Labor and Employment Law Blog
Labor and Employment
The Future of EEO-1 Reporting: EEOC Proposal Creates Compliance Questions
Every September, HR departments at employers with 100 or more employees have turned to the same task: pulling a fourth-quarter payroll snapshot, sorting the workforce into ten job categories, coding each employee by race, ethnicity, and sex, and filing the result with the Equal Employment Opportunity Commission. The EEO-1 report has been a fixture of federal workplace compliance since 1966. By regulation, it is due no later than September 30. This September, employers are in an unusual position. The regulation still says the report is due. The agency that enforces the regulation has proposed eliminating it. And as of early September, the EEOC’s data collections page still reads “The 2024 EEO-1 Component 1 Data Collection is CLOSED,” with a promise that updates on the 2025 collection will be posted “as they become available.” The portal that would allow anyone to comply with the September 30 deadline has not opened, and no filing window has been announced. Welcome to compliance in the interregnum. What the EEOC Has Proposed On July 21, 2026, the Commission voted 2-1, along party lines, to issue a proposed rule rescinding the EEO-1 report along with its counterparts for unions (EEO-3), state and local governments (EEO-4), public school systems (EEO-5), and higher education. The proposal also would eliminate the recordkeeping and record-preservation requirements that supports those reports. The Commission's stated rationale goes further than a burden argument, though the burden numbers are real: the EEOC's own 2023 estimate put annual compliance at roughly $273 million and more than five million reporting hours. The proposal also states that the Commission has preliminarily determined the reports are inconsistent with equal employment opportunity law and potentially unconstitutional, on the theory that collecting race and sex data absent a specific allegation of discrimination sits in tension with Title VII's colorblind mandate. That framing matters. An agency that has said its own form may be unconstitutional is not likely to reverse course on the strength of comment letters. The proposal was published in the Federal Register on July 23, 2026, opening a 30-day comment period that closed on August 24, 2026. A public hearing was held on August 11, 2026. The next step is a final rule, which may or may not track the proposal and may or may not arrive before September 30, 2026. What Has Not Changed This is the part employers tend to skip past, and it is the part that matters. The regulation is still on the books. A proposed rule has no legal effect. Until a final rule is published and takes effect, 29 C.F.R. § 1602.7 continues to require covered employers to file. The EEOC may resolve the tension by opening the portal, by announcing a delay, or by finalizing the rescission. It has not done so yet, and employers should not assume that silence equals relief. The data is still required for other purposes. Even if the EEO-1 disappears tomorrow, the EEOC retains authority to request workforce demographic information in the course of a charge investigation or enforcement action. An employer that stops collecting the data because it no longer has to report it will find itself unable to respond when the same agency asks for it in a narrower, higher-stakes context. State law is unaffected. California's pay data reporting regime applies to employers with 100 or more employees and at least one California employee, and its 2026 amendments tightened storage rules and penalties. Massachusetts requires large employers to submit a copy of their federal EEO-1 to the Commonwealth. Illinois has its own equal pay certification process. None of these depend on the federal report continuing to exist, and several assume that the underlying data will be maintained. The federal contractor threshold is already gone. The separate obligation for federal contractors with 50 to 99 employees was tied to Executive Order 11246, which was revoked in 2025. Contractors of that size filed anyway last cycle out of caution. Going forward, the 100-employee threshold is the operative one for everybody, regardless of what happens to the rescission. The Quieter Risk: Losing the Data You Need There is a tendency to view the EEO-1 purely as a reporting burden. It is also, for many employers, the only structured demographic dataset the organization maintains. That dataset does work unrelated to the EEOC. Consider the reduction in force. An adverse impact analysis, the statistical check on whether selection criteria disproportionately affect a protected group, depends on knowing the demographics of the workforce before and after. Employers that conduct that analysis do so because it is the single most effective way to identify a problem before a plaintiff's expert does. Employers that stop collecting the data lose the ability to run it. The same is true of pay equity reviews, promotion analyses, and the internal audits that support a good-faith defense when a pattern-or-practice claim arrives. The EEOC's proposal does not change the substantive law. Title VII, the ADA, GINA, and the Pregnant Workers Fairness Act remain fully in force. The proposal changes only whether the government collects the data in advance. It does not change whether the data will matter when a dispute arises. The Practical Takeaway For September, the guidance is unglamorous: Prepare to file. Have the Q4 2025 snapshot data ready in filing format. If the portal opens with a short window, as it has in recent years, employers who waited for certainty will be scrambling. Do not stop collecting. Maintain self-identification processes and keep the demographic dataset current. Store it separately from personnel files, restrict access to those with a legitimate need, and make sure it does not flow to hiring or promotion decision-makers. That last point addresses the Chair's concern directly, and it is good practice regardless of what happens to the report. Inventory your state obligations. Determine which state and local reporting or certification regimes apply to your footprint and confirm that your data collection satisfies them independently of the federal form. Watch for the final rule, and for what follows it. A final rescission may draw litigation. It may also draw a Congressional Review Act resolution, though that would require a presidential signature to take effect. Employers should expect the landscape to shift again before it settles. Sixty years is a long run for any government form. The EEO-1 may be nearing its end. But the questions it was designed to answer, about who works where and whether the numbers tell a story, are not going anywhere. Employers who treat the rescission as permission to stop asking those questions are trading a reporting obligation for a litigation one.
September 21, 2026
Labor and Employment
New York Joins Growing List of States Requiring Employee Access to Personnel Records
After Governor Kathy Hochul signed S.3460 into law on September 9, 2026, New York is now one of 18 states that require employers to provide employees access to their personnel records. The statute will apply in both public and private sectors employees and former employees, effective November 8, 2026. Expanded Definition of “Personnel Record,” Record Retention Requirement The new law defines "personnel record" as records that are used, have been used, or may be used in connection with decisions concerning an employee's qualifications for employment, promotion, transfer, compensation, or discipline. The definition also extends to records maintained by third-party vendors acting on behalf of an employer. As a result, employers may need to evaluate not only the contents of formal personnel files, but also records maintained through payroll providers, HR platforms, and other personnel administration services. Employers will also have to determine whether manager working notes, internal communications regarding employee performance, draft evaluations, or portions of investigative files are subject to disclosure. Although the law excludes certain information that would constitute an “unwarranted invasion” of another individual's privacy, it provides limited guidance on how that exclusion should operate in practice when employers are balancing employee access rights against confidentiality concerns. Employers must retain complete personnel records during an employee's employment and for three years following separation. When Access and Notice Requirements are Triggered The statute has a straightforward requirement for scenarios where an employee requests access to their file. Upon receiving a written request, employers will be required to furnish personnel records within five business days at no cost to the employee. Employees are entitled to review their personnel records twice in a calendar year. But the statute creates an unclear requirement for scenarios where an employer adds items into the personnel file that could “negatively affect” the employee. Specifically, if there is any item added to the personnel file that could “negatively affect the employee's qualification for employment, promotion, transfer, additional compensation or the possibility that the employee will be subject to disciplinary action,” it must notify employees within 10 days. In its current form, the law does not define what constitutes “negative” information, which will likely create substantial compliance questions. For example, it is unclear whether routine coaching memoranda, attendance records, customer complaints, investigatory materials, manager notes, performance improvement plans, or preliminary performance concerns trigger the notice obligation. Similarly, employers may struggle to determine whether information becomes "negative" only after a disciplinary decision has been made or whether notice is required whenever a document could potentially influence a future employment decision. Right to Respond to Information in File The new law allows employees to submit written statements contesting information contained in their personnel records. If the employer and employee cannot agree on whether the challenged information should be removed from the personnel file, the employer will be required to include the employee’s contention in their personnel file. The statute also provides employees with an avenue to expunge contested information through the “judicial process” with relatively little guidance regarding how disputes involving subjective performance evaluations or disputed factual conclusions should be resolved. Government Entity in Charge of Enforcing Statute The New York State Attorney General’s Office is responsible for enforcing this new law. Violations of the statute may result in civil penalties ranging from $500 to $2,500. The law also prohibits retaliation against employees who exercise their rights under the statute. As a result of the ambiguities surrounding what information constitutes a “personnel record,” when information added to a personnel file “negatively affects” an employee, and the particular process an employee needs to follow in order to successfully “expunge” an item in their personnel record, the New York State Attorney General’s Office may weigh in to provide guidance on how it plans to enforce this law. In the meantime, employers will be required to make judgment calls regarding the scope of the notice requirement until courts or regulators provide guidance. Conclusion With the November 8, 2026, effective date rapidly approaching, employers should begin reviewing personnel record practices, assessing the records maintained by third-party vendors, updating retention protocols, and developing procedures for responding to employee requests within the statute's five-business-day deadline. Employers should also consider training human resources personnel and managers regarding the law's notice requirements, particularly given the uncertainty surrounding what information may be considered "negative." While the law clearly reflects New York's intent to expand employee access to personnel information, many of its most consequential provisions remain open to interpretation. As employers prepare for implementation, the greatest compliance challenge may not be producing personnel records, but determining when the statute requires notice of information that could be viewed as having a negative impact on an employee's career. Until additional guidance emerges, employers should take a cautious approach and closely monitor developments surrounding this significant change to New York employment law.
September 11, 2026
Labor and Employment
NLRB General Counsel Signals Another Round of Precedent Reversals: What Employers Need to Know About GC Memo 26-04
On August 26, 2026, NLRB General Counsel Crystal S. Carey issued Memorandum GC 26-04, "Further Guidance Regarding General Counsel Priorities." This is a follow-up to her earlier guidance in GC Memo 26-03 on shifting enforcement priorities, and it's a useful roadmap for any private employer trying to anticipate where federal labor law is heading over the next year or two. The headline for clients: No changes have been made yet, but many of the precedents adopted by the NLRB during the Biden administration may change over the next months or possibly years while the Trump administration remains in office. A General Counsel memo does not change what the National Labor Relations Board has held is unlawful. It's a statement of prosecutorial priorities and the legal positions the GC's office intends to argue in pending and future cases. But GC memos are a reliable early-warning system for where Board law is going, and this one specifies, case by case, which Biden-era Board precedents the current GC is actively trying to unwind. The list includes essentially all of the new or revised interpretations of the National Labor Relations Act issued during the Biden administration. If your organization has non-union operations, unionized operations, or is navigating an organizing campaign, several of these items are worth putting on your radar now. GC Carey opens by reporting that the agency has resolved 9,247 pending cases since she took office, more than a 50% reduction in the backlog she inherited. Significantly, the regional offices are not required to route cases involving these targeted issues through the Division of Advice. Instead, they will keep investigating and prosecuting under existing Board law while the GC pursues these arguments through litigation. Positions Already Being Argued in Pending Cases These are precedents the GC's office has already asked the Board or an administrative law judge to overturn in specific, named cases: Severance agreements and confidentiality/non-disparagement clauses. In Valley Radiology, P.A., the GC is arguing to overrule McLaren Macomb (2023) — the decision that made broad confidentiality and non-disparagement provisions in severance agreements presumptively unlawful. If the Board agrees, employers will regain more latitude to include standard confidentiality and non-disparagement language in severance and separation agreements without automatically committing an unfair labor practice. Consent orders. In the Amazon cases, the GC is asking the Board to overturn Metro Health/Hospital Metropolitano Rio Piedras (2024), which limited the Board's discretion to approve consent orders (settlement mechanisms) over the General Counsel's objection. A reversal would restore more flexibility for administrative law judges to approve settlements even without GC sign-off. Work rules and handbook policies. In Honeywell International, the GC is arguing to overturn Stericycle (2023), the standard that made facially neutral work rules unlawful if they could "chill" protected activity from the perspective of an economically dependent employee reading them in the worst reasonable light. A rollback would ease pressure on standard handbook provisions — think confidentiality, social media, and civility policies — that many employers rewrote to comply with Stericycle. "Captive audience" meetings. In UPS Supply Chain Solutions, the GC has moved to withdraw exceptions in favor of overturning the current Amazon.com Services (2024) rule, which bars employers from requiring employees to attend meetings where the employer expresses its views on unionization. She's urging a return to the decades-old Babcock & Wilcox standard, which permitted mandatory captive-audience meetings. This is a significant one for any employer that uses employee meetings as part of a union-avoidance or communication strategy. Statements predicting the impact of unionization. In the same UPS case, GC Carey has explicitly broken from her predecessor's position under Starbucks/Siren Retail (2024) and will instead urge the Board to reinstate Tri-Cast (1985), a more permissive standard for employer statements predicting what might happen to wages, benefits, or working conditions if a union is voted in. Dress codes. In Starbucks Corporation, the GC argues against the employee-protective standard from Tesla (2022) and asks the Board to reinstate Wal-Mart Stores (2019), which gave employers more room to enforce dress code and uniform policies — including logo and pin restrictions — without running afoul of Section 7. Waiver of the right to bargain. In HPC Industrial Group, the GC has flagged Endurance Environmental Solutions (2024) for reversal and intends to push for a return to the MV Transportation (2019) "contract coverage" standard, which gives more weight to broad management-rights clauses as a basis for unilaterally changing terms and conditions of employment without additional bargaining. Positions the GC Intends to Raise When the Right Case Comes Along These are precedents GC Carey has flagged as targets but hasn't yet had a procedural vehicle to formally argue. Employers should watch for these to surface in future litigation: Bargaining orders without an election. (Cemex Construction Materials Pacific, 2023): The GC wants the Board to abandon the Cemex framework — which allows a bargaining order to issue without a union election in some circumstances — and return to the pre-Cemex combination of Gissel Packing (1969) and Linden Lumber (1971), which is generally viewed as more protective of an employer's right to insist on a secret-ballot election. Duty to bargain before changing existing terms. (Wendt Corporation and Tecnocap, both 2023): These decisions currently require bargaining over changes even where there's longstanding past practice guiding the action. The GC views this as slowing down routine contract administration and wants it revisited. Union dues checkoff after contract expiration. (Valley Hospital Medical Center, 2022): The GC wants to return to the 1962 Bethlehem Steel rule, under which an employer's obligation to deduct union dues from paychecks ends automatically when the collective bargaining agreement (and its checkoff clause) expires — rather than continuing post-expiration as Valley Hospital currently requires. Objector fee disclosures. (UFCW Local 700/Kroger, 2014): The GC intends to argue that unions should have to disclose more detailed information to dues objectors than Kroger currently requires under Beck and California Saw & Knife Works. Protected concerted activity and workplace conduct. (Miller Plastic Products and Lion Elastomers II, both 2023): The GC has specifically called out Lion Elastomers II as extending protection to employee conduct — including conduct that would otherwise be prohibitable — that is only tenuously connected to activity protected under the Act. This case is already pending on remand before the Board. Enhanced/"make whole" remedies. (Thryv, 2022): The GC wants the Board to reconsider the expanded consequential-damages remedy adopted in Thryv, noting that courts have repeatedly cut back on it and that it hasn't yet been tested through a full compliance proceeding. What This Means for Your Organization Every item above requires the Board to actually rule in the GC's favor. National Labor Relations Act will likely stay in flux for months to come. Practical Takeaways (For Now) If your severance agreements, handbook policies, or dress code provisions have been revised in the last two to three years specifically to comply with McLaren Macomb, Stericycle, or Tesla, it may be worth flagging those provisions for a fresh look once the Board rules. This may not mean revising them immediately, but it may help you determine in advance what revisions may be permitted or advisable. If you would rely on mandatory employee meetings as part of your communications strategy during organizing activity, the captive-audience question is one to watch closely, since a reversal would restore an employer tool that's currently off the table, except in a few states that have outlawed captive-audience meetings under state law. If you're a unionized employer with a broad management-rights clause, the outcome in the waiver-of-bargaining cases could materially affect how much unilateral flexibility you have when administering the contract.
