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Avoiding the Legal Snare: The Perils of Training Repayment Agreement Provisions (TRAPs)

 

Employers are increasingly using Training Repayment Agreement Provisions (TRAPs) to replace other restrictive covenants such as noncompetes and nonsoliciation agreements. But TRAPs can be even more restrictive—and more exploitative—than noncompetes.  In this article, we’ll explain what a TRAP is and how to avoid getting caught in one.

What is a TRAP?

TRAPs, also known as Training Repayment Agreement Provisions, are contractual terms that employees sign when they are hired. While the wording may vary, a TRAP requires an employee to work for a certain period of time. If the employee separates from service prior to that timeframe (whether they quit or are fired), the employee has to pay back the employer’s training costs, the costs of buying or renting equipment, or the costs of replacing the employee.  Sometimes those fees are prorated depending on how long the employee has worked.

How TRAPs Hurt Employees

TRAPs can be very misleading. Often they don’t state how much the employee will have to pay back, or they don’t disclose interest accrual rates or other information a person would usually be entitled to when entering an agreement that might affect their credit. Sometimes the “training” that an employee is expected to pay for is just the orientation or legally-required videos. Sometimes the fees for such “training” are outrageous – we’ve seen TRAP fees ranging anywhere from $5,000 to $50,000. Some TRAPs accrue interest so fast there is no way an employee will ever repay it. And TRAPs usually don’t provide any exceptions in situations where, the employee quits for reasons beyond their control – like sexual harassment, disability, or lousy working conditions.

A TRAP can reduce an employee’s pay below minimum wage. It can destroy an employee’s credit. Worse, employers use TRAPs as a threat: don’t leave this job or we’ll sue you, destroy your credit, report you to immigration, and make it so you can never find another job. There’s a word for this, and it was outlawed by the 13th Amendment to the United States Constitution. 😡 😡 😡

How To Spot A TRAP

TRAPs are often hidden in piles of onboarding paperwork, so employees might not even realize they’ve signed one. They are commonly used in nursing, trucking, and service industries, but we’ve also seen them in child care and professional contexts.

The only way to know if your employer is trying to get you to sign a TRAP is to read everything before signing. This can be difficult. People get trapped into TRAPs because they are so desperate for a job that they’ll sign anything. But that’s the trap. Employers may be counting on you to sign because you just need the money, and they may pressure you to sign by acting like the job won’t be there if you take your time.

What To Do When You See A TRAP

GET LEGAL ADVICE. TRAPs are illegal in some, but by no means all, jurisdictions—there’s no way to know without consulting an employment law attorney in your area. Legal or not, if someone is pressuring you to sign a document without having an attorney review it, that’s a sign you probably shouldn’t be signing the document. No job is worth your freedom.

Work and Weed: What New York Workers Need to Know

 


This article discusses a law that may affect New York workers, not workers in other states. By the time you read it, it may be out of date. All workers should consult with reputable workplace attorneys in their jurisdictions to understand how the law may affect individual workplace rights.


Introduction:

The New York Marijuana Regulation and Taxation Act (MRTA), in addition to decriminalizing recreational use of cannabis, theoretically created some workplace protections for New York workers who engage in legal off-duty use. But last year’s Fourth Department decision,  Matter of Moran-Ruiz v. Ontario County, 218 A.D.3d 1341 (4th Dept. 2023), has called into question many of those protections, and it’s still illegal under federal law. The only intelligent way to understand how the MRTA affects you is to speak with a reputable New York workplace rights attorney. But here are some things to keep in mind.

1. Off-Duty Use of Marijuana:

The MRTA legalizes the recreational off-duty use of marijuana for individuals aged 21 and older. It is important to note that while the act permits the off-duty use of marijuana, it does not grant employees an absolute right to use or be under the influence of marijuana during working hours. Employers still have the right to enforce workplace policies and existing Collective Bargaining Agreement provisions regarding drug use, particularly if it could impair job performance or jeopardize safety.

2. Drug Testing and Employment:

First the bad news: workers in safety-sensitive positions or positions where drug testing is mandated by federal regulations are still subject to testing, including pre-employment and random drug testing.

Now the slightly better news: For existing employees, drug testing can only be conducted if there is reasonable suspicion of on-duty use, impairment, or violation of workplace policies. What is reasonable suspicion? Well… the statute says that reasonable suspicion does not exist unless the employee “manifests specific articulable symptoms of impairment.” Of course it doesn’t define what a “specific articulable symptom of impairment” might be. This guidance from the New York State Department of Labor indicates that just smelling like marijuana is not a specific articulable symptom. Glassy eyes, lack of focus, and lack of coordination have all been posited as possible articulable symptoms. But those are also symptoms of medical conditions that may trigger an obligation on the employer’s part to offer reasonable accommodations. So, watch this space.

