Now that we’re almost half-way through 2023, it’s time again to review the developments in state and local labor and employment laws. State legislatures and city councils continue to be very busy making new laws and amending existing laws. In fact, due to the large number of updates, we are splitting our post into two parts. Today’s update covers Arkansas through Montana. Part two, with updates for the remaining states (New Jersey through Washington), will be posted later this week.
In our blog here, we noted EU Competition Commissioner Margrethe Vestager’s focus on the evolution of cartels in recent years, with the emergence of purchasing cartels and the focus in the US on ‘no-poach’ agreements, whereby companies agree not to recruit each other’s workers and/or fix wages. This is similar to a purchasing cartel, except that the object is not a raw material or a manufactured product, but is the employees.
Competition law infringements arising in the employment field could include agreements between (groups of) companies (i) not to hire each other’s staff members at all, or (ii) not to offer them a higher salary to move. Such agreements reduce the employees’ mobility, and can negatively affect competition by preventing new companies from breaking into markets where their success is dependent upon being able to hire employees with the right skillsets. In Ms. Vestager’s words, no-poaching agreements between employers are “an indicated way to keep wages down, restricting talent from moving where it serves the economy best”. An important aspect of cartel enforcement is information exchange which reduce uncertainty among competitors in sensitive areas, such as their purchasing price. Applied to the world of employment, this means that exchanges on individual (non-tariff) salaries – including indirectly through publications – are problematic.
As expected, those developments have caused several national authorities to pay closer attention to the topic. We have asked our European colleagues across the firm to explain where enforcement has developed further.
California employers enthusiastically received the decision by the United States Supreme Court in Viking River Cruises v. Moriana, 142 S. Ct. 1906 (2022). That case held the Federal Arbitration Act allows employers to compel employees to arbitrate the individual part of their claim under the California Labor Code Private Attorneys General Act (“PAGA”). Some employers hoped that Viking River Cruises would substantially rein in PAGA litigation.
Of course it could just be coincidence, but scarcely hours after my post last week concerning the dearth of the employment law candidates for the Brexit red-tape bonfire, out pops a Gov.uk policy paper on “Smarter Regulation to Grow the Economy” containing the first five suggested victims.
And what a woeful little bunch they are, showing a smallness of imagination and ambition completely at odds with the tone of the rest of the paper. This is essentially an extended rehearsal of how the UK is going to make better regulations by, well, thinking about how they will work first, rather than (now it can be told) “defaulting to regulation with scrutiny of decisions to regulate left too late to materially change course” (or in motoring terms, putting them on the road first and then carrying out the crash-testing). The view is advanced in the paper that this will limit the number of regulations which “simply make people’s lives that little bit more difficult and annoying“, though it has the grace to admit that being annoying is not solely the province of regulation derived from the EU. No indeed, the UK can hold its head high in any company when it comes to annoying rules entirely of our own creation, and to reinforce that, the document has music by Elgar, a flypast by a Spitfire and all the Union Jack bunting left over from the Coronation. In addition, Gov.uk traditionalists will be reassured to note the continuing presence in it of a very pre-Brexit level of grammatical errors.
So what of our five proposed candidates for change on the employment law front? Sadly, none of those I suggested here. Instead, these:
Here’s the situation: You own a small business that employs 15 employees. You do your best to provide good pay and benefits, but, like many companies, your business has been adversely impacted by lingering effects of the pandemic and the overall sluggishness of the economy. You call an all-hands meeting and reluctantly inform your employees that you need to cut back, so, regrettably, there won’t be any wage or benefit increases for 2023.
In yet another chapter of the saga involving California and its treatment of employment arbitration agreements, a Court of Appeals recently issued two decisions examining the state’s legal standard for determining unconscionable arbitration clauses.
Fuentes v. Empire Nissan, Inc., — Cal. Rptr. 3d. —, No. B314490, April 21, 2023, 2023 WL 3029968 (Apr. 21, 2023) and Basith v. Lithia Motors, Inc., — Cal. Rptr. 3d —, No. B316098, 2023 WL 3032099 (Apr. 21, 2023), involved employees of unrelated Nissan dealerships in southern California, who signed similar form arbitration clauses when hired (Fuentes signed a paper agreement; Basith signed a digital version). Both employees were terminated from their employment, and sued the dealerships for alleged violations of the California Labor Code. Both dealerships filed motions to compel arbitration of the disputes, and the respective trial courts denied the motions to compel, ruling the arbitration agreements were substantively unconscionable. Both dealerships filed appeals in the Second Appellate District, and the Court of Appeals reversed both decisions because the agreements were not substantively unconscionable.
Things have surely come to a pretty pass when it is front page news twice in two weeks that the Government has decided not to press on with doing something daft. First, the abandonment of smart motorways and last week, reports that the Government has backed away from its original proposal to wipe all EU-sourced regulations from the statute book at the end of this year. More predictable is the number of MPs who are nonetheless recorded as being variously aghast, outraged, appalled *[continue until convinced or all similar hyperbole is exhausted, whichever comes first]* by this “betrayal” of the Brexit vote.
On 1 May, the Italian government’s Council of Ministers approved a new “Labour Decree” that will make significant changes to current employment law provisions. The final text of the Decree has not yet been published in the Official Gazette, but below is a summary of the main provisions that will affect employers based on the current draft.
On May 1, 2023, the White House announced that the COVID-19 vaccination mandate for nonimmigrant international air travelers will end as of the end of the day on May 11, 2023. Implemented in 2021 in response to the COVID-19 public health emergency, the mandate required all nonimmigrant travelers arriving in the US by air to provide proof of vaccination status to as a condition to entry into the country in an effort to slow the spread of COVID-19 variants into the US and to allow the US healthcare system time to manage access to care in the event of increased COVID-19 cases and hospitalizations. Noting that COVID-19 related deaths are down 95%, and COVID-19 hospitalizations are down by 91%, each since January 2021, the White House announcement indicated that “we are in a different phase of our response to COVID-19” compared to January 2021, when the travel vaccination mandate went into effect. The White House’s termination of the international air travel COVID-19 vaccine requirement coincides with the official end to the COVID-19 public health emergency on April 10, 2023.
Being married to a techie who was once a lawyer, and not without a degree of self-interest I have recently spent a good number of hours musing over the impact of GPT on the future of the legal profession.
GPT stands for Generative Pre-trained Transformer (memorise it, this will soon be a quiz question) and is a type of language model that uses deep learning to generate human-like, conversational text. GPT 1 and 2 were interesting experiments, GPT 3.5 or ChatGPT was impressive, but the recently-launched GPT 4 has been hailed across the globe as an absolute game-changer.
As a self-proclaimed tech sceptic – if it’s not flawless, I don’t want it – I wasn’t initially worried. I was impressed by GPT as a concept, but the first few times playing around with it did not make me fear for my job. The numerous GPT clangers circulating on social media did not trouble this view (my personal favorite is the one where it provides in moments an impressive list of how to distinguish between a chicken’s egg and a cow’s egg).
But then in March there was a report by Goldman Sachs, predicting that lawyers and administrative staff would be among those at greatest risk of becoming redundant through the march of GPT. This was intriguing, because previously all the reports about artificial intelligence had told us that lawyers did not need to fear for their job, as the language skills of even really good artificial intelligence were fairly bad. However, with this new prediction, mere scepticism is no longer a defence. I had to do more diligent testing. In this blog, I will be happy to share my findings with you, and at the same time, explain why employment law careers still have time to run.
