Labor & Employment – Page 9

Top Five Labor Law Developments for April 2025

U.S. Supreme Court Chief Justice John Roberts temporarily halted a U.S. Court of Appeals for the D.C. Circuit Court order reinstating National Labor Relations Board Member Gwynne Wilcox. Trump, et al. v. Wilcox, et al., No. 24A966 (Apr. 9, 2025). Following President Donald Trump’s unprecedented termination of Board Member Wilcox, the D.C. Circuit issued an en banc order reinstating her to the Board, citing the Court’s 1935 decision in Humphrey’s Executor that upheld the constitutionality of for-cause removal protections for federal agency leaders. The Trump Administration filed an emergency application to the Court for a stay of the D.C. Circuit’s order, arguing subsequent case law narrowed Humphrey’s Executor to apply only to multi-member agencies that do not wield substantial executive power, making the case inapplicable to the Board. Although Chief Justice Roberts’ order temporarily pauses Wilcox’s reinstatement, Wilcox has filed a response to the stay application urging the Court to deny the stay until the D.C. Circuit can issue a decision on the merits of the case. Wilcox also requested that the Court deny the Trump Administration’s petition for certiorari before the D.C. Circuit’s decision, arguing the request to rush the Court’s normal appeal procedures is unwarranted.
A Washington, D.C. federal judge blocked President Trump’s executive order (EO) aiming to exclude certain federal agencies and their subdivisions involved in national security from collective bargaining. National Treasury Employees Union v. Donald J. Trump, et al., No. 1:25-cv-00935 (D.D.C. Apr. 25, 2025). Pursuant to the EO, covered agencies (including the Departments of Defense, Justice, and State) were no longer required to engage in collective bargaining with unions. The National Treasury Employees Union (NTEU), which represents federal workers in 37 departments and agencies, requested a preliminary injunction arguing the order was retaliatory against the unions. The injunction applies to all employees that NTEU represents. Because NTEU was the filing party, employees represented by other unions are not included in the order.
A coalition of unions, nonprofit groups, and local governments filed a complaint in a California federal court arguing President Trump lacks the constitutional authority to downsize or reorganize federal agencies without congressional approval. The lawsuit stems from an EO aiming to reduce the size of the federal government’s workforce and directing each agency head to work with the Department of Government Efficiency on hiring plans. The coalition, which includes national unions such as the Service Employees International Union and the American Federation of State, County and Municipal Employees, as well as the City of Chicago and City of San Francisco, claims the EO violates the U.S. Constitution’s separation of powers and the Administrative Procedure Act. The coalition requests the court to vacate the executive order and the related reorganization plans.
William Emanuel, former Board member and management-side labor attorney, has passed away. Emanuel was appointed to the Board by President Trump in 2017 and served until 2021. Emanuel’s confirmation to the Board gave the Board its first Republican majority in more than a decade. During his time on the Board, Emanuel was involved in reversing a wide range of union-friendly rulings and decisions issued under the Obama Administration, bringing significant changes to Board law.
Former Board General Counsel Jennifer Abruzzo has joined a union-side law firm as an attorney and rejoined the Communications Workers of America (CWA) as a senior advisor. President Trump terminated Abruzzo shortly after Inauguration Day in an expected move. She previously held various roles at the Board and formerly served as special counsel at the CWA. Abruzzo’s time at the Board was marked by aggressive initiatives resulting in overturning precedent on many issues, including expansion of protected concerted activity, increased use of enhanced remedies for unfair labor practice charges, and making it easier for employees to unionize without an election, among others. President Trump recently nominated management-side labor attorney Crystal Carey as the new general counsel. She is awaiting U.S. Senate approval.

Time Is Money: A Quick Wage and Hour Tip . . . Contractual Indemnification May Not Guard Against FLSA Claims

