applicability of the ADA, Judge Pryor worried about the unintended consequences.  “As I read it, the majority opinion gives stores and restaurants license to provide websites and apps that are inaccessible to visually-impaired customers so long as those customers can access an inferior version of these public accommodations’ offerings.”
Continue Reading Website Wars: Eleventh Circuit Rules in a Split Decision That Websites are Not Public Accommodations for Purposes of the Americans With Disabilities Act

California Governor Newsom signed into law a new bill, SB 95, that provides for up to 80 new hours of COVID-19 supplemental paid sick leave to covered employees. The law applies to all businesses with more than 25 employees, and goes into effect on March 29 through September 30, 2021. SB 95 retroactively applies

The New York State legislature recently passed a bill (S2588A/A3354B), signed into law by Governor Cuomo on March 12, 2021, which amends the New York Labor Law and Civil Service Law to grant private and public employees paid leave time for the COVID-19 vaccination. The law is effective March 12, 2021 and will

Continue Reading UK and Canada Announce New Measures to Combat Forced Labor and Human Rights Violations