Labor & Employment Law Articles
2007 Labor and Employment Law Changes
The new year brings some significant changes to labor and employment law. If you have any questions about these items please contact us.
- Electronic Data - On December 1, 2006, amendments to the Federal Rules of Civil Procedure regarding the handling and discovery of electronically stored information went into effect. These new amendments require parties to take steps to make sure that electronic information, such as e-mail and other files stored on a computer, are preserved during litigation. Since in labor and employment matters such electronic information is often solely in the employer’s possession, these new rules place significant obligations on employers to preserve such data.
Under the new rules, once a lawsuit is commenced, the parties’ attorneys must meet to discuss what electronically stored information is relevant to the case and to discuss how relevant electronically stored information should be produced to the opposing side. Additionally, since the new rules specifically state that electronically stored information should be treated in a similar manner as paper documents, a party could be fined, sanctioned or held in contempt if it fails to properly preserve such electronically stored documents.
Thus, as soon as a company receives a lawsuit or even receives notice that a lawsuit may be brought against the company, it should take steps to ensure that all potential relevant electronically stored documents are preserved. Under the federal rules, “relevant documents” include not only documents directly related to the case, but also documents that appear reasonably calculated to lead to the discovery of admissible evidence.
The new rules do have some safeguards to protect parties possessing electronic information. First, the rules provide that a party need not provide discovery of electronic documents from sources that are not reasonably accessible because of undue burden or cost. Thus, an opposing party would not ordinarily be able to request every single e-mail sent by all of the company’s employees, because the probative value of such information would be limited and the company’s expense and burden of providing such electronic data would be great. However, the court may, nonetheless, order broad discovery if the requesting party shows good cause.
Additionally, the amended rules also provide a safe harbor provision, which states that “absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good faith operation of an electronic information system.” This exemption is likely to address the situation where a plaintiff brings a suit several years after a claim arose and the company had in place a policy which stated that electronic data is only stored by the company for a certain time period and the time period expired prior to when the company received notice of the lawsuit. The good faith requirement, however, does not allow a party to destroy electronic documents that it is otherwise required to store. Moreover, there must be a valid business reason behind the company’s electronic document retention policy.
In light of the broad requirements of the new rules, it is advisable that even if a company is not currently involved in litigation, it should implement safeguards regarding the retention of electronic documents. Programs should be developed to avoid the deletion of all business-related e-mail, and companies should develop systems that archive documents to create an easily searchable database of electronically stored documents. Ideally, this database should include all electronically stored documents, not just e-mails. The cost of taking a proactive approach now could be minimal compared to the potential future cost of not properly preserving documents. Thus, companies should contact their attorneys to discuss how to develop sufficient electronic document retention policies prior to being a party to a lawsuit. - New York State Law On Social Security Numbers - In recent years, the widespread public exposure of personal information, especially Social Security numbers, has played an increasingly significant role in identity theft. To combat this growing problem, the New York State Legislature also amended the General Business Law to place limits on the use and disclosure of an individual’s Social Security number by businesses and other individuals. The purpose of the amended law is to protect New York residents by prohibiting businesses from communicating Social Security numbers, while still permitting lawful uses of the numbers to conduct business. Specifically, the amended law targets four types of conduct:
- It prohibits the intentional communication of an individual’s SSN to the general public;
- It restricts businesses’ ability to print an individual’s SSN on mailings or on any card or tag required to access products, services, or benefits;
- It prohibits businesses from requiring an individual to transmit his or her unencrypted SSN over the Internet; and
- It requires businesses who possess SSNs to implement appropriate safeguards and limit unnecessary employee access to SSNs.
- Changes to EEO-1 Form - The EEO-1 Report (short for Employer Information Report) is a government form that must be filed by September 30 of each year by:
- Employers with federal government contracts of $50,000 or more and 50 or more employees; and
- Employers who do not have a federal government contract but have 100 or more employees.
The United States Equal Employment Opportunity Commission (EEOC) recently revised the EEO-1 form for the first time in 40 years. These revisions will go into effect beginning with all 2007 filings. The changes focus on the reclassification of certain job categories and the racial and ethnic categories.
Under the job categories, the former category of “Officials and Managers” will be divided into two levels based on responsibility and influence within the organization. These two levels will be:- Executive/Senior Level Officials and Managers - these employees’ responsibilities include planning, directing and formulating policy, setting strategy and providing overall direction. In larger companies, these employees are within two reporting levels of the CEO; and
- First/Mid-Level Officials and Managers - these employees’ responsibilities include overseeing day-to-day operations and directing implementation or operations within the specific parameters set by Executive/Senior Level Officials and Managers.
- Adds a new category titled “Two or more races”;
- Divides “Asian or Pacific Islander” into two separate categories: “Asian” and “Native Hawaiian or other Pacific Islander”;
- Renames “Black” as “Black or African American”;
- Renames “Hispanic” as “Hispanic or Latino”; and
- Strongly endorses self-identification of race and ethnic categories through surveying employees, as opposed to visual identification by employers.
- Minimum Wage Increase - Effective January 1, 2007, the minimum wage in New York is $7.15 per hour. Previously, the minimum wage in New York had been $6.75 per hour. On January 10, 2007, the United States House of Representatives passed legislation that would increase the federal minimum wage to $7.25 per hour. If this legislation ultimately passes through the Senate and is signed into law, it would mark the first increase in the federal minimum wage in a decade. We will continue to monitor this situation and keep you apprized of any developments that may effect your business. In the interim, please feel free to contact us if you have any questions about the New York wage increase or any other matters.