The complex web of federal and state wage and hour laws create potentially devastating risk of exposure for employers.
Years of possible liability for yet unknown claims, liquidated damages, shifting attorneys’ fees, not to mention the risk of class or collective suit, can quickly transform seemingly minor and technical irregularities into expensive complications. And for companies that partner with other entities to meet their staffing needs, resolving this risk of liability is a critical piece of their business operations.
Quite often, the quick solution for this concern is through a traditional business arrangement: contractual indemnification. Shifting risk of loss via contract is fairly standard, especially as courts generally enforce the unambiguous terms of the parties’ agreement. Yet employers should take note of a concerning trend among courts across the country, which have in some cases refused to enforce indemnification agreements in Fair Labor Standards Act (“FLSA”) matters on public policy grounds.
How Did We Get Here?
Courts ordinarily steer clear of interrupting the unambiguous contractual agreements of sophisticated business entities, so what is motivating this judicial scrutiny of indemnification clauses in FLSA matters? Much can be traced back to the Second Circuit’s decision in Herman v. RSR Sec. Servs. Ltd., which rejected an interpretation of the FLSA that would have provided a statutory right to indemnification or contribution among co-employers.[1]
In Herman, a putative co-employer who had been found liable for back wages following a bench trial sought to shift those losses to his co-defendants, whom he claimed were the plaintiff’s actual employer. In reviewing this claim, the Second Circuit looked to the text of the FLSA, its overarching intent, its remedial mechanisms, and the law’s statutory history. None counseled in favor of creating a new statutory obligation among co-employers. The law was silent as to any right to contribution or indemnification, employers were clearly not the class for whose benefit the FLSA was enacted, and no evidence in the legislative history of the statute favored the judicial creation of this new statutory right. Accordingly, the Second Circuit unequivocally held that “there is no right to contribution or indemnification for employers held liable under the FLSA.” Id. at 144.
More than 20-years after Herman, the Ninth Circuit reached the same conclusion.[2] In rejecting yet another attempt to develop a statutory reading of the FLSA that would have permitted a claim for contribution or indemnification, the Ninth Circuit highlighted how “Congress, not the courts” held responsibility for developing this type of remedy. Following this “cautious” approach toward statutory interpretation, the Ninth Circuit similarly “decline[d] to find an implied cause of action for contribution or indemnification under the FLSA.” Id. at 1105.
How Does this Impact Contractual Obligations?
Although the Second and Ninth Circuit limited their holdings to statutory claims to indemnification under the FLSA—and notwithstanding the judicial “cautio[n]” recognized in their analysis—district courts across the country have not been so restrained. Only two years after Herman, district courts in New York began expanding the rejection of a statutory right to contribution under the FLSA to also negate contractual indemnification agreements. In Gustafson v. Bell Atl. Corp., the defendants sought to enforce an indemnification clause that would have required a putative co-employer to pay for any losses incurred as a result of their violations of the FLSA.[3] The defendants in this matter emphasized that their claim was “purely one for damages for breach of contract by a third party,” and thereby did not fall within the gambit of Herman. The Court disagreed.
Irrespective of the contractual basis for indemnification, the Court held that “defendants’ attempt to recover damages from [the co-employer] for overtime violations is an attempt to receive indemnification for FLSA liability.” Id. (emphasis added). Whether the putative co-employer was responsible for the alleged overtime violation was of no consequence. In the Court’s view: “[a]llowing indemnification in cases such as this would permit employers to contract away their obligations under the FLSA, a result that flouts the purpose of the statute.” Id. Accordingly, the indemnification clause was held unenforceable for purposes of any FLSA-related damages.
Are Courts Uniform In this Approach?
Unsurprisingly, courts across the country are divided on this issue. Some have adopted the public policy arguments noted above, holding that contractual indemnification of FLSA damages would give employers little reason to comply with the statute and run contrary to the FLSA’s statutory purpose.[4] Others have rejected this premise, and distinguished indemnification claims taken against employees (which are prohibited on public policy grounds) from contractual agreements involving sophisticated business entities that should be enforced.[5] Still others have permitted contractual indemnification claims without even opining on this brewing public policy dispute; in these cases, the parties’ unambiguous contractual intent is sufficient to enforce their agreement.[6]
As one court succinctly stated: “[f]or each FLSA case that permits contractual indemnity claims, however, there is a case that prohibits the same.”[7]
How Should Employers Address This Uncertainty?
The lack of any uniformity in this regard, and the policy-based rationale for negating these provisions, presents a difficult problem for employers: an inability to easily allocate risk and develop protection from exposure.
But companies can still take affirmative steps to address this concern. First and foremost, companies must identify potential sources of liability, both internally and through their arrangements with business partners. Indemnification agreements may not provide sufficient protection against FLSA claims, and identification of any vulnerabilities can help dictate how best to allocate appropriate business costs. Next, a comprehensive wage and hour audit of these internal and external pay practices can help quantify risk and potential loss. This will help business leaders maintain compliance with federal and state wage and hour laws, explore remediation opportunities to resolve problems prospectively, and dictate how to structure relationships with business partners in order to reduce the risk of joint liability. Finally, companies and their counsel should carefully consider the forum of any brewing FLSA dispute, in order to gauge the likelihood of success on any indemnification claim.
Judicial uncertainty notwithstanding, these steps can help business leaders identify and quantify risk while also achieving the primary goal of any indemnification clause: safeguarding the company against potential loss.

