Counseling & Compliance Training - Page 13 of 89

Non-Compete Agreements: Provide Them Ahead of Time – But Don’t Let Them Be Signed

On March 8, 2022, the Fifth Circuit Court of Appeals held that a non-compete agreement was not enforceable because the employer seeking to enforce the agreement had presented it to the employee, and the employee had signed it, before the employee’s first day of work. A few months later, Colorado Governor Jared Polis signed into law a new statute requiring that notice of a non-compete agreement be provided to prospective employees before they accept an offer of employment.

In finding a non-compete provision must strictly comply with Louisiana law, the court in Rouses Enterprises, L.L.C. v. Clapp, No. 21-30293 (5th Cir. Mar. 8, 2022), found that Louisiana law (LA. REV. STAT. ANN. § 23:921(A)(1)) permits certain non-compete agreements between employers and employees, but not between job applicants and potential employers. Thus, the court reasoned, a non-compete agreement signed by a prospective employee before her actual date of hire was unenforceable.

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Reforms to Puerto Rican Labor Law Reinstate Employee-Friendly Measures

On June 20, 2022, Puerto Rico’s governor signed into law Act No. 41-2022 (“the Act”). The Act rolls back certain changes brought about by the Labor Transformation and Flexibility Act (“LTFA”). The LTFA was enacted in 2017 in an effort to reenergize the island’s economy following its effective bankruptcy.

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State & Local Employment Law Developments: Q2 2022

Alabama

Leave Benefits for Adoption: Alabama’s Adoption Promotion Act (the Act) takes effect on July 1, 2022 and requires employers with 50 or more employees to provide eligible employees with up to 12 weeks of unpaid family leave for the birth or adoption of a child. The Act also mandates that employers who provide paid leave benefits and additional leave considerations for the birth of a child provide similar benefits for adoption.

Marketplace Contractors: Effective July 1, 2022, marketplace contractors are not considered employees under workers’ compensation and unemployment insurance laws (if certain conditions are met). Marketplace contractors are persons/entities who enter into agreements with marketplace platforms to be connected with third parties seeking services — such as drivers for Uber and Lyft.

Arizona

Expansion of Employer Definition under Sexual Harassment Discrimination: Arizona enacted a change to the sexual harassment provisions of existing employment discrimination law, so that the law applies to any employers or their agents who commit sexual harassment or retaliate against someone for reporting it.

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Workers Wanted: Proposed Legislation to Address Immigration Backlogs

Several bills have been recently proposed in Congress to address some of the challenges employers and employees face in terms of high-skilled immigration. Backlogs in the permanent residence (green card) process and difficulties procuring work visas for professional employees create significant stress and uncertainty for U.S. businesses in a competitive labor market.

One critical challenge is the significant backlog in the permanent residence process, which continues to grow. There are 140,000 immigrant visas available for employment-based applicants each year. However, these 140,000 visas are subject to a country cap that states no more than seven percent of the 140,000 available immigrant visas may go to immigrants from any one country. This cap does not consider the fact that demand from each country for employment-based visas is not equal. Largely because of the cap, individuals from countries for which demand for employment-based immigrant visas is higher — such as India and China — face extreme backlogs when seeking to become permanent residents in the U.S. These backlogs not only impact individuals and their families, but also impact their employers who are sponsoring them through the permanent residence process. There are currently over one million people affected by this backlog, putting strain on employers who must continue to sponsor and extend the temporary work authorization of individuals who cannot finalize their permanent residence processes due to the delays caused by the backlog.

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Coming August 2022: Colorado Substantially Limits Noncompete Agreements

Beginning August 10, 2022, Colorado will drastically narrow the circumstances in which Colorado employers can seek to enforce noncompete and other restrictive employment agreements. Despite Colorado law already having a general restriction against the use of noncompete agreements, the Colorado General Assembly recently passed, and Gov. Jared Polis has now signed, HB 22-1317. With this bill, Colorado joins the growing number of states enacting increased employee protections against restrictive covenant agreements, including banning such agreements with workers earning below a certain threshold.

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Minnesota Frontline Worker Pay Program Application Period Opens

In April 2022, Minnesota Gov. Tim Walz signed Frontline Worker Payments into law to aid Minnesotans who worked in one of 15 frontline sectors identified in the legislation. The public purpose of the law is to “provide payments to frontline workers whose work put them at risk of contracting COVID-19 during the peacetime emergency declared by the governor in Executive Order 20-01.” After the bill was signed into law, the Minnesota Department of Labor and Industry (DOLI) was tasked with developing an application process and guidance for employers and employees to facilitate the frontline worker pay program. DOLI opened the application period for the program on June 8, 2022, announcing the period will remain open through July 22, 2022.

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