2009 Legal News

Pa Agencies - “Right to Know” Law, Labor Law (ADA, FMLA, FLA), Identity Theft, Employment Law (Fair Pay Act”), Litigation, Trademarks, Government Contracts:

1. Pa Agencies – New “Right to Know” Law – Taking effect January 1, 2009, PA’s new Right to Know Law (RTKL) grants liberal access to records of public agencies. Previously, a party requesting information bore the burden of establishing why a record should be released. Now, all state agency records are presumed to be open to the public unless the agency holding them can prove otherwise. The RTKL applies to all agencies, encompassing Commonwealth, local, judicial, and/or legislative agencies. However, the law also includes a category of exceptions to disclosure involving confidential personal information or public safety issues.


2. Labor Law - a number of important changes to 1) the federal Americans with Disabilities Act (ADA) and 2) the federal Family and Medical Leave Act (FMLA), as well as changes impacting 3) New Jersey’s Family Leave Act (FLA), are all effective January 2009.

     As to the ADA (normally impacting companies with 15 or more employees), generally speaking and perhaps most significantly, the new act:

  • directs the federal Equal Employment Opportunities Commission (EEOC) to revise that portion of its regulations defining the term “substantially limits”;
    expands the definition of “major life activities” by including two non-exhaustive lists:
             the first list includes many activities that the EEOC has recognized (e.g., walking) as well as activities that EEOC has not specifically recognized (e.g., reading, bending, and communicating);
             the second list includes major bodily functions (e.g., “functions of the immune system, normal cell growth, digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine, and reproductive functions”);
  • states that mitigating measures (other than “ordinary eyeglasses or contact lenses”) shall not be considered in assessing whether an individual has a disability;
    clarifies that an impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active;
  • provides that an individual subjected to an action prohibited by the ADA (e.g., failure to hire) because of an actual or perceived impairment will meet the “regarded as” definition of disability, unless the impairment is transitory and minor; and
  • emphasizes that the definition of “disability” should be interpreted broadly.

In essence, the scope of ADA coverage has been expanded (and not much above would be considered a “win” for the business community)

      Regarding the FMLA (where some of what is new is a business “win”) – we suggest that, if you have not done so, covered companies (generally speaking, those with 50 or more employees) revise any existing employee handbooks at this time to incorporate the legal changes. We suggest this for reasons including that, under the law, it is the employer’s responsibility to give written notice concerning aspects of this law to their personnel. We have prepared a Summary Update regarding the FMLA that can be inserted into many existing employee handbooks. If you would like to receive that Summary, please let us know asap. The deadline to update your FMLA employee summary information is January 16, 2009.

    (Moreover, as to both the FMLA and the ADA (as well as other pertinent federal and state laws), again, it is the employer’s responsibility to also post at the workplace certain summary legal notices. Applicable posters for this purpose are available from various workplace poster sources at office supply shops, online, etc).

    As to New Jersey employers and NJ’s FLA, as we noted in some greater detail last year, eligible employees will be able to take certain paid leave (noted previously at 2/3 of their compensation, presently up to $524/week) beginning July 1, 2009. However, as either your payroll company or payroll staff already know or need to know, payroll deductions to fund such paid leave are effective as of your January 2009 payroll. (The money to currently fund this program is in the way of an increase in the employee’s payroll deductions effective January 1, 2009, again, with eligible employees entitled to take such paid leave beginning July 1, 2009.) It is worth noting that, since this program ended up essentially as in insurance program – actually a component of NJ’s Temporary Disability Benefit law – its payment benefit alone does not entitle a person to job protection (i.e.: a return to work right, etc); that apparently will apply only where the employer is a covered company under the FLA (or federal FMLA) (again, generally, having 50 or more employees). However, this insurance benefit/payment right is available essentially to all NJ workers, and so, this new payroll deduction applies essentially to all NJ companies. (And, again, there is a summary posting requirement now in effect as to this NJ law topic.)


3. Identity Theft – FTC “Red Flag” Requirements – The Federal Trade Commission (FTC) has issued regulations, or Red Flag Rules, to help detect, prevent and mitigate identity theft in financial institutions. These Rules apply to certain financial institutions and creditors with covered accounts and require that these particular covered entities develop a written program that identifies and detects relevant warning signs of identity theft, such as unusual account activity or fraud alerts on a consumer report.


4. Employment Law – Lilly Ledbetter Fair Pay Act of 2009 – The new federal “Lilly Ledbetter Fair Pay Act” applies to all Title VII pay claims of discrimination for age, sex, national origin, race and/or disability. It reverses a US Supreme Court decision which previously held that the statute of limitations to file a compensation discrimination claim ran from the day of the original discriminatory pay-setting decision, not the date of the most recent paycheck. Now, the Act reinstates the paycheck accrual rule where each paycheck delivering discriminatory compensation resets the clock for filing pay discrimination claims.


5. Litigation – Defining “Management-Level Employees” in Harassment Claims – The US Third Circuit recently handed down a decision, which sought to define “management-level employees” in harassment reporting among co-workers. When a hostile work environment stems from harassment by co-workers, the employer is liable if it failed to provide a reasonable avenue of complaint, or if it knew, or should have known, of the harassment and failed to take appropriate action. In these situations, the Third Circuit (covering federal claims in, among other places, NJ and PA) has held that an employer knew, or should have known, about co-worker harassment if “management-level employees had actual or constructive knowledge” of a hostile environment. This most recent ruling has defined a “management-level employee” as 1) someone sufficiently senior in the employer’s governing hierarchy, or otherwise in a position over employees so that knowledge is important to the employees general managerial duties, such as a department or plant manager, or 2) someone specifically employed to deal with sexual harassment (such as HR personnel), thus potentially narrowing the scope of employer liability.


6. Trade/Servicemarks – Protecting Registered Marks with the Advent of Personalized Facebook URLs – As of June 2009 the popularly used Facebook website is offering users personal username URLs which have the potential to infringe on intellectual property rights of third parties. To prevent the use of protected trademarks or company names as potential usernames by Facebook enthusiasts, Facebook has a service (found at its website) where IP owners can block the unauthorized use of their protected property.


7. Government Contracts – For companies doing business as Federal government contractors or subcontractors, this is a reminder that the “E-Verify” system is now scheduled to go into effect on September 8, 2009. On that date, federal contractors/subcontractors (subject to certain “size/length” of contract provisions etc) will be required to start using E-Verify, an Internet-based system operated by the US Homeland Security Department that is meant to electronically verify an employee’s eligibility to work in the United States. More info at www.uscis.gov/e-verify.

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