Legislation to outlaw employment discrimination against people on the basis of their sexual orientation has been proposed many times since 1994. This year may see its passage, though. With more states approving gay marriage, and prominent politicians on both sides of the aisle approving of the notion of equal rights for gay citizens, the time may have come to add it to the national civil rights protections.
Earlier this month, when ten Republicans in the Senate voted with all Democrats to pass the Employment Non-Discrimination Act, a barrier crumbled. A Republican amendment to protect religious groups from complying with the law put the effort over the top.
Maryland legislation protects employees from being discriminated against on the basis of their sexual orientation; we have yet to add gender identification. Maryland legalized gay marriage by voter referendum. While this effort will probably top out at 30 or so states, the momentum is strong now, and at least in parts of the country, should
In light of the Supreme Court’s recent opinion in U.S. v. Windsor erjecting the Defense of Marriage Act, together with shifting public attitudes towards same-sex marriage and LGBT rights, many insiders believe the time is ripe for ENDA.
October 1 marked the effective date of a number of laws passed in the Maryland General Assembly’s 2013 session. The end of capital punishment and the ban on hand-held cell phone usage while driving have gotten a lot of attention, but there are some other new laws of interest in the employment arena.
The Pregnancy Fairness Act, discussed here earlier, takes effect on October 1. In brief, employers must consider requested accommodations for pregnant workers, and in many cases must grant them. My condolences to the pregnant women who were unable to avail themselves of these protections during the summer; I heard from several of them. But now, employers with at least 15 employees must make accommodations if they are available, and must consider a pregnant worker’s request for a flexible schedule to attend doctor’s appointments, for example, or a temporary ease on lifting requirements.
The unpaid wage lien process also is available. Discussed here before, the new law permits a worker who has been denied wages (often the last paycheck) to use a new process to get a lien on property of the employer. The procedural burden is then on the employer to dispute the claim. This procedure will be helpful for employees whose unpaid wages are not high enough to warrant hiring a lawyer. Indirectly, it will benefit employers who pay their workers, by impairing the illegitimate profits earned by employers who steal from their employees.
Many applicants for employment with the state cannot have their criminal records rule them out prior to at least the time they are granted an interview. Obviously, some types of backgrounds can be considered for some jobs. Our financial overseers do not have to hire convicted embezzlers, for example. But people with records will no longer find that the door to state jobs is locked.
Lastly, a new law prohibits employers of tipped employees from charging them for the costs of customers who run out on their checks. This has been a frequent practice imposed on wait staff. A bar or restaurant facing serious issues with thieving customers must find a better way of preventing freebie meals.
In one of the first calls to action under new Secretary Perez, the Department of Labor issued a blog post yesterday about raising the minimum wage, as President Obama urged in his State of the Union address. Economists have been debating whether even having the minimum wage is in the interest of a free economy. But according to the DOL, raising the minimum wage payable to most American workers would help the economy. Remember reading about Henry Ford, and how he imposed a shorter work day and higher wages for his factory workers? Guess what, they all were able to buy Fords, and use some of their free time to enjoy them. The same principle is at work with the wages paid to lower end workers. If they can pay their absolute necessities and have some cash left over, the cash will be spent on things and services sold by other people, whose income rises.
The DOL blog post has a nice graphic on the reduction in buying power of minimum wage, the lack of ill effects on the economy when a new minimum wage goes into effect, and other fun facts.
Many people assume that most minimum wages jobs are held by teenagers supplementing their allowances with a part-time job. That assumption was never completely correct, but as the recession hit a few years ago, the competition for lower wage jobs intensified. Lots of people try to meet their own expenses and those of their families on $7.25 per hour. After FICA withholding, but not other tax withholding, a 40-hour a week job would net $267 per week. Try paying for rent, groceries and transportation on that paltry sum, and think about the how unlikely it is that you could also afford health care, a cell phone, and clothing. On the other hand, think what a 20% raise could mean.