August 27, 2026
Labor and Employment
When the Algorithm Recommends Termination: Employer Liability for AI in Hiring, Discipline, and Performance Management
Employers have moved quickly to bring artificial intelligence into parts of the employment relationship that used to depend entirely on human judgment. Applicant tracking systems now score resumes before a recruiter sees them. Scheduling and productivity platforms flag employees as underperforming based on keystroke counts, call times, or delivery windows. Performance management tools generate draft write-ups, and in some organizations, recommend whether an employee should be coached, placed on a performance improvement plan, or terminated. The efficiency case for these tools is obvious. The legal exposure they create is less obvious, and it is growing. The core problem is not that AI is involved in employment decisions. It is that AI outputs are increasingly being treated as conclusions rather than inputs, and that shift changes how those decisions look in a deposition, an EEOC position statement, or a jury instruction. The Employer Cannot Delegate the Decision Title VII, the ADA, the ADEA, and their state and local counterparts all impose liability on the employer, not on the software the employer purchased. An employer cannot defend a discrimination claim by pointing to a vendor’s algorithm and arguing that a machine, not a person, made the call. Regulators have already made this point explicit. The EEOC has stated that employers remain responsible for adverse impact caused by algorithmic decision-making tools even when a third-party vendor built and maintains the tool. Several state laws, including New York City’s Local Law 144 governing automated employment decision tools, impose independent audit and notice obligations directly on the employer using the tool. That means the familiar advice to document a legitimate, nondiscriminatory reason for an adverse action now has a second layer. It is not enough that AI flagged the employee. The employer must show that a human reviewed the flag, understood why it was generated, and exercised independent judgment before acting on it. A termination file that says only “system-generated performance score of 2.1, employee terminated” is a much harder file to defend than one that documents what a manager actually observed and considered. Disparate Impact Hides Inside the Model Disparate treatment claims require some evidence of intent, but disparate impact claims do not, and AI-driven employment tools are a natural fit for disparate impact theories. A scoring model trained on historical performance or attrition data can quietly reproduce whatever bias existed in that history. A resume screening tool can learn to penalize employment gaps, certain schools, or language patterns that correlate with protected characteristics even though the model was never told to consider race, sex, age, or disability directly. The practical exposure here is twofold. First, if a plaintiff’s counsel obtains statistical evidence that an AI tool selects or rejects candidates or employees at meaningfully different rates across protected groups, the employer will need validation data showing the tool is job related and consistent with business necessity, the same standard that has applied to any selection device since Griggs v. Duke Power Co. Vendors rarely provide this validation data unprompted, and employers frequently discover during litigation that they never asked for it. Second, an employer that never tested its own tool for adverse impact will have a difficult time arguing it acted reasonably, even where no discriminatory intent existed. Ignorance of how the tool works is not a defense; in a disparate impact case, it can be the plaintiff's best evidence that no one was minding the store. Discovery Now Reaches Further Than the Personnel File AI adoption expands what is discoverable in an employment case well beyond the traditional personnel file. Prompts entered by HR or supervisors, model outputs and confidence scores, version histories showing when a scoring model was retrained, and internal communications about why an alert was or was not acted on are all now fair game. Plaintiffs’ counsel is increasingly requesting this material specifically, because it can show not just that an adverse outcome occurred, but what the company knew and when. This creates a preservation problem many employers have not yet solved. Some platforms overwrite scoring history as new data comes in or retain outputs only briefly by default. If a company has no policy governing retention of AI-generated employment data, it may find itself unable to produce records that plaintiffs assume exist, inviting a spoliation argument, or it may find that the only surviving record is an unfavorable one that a human reviewer never actually relied upon but that now looks, in hindsight, like the smoking gun. Practical Governance Closes the Gap None of this counsels against using AI in employment decisions. It counsels against using it without a governance structure built for the way these tools will actually be examined after the fact. At a minimum, employers should be able to show that a person with real authority to disagree reviewed any AI-generated recommendation before it became a personnel action, that the tool has been validated or at least tested for disparate impact on a periodic basis, that managers are trained to document their own independent reasoning rather than simply citing the tool's output, and that retention practices for AI-generated data are deliberate rather than accidental. Where a jurisdiction imposes specific notice, bias audit, or disclosure obligations on automated employment decision tools, those requirements need to be built into the rollout, not addressed after a candidate or employee complains. The employers best positioned when one of these tools produces a bad outcome are the ones who can show, with contemporaneous documentation, that a human being was accountable for the decision the whole way through. The tool can inform that judgment. It cannot substitute for it, and the law has no intention of letting it try.
August 27, 2026
Labor and Employment
When Safety and Disability Rights Collide: Navigating the ADA in the Workplace
Employers in the construction and manufacturing sectors occasionally confront complex workplace issues involving employees with disabilities, often related to prior injuries, where those conditions may pose safety risks to the employees themselves or to their co-workers. Such situations often involve employees who have valuable skills and experience, but who pose safety risks if they are assigned the full spectrum of tasks under their job description. These employees are protected by rights under the Americans with Disabilities Act (ADA), but their employer has an obligation to prevent them and co-workers from being exposed to known risks of serious physical harm. This balance is not easy to navigate. For HR professionals and in-house counsel, understanding where the ADA draws its lines, and where employers most often cross them, is essential to managing safety-related situations without inviting a discrimination claim. The Direct Threat Standard: The Only Real Safety Exception The ADA doesn't allow employers to exclude an employee from a position, or take adverse action, simply because the employee has a disability that could create risk. The statute carves out a narrow exception: an employer may act if the employee poses a direct threat, which is defined as a significant risk of substantial harm to the health or safety of the employee or others that cannot be eliminated or reduced through reasonable accommodation. That standard has teeth, and each word matters: Significant risk, not a slightly elevated or speculative one Substantial harm, not minor or theoretical injury Assessed through an individualized evaluation, not generalized assumptions about a diagnosis or condition Based on the most current medical knowledge and/or objective evidence, not outdated stereotypes or a manager's gut instinct Considered only after evaluating whether reasonable accommodation would neutralize the risk The EEOC has been consistent for decades: an employer cannot rely on generalizations about a disability, an employee's diagnosis in isolation, or a “better safe than sorry” instinct. The threat has to be real, current, and specific to the individual in the specific job. The Four-Factor Direct Threat Analysis When evaluating whether a genuine direct threat exists, courts and the EEOC look at: Duration of the risk. Is this a temporary condition or an ongoing one? Nature and severity of the potential harm. How serious could the injury be? Likelihood the harm will occur. Is this a real probability or a remote possibility? Imminence of the harm. How soon could the harm materialize? Employers frequently stumble by skipping bullet point one and going straight to bullet point two, imagining worst-case harm, without seriously grappling with likelihood and imminence. A theoretical catastrophic outcome with a low probability of occurring generally will not satisfy the standard. Essential Functions Come First Before any safety analysis, the more fundamental question is whether the employee can perform the essential functions of the position, with or without reasonable accommodation. Safety concerns are frequently really essential function concerns in disguise — an employer worried about a “safety issue” is often actually worried about whether the person can physically or mentally execute a core job duty. This distinction matters procedurally. Essential function analysis and direct threat analysis are related but separate inquiries, and conflating them tends to produce sloppy, defensible-sounding decisions that don't hold up. A written, thorough, and updated job description identifying essential functions, developed before a dispute arises, is one of the most valuable tools an employer can have in either analysis. Objective Evidence, Not Instinct A recurring theme across ADA safety litigation is the demand for objective evidence over subjective judgment. Employers who prevail tend to point to: Documented, specific incidents (falls, near-misses, errors with safety implications) Credible medical opinions tied to the actual essential functions of the job Observable, recent performance or behavioral indicators, not stale history or rumor Employers who lose tend to rely on assumptions: the belief that a particular diagnosis inherently makes someone unsafe, or that a visible mobility aid, medication, or past medical leave signals risk. The ADA's core anti-stereotyping purpose is aimed precisely at that kind of reasoning. Reasonable Accommodation Still Comes First Even where a legitimate safety concern exists, the ADA requires employers to consider whether reasonable accommodation would eliminate or sufficiently reduce the risk before taking adverse action. This might include modified duties, additional safety equipment, adjusted schedules, or reassignment. Only if no accommodation reduces the risk to an acceptable level, and the employer can show that the accommodation would pose undue hardship, does exclusion become legally supportable. Skipping this step, even with good intentions, is one of the most common and costly mistakes employers make. Fitness-for-Duty Exams: A Common Flashpoint Safety concerns often lead employers toward fitness-for-duty (FFD) exams, which are permissible under the ADA only when job-related and consistent with business necessity — generally requiring objective evidence that a medical condition may impair job performance or create a safety risk. A single ambiguous incident, a known diagnosis standing alone, or generalized concern typically won't clear that bar. The request also has to be narrowly scoped to what's needed to assess ability to safely perform the job, not a broad inquiry into unrelated medical history. The Bottom Line The ADA doesn't ask employers to ignore safety. It requires them to prove it, with facts, with process, and with an honest accounting of whether accommodations could have solved the problem. Employers who build that discipline into their practices protect their workforce and substantially reduce their legal exposure at the same time.
August 19, 2026
Labor and Employment
When Does the Commute Count? What Two New DOL Opinion Letters Mean for Flexible Schedules
Employers have been asking a version of the same question for years: If we let employees split their day between home and the office, or let a field employee handle calls before getting in the car, are we suddenly on the hook to pay for the drive? On August 6, 2026, the Department of Labor's Wage and Hour Division answered that question twice, in two opinion letters (FLSA2026-9 and FLSA2026-10) that reach opposite conclusions on similar facts. Read together, they give employers a genuinely useful roadmap for structuring flexible and hybrid schedules without accidentally converting an employee's commute into paid working time under the Fair Labor Standards Act. The Employee's Choice: Mid-Day Commuting Stays Unpaid The first letter deals with a familiar hybrid-work scenario. Employees want to work part of the day from home and part from the office, timing their drive to dodge rush hour rather than sitting in traffic during the worst of it. The employer worried that under the FLSA's continuous workday doctrine, once an employee clocks in for the day, any travel before clocking out again becomes compensable, even if it is really just a commute that happens to fall in the middle of the day rather than at the beginning or end. WHD said no. When the employee decides when to travel and that decision is driven by personal preference rather than any work demand, the trip remains what it has always been: an ordinary commute. It does not matter that it happens mid-shift. The agency went further and effectively created a third bucket of non-compensable time that exists alongside off-duty periods and bona fide meal breaks: voluntary, employee-driven travel that falls inside the continuous workday but outside the definition of "hours worked." This is a meaningful win for employers trying to offer real flexibility. It confirms that letting people avoid gridlock, or duck out mid-afternoon to handle something at home before logging back in later, does not by itself create new wage exposure. The Employer's Control: Travel Bookended by Required Work Gets Paid The second letter tells a different story, and the contrast is the point. Here, a field service engineer with no fixed office spends up to an hour most mornings on the phone, fielding pages, and scheduling appointments with clients and colleagues, before ever leaving the house in a company vehicle to reach the first job. WHD found that the scheduling calls themselves are compensable because they are integral to the engineer's actual job of installing and servicing equipment. More importantly for scheduling purposes, the drive that follows is compensable too, because the employer requires substantial work immediately before and immediately after the travel, and because the employer, not the employee, controls when and how that travel occurs. Notably, WHD drew a line even within this letter. Simply receiving pages during the drive was treated as incidental to using an employer-provided vehicle and did not, by itself, trigger compensability. The dividing line the agency keeps returning to is not the mere presence of a phone or a laptop during the commute; it is whether the employer is dictating the timing of the trip and sandwiching it between required work. Reading the Two Letters Side by Side Both opinion letters apply the same "primary beneficiary" framework that has guided FLSA travel-time analysis for decades, and both reach different results because of who is actually calling the shots. Where the employee sets the schedule, and the travel serves the employee's own convenience, the trip stays an ordinary, unpaid commute even if it happens smack in the middle of a workday. Where the employer sets the schedule and requires real work on both ends of the drive, the travel loses its status as an ordinary commute and becomes paid time. What This Means for Employers Right Now For employers running hybrid schedules, offering flexible start and end times, or managing a field-based workforce, these letters offer something rarer than most agency guidance: a clear, factor-based test that can actually be built into policy. The safest ground is genuine employee choice over the timing of travel, paired with no requirement to perform work immediately before or after the drive. The moment an employer starts dictating when someone has to leave, or requiring calls, paperwork, or scheduling tasks right up against the commute, the analysis shifts and the travel time risk goes up. It is worth remembering that opinion letters are not binding law, but they do carry real practical weight. An employer who structures a policy consistent with an opinion letter and later faces a Fair Labor Standards Act claim on the same facts has a strong argument against a finding of willfulness, which can matter enormously for liquidated damages and the statute of limitations. It is also worth remembering that these letters interpret federal law only. A number of states impose stricter rules on what counts as compensable travel time, so any policy built around this guidance still needs to be checked against state law before it is rolled out. Employers revisiting hybrid work policies, flexible scheduling, or field employee protocols in light of this guidance should take a close look at who actually controls the timing of the commute and what, if anything, employees are required to do immediately before or after they get in the car.
August 14, 2026
Labor and Employment
Three Workers' Compensation Mistakes Small Businesses with Independent Contractors Can Avoid
Many business owners assume that once they've purchased a workers' compensation policy, they've adequately managed their risk. Unfortunately, some of the most significant exposures arise not from the absence of insurance, but from misunderstandings about who is covered, whether independent contractors are properly classified, and whether coverage remains in place when an injury occurs. A workplace injury can quickly lead to disputes over worker status, insurance responsibility, and employer liability. The good news is that many of these risks are preventable. A few proactive steps can significantly reduce your company's legal and financial exposure. Don't Assume Your Independent Contractors Have Workers' Compensation Coverage Many businesses hire independent contractors with the expectation that the contractor is responsible for maintaining their own workers’ compensation insurance. That assumption can become costly. If a contractor is injured and does not maintain valid workers' compensation coverage, the hiring business may face more than a dispute over insurance obligations. In some cases, the injured worker may contend that he or she was actually an employee rather than an independent contractor. If a state’s Workers' Compensation Commission agrees, the business may become responsible for a workers' compensation claim despite having treated the individual as an independent contractor. The business may also face additional insurance premiums, audits, and scrutiny regarding worker-classification practices. Just as importantly, insurance status and worker classification are separate issues. A signed independent contractor agreement and a contractor's certificate of insurance do not necessarily determine whether the individual will be treated as an independent contractor under a state’s workers' compensation law. When evaluating workplace injuries, agencies and commissions often look beyond labels and examine the actual working relationship, including the degree of control exercised by the hiring entity. Businesses should periodically evaluate contractor relationships to ensure the classification remains defensible and consistent with day-to-day operations. Build a Process to Verify and Continuously Monitor Coverage Insurance verification should be an ongoing process, not a one-time administrative task. Many businesses obtain a certificate of insurance when a contractor is first engaged and never look at the file again. Months later, the policy may have expired without anyone noticing. Consider implementing a standard contractor onboarding and renewal process that includes: Obtaining current proof of workers' compensation coverage, including declarations pages or other documentation confirming active coverage Collecting certificates of insurance for applicable policies Recording policy effective and expiration dates Calendaring renewal dates and requesting updated documentation before policies expire Requiring contractors to notify your business if coverage is cancelled or allowed to lapse Periodically auditing contractor files to confirm documentation remains current Verifying coverage before work begins is an important first step, but it should not be the only step. Businesses should also periodically evaluate whether the contractor relationship is structured and administered in a manner consistent with independent contractor status. An expired policy creates risk, but so does a contractor relationship that may not withstand scrutiny if an injury occurs. Workers' compensation should not be reviewed in isolation. Where appropriate, contractor agreements should also require commercial general liability coverage naming your business as an additional insured. While workers' compensation policies generally do not provide additional insured status in the same manner, verifying both types of coverage helps create a more comprehensive risk-management program. Contracts Matter, Too Insurance verification works best when paired with well-drafted contractor agreements. Depending on your business and industry, contracts should address insurance requirements, require contractors to maintain coverage throughout the engagement, obligate them to provide updated proof of insurance upon renewal, require notice of any lapse or cancellation, and include appropriate indemnification provisions where legally appropriate. While strong contracts are important, they do not guarantee that a worker will be treated as an independent contractor following an injury. Courts and administrative agencies generally examine the substance of the relationship rather than the title used in the agreement. For that reason, businesses should view a contractor agreement as just one component of a broader compliance strategy. Don't Overlook Owner Coverage Elections Another frequently overlooked issue involves business owners themselves. Whether an owner is automatically covered under a workers' compensation policy, or may exclude themselves from coverage, often depends on the state law’s requirements, the company's legal structure, and the owner's role. Depending on the state, sole proprietors, corporate officers, LLC members, and partners may be treated differently. As your business grows or ownership changes, it is worth confirming that your insurance policy accurately reflects your intentions. At least annually, review: Whether owners are currently included in the policy Whether any available elections or exclusions have been properly completed Whether changes in ownership or business structure require updates to your coverage A short annual review can help prevent misunderstandings after a workplace injury. A Five-Minute Annual Compliance Check Once a year, ask yourself: Have I verified that every contractor currently maintains workers' compensation coverage Do I have current declarations pages or other proof of active coverage on file Am I tracking policy renewal dates Do my contractor agreements require continuous insurance coverage Have I confirmed appropriate commercial liability insurance and additional insured endorsements where applicable Have I reviewed whether owner coverage elections still reflect my business structure Have I evaluated whether each independent contractor relationship remains properly classified Are my managers treating contractors differently from employees in day-to-day operations Would the facts of the relationship support independent contractor status if reviewed by my state’s Workers' Compensation Commission If any answer is "no," now is the time to update your procedures. Not after someone gets hurt. In sum, workers' compensation risk management with your independent contractors is more than just collecting certificates of insurance. Businesses should verify contractor coverage, maintain current insurance documentation, periodically review worker classifications, and use carefully drafted agreements that align with actual business practices. Taking these steps can help reduce the risk of unexpected workers' compensation liability, classification disputes, insurance audits, and related litigation.
