What’s next in labor law?

Top labor and employment lawyers say what practitioners should watch

Top labor and employment lawyers say what practitioners should watch
April 2017
By Paul Dailing

The world is talking Obamacare, overtime and paid sick leave. But what aren’t people talking about?

We asked some of Chicago’s top labor and employment lawyers about upcoming trends, issues, legislation and cases they think practitioners should keep an eye on. From employee classification to union dues, these are issues that will change the working world, but ones these practitioners think deserve more attention.

Intense changes

Jim Franczek, founding partner and president of Franczek Radelet, said the legal industry is bracing for unprecedented upheaval, and not just in labor and employment law.

“When Obama took over for Bush there were some fairly dramatic changes in the first year, year and a half. When Clinton took over from old Bush, there were a lot of changes. The difference with Trump is the intensity of those changes,” Franczek said.

Previous political swings haven’t swung so far, he said.

“They go from left of center to right of center. If Trump keeps appointing people like the one’s he’s been appointing, I think we’re in for some very significant changes,” Franczek said.

One case Franczek is monitoring heavily is Friedrichs v. California Teachers Association, et al., which could determine the future of fair-share union dues. Lead plaintiff Rebecca Friedrichs is a California elementary school teacher who wants to overturn Abood v. Detroit Board of Education, a 1977 U.S. Supreme Court decision allowing unions to collect dues from people who opted not to join the union, but who benefit from collective bargaining agreements.

Friedrichs went to the Supreme Court last year, which deadlocked 4-4 due to the vacancy left by the death of Antonin G. Scalia.

“With a 4-4 court it was sent back, but I think it’s fair to anticipate that with [Neil] Gorsuch appointed to the court — and he will be appointed — that’s going to come up again,” Franczek said in March. “The prospects of that being decided against the unions is pretty high.”

Franczek said removing fair-share dues would irreparably damage the unions’ ability to operate.

“From a union’s point of view, that’s the life blood of the union because the employer takes [the dues] right out of the employee’s paycheck and sends them to the union,” Franczek said.

New interpretations

While new law from the Supreme Court would change everything, how federal agencies react to and apply existing law can have just as large an effect.

Joe Gagliardo, managing partner of Laner Muchin and chair of its litigation department, is waiting in particular to see how a Trump-led Equal Employment Opportunity Commission and National Labor Relations Board will interpret the rules they’re tasked with enforcing.

The five-member NLRB is down to two Democrats and a Republican. The two appointments that fall to Trump will likely give the group that enforces American labor law on collective bargaining and unfair labor practices a GOP majority.

“As we know over the last handful of years, the National Labor Relation Act has been interpreted in ways that have changed the law in significant ways,” Gagliardo said. “The unknown is what will be the impact of the new administration on the way the act has been interpreted. And naturally, that will also turn on appointments to the National Labor Relations Board.”

Another agency yet to show its new colors is the EEOC.

The group that enforces employment discrimination law is guided by its Strategic Enforcement Plan, a set of priorities set in 2013 and renewed with modifications last year.

Although the current plan runs through 2021, Gagliardo has yet to see how some of the written priorities — including protections for transgender people, immigrant laborers and Muslims — will be applied in practice. He doesn’t predict a repeal, but possibly a behind-the-scenes reshuffling of the precedence each “priority” takes.

“I don’t think the EEOC is going to back off from [the SEP].” Gagliardo said. “I think the question’s going to be are their priorities in terms of what would they normally would be pursuing would be the same and are they going to be as aggressive, as they have been in the past, in filing these systemic claims where they feel there’s a pattern or practice of activity that affects a large groups of people.”

Years of reversals

Joe Tilson, the chair of Cozen O’Connor’s labor and employment department, is also watching the NLRB.

“I’m confident that many of the decisions of the Obama NLRB will be overturned,” Tilson said.

Although the board’s lone Republican Philip Miscimarra was an Obama appointee, Trump appointed him acting chair in January, a position Tilson predicts will become permanent. That means a former voice in the wilderness is now running the show.

“In most of the decisions he was a dissenter,” Tilson said of Miscimarra. “Now that he will become the chair of the NLRB, I believe that he will have a real leadership role. And he really is a thought leader in the field of labor and employment law and a true legal scholar.”

Tilson predicts the reversals of several Obama-era decisions, including the 2015 Browning-Ferris decision, which set how franchisees and staffing agencies determine joint-employment status, and several decisions relating to whether employers can forbid disrespectful comments on social media.

Before that can happen, a new case has to arise and make its way up to the NLRB in D.C.

“I think what people fail to realize though is that this will not be in a matter of weeks or months, it may take years,” Tilson said.

And then there’s the Department of Labor, which could have an immediate effect on the legal landscape if it chooses to drop an appeal the department under Obama was working toward.

“The Department of Labor in the Obama administration pushed hard to raise the salary threshold dramatically for employees to be exempt [from overtime]. The new rules were enjoined by a federal court and I strongly suspect that the new administration will abandon the previous DOL’s efforts to increase the salary threshold,” Tilson said. “They’ll probably increase it somewhat, but they will not double it, as did the prior administration.”