The 5 Biggest Employment Law Developments of 2019

Employment Law

What were the five biggest employment law developments in 2019? From new laws to big decisions, we tracked down some of the top headlines of the last year.

  • Employee or independent contractor? The battle over classification of workers as independent contractors or employees leads the race, with courts across the country continuing to struggle with the issue. The debate was especially pronounced in California, where fallout from last year’s decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles continued. The U.S. Court of Appeals, Ninth Circuit asked the California Supreme Court if the decision—which established a three-part “ABC test” that presumptively considers all workers to be employees unless the hiring entity can satisfy three conditions—applies retroactively, while Governor Gavin Newsom signed “landmark legislation” codifying the ABC test and exempting certain occupations from Dynamex. Manatt led a recent webinar on the legislation known as AB 5. Watch it on demand here.
  • NLRB switches directions. The National Labor Relations Board (NLRB) took an employer-friendly turn over the last year. While still mulling over the nearly 29,000 comments received on its joint employer rule-making, the NLRB answered questions that arose in the wake of the U.S. Supreme Court’s decision in Epic Systems Corp. v. Lewis by ruling that employers are not prohibited under the National Labor Relations Act from informing employees that failing or refusing to sign a mandatory arbitration agreement will result in their discharge. A separate decision signed off on the ban of union reps in public spaces.
  • Arbitration fight continues. The NLRB wasn’t alone in taking a stance on arbitration. Joining its sister federal appellate courts, the Fifth Circuit held that courts—and not arbitrators—should decide the gateway issue of whether an arbitration agreement permits class proceedings, while California courts continued to deny motions to compel arbitration despite the Epic Systems decision. California also enacted a new law banning the use of mandatory arbitration agreements in employment claims related to the Fair Employment and Housing Act or violations of the state’s Labor Code.
  • Raise it or waive it. In a unanimous decision, the U.S. Supreme Court held that Title VII’s charge-filing precondition to suit is not a jurisdictional requirement and is instead a procedural prescription that is subject to forfeiture, refusing to permit an employer to use the plaintiff’s alleged failure to exhaust administrative remedies as a bar to suit. A rule may be mandatory without being jurisdictional, the justices said in Fort Bend County v. Davis, and the employer lost the ability to challenge the claim after it had already wound its way through the court system for several years. The opinion sends a clear message to employers to raise the issue of a plaintiff’s failure to exhaust administrative remedies—or find it waived.
  • Scheduling snafu. Employers in California face potential liability for on-call scheduling systems after an appellate panel ruled that Wage Order 7’s reporting time pay requirements can kick in. The case involved a salesclerk at a retail location where the employer scheduled workers with a combination of regular and “on-call” shifts. Employees were required to contact the store two hours before the start of their on-call shift to find out if they were needed to work. Failure to reach out or refusal to work the shift resulted in discipline, and employees were not paid for the time spent calling in or for the on-call shifts they didn’t end up working. Reversing dismissal of the lawsuit, the California appellate court found the scheduling practices triggered the reporting time pay requirements of Wage Order 7.

Why it matters: 2019 was a busy year for employment lawyers, with issues ranging from the misclassification of workers to the enforcement of arbitration agreements. Join Manatt’s upcoming webinar that will touch on recent developments in California employment law and offer practical guidance to help prepare for 2020. Register here.



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