July 24, 2026
Labor and Employment
The Hidden HR Issues Lurking in Union Labor Relations
Most labor relations playbooks focus on the visible stuff: election timelines, bargaining sessions, grievance procedures. But the issues that may actually blindside HR teams tend to be the ones nobody charts. Here are five worth a second look. Your frontline managers are the real early-warning system — and they're the least prepared Supervisors are usually the first to notice organizing chatter among employees. Their reactions in the first 48 hours often determine whether a campaign fizzles or accelerates. Yet most manager training still treats labor relations as an infrequent compliance issue rather than a live skill. A supervisor who issues a threat, a promise, or a surveillance-related comment can hand a union an unfair labor practice charge that reshapes the entire election. The fix isn't more policy, it's rehearsed, scenario-based manager readiness training before there's any sign of activity, not after. The captive audience meeting is becoming a legal minefield Thirteen states have now banned mandatory "captive audience” meetings in which company executives speak to groups of employees about the disadvantages of union organization and advantages of company policies. Even more legislation is pending, and litigation is still working through the courts. For any employer operating across state lines, this means the standard anti-organizing company speech playbook — one script, rolled out everywhere — no longer holds. HR needs a jurisdiction-by-jurisdiction approach to employee communication during organizing campaigns, which is a heavier lift than most labor relations budgets currently assume. Organizing is happening somewhere HR can't see it Social media has quietly become the default organizing channel, letting employees coordinate, compare notes, and build momentum well before any petition reaches HR's desk. By the time a campaign becomes visible internally, it may already have the signatures it needs. That shifts the real work upstream, toward genuine listening infrastructure and manager relationships, rather than reactive monitoring once cards start circulating. The NLRB Cemex decision hasn't gone anywhere Despite a more employer-friendly NLRB following recent appointments, the NLRB’s Cemex decision framework, which allows a union to immediately gain recognition via signed authorization cards and can strip an employer of its right to an election if it commits unfair labor practices during a campaign, remains in force. Employers who assume the board's new composition has quietly reset the rules are operating on outdated assumptions. Until Cemex is formally revisited, a single misstep during organizing can still mean losing the election process entirely. Grievance and arbitration data is now a data privacy problem As more states expand employee data protection statutes, the systems HR uses to store grievance files, arbitration records, and investigation notes are coming under new scrutiny. Unionized workplaces generate an unusually sensitive paper trail — medical details, disciplinary history, witness statements — and that data often sits in older case management tools never built with today's privacy requirements in mind. This is quietly becoming as much a compliance exposure as the labor relations issues the data documents. The common thread None of these issues show up on a standard labor relations checklist, and that's the point. They sit at the intersection of HR, legal, IT, and frontline management, which means they tend to fall through the cracks between departments rather than getting owned by any one of them. The employers managing labor relations well in 2026 aren't necessarily the ones with the toughest anti-union posture. They're the ones who've mapped these blind spots and assigned someone to actually watch them.
July 23, 2026
Labor and Employment
No Standard, Still Liable: How OSHA Regulates Ergonomics Without an Ergonomics Rule
Ask most employers what OSHA requires on ergonomics, and you will get one of two wrong answers. Some assume there is a detailed federal rulebook governing chair height, lifting limits, and keyboard angles. Others assume that because no such rulebook exists, ergonomics is purely voluntary, a wellness perk, not a legal exposure. Both are mistaken, and the gap between them is exactly where liability lives. Musculoskeletal disorders (MSDs), otherwise known as the strains, sprains, carpal tunnel cases, and back injuries that come from repetition, force, and awkward posture, remain one of the largest single categories of workplace injury, accounting for roughly a third of serious cases and costing employers billions each year in workers’ compensation, lost productivity, and medical expenses. Yet the federal framework governing them is defined more by what is absent than by what is written down. Understanding that absence is the whole game. Ergonomics Program Standard For one decade-spanning moment, federal ergonomics regulation was real. OSHA promulgated a comprehensive Ergonomics Program Standard at the end of 2000, requiring covered employers to identify and control MSD hazards. It survived a matter of weeks. In early 2001, Congress invoked the Congressional Review Act and passed a joint resolution rescinding the rule, which the President signed. The CRA repeal did more than erase the standard. By its terms, the Act bars an agency from reissuing a rule in “substantially the same form” without fresh congressional authorization. That single procedural feature is why, a quarter-century later, there is still no federal ergonomics standard — and why one is unlikely to appear through ordinary rulemaking. OSHA did not decline to regulate ergonomics. It was statutorily disarmed from doing so the conventional way. The General Duty Clause What is left in OSHA’s arsenal is Section 5(a)(1) of the OSH Act, the General Duty Clause, which requires every employer to furnish a workplace “free from recognized hazards that are causing or are likely to cause death or serious physical harm.” The clause is OSHA’s catch-all: it reaches recognized, serious hazards for which no specific standard exists. Ergonomics is the textbook example, sharing that territory with heat illness, workplace violence, and combustible dust. For a labor and employment audience, the operative point is that a General Duty Clause citation is not a free-floating accusation that a workplace felt unsafe. OSHA must establish four elements: A condition or activity in the workplace presented a hazard to employees The employer or its industry recognized that hazard The hazard was causing, or was likely to cause, death or serious physical harm A feasible and useful means existed to materially reduce the hazard Each element is a defense opportunity, and the second and fourth are where ergonomics cases are usually won or lost. “Recognition” can be proven through the employer’s own injury logs, prior complaints, internal ergonomics assessments, or industry consensus materials and NIOSH guidance. “Feasibility” turns on whether a workable engineering or administrative control (i.e., job rotation, lift assists, workstation redesign, or pacing changes) actually existed and was reasonably available. An employer that can show it identified its risks and was implementing reasonable controls in good faith is in a fundamentally different posture than one that did nothing. The Quieter Enforcement Levers The General Duty Clause is the headline mechanism, but it is not the only one, and it is important not to overlook the supporting cast. Recordkeeping obligations under 29 C.F.R. Part 1904 require accurate logging of work-related MSDs. A failure to record can be an independent citation, and an inaccurate log undercuts the credibility of every other defense an employer might raise. The hazard alert letter deserves particular attention because of how it compounds. When OSHA observes ergonomic risk that it is not prepared to cite outright, it may issue a hazard alert letter — a "no-impact" document carrying no fine and no immediate citation history. It is tempting to file and forget. That is a trap. If the agency returns and finds the flagged hazards unaddressed, the prior letter supplies the knowledge element that can elevate a later citation to willful. There is no formal mechanism to contest the letter’s findings, so the practical response is to treat it as a litigation exhibit in waiting: conduct a documented assessment, implement corrective action, and preserve proof of both. What Is Actually Changing in 2025–2026 Two developments make this an unusually live area rather than a settled one. First, in July 2025, OSHA proposed narrowing its own General Duty Clause interpretation, carving out hazards that are “inherent and inseparable from the core nature of a professional activity or performance” —aimed at inherently risky pursuits like certain entertainment and athletic work. The comment period drew enough interest that OSHA extended it and scheduled a public hearing. For ergonomics specifically, the early read from the defense bar is that this changes little: the MSD hazards in warehousing, healthcare, meatpacking, and manufacturing are not “inherent and inseparable” from the core work in the way the proposal contemplates, so robust General Duty Clause enforcement in those sectors is expected to continue. Still, the proposal signals a broader judicial and administrative skepticism toward expansive use of catch-all clauses — a theme worth tracking in any 5(a)(1) defense. Second, and more consequential, the states are filling the federal vacuum. Roughly five states now maintain ergonomics standards of some form, including California, Oregon, Washington, Michigan, and Minnesota, and the recent activity is concentrated in the last two. Minnesota's statute (Minn. Stat. § 182.677) is the one to know. Effective January 1, 2024, it requires covered employers in three high-MSD sectors (warehouse distribution centers, meatpacking and poultry processing sites, and licensed health care facilities), each above defined headcount thresholds, to maintain a written ergonomics program with risk assessments, training, and early-reporting procedures. It layers on a five-year first-aid log requirement and ties enforcement into the state's existing AWAIR safety-program framework, with safety committee obligations triggered above certain incidence rates. This is precisely the kind of prescriptive, documentation-driven mandate the repealed federal rule once contemplated, now operating at the state level. Washington is moving more incrementally but deliberately. Its Department of Labor & Industries regained authority to issue ergonomics rules and may promulgate one rule per year, targeting industries whose workers’ compensation MSD claim rates run at more than twice the statewide average, with effective dates from mid-2026 onward. Multi-state employers can no longer assume a single national compliance posture; the obligations now vary materially by where the work is performed. Enforcement at the federal level, meanwhile, has not gone dormant. OSHA’s high-profile resolution with Amazon, which included committing to facility-wide ergonomic abatement including adjustable workstations, anti-fatigue flooring, and job rotation, demonstrated the agency’s willingness to pursue ergonomic hazards against even the largest employers through the General Duty Clause, and effectively set a reference point for what “feasible controls” look like in high-throughput logistics. The Practical Takeaway The recurring misconception is that “no standard” means “no duty.” It never did. The combination of an active General Duty Clause, recordkeeping obligations, hazard alert letters that ripen into willful-violation predicates, and a growing patchwork of state mandates produces a real and enforceable framework, just one assembled from parts rather than handed down as a single rule. For employers, the defensive posture writes itself: identify ergonomic risks proactively, prefer engineering and administrative controls over PPE, document assessments and corrective action contemporaneously, and respond to hazard alert letters as if they were citations-in-waiting. Good-faith, documented effort is not merely good safety practice: under the four-element test, it is the difference between a defensible record and a willful citation. The federal government may not have written the ergonomics rulebook. But it has built, piece by piece, a regime that holds employers to one all the same.
July 9, 2026
Labor and Employment
Three Jurisdictions, Three Timelines: What the DMV’s Shifting Leave Laws Mean for Employers
For years, employers in the Washington metropolitan area could treat paid family and medical leave as a “somewhere else” problem, an issue for companies with workforces in California, New York, or New Jersey. That era is over. As of this spring, an employer with even a handful of employees spread across Maryland, Virginia, and the District of Columbia is now managing three separate leave regimes, each built on a different funding model, each carrying different obligations, and, perhaps most challenging of all, each operating on its own clock. The result is a compliance puzzle that a single, one-size-fits-all leave policy simply cannot solve. Below is a snapshot of where each jurisdiction stands and what the calendar looks like heading into 2027 and 2028. Washington, D.C. The Established Program You Cannot Put on Autopilot Of the three jurisdictions, the District's program is the most mature, and, for that reason, the one employers are most likely to take for granted. D.C.’s Paid Family Leave program has been paying benefits since 2020 and is administered by the Office of Paid Family Leave within the Department of Employment Services. A few features distinguish it from its neighbors. First, D.C.’s program is funded entirely by employers; there is no employee payroll deduction. The current contribution rate is 0.75% of each covered employee’s gross wages, remitted quarterly through the Employer Self-Service Portal, with payments due at the end of the month following each quarter (April 30, July 31, October 31, and January 31). Second, eligible employees can access up to 12 weeks each of family, medical, and parental leave, plus two weeks of prenatal leave, with partial wage replacement up to a weekly maximum that the District adjusts periodically. The compliance trap here is complacency. The contribution rate has changed more than once in recent years, the maximum weekly benefit is adjusted over time, and the D.C. PFL statute itself does not provide job protection, that has to be layered in through the D.C. and federal FMLA. Employers who set up their payroll years ago and stopped paying attention are the ones most likely to be out of step. Ongoing obligations still require ongoing attention: timely quarterly filings, current rate application, and the required employee notice. Maryland A Long-Delayed Launch That Is Finally on the Horizon Maryland’s Family and Medical Leave Insurance (FAMLI) program has been a moving target in the region. Enacted in 2022, its implementation dates have been repeatedly pushed back; most recently, in response to federal actions affecting the timeline. For employers who tuned out during the delays, now is the moment to tune back in, because the runway is getting short and the final regulations took effect March 30, 2026. Here is the current timeline that matters: Fall 2026: Employer registration opens. Any employer with at least one employee in Maryland will be required to register (there are no exceptions) and will need to designate an Authorized Officer and decide between the State Plan and an approved private plan. January 1, 2027: Payroll contributions begin. The total contribution rate is 0.9% of covered wages, split evenly between employer and employee (0.45% each). Small employers with fewer than 15 employees are exempt from the employer share, but their employees still contribute. January 3, 2028: Benefits become available. Eligible employees (generally those who have worked at least 680 hours in Maryland over the prior four quarters) can receive up to 12 weeks of paid leave (with the possibility of an additional 12 weeks for parental bonding in certain circumstances), capped at $1,000 per week. The practical takeaway for Maryland employers is that the meaningful work happens well before benefits ever get paid. Registration this fall, payroll-system readiness for the January 2027 contribution start, the State-Plan-versus-private-plan decision, and employee notices all land in the next several months (and not in 2028). Virginia The Newcomer That Changes the Regional Calculus The biggest development of 2026 came out of Richmond. In April, Virginia became the first state in the South to enact a statewide paid family and medical leave program, and it paired that with a significant expansion of paid sick leave. Employers who have long viewed Virginia as the “light touch” jurisdiction in the region will need to recalibrate. Paid Family and Medical Leave. Administered by the Virginia Employment Commission, the PFML program will begin collecting payroll contributions on April 1, 2028, and will begin paying benefits on December 1, 2028. When it takes effect, eligible employees may receive up to 12 weeks of leave per year with wage replacement of 80% of average weekly wages, subject to a cap tied to the statewide average weekly wage (roughly $1,500 per week under current figures, adjusted annually). Contributions are shared between employers and employees; employers with 11 or more employees must remit both portions (deducting up to half from employees), while employers with 10 or fewer are not required to pay the employer share. The program includes job-protection and benefit-continuation rights for employees who have been on the job at least 120 days, and it offers a private-plan alternative for employers who prefer to self-administer. Contribution rates have not yet been set—the VEC must finalize regulations and rates before the program launches—so the exact cost remains to be seen, though early estimates put it under 1% of wages. Paid Sick Leave—and this one comes sooner. Just as important for planning purposes, Virginia’s new paid sick leave mandate takes effect July 1, 2027. It expands the state's existing sick-leave requirement (which previously reached only certain home health workers) to nearly all private-sector employees and state and local government employees. Employees will accrue at least one hour of paid sick leave for every 30 hours worked, and the law expressly covers “safe leave” for employees dealing with domestic violence, sexual assault, or stalking. Notably, the enforcement provisions have teeth: aggrieved employees may recover double the amount of any unpaid sick leave plus actual damages, and the law prohibits retaliation. Because the sick-leave obligation arrives in mid-2027 (well before the PFML program goes live), Virginia employers effectively have two distinct deadlines to manage, not one. Why the Differences Are the Whole Point It would be convenient if these three programs converged. They do not. Consider just a few of the fault lines a multi-jurisdiction employer has to navigate: Who pays. D.C. is employer-funded only. Maryland and Virginia split contributions between employer and employee, but with different rates, different small-employer carve-outs (fewer than 15 in Maryland, 10 or fewer in Virginia), and different wage caps. Job protection. Maryland and Virginia build reinstatement rights into their statutes. D.C.'s PFL does not, leaving job protection to the FMLA framework. Timing. An employer running payroll across all three is looking at ongoing quarterly obligations in D.C. right now, Maryland contributions starting January 2027, Virginia sick leave in July 2027, and Virginia PFML contributions in April 2028. State plan versus private plan. Both Maryland and Virginia allow approved private plans as an alternative to the state program. That decision, which carries cost, administrative, and renewal implications, needs to be made deliberately, not by default. Layered on top of all this is the coordination problem: each of these programs interacts with the federal FMLA, with existing employer PTO and short-term disability policies, and with one another. Getting the concurrency and stacking rules wrong is where liability tends to accrue. What Employers Should Be Doing Now The through-line across all three jurisdictions is that the compliance work front-loads. Waiting until benefits start paying is waiting too long. In the coming months, employers with a regional footprint should be inventorying which employees fall under which program, confirming payroll readiness for the Maryland and Virginia contribution start dates, evaluating private-plan options, updating handbooks and leave policies to reflect the new entitlements, preparing the required employee notices, and training HR and managers on the accrual, coordination, and anti-retaliation rules.