Congress is considering, again, the Civil Justice Tax Fairness Act of 2013 (CJTFA). Senator Ben Cardin from Maryland is one of its sponsors in the Senate, Senate bill 1224. The goal of the bill is to reduce the tax inequities applied to people who get settlements or awards in discrimination cases. Since 1996, awards of pain and suffering type of damages in employment cases are taxable, unlike similar awards received by personal injury victims. In addition, employment discrimination cases usually involve some measure of lost wages, either in the past or the future, commonly both. When a person receives wages from multiple years in one check, the tax consequences are artificially high. This bill would reduce that effect, though not make the wages untaxable.
Maryland made similar strides this year, with the passage of the Civil Rights Tax Relief Act. That law removed the taxation of non-economic damages. Since federal taxes are so much higher than Maryland’s though, the bill pending in Congress will have a much greater impact on the victim of discrimination.
The Maryland General Assembly passed the Civil Rights Tax Relief Act (HB1169/SB639). The law addresses the taxation disparity between personal injury and employment discrimination plaintiffs: emotional distress damage awards are taxable to the latter but not the former. The disparity encompasses a large number of federal laws relating to employment discrimination and retaliation, including Title VII, the Fair Labor Standards Act, and ERISA. Under the new law, noneconomic damages in employment cases will be a subtraction from income on Maryland tax returns.
Awards and settlements received by personal injury plaintiffs have long been excluded from income tax under federal law. One rationale is that an injured person has not “earned” income by suffering emotional or physical pain or disfigurement. Rather, though the victim can be compensated only by money, he or she did not voluntarily participate in the transaction, and would not have chosen to trade the miserable experience for cash.
Until 1996, employment discrimination victims did not pay tax on compensatory damages for emotional distress. Congress changed the law for employment discrimination and defamation awards, however, via the Small Business Job Protection Act of 1996. Maryland tax law automatically incorporated the taxability characterization of emotional distress damages in employment discrimination cases. Awards for emotional distress in personal injury suits remained free of taxation.
Employment rights advocates have been attempting to roll back this law on the federal level for some time. In the meantime, state by state, some victims are getting relief. Lawyers representing employers did not oppose the new law. They know that cases are easier to resolve if the plaintiff’s compensation is not eaten up by taxes. Damages attributable to punitive damages and lost wages are still taxable.
Assuming the Governor signs it, the law goes into effect as of July 1, 2013.
After a busy and eventful session, the Maryland General Assembly has convened for the year. Several new employment related bills were passed by both houses, and are expected to be signed into law by the Governor.
One new law is titled the Pregnancy Fairness Act (HB804/SB784). Its genesis lies in a recent Fourth Circuit case involving UPS driver Peggy Young, Young v. United Parcel Service, 707 F.3d 437 (4th Cir. 2012). The Fourth Circuit decided that the Pregnancy Discrimination Act did not require UPS to give work accommodations to pregnant workers equivalent to those given to other employees.
Ms. Young worked an early shift for UPS, unloading from the airport shuttle and delivering rush letters and parcels due by 8:30 a.m. Shipments using this more expensive type of delivery ordinarily consisted of letters and light packages.
Young had experienced difficulty becoming pregnant, but in 2006 took leave and had a successful in vitro procedure. Her medical provider advised her not to lift packages weighing more than 20 pounds, as a precaution. UPS refused to allow her to return to work with the restriction. UPS offered this kind of light duty for employees who had suffered on-the-job injuries, for employees entitled to accommodations under the Americans with Disabilities Act, and for employees who had lost their federal driving certification. Young unsuccessfully tried to convince UPS that her restriction would not interfere with her work; she could use a hand truck and other employees had offered to help with the rare heavy package. UPS would not budge, and Young went on a lengthy unpaid leave of absence, losing her health insurance benefits for the remainder of her pregnancy and delivery. She later returned to UPS.
Pregnancy is not a disability under the ADA, so UPS did not have to offer her an accommodation under that law, though it voluntarily did so for other categories of employees. Young has filed a petition for certiorari in the Supreme Court frames the issue as follows:
Whether, and in what circumstances, an employer that provides work accommodations to nonpregnant employees with work limitations must provide work accommodations to pregnant employees who are “similar in their ability or inability to work.”