ENDNOTES
[1] 172 F.3d 132 (2d Cir. 1999).
[2] Scalia v. Employer Solutions Staffing Grp, LLC, 951 F.3d 1097 (9th Cir. 2020).
[3] Gustafson v. Bell Atl. Corp., 171 F. Supp. 2d 311 (S.D.N.Y. 2001).
[4] Goodman v. Port Auth. of N.Y. & N.J., 850 F. Supp. 2d 363 (S.D.N.Y. 2012); Scalia v. MICA Contracting, LLC, 2019 WL 6711616, at *4 (S.D. Ohio Dec. 10, 2019), report and recommendation adopted, 2020 WL 635908 (S.D. Ohio Feb. 11, 2020).
[5] Varnell, Struck & Assocs., Inc. v. Lowe’s Cos., 2008 WL 1820830, at *10-11 (W.D.N.C. Apr. 21, 2008); Plummer v. Rockwater Energy Sols. Inc., 2019 WL 13063612, at *4 (S.D. Tex. July 2, 2019) (“The court finds that no controlling authority bars Rockwater’s claims for contractual indemnity and contribution under the FLSA.”).
[6] Bogosian v. All Am. Concessions, 2011 WL 4460362, at *4 (E.D.N.Y. Sept. 26, 2011).
[7] Robertson v. REP Processing, LLC, 2020 WL 5735081, at *5 (D. Colo. Sept. 24, 2020).

Ready for the Recent Arrival? Pregnant Workers Fairness Act is Here and Kicking

As everyone in Human Resources knows by now, the Pregnant Workers Fairness Act (PWFA) requires employers to reasonably accommodate employees because of pregnancy and conditions related to pregnancy. In case you missed it, we blogged about this here. The EEOC has filed lawsuits to enforce employee rights under the PWFA and has settled cases for pregnant workers. While these were all filed under the prior administration, the PWFA is the > law of the land and employers need to be ready.
Make Sure Your Leadership Knows Pregnant Workers Have a Legal Right to Accommodations
The standard for a reasonable accommodation under the PWFA is different than the standard under the ADA. Make sure your front-line supervisors and managers know that you have a heightened responsibility to pregnant workers who need accommodations. While your supervisors do not need to be PWFA experts, they do need to understand that if a pregnant worker is having trouble fulfilling her job duties, they should call Human Resources.
Human Resources professionals need to be ready as well. Unlike the ADA, reasonable accommodations under the PWFA:

Could require that you remove an essential function of a job temporarily. If you have light-duty positions, you many need to make those available to your pregnant employees.
Are temporary, which would be up to the 40 weeks of the pregnancy.

Like the ADA, if an employee is not eligible for FMLA leave (or any other leave under company policy or state law), you likely have an obligation to provide unpaid leave under the PWFA. However, leave to accommodate pregnancy is a last resort.
Check Your Policies and Procedures
In defending an EEOC charge of discrimination, you will want to tell the EEOC that you have a policy that shows your good faith. With that in mind:

Be sure your EEOC policy mentions that you prohibit discrimination based on pregnancy. Saying that you prohibit discrimination based on sex probably covers it, but it may be helpful to add pregnancy to your policy.
Consider having a separate policy addressing the PWFA. A policy that clearly outlines how an employee can request a PWFA accommodation can be great evidence if an employee claims she did not know she could request one.
Given the differences between the PWFA and the ADA, you may want to consider having separate forms to document the PWFA process.

Takeaways
This is a new law and it is complicated. Make sure your front-line supervisors are staying in touch with Human Resources. There is no one size fits all approach, so Human Resources should seek legal advice when necessary.
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Employers Beware: Blanket Policies Prohibiting Workplace Recordings May Violate the NLRA

In the past, employees recording audio or images in the workplace might resort to use of a bulky tape recorder or a hidden “wire” or camera. Now that smart phones with professional-grade audio and video capabilities are an integral part of our society, clandestine (or blatant) workplace recordings are much more easily accomplished.
With this increased ease of access to reliable and compact recording equipment has come a heightened employer sensitivity to workplace recordings. As a result, many employers are tempted to implement blanket policies prohibiting workplace recordings, or otherwise require management consent to make any workplace recordings.
While some limited prohibitions on workplace recordings are permissible—for instance, to protect confidential business information or private health information—in recent years, the National Labor Relations Board (“NLRB” or the “Board”) has criticized blanket policies prohibiting such activities. The NLRB reasons that policies against workplace recordings may discourage employees from participating in concerted activity with other employees that safeguard their labor rights. In other words, such policies may “chill” employees’ ability to act in concert, and some courts have agreed.
Section 7 of the National Labor Relations Act (“NLRA” or the “Act”) ensures employees’ “right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection,” and the right “to refrain from any or all such activities.” Section 8(a)(1) of the Act makes it an unfair labor practice for an employer “to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7” of the Act.
The Board has noted that workplace video and audio recording is protected if employees are “acting in concert for their mutual aid and protection” and the employer does not have an “overriding interest” in restricting the recording. As noted above, protection of confidential company information or personal health information can help an employer to demonstrate an overriding interest in restricting recordings. As noted by the Board, a few examples of recordings made in concert for mutual protection that may outweigh an employer’s interest in any restrictions are recordings made to capture:

unsafe working conditions;
evidence of discrimination;
“townhall” meetings with anti-union sentiment; and
conversations about terms and conditions of employment.