The reality is that, if an employer reasonably suspects on-duty marijuana use or impairment, they may request an employee to undergo a drug test, and the drug test will be used as evidence that the employee may have been using marijuana while on duty. And because most employment is at-will, the employer doesn’t have to prove anything. So unless you have a union, you might be out of luck, even if you weren’t high at work.

3. Implications of Matter of Moran-Ruiz v. Ontario County:

This is where it gets weird. The MRTA created a whole new section in the New York lawful off-duty activities statute, seemingly creating robust protections for workers who engage in lawful off-duty use of cannabis.  But Matter of Moran-Ruiz significantly dials back those protections, concluding that the new section only gives employers additional excuses to discriminate on top of all the reasons that employers can already legally discriminate. (Not even kidding. Check out the language at the end of the decision.) So far, Moran-Ruiz stands. But…watch this space.

4. Conclusion:

Theoretically, the MRTA allows for off-duty cannabis use, but employers retain the right to implement policies regarding drug usage during working hours. And the decisional law so far has not been promising. It is crucial for employees to understand the limitations of the statutory protections. Staying informed and seeking legal advice is the best way to protect your workplace rights. Always consult a legal professional for personalized advice.

Dressing for Success: Workplace Dress Codes, Grooming Standards, and Your Rights

 

Employers may establish dress codes or grooming standards to create a particular image or comply with safety requirements. These workplace rules may require uniforms or simply require a particular type of attire. Companies generally have the authority create these rules, as long as they apply them equally. As long as the dress code does not stifle Union activity, treat certain groups less favorably, or interfere with a reasonable accommodation, then the dress code wins. But there are some exceptions.

1. Union Clothing

Union-related clothing is a great way to show solidarity with your coworkers. In general, an employer can’t just say “don’t wear Union paraphernalia.” But they can prohibit buttons and pins of any type, or make rules about safety, or say that their dress code prohibits wearing t-shirts. The rules on this issue flip-flop approximately every four years, so talk to your Union rep or a workplace lawyer if you are getting called out for wearing that “Respect Our Contract” button.

2. Discrimination

Although employers have the right to implement dress codes, they must do so in accordance with anti-discrimination laws. Any dress code policy that disproportionately impacts certain protected groups may be deemed discriminatory:

A. Gender

The EEOC has concluded that a dress code that requires only women to wear uniforms probably violates Title VII. Historically, dress codes requiring roughly equivalent standards for male and female employees were considered nondiscriminatory if they were enforced equally (for example, neckties for men, skirts for women). But the Supreme Court’s decision in Bostock v. Clayton County has moved the needle, affirming that Title VII prohibits employers from discriminating on the basis of gender identity or sexual orientation.  Under Bostock, dress codes and grooming standards may be discriminatory if they are based on outdated sexual stereotypes.

B. Race

Grooming standards that are harsher on one group than another may be discriminatory. For example, if white men are allowed to wear long sideburns and facial hair but Black men are not allowed to wear afros, the grooming policy may be discriminatory. Many states (including New York) have implemented legislation to prevent discrimination on the basis of hair textures and hair styles that protect hair from damage.

Likewise, if shaving causes you skin problems, you may be able to get a reasonable accommodation allowing you to deviate from an employer’s “clean shaven” policy – but you’ll probably have to ask for it.

C. Reasonable Accommodations for Religious or Disability-related Considerations

If a dress code conflicts with an employee’s religious practices or medical condition, the employee may request an accommodation. The employer is then required to modify the dress code unless to do so would result in an undue hardship.  Caution:  If you don’t request an accommodation, the employer isn’t going to just hand one out.  Also, the employer doesn’t have to provide the accommodation requested, just one that doesn’t cost them too much money.

In case you’re wondering, a dress code that allows pregnant workers to wear maternity clothes does not violate Title VII as long as other employees with medical conditions are allowed to deviate from the dress code as needed.

D. National Origin:

In general, a dress code does not have to be modified to adhere to a person’s national identity. But a dress code that prohibits some kinds of national attire but not others may be discriminatory. For example, if brightly colored clothing is allowed but an employee gets into trouble for wearing Kente cloth, that could be discriminatory.

Conclusion:

This is a rapidly-changing area, so it’s important to get advice from legal professionals or government agencies when it seems like a dress code is cramping your style. Always speak with a qualified workplace attorney in your geographical area to determine whether you have legal protections against your employer’s dress code!

What’s Going On With Non-Compete Agreements?