July 6, 2026
Labor and Employment
Virginia’s Non-Compete Restrictions Are Now in Effect: What Employers Need to Do Now
Virginia Governor Abigail Spanberger signed Senate Bill 170 on April 13, 2026. In the weeks that followed, however, Virginia’s non-compete landscape shifted even further. On May 14, 2026, Governor Spanberger also signed SB 128, which expands restrictions on non-competes by prohibiting such agreements altogether for healthcare professionals. Both laws took effect on July 1, 2026. What initially appeared to be a targeted modification to enforceability now operates as a broader restructuring of how non-competes function in Virginia. Non-Competes Are Now Conditional Under SB 170, a non-compete is unenforceable if an employer terminates an employee without cause unless the employer provides severance or other monetary consideration that was disclosed at the time the agreement was executed. Notably, the statute does not define “cause” or establish a minimum severance amount. The legislation expands upon Virginia’s existing restrictions on non-competes for low-wage and non-exempt employees. The statute applies broadly to all employers and reflects a continued state-led shift away from treating non-competes as baseline protections for employers. Instead, Virginia employers must plan, price, and document non-competes at the outset of the employment relationship. In practice, employers must determine at the time of hire whether a particular role justifies a post-employment restriction and whether they are prepared to commit financially to preserving that restriction in the event of a no-cause separation. If that determination is not made and documented from the beginning, the restriction may be unenforceable. Termination Decisions Now Control Enforceability One of the most consequential effects of SB 170 is that enforceability is no longer determined solely by the language of an agreement. It is now directly tied to how the employment relationship ends. A without-cause termination without the required pre-disclosed payment will render a non-compete unenforceable. A for-cause termination, by contrast, may preserve enforceability, but it also creates the potential for disputes over whether the termination was properly classified as for cause. This creates a direct connection between contractual terms, defined standards for “cause,” and actual termination practices. As a result, even carefully drafted agreements may fail if operational decisions are not aligned with the terms of the restriction. Healthcare Non-Competes Are Also Eliminated At the same time, SB 128 imposes a near-total prohibition on non-competes for healthcare professionals, broadly defined as “any person licensed, registered, or certified by the Board of Medicine, Nursing, Counseling, Optometry, Psychology, or Social Work.” Employers who violate this prohibition may face civil penalties, fee exposure, and private enforcement risk. While confidentiality agreements and limited non-solicitation provisions remain available, non-competes are no longer a viable tool in this sector. This development reflects a broader willingness to restrict non-competes not only by circumstance, but by industry. A Broader Shift Toward Data Protection These developments build on a broader trend: courts and legislatures are placing less emphasis on where employees work and greater emphasis on whether employers are meaningfully protecting legitimate business interests. Virginia’s framework reflects that shift. While it limits and conditions non-competes, it leaves intact protections for confidential information and trade secrets, making information access, use, and safeguarding the primary battleground. Employers that rely solely on restrictive covenants, without corresponding data protection efforts, may find those agreements increasingly insufficient. Bottom Line Non-competes in Virginia remain viable, but they are no longer passive protections. They must be deliberate, supported, and aligned with business decisions from hiring through separation. At the same time, SB 170 and SB 128 shift the focus toward information governance and fundamentally change how non-competes operate in practice. Employers that pair narrowly tailored agreements with strong data protection practices will remain well-positioned. Those that do not risk discovering that their protections are unenforceable.
July 6, 2026
Labor and Employment
Untrained Managers Create Legal Risk: Federal Training Requirements Every Employer Must Follow
Many employment lawsuits I have handled on behalf of employers had something in common: a manager made a deficient decision or failed to act appropriately because no one had trained them properly. Sometimes the decision was a termination made without documentation. Sometimes it was a failure to recognize a harassment complaint and how to respond. Sometimes it was a well-meaning accommodation conversation that crossed a legal line. The lesson is not complicated. Under federal law, your managers are your company’s legal agents. When they act, or fail to act, the law generally treats it as the company acting. Liability flows upward. Training is the mechanism by which you limit that exposure. Title VII of the Civil Rights Act of 1964, along with the Age Discrimination in Employment Act (ADEA) and the Americans with Disabilities Act (ADA), prohibits workplace harassment based on protected characteristics. The EEOC’s enforcement guidance makes clear that employers are expected to take reasonable steps to prevent and promptly correct harassment. But the most compelling reason to train managers is a practical defense, not a moral one. Under Faragher v. City of Boca Raton (1998) and Burlington Industries v. Ellerth (1998), the Supreme Court held that an employer may avoid vicarious liability for a supervisor’s harassment — if no tangible employment action resulted — by demonstrating two things: (1) that the employer exercised reasonable care to prevent and correct harassing behavior; and (2) that the employee unreasonably failed to use the employer’s preventive or corrective opportunities. You cannot establish the first prong without documented manager training. Courts consistently look for: A written anti-harassment policy that is distributed to all employees A complaint procedure that bypasses the immediate supervisor when that supervisor is the alleged harasser Regular, documented training for managers on recognizing, reporting, and responding to harassment complaints Training that addresses bystander intervention obligations and retaliation prohibitions Practical Tip Managers must understand that their obligation is not merely to avoid harassing behavior themselves, it is to act when they observe or learn of harassment by others. A manager who witnesses harassment and does nothing creates employer liability, regardless of whether there is a reporting policy. Quick Reference: Federal Manager Training Obligations The table below summarizes the primary federal laws that impose manager training requirements and the key compliance obligations in each area. The Bottom Line for Employers Federal employment law does not require perfection. What it requires is a good-faith, documented effort to comply. In practice, that means written policies, a functional reporting structure, and — above all — managers who are trained, periodically re-trained, and held accountable for what they know. When a lawsuit or agency charge arises, one of the first things plaintiff’s counsel and investigators request is documentation of manager training. The question they are asking is simple: did this company do what a reasonable employer would do to prevent this from happening? Training records, or the absence of them, answer that question before the first deposition is taken. If your organization does not have a structured manager training program addressing each of the areas discussed in this article, now is the time to build one. The investment is modest. The cost of the alternative is not.
June 19, 2026
Labor and Employment
Beyond Bostock: Legal Gaps Affecting LGBTQIA+ Workers
In its landmark decision in Bostock v. Clayton County, the Supreme Court held that discrimination based on sexual orientation is illegal under Title VII. This sweeping ruling changed the legal landscape for homosexual and transgender employees, ensuring that key anti-discrimination laws also protect them in the workplace. In it, the Court makes clear, “it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex.” While Bostock marked a major victory for LGBTQIA+ workers, its reasoning leaves important gaps — particularly for bisexual, asexual, and nonbinary individuals, as well as in areas like healthcare coverage. Bisexuality The Supreme Court could not have been clearer in Bostock that Title VII “works to protect individuals of both sexes from discrimination and does so equally” (emphasis added). As stated above, this clarity extends to homosexual and transgender individuals. Where the waters become murky is in instances where individuals do not fit neatly into the gender binary, or when their sexuality is neither heterosexual nor homosexual. The Sixth Circuit recently posited in Hamm v. Pullman SST, Inc., “Does Bostock’s but-for logic also prohibit employers from discriminating against those who are bisexual?” It then declined to answer that question or address whether bisexual, asexual, or otherwise queer orientations would be covered equally. Taken to its logical limits, Bostock’s but-for framework raises difficult questions about how bisexual or asexual individuals fit within Title VII protections. The Bostock Court explained that “if changing the employee's sex would have yielded a different choice by the employer, a statutory violation has occurred.” In the case of bisexual, asexual, or other orientations, however, changing the employee’s sex may not necessarily change the outcome. The example provided by the Supreme Court is illustrative: The two individuals are, to the employer's mind, materially identical in all respects, except that one is a man and the other a woman. If the employer fires the male employee for no reason other than the fact he is attracted to men, the employer discriminates against him for traits or actions it tolerates in his female colleague. Put differently, the employer intentionally singles out an employee to fire based in part on the employee's sex, and the affected employee's sex is a but-for cause of his discharge. Applying this standard to a bisexual employee, one might imagine a male employee terminated for being attracted to both men and women. If the employer were to terminate a female employee for being attracted to both men and women, the termination would not necessarily be discriminatory under a strict but-for analysis. The same logic could apply to employees who are attracted to neither men nor women. Nonbinary Individuals Courts have not yet squarely addressed whether Bostock extends Title VII protections to nonbinary individuals — those who identify outside of the male/female gender binary. This presents a closer question. On the one hand, the Court’s reasoning in Bostock relies heavily on a binary conception of sex. On the other, nonbinary status is arguably “inextricably bound up with sex,” as an employer who discriminates against a nonbinary individual necessarily treats that employee differently because of sex-based considerations. Gender-Affirming Care Bostock also raises practical questions for employers, particularly with respect to benefits. For example, must employers provide gender-affirming care on equal terms across genders? The Eleventh Circuit addressed part of this issue in September 2025 in Lange v. Houston County, Georgia, holding that employers may categorically deny coverage for gender-affirming surgeries so long as the policy applies “regardless of [the employees’] biological sex.” In reaching this conclusion, the court relied heavily on United States v. Skrmetti, reasoning that classifications based on medical use do not implicate Title VII because “a key aspect of any medical treatment is the underlying medical concern the treatment is intended to address.” This focus on medical reasoning eliminates the gender question, thus allowing employers a broader ability to determine what conditions to cover. Conclusion Bostock was a transformative decision, but it is not the final word. As courts continue to grapple with bisexuality, nonbinary identity, and healthcare benefits, its promise remains uneven in application. For employers, the safest course is to interpret Title VII broadly when reviewing workplace discrimination and benefits policies, while remaining mindful of evolving protections for employees across the LGBTQIA+ spectrum.
June 17, 2026
Labor and Employment
AI in Predictive Analytics for Employee Performance: Risk vs. Reward
Employers are increasingly deploying artificial intelligence (AI) and data-driven tools in performance management in an effort to promote consistency and reduce human bias. Yet these systems inherit the limitations of the data that fuels them, and workplace performance data is rarely neutral. Importantly, AI models are only as reliable as the information on which they are trained, and when that information reflects historical inequities or includes data correlated with protected characteristics, AI-driven performance metrics may perpetuate patterns that have long disadvantaged certain groups of employees. Performance data also frequently lacks critical context. Metrics such as output volume, response times, or client feedback often fail to account for legitimate sources of variation, including disability accommodations, intermittent or protected leave, caregiving responsibilities, or differences in job assignments. AI systems generally struggle to recognize these nuances, even though performance evaluations commonly inform high-stakes decisions involving promotions, compensation, and terminations. When adverse employment actions are grounded in incomplete or misleading data, employers may find it difficult to defend those decisions, particularly where they have a disparate impact on members of protected classes. The takeaway for employers is not to abandon AI, but to deploy it thoughtfully and lawfully. Employers should routinely audit performance data for bias, understand how AI tools weigh and interpret inputs, and train managers to assess AI-generated insights critically rather than accept them at face value. And always remember: human oversight remains essential.
June 16, 2026
Labor and Employment
"The Pitt" is a Hospital Drama. It’s Also a Masterclass in Employment Risk
Like most good TV hospital dramas, "The Pitt" is not really about medicine. It is about pressure. The show captures what happens when employees are overextended, managers are operating in constant crisis mode, and organizational systems begin to strain under the weight of staffing shortages, emotional exhaustion, and impossible expectations. The setting may be a hospital emergency department, but the legal issues are recognizable to virtually every employer. What makes the series especially interesting from a labor and employment perspective is how many of its workplace tensions intersect with real legal obligations. Take burnout. For years, employers treated burnout as a retention problem or a culture issue. Increasingly, however, burnout-related concerns arrive wrapped in legal protections. An employee struggling with anxiety, depression, PTSD, or other mental health conditions may trigger obligations under the ADA. Extended stress-related absences may implicate the FMLA. Complaints about chronic understaffing or unsafe workloads may become protected activity under workplace safety laws or the National Labor Relations Act. The law has not suddenly become more forgiving of operational strain simply because employers are understaffed. If anything, courts and agencies have become more skeptical of workplaces that normalize exhaustion as part of the job. "The Pitt" also illustrates a common but underappreciated source of liability: supervisors under pressure. Employment claims are often shaped less by formal policy and more by how frontline managers respond in moments of stress. A dismissive reaction to a complaint, inconsistent discipline, public criticism, or poorly handled accommodation requests can quickly become evidence in discrimination, retaliation, or hostile work environment litigation. Healthcare settings make this especially visible because the hierarchy is so compressed and the stakes are so immediate. But the broader lesson applies everywhere. Technical excellence is not the same as management training, and many organizations continue to promote high performers into supervisory roles without adequately preparing them for the legal dimensions of people management. The show also reflects the growing legal significance of employee complaints about workplace conditions. Discussions about staffing levels, scheduling, workload, safety, and compensation are often protected under Section 7 of the NLRA, even in non-union workplaces. Employers sometimes frame these issues as morale problems or negativity concerns when, legally, they may constitute protected concerted activity. That distinction matters. Particularly in high-pressure industries, retaliation claims increasingly emerge from situations where employees raised operational concerns, and management responded defensively. Another recurring theme in "The Pitt" is documentation — or, more accurately, the lack of it. In chaotic workplaces, documentation often becomes inconsistent until a complaint arises. By then, employers may attempt to reconstruct performance concerns after the fact, which rarely presents well in litigation. Courts, agencies, and juries tend to view sudden paper trails with suspicion, especially when they appear only after protected activity, leave requests, or accommodation discussions. Perhaps the most modern employment-law lesson embedded in the show is the importance of psychological safety. Employees who fear humiliation, retaliation, or professional consequences for speaking up are less likely to report concerns early, whether those concerns involve discrimination, harassment, or workplace safety. Regulators increasingly expect organizations to create reporting structures that employees actually trust enough to use. Ultimately, "The Pitt" works because it understands something many workplaces still resist acknowledging: prolonged crisis conditions reshape employment risk. Fatigue affects judgment. Stress alters communication. Staffing shortages expose compliance gaps. And cultures built around endurance rather than sustainability tend to create legal vulnerabilities long before litigation begins. The show may be fiction, but the workplace issues are painfully familiar. Just with better lighting and more trauma bays.