Regardless of any state laws that may require two-party consent for recording conversations, the NLRB has held that the NLRA preempts state law, and that protection of employees’ rights under the NLRA overrides concerns about state law recording consent violations.
Thus, at a time when recording capabilities are packed into an ordinary, everyday device carried by nearly every employee in every workplace, employers who still wish to have a policy limiting workplace recordings should ensure that the policy lists valid reasons for implementing the policy, include a carve-out in the policy for protected concerted activities under the NLRA, and not require management approval for recordings that constitute protected concerted activities. Taking such measures can help to ensure the Board will not find an employer’s no-recording policy in violation of the NLRA.

Connelly v. U.S.: A Reminder About Corporate Owned Life Insurance

Many businesses have used corporate owned life insurance (COLI) and buy-sell agreements as key elements of their succession planning. However, it may be time to consider whether these programs are creating unnecessary risk. Although these programs generally have not been problematic in the past, a recent Supreme Court case has potentially changed the analysis.
COLI is a life insurance policy owned by the company on the life of an employee, with some or all the benefits payable to the company. This life insurance can provide a significant cash benefit at a time when the company may be looking to fund the repurchase of shares from a deceased owner. Historically, practitioners have excluded insurance proceeds from a business’s valuation when those proceeds are contractually designated for repurchasing shares under a buy-sell agreement. This exclusion arises because the buy-sell agreement creates a liability that offsets some or all of the proceeds. Although excluding the value of the insurance proceeds from the value of the business was relatively common, the IRS had sometimes argued that the value of the insurance should be included in the value of the company.
In Connelly v. U.S., the Supreme Court unanimously held that the proceeds from COLI need to be included in some valuations of the company that received the proceeds. When the value of the COLI is added for tax and valuation purposes, there are several possible implications. First, the increased value from including the COLI may have to be reflected in a higher purchase obligation under the buy/sell obligation associated with the COLI than would otherwise be necessary. Second, the value of the COLI may need to be included in company valuations related to deferred and executive compensation payments. Third, the inclusion of COLI proceeds as an asset on the company’s balance sheet may impact the company’s investment or lending agreements. And fourth, the increased value of the company needs to be reflected when valuing the decedent’s company equity for estate tax purposes and in any tax planning for surviving owners.
After Connelly v. U.S., companies and business owners should reassess how COLI and buy-sell agreements interact. If a COLI and a buy-sell agreement are already in place, now is a good time to review them to determine if changes need to be made. If so, make those changes before it’s too late. For companies that do not have COLI and a buy-sell agreement in place, it is a good time to determine if your business should have these arrangements in place now that the Supreme Court has settled the question.

Florida CHOICE Act: New Protections for Noncompete and Garden Leave Agreements

Go-To Guide:

CHOICE Act Bill Summary
U.S. Bureau of Labor Statistics Wage Data

On April 24, 2025, the Florida House and Senate passed the Florida Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act, designed to foster economic growth, protect business interests, and enhance the state’s investment climate by strengthening protections for covered employers with covered noncompete and garden leave agreements. If signed by Gov. DeSantis, the CHOICE Act would take effect on July 1, 2025.
CHOICE Act Takeaways

The Act creates a presumption that covered noncompete and garden leave agreements are enforceable and do not violate public policy as a restraint on trade;
The Act requires courts to issue a preliminary injunction to enjoin a covered employee from violating a covered agreement; and
The Act only allows courts to modify or dissolve a preliminary injunction if the covered employee proves by clear and convincing evidence that either the new employment will not result in unfair competition, or the covered employee did not receive the consideration described in the covered agreement.

The Act applies to:

Covered Employers – entities or individuals who employ or engage a covered employee.
Covered Employees – individuals (employees or contractors) who earn a salary twice the annual mean wage of the Florida county where either the covered employer has its principal place of business or where the employee resides if the covered employer’s principal place of business is outside of Florida.
Covered Agreements – covered garden leave and noncompete agreements with either a covered employee who maintains a primary place of work in Florida (regardless of any choice of law provision); or a covered employer whose principal place of business is in Florida and the agreement identifies Florida in its choice of law provision.

Covered garden leave agreements would be enforceable if the following conditions are met:

The covered employer advised the covered employee in writing of the right to seek counsel before execution and provides at least seven days to review the agreement;
The time to provide advance express notice of termination (the notice period) does not exceed four years;
The covered employer agrees to pay the covered employee her regular base salary and benefits during the notice period;
The covered employee acknowledges in writing receipt of confidential information or customer relationships.
The agreement provides that:

a. After the first 90 days of the notice period, the covered employee does not have to provide services to the covered employer;
b. The covered employee may engage in nonwork activities at any time, without limitation, for the remainder of the notice period;
c. The covered employee may, with permission from the covered employer, work for another employer, for the remainder of the notice period; and
d. The notice period may be reduced if the covered employer provides at least 30 days’ advance notice in writing to the covered employee.
Covered noncompete agreements would be enforceable if the following conditions are met:

The covered employer advised the covered employee in writing of the right to seek counsel before execution and provides at least seven days to review the agreement;
The covered employee acknowledges in writing receipt of confidential information or customer relationships;
The noncompete period does not exceed four years; and
The noncompete period is reduced day-for-day by any nonworking portion of the notice period, pursuant to a covered garden leave agreement, if applicable.