 

            You may have heard about the Federal Trade Commission’s Final Rule banning non-compete clauses, which issued on April 23, 2024. What does that mean for workers two months later? So far…well, read on.

            What is a non-compete? A non-compete (or noncompete, depending on who is spelling it) is a form of restrictive covenant, which is a way of restricting activity after a transaction or legal relationship has ended. The most basic form of a non-compete prohibits an employee at Company A from going to work for Company B for a period of time after the employee no longer works for Company A.

            Yes, you read that right. Company A wants to control the employee after the employee no longer works for, and is no longer paid by, Company A. Simply put, if a worker is unhappy in the job and wants to move on to a better opportunity, a non-compete stops that from happening. Workers who violate these clauses can face hundreds of thousands of dollars in liquidated damages, injunctive relief, attorneys’ fees, and the total destruction of their careers.

If this seems perverse to you, join the club. As long ago as 2016, the New York State Attorney General reached an agreement with Jimmy John’s, following an investigation into the sandwich company’s practice of distributing two-year non-competes to sandwich makers. The AG put a stop to the practice, observing that these things “…limit mobility and opportunity for vulnerable workers and bully them into staying with the threat of being sued.” The New York State AG’s efforts notwithstanding, non-competes continue to be used to limit worker mobility in a variety of industries.

            Is that even legal? Here’s what happens. Say a worker gets a job at a sandwich shop. On the worker’s first day, there’s something called “orientation” or “onboarding” or “training.” During this process, the worker has to sign a dozen or so documents, such as W-4s, I-9s, acknowledgments, etc. One of those documents might be some kind of restrictive covenant. The employee may not even know they signed it. And the employee does not have a choice in the matter: no signature, no job. So the employee signs so they can hurry up and get to the sandwich-making.

Officially, while most employment documents have been deemed by the courts not to be  binding contracts, historically, non-competes have been held to be enforceable because, so the logic goes, in return for providing the worker the sumptuous privilege of being paid to make sandwiches, the employer is entitled to extract several years of the employee’s life force. According to the traditional legal analysis, it’s a bargain. And unless a statute specifies otherwise, parties can usually bargain away their own rights, which is why it’s a darn good idea to have an attorney review things before you sign them.

            Realistically, the employee has gotten no opportunity to bargain. The employee needs that sandwich-making job to make their car payment and will sign anything to get that paycheck. Sure it’s a contract. It’s also patently unfair.

            What happened?  The FTC, after several months of gathering commentary, concluded that non-competes are…well…non-competitive. The FTC doesn’t like stuff that interferes with competition. Hence the rule. (This paragraph is a very watered down version of the 570-page rule. Check out pages 11-14 for some real-life examples of how destructive a non-compete can really be.)

            Where are we now? First of all, the rule doesn’t become effective until 120 days after it’s published in the Federal Register, which means even if no one hated this rule it wouldn’t go into effect until around September 10.

            Second, employers couldn’t move fast enough to take the FTC to court. An accounting firm beat everyone else with Ryan, LCC v. Federal Trade Commission, pending in the Northern District of Texas. The Chamber of Commerce (which, by the way, couldn’t name any employers who were actually hurt by the rule) filed its own case in the Eastern District of Texas but lost out because Ryan got there first. But the COC is being allowed to join the Ryan case, so that’s nice for employers.

            Where this leaves the rest of us is that, while we don’t have any crystal balls, decisions coming out of Texas courts recently have not been overwhelmingly progressive. On the other hand, even rich people are sometimes annoyed by non-competes. But then again, employers are already figuring out work-arounds…so don’t pop open the workers’ rights champagne just yet. But go ahead and leave it in the fridge door; we might end up having a use for it in a couple months!

            Who knows what will happen between now and September, so if you’re wondering what this means for your particular situation, make sure you speak with a workers’ rights attorney in your jurisdiction. Fingers crossed.

EEOC Update Regarding Workplace Harassment

 

 

 

For the first time in 24 years, the EEOC has updated its guidance on Workplace Harassment.  The guidance, which issued on April 29, 2024, provides new clarifications on duties to protect LGBTQIA+ workers, handling virtual harassment, and newly beefed-up protections against harassment based on pregnancy and religious expression.

In 2020, in Bostock v. Clayton County, the US Supreme Court concluded that Title IX prohibitions against gender discrimination include protections against discrimination on the basis of a worker’s sexual orientation or gender identity. The new guidance clarifies that this also means protections against harassment. New examples of illegal harassment include, among other things, intentionally and repeatedly using the wrong pronouns or name, “outing” a person without their consent, requiring an employee to wear clothes inconsistent with their gender identity, and denying use of a particular bathroom based on gender.

