3 Key Supreme Court Developments Affecting the Workplace

antonin-scalia-obit-cardThe US Supreme Court’s recently concluded term took a turn few could have anticipated with the February death of Justice Antonin Scalia. While the term had its usual array of cases affecting employers, Justice Scalia’s absence unquestionably altered the result in at least some of those disputes.

Anthony Oncidi, who heads the labor and employment law practice group for the Los Angeles office of Proskauer Rose, will join me this week to co-present an XpertHR  webinar on what the Court’s 2015-2016 term means for employers.

Here are some key rulings – and in some cases – non-rulings from the term that could have a profound impact on your organization.

1.    4-4 Ties Abound

Public Employee Unions

The Supreme Court appeared poised to undo nearly 40 years worth of settled labor law in the case of Friedrichs v. California Teachers Association. The case involved the claims of a group of nonunion teachers who claimed their free speech rights were being violated each time they are compelled to pay dues to the state’s teachers’ union.

During the oral arguments, it appeared likely that five of the nine justices were poised to rule against the teachers’ union, or at least scale back its ability to collect mandatory dues. Such a ruling would have affected millions of employees and greatly weakened public employee unions. At the time, Justice Elena Kagan said a finding for the objecting teachers could “disrupt thousands of labor contracts.”

But Justice Scalia died before the Court could rule, and the result was a 4-4 split which left the lower court’s ruling intact in favor of the teachers’ union and its ability to collect the dues. Oncidi called the stakes in Friedrichs “monumental.”

Immigration Executive Action Goes Kaput

Amidst gridlock in Washington, President Obama issued high-profile executive action in late 2014 that would have allowed up to five million undocumented workers remain in the US if they met certain conditions, including:

  • Having been in the US for at least five years;
  • Having children who are citizens or legal residents;
  • Passing a criminal background check; and
  • Being willing to pay their fair share of taxes.

In all, 26 states challenged this executive action as unlawfully legislating immigration issues that should be addressed by Congress. The Supreme Court again split 4-4 along ideological lines in US v. Texas. Since the Fifth Circuit Court of Appeals had agreed with the states last year and placed that executive action on hold, the tie in this case amounted to a setback for the administration.

2.    FLSA Class Action Cleared for Takeoff

One case in which the Supreme Court did rule involved a $5.8 million Fair Labor Standards Act (FLSA) class action award involving Tyson Foods. In recent years, the Court had made it more difficult for employees to bring such cases against employers.

But in a 6-2 decision, the justices held that the lower court did not err in certifying a large class of workers who claimed Tyson violated the FLSA by failing to pay them for time spent putting on and taking off protective clothing and equipment, as well as for time spent walking to and from their work stations.

The lower court had used statistics to assess damages rather than deciding them for each individual employee. Tyson’s appeal centered on this use of statistics and its claim that many of the workers in the class suffered no injury.

But the Supreme Court explained that using a representative sample of the class may be the only feasible way to establish the employer’s liability. The Court also pointed to the fact that Tyson had failed to keep records of the hours its employees worked. The majority said employees can win overtime claims under the FLSA if they can prove the amount and extent of their unpaid work as “a matter of just and reasonable inference.”

3.    Rebukes for EEOC and Department of Labor

Hearing the words “attorney’s fee dispute” might be enough to make your eyes glaze over. But don’t doze off because one such dispute this term provided exceedingly good news for employers.

In CRST Van Expedited v. EEOC, the Supreme Court held that a ruling on the merits was not needed for an employer to be considered the prevailing party in a case and, therefore, be entitled to a fee award of more than $4 million.

In dismissing a sexual harassment case the EEOC brought against CRST, the federal district court granted the fee award because it found the agency did not adequately investigate the claims or attempt to conciliate the matter before suing the employer.

The EEOC wasn’t the only agency the Supreme Court rebuked this term. The justices also rejected a Department of Labor regulation in an overtime pay exemption case, Encino Motorcars v. Navarro.

To hear more about the employment law implications in these cases and others, don’t miss our 60-minute webinar featuring key takeaways from the Supreme Court’s term.

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