Notably, the Act (1) applies to nonresident covered employees employed by a Florida based employer; and (2) excludes from the definition of salary, discretionary incentives or awards and anticipated but indeterminable compensation like bonuses, tips, and commissions, among other excluded items.
The Act does not apply to:

Healthcare practitioners;
Standalone confidentiality or non-solicitation agreements; and
Garden leave and noncompete agreements that do not meet the Act’s requirements. For these noncovered agreements, employers will still need to meet the requirements under section 542.335, Florida Statutes to enforce a restrictive covenant.

What about noncompete laws in states where covered employees reside?

The Act provides that if the covered employer has its principal place of business in Florida and uses a covered agreement with a Florida choice of law provision, then “if any provision of this section is in conflict with any other law, the provisions of this section govern.”
Covered employees residing outside of Florida (or their subsequent employers) may challenge this provision.

Enforcement of Covered Agreements

The Act requires courts to issue a preliminary injunction against a covered employee. After a preliminary injunction is entered, the court may only modify or dissolve the injunction if the covered employee (or subsequent employer) proves by clear and convincing evidence based on non-confidential information that:

– the employee will not perform similar work during the restricted period or use confidential information or customer relationship;
– the covered employer failed to pay the salary or benefits required under a covered garden leave agreement, or failed to provide consideration for a covered noncompete agreement, the covered employer had a reasonable opportunity to cure the failure; or
– the subsequent employer is not engaged in, or preparing to engage in, a similar business as the covered employer within the restricted geographic area.

Under a covered garden leave agreement, if a covered employee engages in gross misconduct, the covered employer may reduce the salary or benefits of the covered employee or take other appropriate action during the notice period. These acts by the covered employer would not be considered a breach of the covered garden leave agreement.

Considerations for Employers

Review and revise existing agreements for compliance with the Act where applicable.
Review hiring practices for (1) compliance with the notice period for covered agreements; and (2) prospective employees who may be covered by a covered agreement.
Review confidentiality practices to ensure appropriate guardrails are in place to maintain the confidential designation for confidential information and prevent misappropriation of confidential and proprietary information and trade secrets.

Do Weekends Count? SCOTUS Decides They Don’t for Voluntary-Departure Deadline

Takeaways

Voluntary-departure deadlines are extended to the next business day when they fall on weekends or legal holidays.
Courts may review final orders of removal and all questions of law arising from them.
The decision provides clarity for immigration judges and attorneys.

ECHA Will Propose EU-Wide Restrictions on Certain Hexavalent Chromium Substances

The European Commission (EC) requested that the European Chemicals Agency (ECHA) assess the risks posed by certain hexavalent chromium substances. ECHA announced on April 29, 2025, that it has concluded that a European Union (EU)-wide restriction for hexavalent chromium substances is justified because the substances “are among the most potent workplace carcinogens and pose a serious risk to workers’ health.” ECHA states that it expects to begin a six-month public consultation on a ban on hexavalent chromium substances, except in the following use categories when defined limits for worker exposure and environmental emissions are met:

Formulation of mixtures;
Electroplating on plastic substrate;
Electroplating on metal substrate;
Use of primers and other slurries;
Other surface treatment; and
Functional additives/process aids.

ECHA states that this restriction could replace the current authorization requirements under the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) regulation, ensuring that the risks associated with hexavalent chromium substances are effectively controlled once they are no longer subject to REACH authorization. ECHA notes that it included barium chromate in the scope of the restriction to avoid regrettable substitution.
ECHA states that stakeholders will have the opportunity to provide information during the six-month consultation, which is expected to start on June 18, 2025. ECHA plans to organize an online information session to explain the restriction process and help stakeholders take part in the consultation. ECHA’s Committees for Risk Assessment (RAC) and Socio-Economic Analysis (SEAC) will evaluate the restriction proposal and scientific evidence received during the consultation.