Harassment on the basis of pregnancy is also gender discrimination, and includes denial of reasonable lactation time, giving someone a hard time about contraception or abortion, or being nasty to or about a person because they are pregnant.

Employers have always been required to accommodate sincerely-held religious beliefs; the updated guidance clarifies that some amount of coworker proselytizing is acceptable, but if an employee asks not to be part of the discussion, a failure to honor that request is harassment.

The new guidance also specifies that harassment that occurs via email, social media, chat, videoconference, or other online technology is still harassment.

About 20 states’ AGs have sued to enjoin the guidance, mostly because they are freaking out about the gender identity protections. So far the guidance remains in effect…but stay tuned.

Wondering if this is still a thing? By the time you read this blog post, the whole landscape may have changed. So always, always, always talk to a workplace lawyer in your jurisdiction to determine what applies to your particular situation.

Federal “White Collar” Overtime Exemption is Getting A Raise!

 

Heads up: the Federal “White Collar” overtime exemption is getting a raise. Specifically, the salary threshold above which an employee no longer qualifies for overtime will go up on July 1, 2024 to $844/week ($43,888 annually). On January 1, 2025, the threshold will rise again to $1,128/week ($58,656 annually). The new rule contemplates automatic increases to the salary threshold every three years.

The salary threshold is one test for determining whether employees are “exempt” from overtime rules (which actually means the employer is exempt from having to pay overtime). To be considered exempt, employees must meet the salary threshold, be paid on a salary basis (which means the amount of pay is predetermined and not subject to deductions if the employee is ready, willing, and able to work), and perform duties consistent with being a bona fide executive, administrative, professional, or outside sales person.

Currently the threshold is at $684/week ($35,568 annually) which cuts out a lot of employees who are making more than minimum wage, but not much more. The July increase won’t have much effect on executives and administrative workers in New York, whose salary threshold is already over $1000/week ($1,124.20 for upstaters, $1,200.00 downstate). But New York professional employees may see a difference.

Expect legal challenges to this rule. And always talk to a workplace rights lawyer in your jurisdiction before making any decisions or claims.

Happy Juneteenth!

     

On June 19, 1865, enforcement of the Emancipation Proclamation reached Galveston, Texas. Union troops posted General Order 3 in various places around town, such as the Customs House and the AME Church. Most enslaved people were aware of the Emancipation Proclamation, but they were still in held in bondage until the Union had enough military presence in Texas to force slave owners to comply. Many first heard the words of General Order 3 from the mouths of their enslavers.

The order includes inspiring language:

“The people of Texas are informed that, in accordance with a proclamation from the Executive of the United States, all slaves are free. This involves an absolute equality of personal rights and rights of property between former masters and slaves, and the connection heretofore existing between them becomes that between employer and hired labor.”

But even General Order 3 didn’t deliver on the promise of freedom. In addition to the above quote, it included language ordering freed people to stay put and work for wages for their former enslavers. Nor was every enslaved person automatically emancipated on June 19. It took the passage of the 13th Amendment on December 6, 1865 to completely abolish slavery in the border states of Delaware and Kentucky.

Nevertheless, Juneteenth is a good time to reflect on our history, celebrate freedom, and recommit to “absolute equality of personal rights and rights of property.”

Wishing you a safe, cool, and free Juneteenth!

Pregnant Workers Fairness Act UPDATE

The EEOC has issued final rules clarifying how the Pregnant Workers Fairness Act (“PWFA”) is implemented. Those rules go into effect on June 18, 2024. These regulations clarify the availability of accommodations for limitations arising out of pregnancy, childbirth, and associated conditions.  

Employers don’t have to grant every accommodation request, just those accommodations that are “reasonable.” Without getting into a long discussion of how “reasonableness” is determined by legal decisionmakers, suffice it to say that accommodation requests often get watered down or negotiated out of existence.  These guidelines help set a baseline.

Predictable Assessments: The new rules are exciting because they propose four accommodations that are presumed reasonable—meaning that, if the employer wants to deny them, the employer has to prove that they aren’t reasonable. Those accommodations are: 1) keeping water nearby and breaks for drinking (for example, having a water bottle); 2) additional restroom breaks; 3) allowing standing, sitting, and alternating positions; and 4) allowing additional eating/drinking breaks. These accommodations are called “predictable assessments.”  

 

Limits on seeking additional documentation: Employers should not be seeking additional documentation in the following circumstances:  1) The need to adjust the workplace is obvious (for example, needing a larger uniform); 2) The employee has already provided sufficient information; 3) The employee is requesting one of the predictable assessments; 4) The employee requests time to pump or nurse; or 5) Non-pregnant or nursing employees would not be required to provide documentation for the same accommodation. 