May 29, 2026
Labor and Employment
Beyond Attendance: The Legal Duties of Nonprofit Board Members
Serving as an officer or director of a nonprofit organization is both an honor and a serious legal responsibility. Whether your organization is a large regional association or a small community-based nonprofit, the individuals who sit on the board are held to defined legal standards — standards that exist to protect the organization, its members, and the public it serves. This article outlines the core governance obligations that apply to every nonprofit board member, including the three fiduciary duties imposed by state law, the board’s proper role in organizational management, and several practical obligations that are easy to overlook but carry real legal consequences. Modern Governance Demands Active, Informed Leadership Nonprofits today operate in an environment of heightened public scrutiny, legal complexity, and accountability. The days when a board member could fulfill his or her obligations simply by showing up for quarterly meetings and voting on motions are long past. Effective governance now requires directors to be proactive, to engage with the organization between formal meetings, to participate meaningfully in leadership transitions, and to approach every board communication and decision with deliberation. Passive participation is not just ineffective; it can be a legal liability. A director who sits back, defers entirely to others, and casts uninformed votes risks violating the very duties assumed upon joining the board. The Board Governs — It Does Not Manage One of the most important distinctions in nonprofit governance is the line between policy and management. The board of directors is the organization’s governing body, with ultimate responsibility for its mission and direction. But that responsibility does not extend to the day-to-day administration of the organization. Operational decisions —staffing, program delivery, vendor relationships, and the like — are properly delegated to paid staff, designated committees, or empowered officers. This principle holds even for smaller nonprofits that lack a professional staff. The board’s role is to set policy and ensure that results align with the organization’s mission and governing documents. When boards stray into micromanagement, they create confusion, undermine staff authority, and expose themselves to unnecessary risk. The best boards define clear boundaries, delegate appropriately, and hold leadership accountable for outcomes. The Three Fiduciary Duties State law imposes three legally enforceable fiduciary duties on every officer and director of a nonprofit organization: the duty of care, the duty of loyalty, and the duty of obedience. These duties are not optional — they cannot be waived by agreement, and they apply regardless of whether the organization is large or small, well-funded or volunteer-run. Every decision made in the course of board service should be evaluated against all three. Duty of Care: Be Informed and Engaged The duty of care requires directors to exercise the same ordinary and reasonable diligence that a prudent person would apply in similar circumstances. In practice, this means directors must arrive at meetings prepared, ask questions when something is unclear, seek out information independently when necessary, and engage substantively in board deliberations. A director who attends meetings without reviewing materials in advance, who relies entirely on the representations of other board members without independent inquiry, or who votes yes or no simply to go along with the room is not meeting this standard. The duty of care is an individual obligation; each director is personally responsible for being informed. Duty of Loyalty: Put the Organization First The duty of loyalty requires that when a director acts in his or her capacity as a board member, that director’s allegiance must be undivided and directed entirely to the organization’s interests. Personal interests, outside business relationships, and affiliations with other organizations must not influence board decisions. This duty encompasses two related obligations. First, directors must avoid actual conflicts of interest — situations in which personal gain could be derived from an organizational decision. Second, and equally important, directors must avoid even the appearance of conflicts of interest. The credibility of a nonprofit depends in large part on public trust, and that trust is damaged when there is any reasonable basis for questioning whether a board member’s decisions were made for the right reasons. Organizations should have a written conflict-of-interest policy, and directors should be prepared to disclose and recuse themselves where appropriate. Duty of Obedience: Know and Follow Your Governing Documents The duty of obedience requires directors to act in accordance with the organization’s articles of incorporation, bylaws, mission statement, and any other governing documents, as well as applicable federal, state, and local law. This is not a passive obligation. Directors are expected to have read and understood the organization’s governing documents, and to act consistently with them, even when a director might personally have approached a matter differently. If governing documents are outdated, unclear, or inconsistent with current law, the appropriate response is to pursue a proper amendment, not to ignore the documents or work around them. Counsel can assist with reviewing and updating governing documents to ensure they reflect the organization’s current operations and legal obligations. Additional Obligations Individual Accountability for Fellow Directors’ Conduct Board membership is not a passive credential. Directors have an individual obligation to respond when they become aware that a fellow director, or an officer, is engaging in conduct that is illegal, in violation of fiduciary duties, or otherwise contrary to the organization’s interests. Awareness without action can itself give rise to personal liability. What constitutes an adequate response will depend on the circumstances, but in serious cases it may require raising the issue formally at a board meeting, consulting with legal counsel, or escalating the matter through appropriate channels. Directors who simply look away when misconduct is apparent do so at their own legal risk. Confidentiality: An Absolute Obligation Board deliberations are confidential. Information discussed in the course of board business — whether in formal meetings or in communications among directors — may not be shared with individuals who are not part of the board or otherwise properly within the organization’s governance structure. This obligation applies regardless of how a vote came out and regardless of whether the director agreed with the board’s decision. The reason for this rule is practical as well as legal. Open and candid board discussion depends on the mutual understanding that what is said in the boardroom stays there. When confidentiality is breached, even informally, even with good intentions, it chills future deliberation and can seriously damage the organization. Directors should treat all board communications as confidential by default, and should decline to discuss board matters with family members, professional colleagues, or anyone else outside the governance structure. Written Communications: Assume Everything Is Public In litigation and regulatory proceedings, written communications are among the first materials sought in discovery which includes emails, text messages, board messaging platforms, and any other written communication, regardless of how informal the channel. There is, in practical terms, no such thing as a private electronic communication for a nonprofit director. Directors should bring the same care to their written communications that they bring to formal board proceedings. This means avoiding emotional or inflammatory language, refraining from personal attacks, and thinking carefully before committing anything to writing that would be embarrassing, misleading, or legally problematic if it later appeared in a courtroom or regulatory hearing. When in doubt, a phone call is often the better choice. And when written communication is particularly sensitive, having it reviewed by counsel before sending is a worthwhile precaution. Nonprofit Directors Are Accountable to the Public Unlike the directors of a for-profit corporation, who owe their primary duty to shareholders, nonprofit directors operate in a context of broader public accountability. The tax-exempt status and public-benefit mission of a nonprofit organization mean that its governance is, in a meaningful sense, a matter of public interest. This is the foundation of many of the rules that apply to nonprofits and their directors, and it is why the standards for nonprofit governance are taken seriously by regulators, courts, and the communities these organizations serve. Directors who internalize this principle — who understand that their role is not simply to serve the membership but to advance a mission for the broader public good — tend to govern more effectively and with greater integrity. A Final Word The legal obligations of nonprofit board service are real, and they apply from the moment a director takes office. But they are not burdensome for directors who approach the role with the seriousness it deserves. Directors who stay informed, act in the organization’s best interest, follow the governing documents, communicate carefully, and hold themselves and their colleagues accountable will, in virtually every case, meet their legal obligations and serve their organization well.
May 20, 2026
Labor and Employment
It Ends Quietly: What the Lively-Baldoni Settlement Really Tells Us About Litigation
For nearly two years, this case unfolded the way modern legal disputes often do. Not in a courtroom, but in fragments and narratives. In articles, group chats, comment sections, and carefully curated statements. It felt, at times, like a story in search of an ending. But when the ending finally arrived, it was not a verdict. It was a settlement announced in a handful of sentences, issued jointly, and designed to close the door rather than resolve the conflict. No trial. No jury. No public reckoning of who was right. Instead, something quieter. And in many ways, far more revealing. What does it mean when a case settles right before trial? The timing matters. This case did not settle early, when uncertainty is highest and discovery has yet to sharpen the issues. It settled at the last possible moment, just weeks before a scheduled May trial, after the legal landscape had already shifted in a meaningful way. By that point, the court had done what courts do best. It stripped the case to its essentials. Of the original claims, 10 were dismissed, including the most visible, leaving only a narrow set of theories to be decided by a jury. What remained was not the sweeping narrative the public had been following. It was something much smaller. Something much more technical. Something that would have required jurors to answer precise legal questions about retaliation and contractual obligations rather than broader questions about conduct or character. And then, before any of those questions could be answered, the case ended. That sequence is not unusual. It is, in fact, typical. Once discovery is complete and the court has defined the case, the parties are no longer negotiating in the abstract. They are negotiating in the shadow of a very specific trial. One that now comes with clearer risks and fewer unknowns. In that environment, settlement is not retreat. It is recognition. Why would a high-profile case end without money changing hands? Perhaps the most surprising detail emerging from early reporting is the apparent lack of financial exchange between the parties. Each side reportedly walked away covering its own legal fees. That outcome can feel counterintuitive in a case defined by claims of massive reputational and economic harm. But it aligns with something lawyers understand instinctively, and the public often overlooks. Litigation is not a referendum on harm. It is a method for proving it. At various points in the case, the parties advanced dramatically different accounts of damages. One side spoke in terms of lost opportunities and reputational impact. The other questioned both the methodology and the underlying premise. By the time a case reaches the brink of trial, those claims are no longer theoretical. They have been tested, challenged, constrained by evidentiary rules and expert scrutiny. The result is rarely as expansive as the initial pleadings suggested. A no-payment resolution, in that context, does not mean nothing happened. It means something more specific. It reflects the gap between what could be alleged early and what could ultimately be proven in court. Did the settlement change anything or simply confirm what the court had already signaled? In many ways, the settlement feels less like a turning point and more like a conclusion to a process that had already narrowed the case substantially. The April ruling set the trajectory. It was not an early procedural decision. It was a merits-driven assessment after discovery, focused on what the record could actually support. That ruling reshaped the case in several important ways. It clarified that many of the claims failed for reasons grounded in legal structure rather than public perception. Employment status, jurisdiction, and contract formation all played decisive roles in determining what could proceed. At the same time, the court allowed certain claims to move forward, particularly those tied to retaliation and contractual obligations. Those surviving theories reflected something more subtle. A shift in where legal risk often resides in modern workplace disputes. The settlement did not undo any of that analysis. It accepted it. What does this case reveal about power, proof, and perception? Earlier, this litigation offered a useful lens into how power, proof, and perception interact. The settlement shows how that interaction resolves. Perception drove the public conversation. From the beginning, the case was understood through competing narratives that invited audiences to take sides long before the pleadings had settled. But perception did not determine the legal outcome. It could not expand jurisdiction. It could not convert an unsigned agreement into an enforceable contract. It could not substitute for admissible evidence. Proof did the work that proof always does. It narrowed. It filtered. It transformed broad allegations into discrete questions anchored in documents, communications, and contemporaneous records. By the time the case reached its final stage, what mattered was not how the story felt, but what could be demonstrated. Power remained present throughout, but not in the way it is often imagined. Influence shaped the stakes and the visibility of the dispute, but it did not rewrite the legal standards that governed it. The court applied the same framework it would apply in any workplace case, even if the setting was far from ordinary. The end result reflects that hierarchy. Perception set the stage. Proof controlled the script. Power influenced the audience, not the outcome. What lessons should employers and practitioners take from how this ended? Strip away the names and the attention, and what remains is a fairly familiar legal arc. A workplace dispute arises in a setting that blurs professional and personal boundaries. Allegations are made, both legal and reputational. The case expands quickly, incorporating multiple causes of action and overlapping narratives. Discovery follows, and with it a more disciplined examination of the evidence. The court narrows the issues. What survives is more precise, more technical, and often less satisfying to anyone looking for a sweeping resolution. From there, the incentives shift. The cost of trial becomes concrete. The risks are no longer abstract. And the question becomes less about proving everything and more about resolving what remains. This case also reinforces something increasingly important. Even where underlying misconduct claims fall away, retaliation theories can persist. The alleged harm is not always tied to traditional employment actions. It may instead center on reputation, messaging, and the way narratives are managed in public spaces. That evolution matters because it expands the kinds of conduct that may be examined through a legal lens, even when the original allegations do not move forward. Why does this ending feel so incomplete? Because it is. Settlements are designed to end disputes, not to explain them. They provide closure without resolution, finality without full transparency. They are, by their nature, unsatisfying for anyone seeking a definitive account of what happened. And yet, they are the most common ending to cases like this. In that sense, the conclusion here is entirely consistent with the system in which it unfolded. The case did not fail to deliver an answer. It delivered the answer the legal process is structured to give. A narrowing of claims. A testing of proof. A recalibration of expectations. And, ultimately, a decision to stop litigating before the final question is put to a jury. What is the real takeaway from how this case ended? The title of the film at the center of the dispute suggests a clean conclusion. A moment where something definitively ends. The litigation tells a different story. It suggests that in modern workplace cases, especially those that unfold in public view, resolution rarely comes in the form people expect. It does not arrive with a clear declaration of fault or vindication. It arrives more quietly, shaped by legal constraints, evidentiary realities, and the practical considerations that define every case once it moves from narrative to proof. What began as a story about conduct became a case about law. What felt expansive became precise. What seemed headed toward a dramatic ending instead resolved in silence. Not because the issues disappeared. But because, in the end, litigation only answers the questions it knows how to ask.
May 7, 2026
Labor and Employment
New Jersey Finalizes ABC Test Rule: A Measured Retreat, Not a Reset
After more than a year of delay and unusually forceful opposition from the business community, the New Jersey Department of Labor has adopted final regulations implementing the state’s “ABC” test for worker classification. The final rule reflects a meaningful course correction from the proposal first circulated in 2025. It is narrower, more measured in tone, and less overtly targeted at particular industries. But it does not alter the underlying premise. New Jersey continues to place a heavy burden on businesses seeking to classify workers as independent contractors, and these regulations reaffirm that approach with greater clarity rather than greater flexibility. Clarity Arrives — on the State’s Terms The regulations operate across multiple statutory schemes, including the state’s wage-and-hour, wage payment, and unemployment compensation laws. At their core is the familiar but demanding ABC test. A worker is presumed to be an employee, and the hiring entity must establish all three elements to rebut that presumption: that the worker is free from control in both contract and practice; that the work is performed outside the usual course or places of the company’s business; and that the worker is engaged in an independently established trade or business. The significance of the final rule lies less in redefining those elements than in codifying how the Department expects them to be applied. In doing so, the rule closes off ambiguity that had previously allowed employers to rely more heavily on contractual structuring and industry convention. A Noticeable Step Back from the Edge The most notable feature of the final rule is what it no longer says. In several respects, the Department retreated from positions that would have pushed New Jersey’s already stringent framework even further. Most visibly, the rule abandons the proposal’s use of industry‑specific examples. Those examples — focused on rideshare drivers, construction trades, and similar roles — had been criticized as outcome‑driven. Their removal restores a measure of neutrality, even if it also leaves employers with less informal guidance. Equally significant is the Department’s reversal on its approach to legal compliance. The proposed rule suggested that steps taken to comply with other legal obligations (such as training, supervision, or similar controls) could still weigh in favor of employee status. The final rule rejects that approach, making clear that compliance‑driven requirements are not, without more, evidence of control. This change is likely to have practical importance for employers operating in regulated industries. The final rule also abandons several interpretive positions that would have expanded the concept of “control” or “place of business,” including the suggestion that required use of company software is inherently indicative of control, or that off‑site work could nonetheless be treated as occurring at the employer’s place of business based on its importance to the enterprise. Taken together, these deletions suggest a more restrained (and more defensible) regulatory posture. Refinements at the Margins The Department also introduced clarifications that, while modest, are directionally helpful. The rule confirms that existing statutory exemptions remain intact, avoiding any suggestion that the regulatory framework displaces those carve‑outs. It also addresses remote work directly, explaining that a worker’s home is not automatically part of the employer’s place of business; a point that carries particular relevance in a post‑pandemic workforce. These changes do not alter the structure of the ABC test. They do, however, narrow the risk that ordinary, compliance‑driven, or modern workplace practices will be recast as evidence of employment. The Core Framework Remains Firmly in Place Notwithstanding these revisions, the substance of the regime remains unchanged in the respects that matter most for employers. The burden of proof continues to rest entirely with the business. The inquiry remains fact‑driven and cumulative, rather than formalistic. And, critically, the rule reiterates that commonly relied‑upon indicia of independent contractor status (including written agreements, the use of business entities, or even the existence of multiple clients) are not dispositive. In practice, the most difficult element will continue to be the requirement that the work fall outside the company’s usual course of business. Where a worker is performing the same core services that define the enterprise, the final rule offers little comfort. The revisions do not relax that standard; they merely clarify how it will be assessed. A Short Runway to Implementation The rule is expected to be published in June 2026 and to take effect on October 1, 2026. That timeline leaves a limited window for employers to reassess existing classifications. Given New Jersey’s long‑standing focus on misclassification, and its willingness to pursue significant enforcement actions, the expectation should be that the clarified standards will be actively applied. A More Tempered Rule, But No Easier Path In the end, the Department did not abandon its approach; it refined it. The final rule is less aggressive in tone and more attentive to practical business realities than the version initially proposed. It removes several features that had appeared designed to expand the reach of the ABC test at the margins. But the central proposition remains the same. New Jersey is not seeking to make independent contractor classification easier. It is seeking to make the rules clearer and ensure they are consistently enforced. For employers, that clarity is useful, but it also eliminates any remaining doubt about the rigor of the standard they are expected to meet.