District Court Upholds Browsewrap Agreements in Pennsylvania Wiretap Class Action

Online retailer Harriet Carter Gifts recently obtained summary judgment from the district court in a class action under Pennsylvania wiretap law. At the heart of this case is the interpretation and application of the Pennsylvania Wiretapping and Electronic Surveillance Control Act of 1978 (WESCA), a statute designed to regulate the interception of electronic communications. The court’s primary task was to determine whether the actions of Harriet Carter Gifts and NaviStone constituted an unlawful interception under this law.
In 2021, the district court sided with the defendants, granting summary judgment because NaviStone was a direct party to the communications, and thus, no interception occurred under WESCA. However, the Third Circuit Court of Appeals overturned this decision. The appellate court clarified that there is no broad direct-party exception to civil liability under WESCA. Consequently, the case was remanded to determine “whether there is a genuine issue of material fact about where the interception occurred.”
On remand, the district court examined whether Popa could be deemed to have consented to the interception of her data by NaviStone through the privacy policy posted on Harriet Carter’s website. The court focused on whether the privacy policy was sufficiently conspicuous to provide constructive notice to Popa.
The enforceability of browsewrap agreements, which are terms and conditions posted on a website without requiring explicit user consent, was another critical aspect of the case. The court found that Harriet Carter’s privacy policy was reasonably conspicuous and aligned with industry standards. The court noted that the privacy policy was linked in the footer of every page on the Harriet Carter website, labeled “Privacy Statement,” and was in white font against a blue background. This placement was consistent with common industry practices in 2018 when the violation was alleged, which typically involved placing privacy policies in the footer of websites.
This led the court to conclude that Popa had constructive notice of the terms, reinforcing the notion of implicit consent. Notably, the court found implicit consent without any evidence that Popa had actual knowledge of the terms of the privacy statement. Rather, the court found a reasonably prudent person would be on notice of the privacy statement’s terms.
Based on these findings, the court granted summary judgment in favor of the defendants. The court determined that Popa’s WESCA claim failed because she had implicitly consented to the interception by NaviStone, as outlined in Harriet Carter’s privacy statement.
The case of Popa vs. Harriet Carter Gifts, Inc. and NaviStone, Inc. emphasizes the necessity for clear and accessible privacy policies in the digital era. It also brings attention to the complex legal issues related to user consent and the interception of electronic communications.

President Trump Nominates Assistant U.S. Attorney Panuccio to Serve as EEOC Commissioner

In what may provide the U.S. Equal Employment Opportunity Commission (EEOC) the ability to move forward with implementing policy changes, issuing new guidance, and rescinding other guidance, President Donald Trump nominated Brittany Panuccio, currently an assistant U.S. attorney in the Southern District of Florida, to serve as a commissioner. If confirmed, Panuccio would give the EEOC a quorum, which it has lacked since the president fired two sitting Democratic commissioners in January 2025.

Quick Hits

President Trump nominated Brittany Panuccio, an assistant U.S. attorney in Florida, to serve as an EEOC commissioner.
The EEOC currently has only two commissioners, one less than needed for a quorum.
Once the EEOC has a quorum, it will be able to engage in rulemaking, policymaking, and issuing (and, in some instances, rescinding) official guidance that advances the administration’s agenda.

By statute, the EEOC is composed of five political appointees: a chair, vice chair, and three commissioners. Title VII of the Civil Rights Act of 1964 dictates that no more than three commissioners may be from the same political party, and once confirmed, they serve five-year terms on the Commission. Thus, in addition to the EEOC’s acting chair, Andrea Lucas, if Panuccio is confirmed, the president can nominate another Republican to serve as a commissioner.
Further, Title VII demands that for there to be a quorum at the agency, there must be three active commissioners. Thus, Panuccio’s confirmation will resolve the EEOC’s current dilemma, i.e., being unable to vote on topics such as official guidance, policies, regulatory proposals/rulemaking, subpoena enforcement, and litigation (although by memorandum of understanding, much of the litigation decision-making has been delegated to the general counsel in the absence of a quorum).
We anticipate, based on statements made by Acting Chair Lucas and other informal guidance, that once the Commission has a quorum, it will make certain types of charges, litigation, and other policy matters a priority. This prioritization includes:

focusing on investigating and litigating with an expanded definition of what constitutes an adverse action when considering employer diversity, equity, and inclusion (DEI) programs (e.g., where a DEI program results in one protected class failing to receive the same or similar mentorship or feeling ostracized or discriminated against because of such programs);
eliminating systemic investigation and litigation of otherwise neutral employer policies that may have a disparate impact on a protected class;
eliminating recognition of “gender identity” as it relates to the EEOC’s sexual harassment guidance and similar guidance, particularly concerning restrooms, locker rooms, sleeping quarters, and other sex-specific workplace facilities, which, in the view of Acting Chair Lucas, impinges on the rights of women;
eliminating existing EEOC policy, guidance, and regulations associated with abortion as a pregnancy-related condition under the Pregnant Workers Fairness Act; and
an increased focus on investigation and litigation of employment discrimination based on religion or national origin (e.g., Judaism and American), race (particularly those employees who feel preferential programs exclude them in the name of DEI), and sex (particularly from those employees who think that the focus on gender identity, transgender rights, and sexual orientation has impinged on their rights).