Maryland’s new law would require employers with at least 15 full time employees to give pregnant women accommodations unless the accommodation would impose an unreasonable hardship. An employee’s request for different hours, job duties, or work location, for example, must be considered; the law imposes an affirmative duty on the employer to explore accommodation possibilities with the employee. Further, if an employee requests a transfer to a less strenuous or less hazardous job during the pregnancy, the employer must grant the request if (1) it would do so for any other temporarily disabled employee, or (2) the woman’s health care provider so advises, and the employer is able to do so without displacing employees or creating a new job. Pregnant workers will be required to support their requests with medical certifications.
Often pregnant employees need simple accommodations, such as more frequent bathroom breaks, water or snacks at their work sites, and flexible hours for doctor’s visits. Moreover, the lifting requirements of many jobs overstate the typical daily tasks. For more serious medical restrictions, the law specifies that leave may be a reasonable accommodation. Nothing in the law requires the leave to be paid.
This new law is expected to ease the burden on the unemployment compensation and social services budgets.
Paul Krugman praised the President’s call to raise the minimum wage. Mr. Krugman is not only a cogent opinion writer for the New York Times, but also an economics professor and a recent winner of the Nobel prize in economics. So if he endorses the minimum wage hike, it is worth a look.
The federal minimum wage is very low, at $7.25 per hour. But many states, Maryland included, have a higher minimum wage, at least for some jobs. And using the state differences as a laboratory, economists like Krugman conclude that raising the minimum wage has a positive effect on jobs.
It could be as simple as Henry Ford’s famous experiment in paying workers more than the going rate. By giving automobile employees higher wages than his competitors paid, he enabled them to buy cars. Fords, of course.
In a similar way, the minimum wage workers making a little may be able to use more of their money at fast food places, grocery stores, gas stations, other places where minimum wages might prevail, thereby allowing more hires.
A bill without organized opposition may have reached its year. The Civil Rights Tax Fairness Act, HB 1169/S 639, seeks to equalize the taxation of employment damage awards with those of personal injury claimants for purposes of Maryland taxes. A person who gets money because of a personal injury does not pay taxes on the award: the exchange of money for an injury or ongoing pain is not the same as earning money. A person who exchanges money for the pain of having been racially harassed, however, does pay taxes on those damages. In both cases, the money is not earned income, it is the only, way to compensate someone for an illegal action leading to pain. Employers do not object to this law. It has a tax consequence to the State of Maryland, but it is minuscule.
Maryland’s legislature meets only 90 days every year, unless special sessions are called for emergency purposes, usually budget-related. As in most years, a number of bills affecting the employment relationship are up for consideration. Some will disappear with nary a trace, some will get hearings but little else, and some may even pass. I’ll post about a few of the interesting ones to watch.
To protect the unemployment insurance fund as well as the interests of unemployed people, Senate Bill 51 would override an otherwise enforceable noncompete agreement where the former employee is receiving unemployment benefits. The law would not apply to any contracts that predated October 2013, so the effect of the law would be delayed. Noncompete agreements hinder individuals from obtaining work in their fields, but protect their former employers from poaching contacts made while the former employee was the “face of the company.”
The idea behind this bill, then, is to assume that the restrictive covenants are keeping the unemployed worker from getting a new job. One interesting twist, though, is that the employee must be actually receiving unemployment benefits. That means that someone who quit without good cause, or who had been found guilty of gross misconduct, would not realize the benefit of having their restrictive covenants retroactively voided.
We should expect heavy opposition to this bill from business lobbyists.
Maryland’s Senator Barbara Mikulski intends to prioritize the Paycheck Fairness Act this term of Congress. The number of women senators reached an all-time high after this past election, and women now comprise 19% of the Senate. The bills, H.R. 377 and S. 84, are in committee.
When last considered, the House but not the Senate passed the law. The purpose is to sweep away some of the defenses by employers to their failure to pay women equally for the same job. Women still earn quite a bit less than men, for the same job.
At the same time, though, Senator Mikulski, together with House Representative Rosa DeLauro of Connecticut, asked the President to require government contractors to refrain from retaliating against or prohibiting workers from discussing their pay. While many people do not discuss pay because of culturally-instilled privacy reasons, a person paid less than a peer for doing the same job cannot always find out that she is underpaid, unless she asks.
The National Labor Relations Board already considers prohibitions against discussion of pay and other work conditions to be unfair labor practices, regardless of whether the workplace has a union