May 7, 2026
Labor and Employment
ICE’s Updated Form I‑9 Inspection Guidance: What Employers Need to Know
For more than three decades, Form I‑9 has been a cornerstone of U.S. employment eligibility verification. Every employer—regardless of size, industry, or location—is required to complete and retain a Form I‑9 for each employee hired after November 6, 1986. While the form itself has evolved over the years, the underlying obligation has remained constant: employers must verify identity and work authorization, maintain accurate records, and be prepared for inspection by U.S. Immigration and Customs Enforcement (ICE). But in 2026, ICE issued updated inspection guidance that significantly changes how the agency evaluates Form I‑9 errors. These updates don’t alter the form or the law, but they do reshape the compliance landscape. Many mistakes that were once considered minor or “technical” are now treated as substantive violations, meaning they can trigger immediate fines with no opportunity for correction during an audit. For HR leaders, compliance teams, and hiring managers, understanding these changes, and adjusting internal processes accordingly, is essential. How ICE I‑9 Inspections Work ICE conducts thousands of Form I‑9 inspections each year. When an employer receives a Notice of Inspection (NOI), they typically have three business days to produce their I‑9s and supporting documentation. ICE then reviews the forms for accuracy, completeness, and compliance with federal regulations. Historically, ICE distinguished between technical or procedural violations, which employers could correct within 10 business days, or substantive violations, which were immediately subject to penalties. This distinction mattered. A missing date, an incomplete field, or a minor oversight could often be corrected during the audit window, reducing or eliminating fines. The new guidance changes that calculus. What’s New in ICE’s Updated Fact Sheet ICE’s updated fact sheet expands the list of substantive violations, errors that cannot be corrected once an audit begins. These include many issues that employers previously treated as minor administrative mistakes. Examples of errors now considered substantive: Missing employee date of birth in Section 1 Missing or incomplete employer attestation information in Section 2 Missing date of hire Missing document title, issuing authority, or expiration date—even if a copy of the document is on file Missing rehire date in Supplement B Improper use of the Spanish‑language Form I‑9 outside Puerto Rico Deficiencies in electronic I‑9 systems, such as incomplete audit trails or signature issues These are critical as they cover all parts of the form including areas completed by the employer and employee. ICE also clarified that employers cannot rely on document copies to cure missing information. If the form itself is incomplete, the violation stands. Why This Matters: Increased Penalties and Higher Risk The consequences of these changes are significant. Substantive violations can result in fines ranging from hundreds to thousands of dollars per error. For employers with large workforces or high turnover, cumulative penalties can escalate quickly. Accordingly, industries at heightened risk include: the hospitality business, retail stores, construction companies, various forms of manufacturing businesses, certain healthcare providers, staffing and recruiting agencies, and federal contractors. These sectors often rely on decentralized hiring, multiple onboarding locations, or large volumes of I‑9s, conditions that increase the likelihood of errors. ICE’s updated guidance signals a stricter enforcement posture and a reduced tolerance for administrative mistakes. Employers can no longer assume that routine errors will be fixable during an audit. What Employers Should Do Now Conduct a proactive internal I‑9 audit. Review all existing I‑9s — especially older forms completed under prior guidance — to identify and correct errors before ICE ever requests them. All covered I-9s that could be audited include terminated employees for the last three years, which underscores how critical record keeping is for I-9 compliance. Employers should work with immigration compliance counsel to ensure corrections are made properly. Strengthen onboarding and I‑9 completion procedures. Ensure HR staff and authorized representatives understand the new classifications and the importance of complete, accurate entries in all sections of the form. Real-time review of the completion of form I-9 is recommended as substantive violations are incorporated into sections completed by the employee as well as the employer. Review your electronic I‑9 system. Confirm that your system meets DHS requirements for: Audit trails Electronic signatures Data integrity Proper indexing and retrieval Auto‑population features should be reviewed to ensure they do not create incomplete or inaccurate fields. Retrain all I‑9 preparers. Training should cover: Proper document review Accurate recording of hire dates and document details Correct use of the preparer/translator section Proper reverification procedures Ensure proper use of alternative verification procedures. If your organization uses DHS‑authorized remote verification, confirm that all eligibility requirements, such as E‑Verify participation, are consistently met. The Bottom Line ICE’s updated Form I‑9 inspection guidance represents a meaningful shift in enforcement. Employers now face higher stakes and less flexibility when errors occur. The organizations that invest in strong I‑9 practices today through audits, training, and system improvements will be far better positioned to withstand increased scrutiny. In the current environment, proactive compliance is not optional. It’s essential risk management. For more information visit: Form I-9 Inspection Under Immigration and Nationality Act § 274A | ICE
May 5, 2026
Labor and Employment
Labor and Employment State Law Watch: Key Changes & Trends
Below is a roundup of recent labor and employment law developments, regulatory updates, and notable workplace trends that may affect employers and human resources professionals, with a focus on compliance considerations, risk management, and emerging issues shaping the modern workplace. Maine Paid Family and Medical Leave Benefits Become Available - Effective May 2026 Maine is implementing a comprehensive paid family and medical leave (PFML) program, with employee benefits becoming available beginning in May 2026. The law establishes a statewide system allowing eligible employees to take up to 12 weeks of job-protected, paid leave in a benefit year for specified family, medical, and personal safety reasons. The program is administered by the Maine Department of Labor and funded through employer and employee payroll contributions, which began in January 2025. Eligibility is based on an employee’s earnings during the applicable base period (generally the first four of the five most recently completed calendar quarters), and the law applies broadly to nearly all Maine employers. Covered leave includes an employee’s own serious health condition, bonding with a new child, caring for a family member with a serious health condition, certain military-related needs, and “safe leave” for issues related to domestic violence, sexual assault, or stalking. The 12-week cap applies in the aggregate across all qualifying leave types. The law effectively creates a state-administered wage replacement and job protection framework, requiring employers to integrate PFML into existing leave policies and workforce planning. While the state administers benefits, employers remain responsible for payroll compliance, job restoration obligations, and coordination with other leave laws such as the federal Family and Medical Leave Act. Action Items: Employers should confirm compliance with payroll contribution requirements and ensure systems are properly configured. Leave policies should be updated to incorporate PFML rights and coordination with existing PTO and FMLA policies. Employers should also train HR personnel on eligibility determinations, job protection requirements, and claims coordination, and begin planning for staffing coverage during employee absences once benefits become available. New York Secure Choice Savings Program Registration Deadline - Effective May 15, 2026 New York is advancing its state-facilitated retirement initiative by imposing a firm deadline for mid-sized employers. Under the Secure Choice Savings Program, employers with 15 to 29 employees that do not sponsor a qualified retirement plan must register and participate in the program. The law effectively deputizes employers into facilitating employee retirement savings through payroll deductions, even where the employer has opted not to offer its own plan. While the program does not require employer contributions, it does require administrative coordination and ongoing compliance. Action Items: Employers in scope should promptly register for the program, ensure payroll systems can accommodate required deductions, and prepare employee communications. Employers that prefer greater plan flexibility may wish to consider implementing a private retirement plan instead. Utah Expanded Restrictions on Non-Compete Agreements - Effective May 6, 2026 Utah has enacted targeted legislation significantly limiting the enforceability of non-compete agreements in certain professional sectors. Health Care Workers (HB 270): Employers may no longer require licensed health care workers to enter into non-compete agreements. The law also prohibits non-solicitation provisions that would prevent these workers from informing patients of their current or future place of employment. This represents a notable shift toward prioritizing patient continuity of care over restrictive covenants. Veterinarians (SB 111): Similarly, Utah now restricts the use of non-competes for veterinarians. Such agreements are prohibited unless the veterinarian holds at least a 5% ownership interest in the business. The law reflects a policy judgment that mobility should be the default absent a meaningful ownership stake. Action Items: Employers should review and revise existing restrictive covenant agreements, particularly in the healthcare and veterinary sectors. Template agreements, onboarding materials, and exit procedures should be updated to ensure compliance with the new limitations. Washington Expanded Personnel File Access and Enforcement - Effective May 1, 2026 Washington has finalized amendments to its personnel file regulations through WAC 296-126-050, aligning agency rules with the broader statutory overhaul enacted in 2025. Under the updated framework, employers must provide employees — and certain former employees — with access to a significantly expanded set of personnel records within a defined timeframe. The rule now expressly defines “personnel file” to include not only core payroll and employment records, but also job applications, performance evaluations, disciplinary records (including closed matters), leave and accommodation records, and employment agreements, if maintained. The amendment imposes a 21-calendar-day deadline to provide access following a request and extends coverage to former employees for up to three years post-separation. Importantly, the rule incorporates a private right of action, allowing employees to pursue claims for noncompliance after providing notice. While much of the substantive expansion originates from the 2025 statute, the updated regulation solidifies these obligations and removes prior ambiguity around timing, scope, and enforcement. Action Items: Employers should review and update personnel file policies to reflect the expanded definition and ensure all responsive documents are consistently maintained and retrievable. Internal processes should be implemented to track and respond to requests within the 21-day deadline. Employers should also coordinate with HR and legal teams to identify privileged or sensitive materials before disclosure and assess potential litigation exposure associated with noncompliance.
May 1, 2026
Commercial Litigation
Virginia Moves to Further Restrict Non-Compete Agreements
Virginia continues to restrict non‑compete covenants. On April 13, 2026, Governor Spanberger signed Senate Bill 170 (“SB 170”) SB170 - 2026 Regular Session | LIS, into law. SB 170 will materially limit the enforceability of non‑compete agreements in Virginia moving forward. For years, Virginia courts enforced narrowly tailored non‑compete agreements, and employers adopted non-competes across industries as a risk‑management tool. As of July 1, 2026, any company or employer doing business in Virginia should reexamine the use of non- competes. In many cases, it will no longer make economic or operational sense to use non-compete provisions. Under amended Virginia Code § 40.1‑28.7:8, a non‑compete becomes unenforceable if an employee is terminated without cause and the employer has not provided severance or other disclosed monetary compensation. This rule applies to all employees, regardless of seniority, compensation level, or role. Importantly, the law will not be retroactive, meaning that non-compete agreements in effect, and unmodified, before July 1, 2026, will remain enforceable. For Virginia business owners and HR professionals, the most important takeaway is this: a non‑compete can now be perfectly drafted and still fail entirely based on how the employee’s departure is handled. If your termination process is misaligned with your employment agreements, you may lose the very protection you thought you had purchased. The first practical impact of SB 170 is that termination decisions are now legally intertwined with enforceability. Employers should no longer wait until an employee resigns or is separated to consider whether a non‑compete will achieve the employer’s goals. That analysis needs to happen at the front end, when the employer makes an offer to an employee. Employers should be asking themselves whether they are truly willing to commit, in advance, to paying severance to preserve post‑employment restrictions. Employers should also decide which employees actually present a competitive threat worth that cost, rather than automatically rolling non‑compete language into every offer letter. A second major shift is that SB 170 extends far beyond the “low‑wage employee” focus of earlier Virginia legislation. This law applies just as much to executives, senior managers, sales professionals, and business development employees as it does to entry‑level staff. Employers who assume their leadership team or top performers are insulated from these changes are mistaken. Virginia law no longer treats non‑competes as a default option even at the highest levels of an organization, and employers should revisit every existing assumption about who may be bound by post‑employment restrictions. Unfortunately, SB 170 also leaves critical questions, as key terms in the statute are undefined. For example, SB 170 does not explain what constitutes a “for cause” termination, nor does it specify how much severance—or what type of compensation—is sufficient to preserve enforcement. That ambiguity virtually guarantees litigation. Employers relying on vague termination language, inconsistent cause determinations, or ad hoc severance arrangements are setting themselves up for disputes they are unlikely to win, particularly given that the statute authorizes attorneys’ fees and penalties of up to $10,000 per violation. As a result of SB 170, non‑competes are no longer “free.” Employers who want them to remain enforceable must ensure compliance and planning in all hiring decisions and offer letters. Employers should clearly define what constitutes for cause termination events in employment agreements, commit to severance or other post‑separation compensation in advance, and disclose separation pay or compensation at the time the employee signs the employment agreement and non‑compete. In many cases, once these costs are identified, businesses will decide that a non‑compete no longer makes economic sense for a given role. Between now and July 1, 2026, Virginia employers should take several concrete steps. First, review employment agreements and non‑compete templates for compliance with SB 170. Existing agreements should be inventoried so decision-makers know which employees are subject to post‑employment restrictions and which agreements may be amended or renewed in a way that triggers SB 170. Second, Employers should tighten termination provisions in employment agreements. Consider clearly defining for cause termination events to align with actual business practices and goals. Employers should resist the temptation to automatically renew non‑competes without reevaluating whether they are necessary and sustainable under the new framework. Finally, HR, legal, and management teams should be aligned before any termination decision involving a non‑compete holder is made. If a company intends to rely on a non‑compete provision going forward, it must either have a well‑documented for‑cause termination or pay severance exactly as disclosed in the employment agreement. Deviating from that plan after the fact is likely to render the restriction unenforceable. Beginning July 1, 2026, offer letters and employment agreements must be drafted with SB 170 squarely in mind. Severance obligations should be explicit, termination standards should be unambiguous, and the agreement should integrate cleanly with any separation or release documents the company typically uses. Ambiguity will not benefit the employer under this statute. Finally, as an alternative to non-compete provisions, consider refocusing your post-employment protective strategies. Confidentiality agreements, trade secret protections, data access controls, and narrowly tailored non‑solicitation provisions often provide more reliable and less expensive protection than non‑competes under Virginia’s current legal landscape. For some employers, shifting focus to these tools will reduce litigation risk while still safeguarding key business interests. SB 170 continues Virginia’s clear policy trend favoring employee mobility and limiting post‑employment restraints. Non‑competes are not gone, but they are no longer the default solution they once were. Employers who proactively adjust their agreements and offboarding strategies can still protect themselves effectively. Those who ignore these changes risk expensive disputes, unenforceable contracts, and penalties that could have been avoided with thoughtful planning.
April 28, 2026
Labor and Employment
Substance Use Policies and Legal Cannabis: Balancing Compliance and Judgment in a Rapidly Shifting Landscape
For years, workplace substance use policies were easy to administer and easy to defend. A positive drug test typically ended the analysis. That is no longer true. Legal cannabis has introduced a level of complexity that many employers have not fully absorbed. The issue is not whether employers can maintain drug-free workplaces. They can. The issue is whether their policies reflect the legal distinctions that matter now and whether their decision-making will hold up under scrutiny. In 2026, the risk is not permissiveness. It is imprecision. The instinct to rely on federal law is understandable, but often misplaced. Cannabis remains illegal under the Controlled Substances Act. For certain employers, particularly those subject to the U.S. Department of Transportation, that fact continues to dictate outcomes. Safety-sensitive roles remain tightly regulated, and state law does not override those obligations. But for most employers, federal law does not answer the questions that actually arise in practice. State law increasingly does. The critical mistake is treating federal illegality as a blanket justification for broad policies or reflexive discipline. In many jurisdictions, that approach is no longer defensible. State law has shifted the analysis in a meaningful way. Across the country, legislatures have moved beyond legalization and into regulation of the employment relationship itself. In practical terms, that means employers are now operating within statutory frameworks that protect lawful, off-duty cannabis use and limit how employers can respond to it. The implications are significant. A positive test result, standing alone, is often no longer enough. Hiring decisions based on off-duty use are increasingly restricted. Policies that fail to distinguish between lawful conduct and workplace impairment are becoming harder to defend. This is not a marginal development. It is a structural change in how substance use issues are evaluated. The legal question is no longer “did the employee use cannabis.” Questioning whether an employee used cannabis is no longer valid. It is whether the employee was impaired at work and whether the employer can prove it. That distinction is where many policies break down. Traditional testing methods detect past use, not current impairment. As a result, employers who continue to rely exclusively on test results are often relying on evidence that does not answer the legally relevant question. State guidance is increasingly explicit on this point. Employers are expected to base decisions on observable, contemporaneous indicators of impairment that affect performance or safety. That requires more than suspicion and more than a laboratory result. It requires judgment, documentation, and consistency. Employers who have not trained managers to identify and articulate those indicators are, in effect, delegating critical legal decisions to individuals who are not equipped to make them. These issues rarely exist in isolation. Substance use questions often intersect with obligations under the Americans with Disabilities Act and parallel state laws. That is where the analysis becomes more nuanced. An employee’s conduct may be unprotected. The underlying condition may not be. Treating those as the same issue is a common and costly mistake. Medical cannabis adds another layer. While federal law does not require accommodation of marijuana use, state law may impose obligations that require a more individualized assessment. Employers who default to categorical rules risk overlooking when the law requires a closer look. This is an area where rigid policies tend to create, rather than reduce, exposure. Remote work has made outdated policies harder to defend. The shift to remote and hybrid work has exposed another weakness in legacy substance use policies. Rules that were drafted with a physical workplace in mind do not always translate well to a workforce that operates across locations and, in many cases, from home. The relevant inquiry is no longer where the employee is. It is whether the employee is fit for duty during working time. That sounds like a subtle distinction. It is not. Policies that focus on presence rather than performance are increasingly out of step with both how work is performed and how the law evaluates these issues. What a defensible approach actually looks like. Employers who are managing this well tend to have one thing in common. Their policies are not just updated. They are deliberate. They distinguish clearly between off-duty conduct and on-duty expectations. They define impairment in terms that can be observed and documented. They use testing in a way that aligns with legal limits rather than as a default response. And they train managers to make decisions that will withstand scrutiny after the fact, not just in the moment. Just as importantly, they recognize when a situation calls for legal analysis rather than a reflexive policy application. The takeaway. This is one of those areas where the law has moved faster than most workplace practices. Employers who continue to rely on familiar approaches are not necessarily being careless. But they are often operating with assumptions that no longer reflect the legal landscape. That is where risk accumulates. A well-drafted policy is part of the solution. It is not the entire solution. Alignment between policy, training, and decision-making is what ultimately determines whether an employer is protected or exposed. In a landscape that continues to evolve, getting that alignment right is not simply a compliance exercise. It is a strategic one.