The lack of a quorum has prevented the EEOC from investigating charges consistent with Acting Chair Lucas’s perspective concerning various active agency guidance (several of which she condemned in public statements), enforcing administrative subpoenas (due to a 2024 delegation of authority), pursuing noncontroversial, nonsystemic, noncostly litigation (due to a 2021 continuing resolution); and seeking dismissal of certain cases approved under prior EEOC leadership.
More importantly, the lack of a quorum has kept the Commission from engaging in rulemaking, policymaking, and issuing (and, in some instances, rescinding) official guidance that furthers the current administration’s agenda. Such a lack of quorum has seemingly caused confusion and a state of “unknown” in the employment law community (given Acting Chair Lucas’s statements without the proper quorum to push such agenda items), as well as inhibited the EEOC from voting to pursue controversial, costly, and systemic lawsuits.
If Panuccio is confirmed, the EEOC will be able to discuss and vote on various matters. While we do not know how Panuccio will vote, we expect significant changes in policy and internal operations within the EEOC that are consistent with the areas identified above. Employers can expect the EEOC to begin working on rescinding guidance and policies that run afoul of the current administration’s agenda, adopting updated guidance and policies, and proposing new and updated regulations. Further, there may be a change in the types of “priority” cases within the EEOC’s enforcement and litigation divisions.
While the EEOC has no authority to overturn case law, it certainly can become a burden on employers’ resources during investigations of charges of discrimination.
By continuing to ensure policies and practices are lawful and compliant with antidiscrimination statutes, employers should be able to achieve the appropriate balance in the days to come.

When Emotional Support and Service Animals Fall Short: ADA Lessons From Fisher v. City of Lansing

On April 29, 2025, in Fisher v. City of Lansing, the U.S. District Court for the Western District of Michigan ruled that the City of Lansing did not fail to accommodate an employee’s request to bring an emotional support dog to work. The court found that the proposed accommodation failed to address a key obstacle that prevented the employee from performing an essential job function.
This decision has broad implications for employers facing an increase in accommodation requests related to mental health conditions and the presence of service or emotional support animals in the workplace.
Quick Hits

Under the Americans with Disabilities Act (ADA), an employee must propose a reasonable and necessary accommodation that addresses a key obstacle that prevents the employee from performing a necessary function of the position.
The ADA does not include emotional support animals in its definition of “service animals.”
Where an employee admits he or she can perform the essential job functions without the requested accommodation, even if not optimally, it weakens any claim that the accommodation is necessary.

Background
Aaron Fisher, a firefighter for the City of Lansing, Michigan, suffers from post-traumatic stress disorder (PTSD). Fisher requested permission to bring a service dog to work, stating that his symptoms worsened while on emergency calls. Although the City of Lansing required employees to submit a reasonable accommodation request form with medical documentation to Human Resources (HR), Fisher bypassed this policy. Fisher submitted his request only to his battalion chief, who initially approved it. However, HR denied the request after discovering the arrangement and determining that Fisher had provided insufficient documentation.
Fisher later submitted another request, this time including a letter from his physician stating he needed an “emotional support animal during work hours.” The city again denied the request. Fisher responded by filing a lawsuit under the ADA and Michigan’s Persons with Disabilities Civil Rights Act (PWDCRA), claiming discrimination and retaliation.
In its motion for summary judgment, the city argued Fisher did not need a service dog to perform his essential job functions. The City of Lansing also contended that the presence of a dog could hinder Fisher’s ability to respond quickly to emergencies, that the dog might not always remain under Fisher’s control, and Fisher had not demonstrated a medical necessity for the accommodation.
The Court’s Decision
The court granted summary judgment in the city’s favor, holding that Fisher had not shown that a service dog was necessary for him to perform his essential job function. Fisher’s own testimony indicated he could perform his duties—though not optimally—without the dog. Additionally, the letter from Fisher’s psychologist recommended an emotional support animal but did not state that he could not perform his job without it. While the court did not decide whether Fisher’s dog qualified as a “service animal” under the ADA, it pointed out that the ADA authorizes “service animals” but not “emotional support animals.”
The court also observed that Fisher received a positive performance evaluation and had accrued substantial sick leave and overtime hours after the city denied his accommodation request. These facts supported the conclusion that Fisher could perform his job without the accommodation. Ultimately, the court found Fisher had not met his to prove the dog was a necessary accommodation and dismissed the case.
Key Takeaways for Employers
This case highlights several important considerations for handling ADA accommodation requests:

Under EEOC guidance, employers may require employees to provide adequate medical documentation to support accommodation requests and follow a consistent formal review process if the “requirements are job related and necessary for the conduct of the business.”
Distinguishing between service animals and emotional support animals can be useful. ADA regulations authorize accommodations related to service animals, but not emotional support animals.
Assessing whether the accommodation is necessary for the employee to perform essential job functions is valuable. If the employee can perform those duties without the accommodation, it may not be required.
Employers may also want to communicate clearly with employees about the status of their accommodation requests and provide documented explanations for any denial.