 

New York Workers: Meanwhile, New York Pregnancy protections are gearing up. On June 19, 2024, New York employees will be entitled to a paid[1] 30-minute lactation break “each time such employee has reasonable need to express breast milk for up to three years following child birth.” While some employers are already wringing their hands about how often the need to pump might be “reasonable,” there is similar language in the FLSA (“a reasonable break time…each time such employee has need to express milk…”) 29 U.S.C. §218d (a)(1). Additionally, under New York’s Paid Prenatal Leave, on January 1, 2025, pregnant New York workers will be entitled to 20 hours of paid prenatal leave per calendar year, at the regular rate of pay, to be used to attend prenatal doctor’s appointments. This leave is in addition to New York statutory paid sick leave.  

 

Always contact a reputable workplace rights attorney to understand how new developments affect your rights! 

 

[1] This beats out the Federal PUMP Act, which only requires unpaid leave, unless the employee is not completely relieved from duty during the pump break.

Federal Protections for Pregnant Workers Under the PWFA

 

This is the 1-year anniversary of the passage of the Federal Pregnant Workers Fairness Act [“PWFA”], which went into effect on June 27, 2023. The EEOC has issued guidance on how it works, and final rules are due out any minute. What should employees know?

 

The PWFA prohibits employers from requiring employees to take leave if another accommodation would let them keep working, denying employment opportunities on the basis of the need for a reasonable accommodation, and interfering with or retaliating against employees who are exercising their PWFA rights.

 

The PWFA requires employers with 15 or more employees to provide reasonable accommodations to workers with limitations related to pregnancy, childbirth, or related medical conditions. Unlike previous pregnancy discrimination statutes, these requirements apply even if the pregnancy is uncomplicated or the limiting condition existed prior to the pregnancy. Additionally, an employee who is “temporarily” unable to perform the essential functions of the job is still considered “qualified” to do the job if they could perform the essential functions “in the near future.” No one knows exactly what these terms mean, so we’re waiting for the  regulations to give some indication.

 

Employers only have to accommodate “known limitations,” which means if you don’t tell the boss about the limitation, and they can’t see it, they don’t have to accommodate it. Technically, you don’t have to say “PWFA,” but it might be good idea to use the term to make sure the HR person knows what you’re talking about. Also, while there is some duty for the employer to detect obvious limitations, you shouldn’t count on the boss going out of his way to allow you to sit/stand or take frequent breaks if you don’t explain why you need them.

 

The EEOC says that four accommodations should be almost always granted: carrying and drinking water as needed, additional bathroom breaks, sitting and standing, and breaks to eat and drink. The key word here is “almost.” Remember, “reasonable” means that the accommodation does not impose an “undue hardship” on the employer, so if the requested accommodation is going to cost a lot of money or be disruptive to operations, it might not be considered “reasonable.”

 

Do some of these requirements sound familiar? That’s because in some cases, pregnant workers had protections under Title VII and the ADA (as well as various state and local laws). But the PWFA enhances, broadens, and clarifies those protections.

 

This is a new law with new regulations, so contact a reputable workplace attorney to make sure you have up to date information about your rights under the Federal Pregnant Workers Fairness Act!

Meet Margaret!

Meet our Spring 2024 intern, Margaret Grinnell, who is a part of Professor Grant Reeher’s Political Science Internship course at Syracuse University. Margaret is in her final semester at Syracuse, studying International Relations, and is drawn to areas of civil law.

Margaret has had the opportunity to volunteer for the Central Virginia Legal Aid Society in her hometown of Charlottesville, Virginia. In this role, she completed paralegal work in the family law division, helping to support attorneys provide free legal assistance to low-income clients. At Syracuse, she completed a research assistantship with the Muslim Family Law Index Project, assessing legal reform in fifty-three countries. Through these experiences, Margaret gained a passion for legal accessibility and research.

At Satter Ruhlen Law Firm, Margaret is learning about the continuing evolution of labor law legislation, and is developing an interest in advocating for employee rights. She has observed depositions, interacted with clients, and participated in discussions of case law. Different from her previous experiences, at Satter Ruhlen, Margaret has gained a new perspective in the legal field, researching and learning about how employees and unions are protected under the law.

Margaret says her experience at Satter Ruhlen has given her clarity and confidence in her plans to move forward with a career in law. She notes, “Observing the diverse caseload at the firm has allowed me to understand different legal procedures which has enriched my legal understanding.”

We’ve certainly enjoyed having Margaret with us this semester, and we’re excited to watch her pursue a legal career!

 

 

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