April 24, 2026
Labor and Employment
Non-Discrimination Training: What In-House Counsel and HR Executives Need to Do Now
Non-discrimination training is no longer simply a best practice; it is increasingly a legal imperative. Across the country, states, and municipalities are imposing affirmative obligations on employers to implement, document, and periodically refresh training programs to prevent workplace discrimination and harassment. For companies operating in multiple jurisdictions, the array of requirements presents both compliance complexity and potential litigation risk. This advisory is directed to in-house legal counsel and human resources executives. Its purpose is straightforward: if your organization does not currently have a structured, recurring non-discrimination training program in place, you need one — and the time to act is now. The Legal Landscape: A Jurisdiction-by-Jurisdiction Overview The following summary reflects the current state of non-discrimination training requirements and formal recommendations across key jurisdictions. This is not an exhaustive survey, but it illustrates the breadth of regulatory attention employers face. California California imposes an affirmative duty on employers to take reasonable steps to prevent and promptly correct unlawful discrimination and harassment. While the statute does not establish a single universal periodic training mandate for all protected categories, it does require certain employers to provide regular sexual harassment training. Critically, California law also requires that any training program leading to employment be administered in a nondiscriminatory manner. Employers with California operations who are not already conducting regular, structured anti-discrimination training should treat this as a compliance gap requiring immediate correction. New York City The New York City Human Rights Commission recommends that employers implement antidiscrimination policies specifically addressing gender identity and expression and provide ongoing training for employees and agents. In the context of New York City’s historically aggressive enforcement posture—including substantial administrative penalties and individual liability exposure—these recommendations carry significant practical weight. In-house counsel should treat the commission’s guidance as a strong indicator of what regulators will scrutinize in the event of a complaint. Philadelphia The Philadelphia Fair Practices Ordinance guidance recommends that employers provide training to managers and employees before problems arise—particularly regarding gender identity and expression. This proactive framing is significant: Philadelphia regulators are signaling that reactive training (i.e., training only after a complaint is filed) is insufficient. Employers with Philadelphia operations should build training into their standard onboarding and periodic compliance calendars. San Francisco San Francisco imposes some of the most explicit affirmative obligations. The San Francisco Human Rights Commission requires all agencies, businesses, organizations, city contractors, and city departments to clearly communicate the city’s non-discrimination laws. It further recommends ongoing training for all management, employees, and volunteers on gender identity issues. Washington The Washington State Human Rights Commission recommends that employers educate all employees about non-discrimination policies, with particular attention to gender identity and expression. The commission further suggests that employers consider bringing in outside consultants to provide specialized training on gender identity sensitivity and awareness. For organizations with a significant Washington workforce, this consultant recommendation reflects regulatory awareness of the limits of generic training—and should prompt a review of whether your current training program is sufficiently tailored. District of Columbia The District of Columbia mandates compliance with non-discrimination laws and requires that employer programs contribute to the elimination of sex stereotyping and barriers to employment. While current guidance does not specify a universal periodic training interval for all employers, the District’s substantive mandate is clear, and employers operating there should not interpret the absence of a specific training schedule as an option to forgo training altogether. Why “Recommendations” Carry Real Legal Risk In-house and outside legal counsel sometimes draw a sharp distinction between legal requirements and regulatory recommendations, treating the latter as aspirational and optionally advisable. In the employment discrimination context, that distinction can be misleading and potentially costly. When a regulatory body with enforcement authority—such as the New York City Human Rights Commission, the Philadelphia Commission on Human Relations, or the San Francisco Human Rights Commission—issues guidance recommending employer training, that guidance typically reflects the standard against which the agency will measure employer conduct when adjudicating a complaint. An employer who ignored formal training guidance from an enforcement agency will face a significantly more difficult defense posture than one who followed it. Beyond agency enforcement, you should consider the evidentiary implications in civil litigation. Plaintiffs’ counsel regularly introduce evidence of an employer’s failure to conduct training, or to conduct it adequately, as evidence of a discriminatory or hostile work environment. Courts have consistently recognized training programs as a component of an employer’s affirmative defense in harassment cases. The absence of training, by contrast, can undermine an employer’s ability to invoke the Faragher-Ellerth defense or its state-law equivalents. A Practical Action Plan for Legal Counsel and HR The following steps represent a baseline compliance framework for organizations operating in one or more of the jurisdictions addressed above. Legal counsel and HR executives should assess their current programs against each item. Conduct a Jurisdictional Audit Map your workforce to the specific jurisdictions where employees work or are supervised. For each jurisdiction, identify applicable statutes, ordinances, and agency guidance. Pay particular attention to gender identity and expression requirements, which appear consistently across the surveyed jurisdictions. Establish a Training Calendar Several jurisdictions emphasize ongoing or periodic training—not one-time programs. Build a recurring training schedule into your compliance calendar, with defined intervals for managers and employees. Tie training events to onboarding, annual compliance cycles, and promotion into supervisory roles. Differentiate Manager and Employee Training Management-level training should address investigation obligations, reporting duties, and liability implications that differ from general employee instruction. Several jurisdictions specifically call out training for managers and agents, ensure your program reflects this distinction. Address Gender Identity and Expression Explicitly Every jurisdiction reviewed here specifically references gender identity and expression as a training focus. Ensure your curriculum addresses these protected categories with specificity, not merely as a line item in a broader protected-class list. Consider Specialized Consultants Washington State’s recommendation that employers engage outside consultants for gender identity training is worth noting for employers in any jurisdiction. Where internal training capacity is limited, or where a workforce has complex dynamics, outside expertise can improve both the quality and the credibility of your training program. Document Training records should be maintained systematically. Document attendance, training content, delivery dates, and any acknowledgment forms signed by participants. In the event of an administrative complaint or civil litigation, contemporaneous documentation of a robust training program is among the most valuable evidence an employer can produce. The Bottom Line Non-discrimination training requirements are not static, and the regulatory trend is clearly toward more specificity, more frequency, and more accountability—not less. Employers who treat training as a one-time orientation task, or who have allowed their programs to go stale, are accumulating legal exposure that is relatively inexpensive to address proactively and potentially very costly to address reactively. In-house counsel should elevate this issue with HR leadership and, where appropriate, the executive team. A well-designed, regularly delivered, and carefully documented training program is one of the most straightforward investments a company can make in its employment law compliance infrastructure—and one of the most defensible positions it can establish when regulatory or litigation exposure materializes. Employers should consult qualified employment counsel to evaluate compliance obligations applicable to their specific circumstances and jurisdictions.
April 21, 2026
Landlord Representation
Avoiding FLSA Pitfalls When Offering Onsite Housing and Rent Discounts
Onsite housing and rent discounts are common benefits in the property management industry, but federal wage-and-hour litigation makes clear that these arrangements can create significant Fair Labor Standards Act (FLSA) exposure if they are not carefully structured. The central question courts ask is not how the benefit is labeled, but whether onsite living primarily benefits the employer and whether it results in unpaid or underpaid work. When housing benefits blur into compensation or operational control, employers face heightened risk of overtime liability, off‑the‑clock claims, and retaliation allegations. Keep Housing Truly Voluntary Housing benefits pose the least FLSA risk when employees are free to live onsite by choice rather than necessity. Requiring onsite residence as a condition of hire or continued employment strongly suggests that the arrangement exists for the employer’s benefit. Employers should ensure that employment offers, policy documents, and actual practices make clear that living onsite is optional and that declining housing has no effect on wages, scheduling, or job security. Separate Housing Benefits from Compensation Rent discounts must remain clearly distinct from wages. When discounts vary by job title, seniority, or responsibility, courts are more likely to view the housing as compensation rather than a fringe benefit. Uniform discounts—or discounts that are demonstrably unrelated to performance or availability—are easier to defend. Employers should avoid structuring housing benefits in ways that resemble pay incentives or substitutes for overtime compensation. Avoid Creating Implicit On‑Call Obligations Employees who live onsite are often perceived—by management or by tenants—as naturally available after hours. Even absent a formal on-call policy, this expectation can give rise to compensable work time. Employers should clearly define work hours, limit after-hours requests, and avoid relying on employees’ proximity as a substitute for staffing. Where on-call work is required, it must be clearly documented and compensated in accordance with the FLSA. Use Arms-Length Leasing Practices Treating employee residents the same as non-employee tenants reinforces the non-compensatory nature of housing benefits. Requiring standard rental applications, background checks, and lease agreements supports an arms-length relationship and reduces the argument that housing is a condition or incident of employment. Special treatment, guaranteed units, or waived leasing requirements undermine that distinction. Pay for All Time Worked—Including After Hours After-hours responses to maintenance calls, tenant complaints, or emergencies frequently constitute compensable work time. Employers should implement reliable timekeeping procedures that allow employees to record this work and should train supervisors to avoid discouraging accurate reporting. Failure to capture and pay for after-hours work remains one of the most frequent sources of FLSA liability in the property management context. Evaluate Whether Rent Discounts Affect the Regular Rate When onsite living primarily benefits the employer—by ensuring immediate coverage, enhanced security, or continuous availability—the value of a rent discount may be required to be included in the regular rate of pay for overtime calculations. Employers should evaluate housing arrangements holistically and seek legal guidance before excluding rent discounts from overtime calculations, particularly where onsite residence is expected or strongly encouraged. Bottom Line Onsite housing can be a lawful and effective benefit, but only when it functions as a voluntary perk rather than an operational necessity. When housing is mandatory, compensation-linked, or tied to unpaid availability, FLSA risks increase substantially. Careful program design, clear policies, and consistent compensation practices are essential to minimizing wage-and-hour exposure.
April 20, 2026
Labor and Employment
Jury Awards Employee $22.5 Million For Employer’s Improper Denial of Pregnancy Accommodation Request
When dealing with injured, sick, or pregnant employees, employers must exercise extreme diligence when denying an accommodation request; it is not as clear-cut as it might appear. The courts (and juries) tend to favor employees. Employers are simply playing with Fire with a capital “F” if an accommodation is denied without first consulting with experienced labor counsel. Take the Ohio state court case discussed below. On March 18, 2026, an Ohio jury awarded an employee $22.5 million dollars for her wrongful death claim against her employer for the loss of her child arising from the denial of her request for a pregnancy-related work accommodation. The jury found that the employer’s initial denial, of only two days, from her work-from-home request, was a substantial factor resulting in her baby’s death. The employee, a fairly new claims associate for a logistics company, was prescribed bed rest by her doctor after she suffered a serious complication related to her pregnancy; this was not in dispute. When she requested a temporary work-from-home accommodation, as was allowed to others, and provided supporting medical documentation, the company denied the request. Instead, it placed her on unpaid leave of absence. Because she and her family depended upon her paycheck and continued medical benefits, she was unwilling to forgo any paychecks and the employee quickly returned to in-office work. At the end of her second day, after the work-from home-denial, the employer reconsidered and said she could work from home. However, unfortunately, that night, after the second day of in-office work, she suffered severe medical complications resulting in her child being born too early; six hours after being born, her baby girl died. The employer’s counsel, we believe, of course, with hindsight, chose a disingenuous defense strategy that obviously offended and inflamed the jury, resulting in the huge verdict. Employer’s counsel conflated the employee having her mother drive her to work so she could ask her supervisor if she could work from home (which the supervisor said she could) and to pick up her computer so she could work at home, by saying she came to work and worked that day of her own volition. Then, when the human resources department overruled the supervisor and denied the employee’s request to work-from-home, it placed her on unpaid leave. When the employee, needing her pay and medical benefits, felt she had to come into work, the employer’s counsel faulted the employee for coming into the office rather than staying on unpaid leave. It became clear that the employer made an error and wrongfully considered the employee’s request as one for unpaid leave of absence. The baby’s estate filed a wrongful death lawsuit in February of 2023: Larkin v. Total Quality Logistics, LLC, (Hamilton County, Ohio). There is no reported decision, and the above alleged facts have been assembled from copies of the complaint and motions filed in the case; it will likely be appealed. We highlight this extreme case because it shows the real danger and consequences of the improper handling of an employee’s good-faith request for a reasonable work accommodation. If the employee suffers physical harm as a result of the denial, or even the unreasonable delay in approval, the employer may be on the hook not only for lost wages, but also the damages that flow from the denial/delay, including wrongful death, medical bills and costs, and pain and suffering. As this employee was relatively new and did not appear to even qualify for FMLA leave, which is unpaid leave, the employer was offering a leave of absence instead of allowing the employee to work from home. However, she had other causes of action under federal and state law. Under the Americans with Disability Act (ADA), 42 U.S.C. §12101 et seq., the Family Medical Leave Act (FMLA), 29 U.S.C. § 2601, et seq. and the Pregnant Workers Fairness Act (PWFA), 42 U.S.C. 2000gg et seq., covered employers are required to assess, through an interactive process with a covered employee, whether a suggested accommodation may allow an employee to fulfill their required job duties in a manner least burdensome on the business. To legally justify denying a reasonable accommodation request, an employer must demonstrate the accommodation would impose an undue hardship, meaning a substantial cost or difficulty, as determined by factors such as the nature and cost of the accommodation, the employer’s financial resources, and the impact on business operations. An employer does not have to create a new position for the employee, but where the disabled/pregnant employee could perform the essential functions of the job by working from home, an employer (especially a large employer, as this was) will have a difficult time justifying a denial. This case serves as a reminder that the stakes of these employment decisions are very high, and mistakes can lead to drastic consequences for both employee and employer. Employers should review employee job descriptions for accuracy and train supervisors on the accommodation process and what is required under the ADA, FMLA, and PWFA. As always, documentation is key. Experienced labor and employment counsel can help successfully navigate this process and should be contacted as soon as there is any discussion about the denial of an accommodation. A short phone call or two (or emails) with labor counsel before a denial could greatly increase the chances of avoiding liability, six figures of attorney’s fees, and serve to avoid harming an employee and his/her family.
April 16, 2026
Labor and Employment
Responsible AI in HR Starts with Transparency and Trust
Artificial intelligence (AI) is increasingly positioned as a tool to help businesses better understand workforce trends, predict retention risk, and improve performance. Yet from the employee perspective, these same tools can feel intrusive. AI systems often pull sensitive data directly from HRIS platforms including, personal information, performance metrics, engagement signals, communications, and behavioral indicators. Without clear communication, employees may be left wondering what data is being collected, how it is being interpreted, and whether it could be used against them. In this context, transparency is essential: employees should understand not only what data is gathered, but why it is necessary and how it benefits both the business and the workforce. Employers, meanwhile, face their own set of risks. Many AI-driven workforce tools rely on third-party vendors, raising important questions about data ownership, retention, and security. Is employee data being stored indefinitely? Is it being used to train models beyond the scope of the employer’s relationship with the vendor? These concerns make careful contract review critical, particularly around data usage rights, confidentiality, and security safeguards. A practical guiding principle is data minimization: if data is not essential to achieving a clear business purpose, it should not be collected. Excessive data collection can increase legal and regulatory exposure without delivering proportional value. Ultimately, the issue of AI-driven employee monitoring extends beyond compliance to governance, risk management, and organizational trust. When employees believe they are being surveilled without sufficient guardrails and transparency, morale can erode and retention risks can grow. Businesses that use AI responsibly limit data collection and communicate openly with employees are better positioned to maintain employee confidence and foster a culture where technology supports, rather than undermines the workforce.