Employers that consider these factors may be more able to effectively manage accommodation requests and remain compliant with the ADA.

Major Changes to AAA Employment Arbitration Rules: What Employers and Litigants Need to Know

Effective May 1, 2025, the American Arbitration Association (“AAA”) implemented significant revisions to AAA Employment/Workplace Arbitration Rules and Mediation Procedures. According to the AAA, these revisions aim to improve transparency, efficiency, and fairness in the arbitration process, while also addressing the evolving needs of workplace disputes. The changes carry important practical considerations for anyone involved in employment arbitration before the AAA. Below we discuss the key updates and what they mean for litigants.
1. Expanded Scope – More Disputes Covered
One of the most significant updates is the expansion of the rules’ scope. Previously, the rules were vulnerable to the argument that they only covered disputes between bona fide employers and their employees, leaving open the question of whether employment law claims brought by independent contractors would be subject to the AAA rules. With the new changes, the rules explicitly provide that they apply to all workplace and work-related disputes, including those involving independent contractors. This change bolsters the argument that arbitration agreements between independent contractors and hiring entities may be enforced under the same arbitral forum rules and procedures as those between employers and employees, which in turn may increase the odds that a reviewing court will compel arbitration of claims between an independent contractor and a hiring entity where the arbitration agreement references the AAA Employment/Workplace Arbitration Rules and Mediation Procedures.
2. Administrative Changes – Clarifying Case Management
The AAA has strengthened its arbitrators’ authority to decline or cease administration of a case if required administrative or arbitrator fees are not paid. This change largely falls in line with existing California state law (Code of Civil Procedure, section 1281.98), but now applies the California rule across the country. Failure to pay arbitration administration fees could now result in the AAA withdrawing from the process entirely, potentially pushing disputes into court. Employers, hiring entities, and their counsel should confirm that internal processes are set up to handle the prompt disposition of administration fees to avoid any potential disruptions to ongoing arbitration proceedings.
Additionally, similar to how the strengthened fee enforcement reduces the risk of parties stalling proceedings, the AAA has extended the automatic stay period from 60 to 90 days when a party seeks court intervention at the outset of a case. This change provides courts with more time to address important threshold issues before arbitration proceeds, helping ensure that early legal challenges are resolved without prematurely advancing the arbitration process. This change may also have significance for cases involving the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (“EFAA”) or California Private Attorney General Act (“PAGA”), where there may be a need for a judicial determination as to the scope of arbitration if there is a disagreement between the parties.
3. Procedural Updates – Embracing Virtual Hearings and Streamlining
Reflecting the post-pandemic shift toward remote work, the AAA has made virtual hearings the default format in employment cases – though parties can still agree to in-person proceedings, or arbitrators can decide the format.
Additionally, the new rules allow the AAA to consolidate multiple claims brought by the same party in separate matters under the same contract. For employers or hiring entities facing such a scenario, this rule change will offer streamlined proceedings but also increase the complexity and potential exposure of a single arbitration.
4. Expanded Arbitrator Powers – Subpoenas, Depositions, and Sanctions
Under the newly revised rules, arbitrators have significantly enhanced authority, including the ability to:

Issue subpoenas for witnesses and documents[1]
Order depositions
Modify or clarify awards on their own or at the parties’ request
Impose sanctions for misconduct

The AAA also reworked Rules 21 and 22, which pertain to the exchange of information, to emphasize the arbitrator’s authority to grant necessary information exchange as required for a party to fairly present its claims and defenses.
Additionally, the AAA revised arbitrator authority for allowing motions, including dispositive motions. The former rules provided general guidance on the arbitrator’s authority to grant interim measures, while the revised rules explicitly outline the arbitrator’s authority to allow motions, including dispositive motions, thereby clarifying the scope and process for such motions.
5. Confidentiality and Transparency – What Will Be Published
Under the new confidentiality rules, arbitrators have authority to resolve disputes over confidentiality between parties. The AAA will continue to publish redacted arbitration award summaries and release quarterly data on employment caseloads.
The AAA’s rule revisions mark a meaningful shift in how employment disputes will be managed and resolved in arbitration. Whether you are an employee, independent contractor, or employer, understanding these changes is crucial to navigating the arbitration process effectively.

FOOTNOTES
[1] State and federal law place limitations on arbitrators’ subpoena powers. Under California law, although arbitrators generally have authority to issue subpoenas for both witness testimony and document production for arbitration hearing and depositions, pre-hearing discovery is limited to certain circumstances. (Code of Civil Procedure, section 1282.6). Similarly, the Federal Arbitration Act (“FAA”) permits arbitrators to compel witnesses and document only at the arbitration hearing, not for general pre-hearing discovery. (Federal Arbitration Act (“FAA”), 9 U.S.C. section 7).
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