April 16, 2026
Immigration Law
Understanding the EB 5 Program’s Critical Deadlines: What Investors Need to Know
The EB‑5 Immigrant Investor Program continues to be one of the most reliable pathways for families seeking permanent residency in the United States through investment. But with the passage of the EB‑5 Reform and Integrity Act (RIA), timing has become more important than ever. Two key dates—September 30, 2026, and September 30, 2027—now shape the strategic landscape for investors. Understanding the difference between these deadlines can help you protect your immigration process, secure your place in line, and avoid unnecessary risk. History of the EB‑5 Immigrant Investor Program The EB‑5 Immigrant Investor Program was created by Congress in 1990 to stimulate the U.S. economy through foreign investment and job creation, offering eligible investors and their families a path to permanent residency in exchange for investing in a new commercial enterprise that creates at least 10 full‑time U.S. jobs. In 1992, Congress introduced the Regional Center Program, allowing investors to participate in pooled, federally designated projects and count indirect job creation, which dramatically expanded the program’s reach and popularity. Over the decades, EB‑5 has undergone significant reforms, most notably the 2022 EB‑5 Reform and Integrity Act, which modernized oversight, increased investment thresholds, and introduced strong integrity measures. September 30, 2026, Grandfathering Deadline Under the RIA, any EB‑5 Regional Center petition filed on or before September 30, 2026, receives powerful “grandfathering” protection. This means: USCIS must continue processing your petition even if the EB‑5 Regional Center Program expires in the future Your case remains valid under the rules in place at the time of filing You are shielded from political uncertainty, program lapses, or regulatory changes that could otherwise disrupt your immigration process For many families, this date represents the safest window to file. Submitting an I‑526E petition before the 2026 deadline locks in today’s requirements and ensures your case cannot be altered by future program interruptions. September 30, 2027, Program Authorization Deadline The EB‑5 Regional Center Program is currently authorized through September 30, 2027. Investors may still file after the 2026 grandfathering deadline and before the 2027 program expiration. However, filings made between October 1, 2026, and September 30, 2027, do not receive the same guaranteed protection. If Congress fails to reauthorize the program after 2027: Petitions filed after September 30, 2026, may be paused or left unprocessed Investors could face delays, uncertainty, or the need to refile under new rules Investment thresholds or program requirements could change In short, you can file until 2027, but only filings made by 2026 are guaranteed protection. Why Investors Should Act Before 2026 Filing before the September 30, 2026, grandfathering deadline offers several advantages: Guaranteed case processing, regardless of future political developments Earlier priority dates, which matter for investors from backlogged countries Protection from future rule changes, including potential increases in investment amounts Reduced risk of delays caused by last‑minute filing surges Given the long‑term nature of the EB‑5 process, securing stability early is often the most prudent choice. Investment total increases and potential fee increase in 2027 January 1, 2027, is another critical date for potential EB-5 investors, as at that point, the USCIS can increase the investment totals under RIA. In addition, new fees and changes to the program are also possible. What This Means for You If you are considering the EB‑5 program, the next 18–24 months represent a uniquely important window. Filing before the 2026 deadline provides the strongest legal protections available under current law. Filing after that date remains possible but carries more uncertainty. Whether you are just beginning your EB‑5 journey or evaluating project options, now is the time to understand your timeline and prepare your strategy.
April 16, 2026
Labor and Employment
How to Use Contractors and Gig Workers Safely: Navigating DOL Classification Standards in a Changing Enforcement Climate
The use of independent contractors and gig workers remains an attractive and, in many industries, essential component of modern workforce strategy. Flexibility, cost control, and scalability continue to drive businesses toward non-employee labor models. At the same time, the legal framework governing worker classification has become more exacting, more nuanced, and more actively enforced. Misclassification is no longer a technical compliance issue. It is a material risk with significant financial and reputational consequences. Understanding how to engage contractors safely requires more than a surface-level application of outdated tests. It requires a disciplined, fact-specific analysis grounded in current U.S. Department of Labor standards and enforcement priorities. The DOL’s Economic Reality Test: Substance Over Form The governing framework under the Fair Labor Standards Act is the economic reality test, as refined by recent Department of Labor rulemaking. The inquiry is not determined by contractual labels or the parties’ stated intentions. It turns on whether, as a matter of economic reality, the worker is dependent on the business or is operating an independent enterprise. While the analysis remains holistic, several core factors consistently guide the determination. The degree of control exercised by the company is often central. Where a business dictates how, when, and where work is performed, classification as an independent contractor becomes increasingly difficult to sustain. Equally significant is the worker’s opportunity for profit or loss based on managerial skill. Independent contractors typically can increase earnings through initiative, investment, or business judgment. Workers paid on a fixed or standardized basis, without meaningful entrepreneurial discretion, present heightened risk. The permanence of the relationship also carries weight. Open-ended or indefinite engagements resemble traditional employment relationships, particularly where the worker is integrated into ongoing operations. Investment in tools and resources, the degree of skill required, and whether the work is integral to the business’s core function all further inform the analysis. No single factor is dispositive. However, in practice, patterns emerge. Where multiple factors point toward economic dependence, the likelihood of misclassification findings increases substantially. Why Misclassification Risk Is Rising Recent enforcement trends reflect a clear and consistent priority. Federal and state agencies are increasingly aligned in scrutinizing contractor arrangements, and plaintiffs’ counsel continue to leverage classification issues as a gateway to broader wage-and-hour claims. Misclassification rarely exists in isolation. It often gives rise to allegations involving unpaid overtime, minimum wage violations, failure to provide benefits, and tax exposure. In collective or class contexts, liability can scale rapidly. In addition, state law frameworks, including ABC-style tests in certain jurisdictions, impose stricter standards than federal law. A classification that may be defensible under federal guidance can nonetheless fail under applicable state requirements. This layered regulatory environment requires a coordinated approach. A one-size-fits-all model is no longer viable for employers operating across multiple jurisdictions. Common Missteps That Create Exposure A recurring issue in contractor engagements is the reliance on form over function. Well-drafted independent contractor agreements, standing alone, do not establish compliance. Agencies and courts consistently look beyond contractual language to the realities of the working relationship. Similarly, classification decisions driven by business preference rather than legal analysis create significant exposure. The fact that a contractor model is operationally convenient, or industry common does not insulate it from challenge. Another frequent concern arises where contractors are treated, in practice, like employees. Requiring adherence to internal policies designed for employees, imposing rigid schedules, or integrating contractors into core teams without distinction undermines the independence necessary to support proper classification. Finally, the use of long-term, exclusive contractor relationships presents elevated risk, particularly where the individual does not meaningfully market services to other clients. Practical Strategies for Structuring Compliant Relationships Mitigating classification risk requires alignment between documentation and day-to-day operations. Engagements should be structured to reflect genuine independence. This includes defining project-based scopes of work, preserving contractor discretion in how services are performed, and avoiding unnecessary control over scheduling or methods. Compensation models should, where appropriate, allow for variation based on performance, efficiency, or business judgment, rather than mirroring employee wage structures. Businesses should also evaluate whether contractors are making meaningful investments in their own operations, including tools, equipment, or business infrastructure. Regular audits are essential. Classification determinations made at the outset of a relationship may become outdated as the engagement evolves. Periodic review allows employers to identify and address risks before they mature into liabilities. Importantly, compliance strategies must account for both federal and state standards. Where stricter state tests apply, those frameworks should govern the analysis. The Strategic Imperative The continued expansion of the gig economy ensures that contractor relationships will remain a focal point of regulatory and litigation activity. Employers who approach classification as a static, check-the-box exercise are increasingly vulnerable. Those who treat it as an ongoing, strategic consideration are better positioned to manage risk effectively. The distinction between an employee and an independent contractor is, at its core, a legal conclusion drawn from operational realities. Aligning those realities with governing standards requires careful planning and informed judgment. For organizations seeking to preserve flexibility while minimizing exposure, experienced counsel is not simply beneficial; it is essential. Proactive structuring, informed by current enforcement priorities, remains the most reliable way to avoid costly disputes and to ensure that workforce models withstand scrutiny when it matters most.
April 10, 2026
Labor and Employment
From Allegations to Adjudication! Court Strips Lively–Baldoni Case to a Retaliation Reckoning
The April 2, 2026, decision in the dispute between Blake Lively and Justin Baldoni is best understood as a post discovery narrowing that leaves the case both smaller and more legally coherent. Judge Lewis Liman granted the defendants’ motion for judgment on the pleadings and motion for summary judgment in substantial part, dismissing most of the claims and allowing only a limited set to proceed. This was not an early-stage plausibility ruling. It was a merits-driven assessment of what the record can actually support. What remains is precise. Lively’s retaliation claim under the California Fair Employment and Housing Act proceeds against the production entities. Her aiding and abetting retaliation claim proceeds against the public relations firm. Her breach of contract claim proceeds against the entity that signed the Contract Rider Agreement. The rest of the case, including Title VII, Labor Code retaliation, and the common law theories, has been dismissed. The contractual analysis is where the opinion does some of its most important work, and it explains why the case looks the way it does now. The court treated two agreements very differently, and the reason is not subtle. One was never signed. One was. The Actor Loanout Agreement failed as a matter of contract formation. The court focused on express language that made execution a condition of any obligation. The agreement provided that the company’s obligations were conditioned on “receipt of executed copies of this Agreement signed by Lender and Artist.” It also required execution of the inducement. Those provisions were not treated as boilerplate. They were treated as dispositive. Lively never signed. The parties continued to negotiate material terms, including the very provision addressing sexual harassment and remedies. On those facts, the court held there was no binding contract to enforce. That conclusion carries broader significance than this case. The court rejected the idea that substantial performance can override an express intent not to be bound absent execution. Filming occurred. Compensation was paid. Negotiations continued. None of that altered the contractual analysis. Where the parties clearly reserve the right not to be bound until signature, courts will enforce that reservation. In practical terms, the court treated the ALA as exactly what it was in the record. An unconsummated negotiation. The Contract Rider Agreement, by contrast, is the rare piece of paper in this record that does exactly what lawyers expect a contract to do. It was signed. It contains operative language. And that language goes directly to the theory that survived. Paragraph 10 provides that there shall be “no retaliation of any kind” against Lively for raising concerns, including retaliation “during publicity and promotional work.” That provision is not abstract. It is tailored to the very conduct Lively alleges occurred after she raised complaints. The court’s willingness to let the contract claim proceed flows directly from that text. The difference in treatment between the ALA and the CRA is therefore not a matter of judicial preference. It is a straightforward application of contract law. An unsigned agreement with disputed terms does not bind. A signed agreement with a clear anti-retaliation clause does. The retaliation analysis follows a similar pattern of doctrinal precision. Several claims failed because they required an employment relationship that the court concluded was not present. That determination eliminated the Title VII and Labor Code theories. But FEHA retaliation is written differently. It protects any person who engages in protected activity. That statutory distinction is what allows the claim to proceed. The court also declined to treat the alleged conduct as too remote from California to support a FEHA claim. It found a sufficient connection based on allegations that California-based actors directed and executed the challenged conduct. That holding keeps California law in play and preserves a framework that is often broader than its federal counterpart. The most closely watched aspect of the case, the alleged reputational campaign, survives but only in the narrow sense that matters at this stage. The court did not find that retaliation occurred. It held that a reasonable jury could find it occurred. It also held that the defendants’ explanation that they were protecting their reputations and the film does not resolve the issue as a matter of law. Competing explanations are for a jury where the record supports them. That brings us to the question that tends to get lost in the headlines. What about Baldoni himself. Is he out? The answer is no, but his exposure is materially reduced. Many of the claims asserted directly against him, including harassment and certain statutory claims, have been dismissed. However, he remains a defendant to the extent he is part of the group alleged to have engaged in retaliatory conduct and conspiracy. The case against him now lives or dies on the retaliation theory rather than on the broader set of claims originally pleaded. The same narrowing applies across the board. Wayfarer is no longer in the contract case because it was not a party to the agreements and the argument was not preserved. But it remains in on retaliation. The public relations entity remains in on aiding and abetting. The film specific entity remains in on both retaliation and contract. The cast of defendants is still present. The script they are operating under is simply much tighter. What the court has done is not to decide who is right. It has decided what can be decided later. The case now turns on a set of familiar but demanding questions. Whether Lively engaged in protected activity. Whether she experienced adverse action after doing so. Whether that action was motivated by retaliation. And whether it breached a written promise prohibiting retaliation. For a legal audience, the lesson is as straightforward as the holding. Contracts matter in the form they are actually executed, not the form in which they are discussed. Statutes matter in the words they actually use, not the words we assume they contain. And at summary judgment, claims survive not because they are compelling in the abstract, but because the record permits a reasonable jury to accept them. The case that remains is narrower. It is also more dangerous in a familiar way. Retaliation claims tend to turn on motive and sequence rather than a single discrete act. Those are questions that courts are often reluctant to resolve as a matter of law. That is why, even after a ruling that eliminates most of the complaint, this litigation is far from over.
April 3, 2026
Labor and Employment
Spring Cleaning Your Employee Files
Spring inspires a certain kind of ambition. Closets are reorganized. Garages are reclaimed. Kitchen drawers finally surrender their mysterious collections of takeout menus and expired soy sauce packets. Employers would do well to apply the same seasonal energy to another space that tends to accumulate clutter quietly over time: employee records. Personnel files have a remarkable way of expanding without supervision. A performance note here, an email printed there, a manager’s handwritten reminder tucked into a folder for “later.” Years later, the file resembles less of a clean employment record and more of a historical archive. Unfortunately, when a dispute arises, those archives tend to become exhibits. Spring is a useful moment for employers to step back and examine how employee records are organized, what should be retained, and what should not be living in the same file in the first place. A thoughtful approach to data retention is not just good housekeeping, it is a meaningful risk management strategy. One of the most common misconceptions about employee files is that everything related to an employee should live in one folder. Legally speaking, that approach creates more problems than it solves. Most employers should maintain several distinct categories of employee records, each with its own purpose and level of confidentiality. The traditional personnel file is the record most employers think of first. It typically contains materials related to hiring, compensation, performance evaluations, promotions, disciplinary actions, and other employment decisions. In short, it tells the professional story of the employee’s relationship with the company. But certain types of information should not live in that same file. Medical information is a prime example. Documents related to medical conditions, disability accommodations, and medical certifications for leave must be maintained separately and treated as confidential under federal law, including the Americans with Disabilities Act. Keeping medical records apart from the general personnel file helps limit access and ensures managers reviewing performance information are not inadvertently exposed to protected medical details. Immigration related documents are another category that deserve their own home. Form I-9s, which verify employment eligibility, should be stored in a separate I-9 file or electronic system rather than within the personnel file itself. There is a practical legal reason for this. If the Department of Homeland Security or another agency conducts an I-9 audit, employers are required to produce those forms. Housing them separately allows employers to provide the required documents quickly without turning over the entire personnel file or exposing unrelated, potentially sensitive employment records. A similar logic applies to background check documentation. Reports obtained under the Fair Credit Reporting Act often contain personal information that should be maintained separately from routine personnel materials and handled in accordance with the statute’s confidentiality requirements. If this sounds like a lot of folders, it is. But the structure matters. Separating records by category is not about bureaucracy. It is about protecting sensitive information, limiting unnecessary disclosure, and ensuring compliance with multiple overlapping employment laws. Consistency is equally important. Employers should aim for uniform recordkeeping practices across the workforce. Documents that are routinely created, such as performance evaluations or written warnings, should appear consistently in employee files. Sporadic documentation invites uncomfortable questions later about whether records were selectively created or preserved. This becomes especially relevant in litigation. When employee files contain scattered notes, informal comments, or partial documentation, they often raise more questions than they answer. The absence of records can be just as problematic. If an employer asserts that an employee struggled with performance but the file contains no documentation of those concerns, that gap becomes difficult to explain. Of course, spring cleaning does not mean shredding everything in sight. Employers must comply with a bevy of federal and state record retention requirements. Under the Fair Labor Standards Act, for example, payroll records must generally be retained for at least three years. The Equal Employment Opportunity Commission requires employers to preserve personnel and employment records for at least one year, and longer if a charge of discrimination has been filed. Form I-9s must be retained for a specific period tied to the employee’s date of hire and separation. Benefit plan records, tax documents, and workplace injury reports often carry their own retention timelines as well. Because the rules vary, the most effective approach is to adopt a written document retention policy that clearly identifies which records must be maintained and for how long. A well-designed policy helps HR teams manage records consistently and prevents the ad hoc cleanups that tend to occur when file cabinets become too full. Those spontaneous cleanups can create real problems. Once an employer becomes aware of a dispute, investigation, or potential claim, the organization has a legal obligation to preserve relevant records. Destroying documents after that point, even if it would normally be permitted under a retention policy, can lead to allegations of evidence destruction. Courts tend to take a dim view of that kind of spring cleaning. Modern technology has also complicated the recordkeeping landscape. Employee information now lives in HR platforms, email systems, messaging tools, shared drives, and occasionally personal devices. A comprehensive retention strategy should account for both physical and electronic records and ensure they are governed by consistent rules. At the same time, employers should resist the temptation to keep everything forever. Over retention can create its own problems. The more documents an organization keeps, the more it may have to search, review, and produce in the event of litigation or an investigation. In other words, the goal is not hoarding. It is curation. Spring cleaning employee files may not provide the immediate satisfaction of finally conquering the garage, but it offers something arguably more valuable: clarity. Organized, compliant records help employers make better decisions, respond confidently to audits or claims, and protect the confidentiality of sensitive information. And unlike that kitchen drawer full of soy sauce packets, an orderly recordkeeping system rarely produces unpleasant surprises later.
April 1, 2026
