A Whistle Upon Deaf Ears: Changes to Dodd-Frank Whistleblower Protections

A Whistle Upon Deaf Ears: Changes to Dodd-Frank Whistleblower Protections On Wednesday, February 21st, the U.S. Supreme Court unanimously ruled that individuals who report allegations of corporate wrongdoing must do so to the Securities and Exchange Commission, not just to their own companies, in order to qualify for protections offered under the Dodd-Frank Act. The case in question, Digital Realty Trust v. Somers, involved Paul Somers, a former employee of Digital Realty Trust, a San Francisco-based real estate investment company. Somers detected foul-play in the company and reported mismanagement of funds and contracts to senior management. He was subsequently fired in 2014. Somers proceeded to sue, claiming that his termination was retaliation that violated the Dodd-Frank Act. Unfortunately for Somers, and other would-be whistleblowers, the Supreme Court disagreed. This decision is contrary to how the Dodd-Frank Act has been interpreted by many lower courts since its introduction in 2010. The Dodd-Frank Whistleblower Program includes payable awards to those who report information that leads to a successful action, as well as safeguards against employer retaliation. Whereas past interpretations offered these protections for those who reported issues internally, the Supreme Court decision suggests that the Act’s plain language limits its protections to specific instances where the individual has reported the violations in question directly to the SEC.  Digital…

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Proposed Amendments to Employment Regulations Regarding Criminal History, the California Family Rights Act, and the New Parent Leave Act

Proposed Amendments to Employment Regulations Regarding Criminal History, the California Family Rights Act, and the New Parent Leave Act The Fair Employment and Housing Council of the Department of Fair Employment and Housing provided notice on February 16, 2018 that it intends to amend sections 11017.1 and 11087-97 of Title 2 of the California Code of Regulations. Amendment would follow a public hearing at 10:00 a.m. on April 4, 2018 in Los Angeles and review of written comments due by 5:00 p.m. on the same day. The amendment is intended to clarify interpretations of the Fair Employment and Housing Act. In 2017, two bills (AB 1008 and SB 63) added new sections to the FEHA. AB 1007 is intended to “ban the box” by prohibiting employers from seeking criminal history information until a conditional offer of employment is made. SB 63 enacts the New Parent Leave Act (NPLA), expanding parental leave rights at employers with 20-49 employees. The Council contends that the proposed amendments are intended to describe how the two new laws operate and fit into the FEHA by centralizing, clarifying, and codifying the two statutes. Specifically, the Council indicates that the amendments will: “(1) articulate the parameters of AB 1008 in an orderly fashion in the context of existing regulations regarding the consideration…

Department of Labor Appears Set to Tip the Balance Back in Favor of Tip-Pooling

Department of Labor Appears Set to Tip the Balance Back in Favor of Tip-Pooling In December, the Trump Department of Labor issued a Notice of Proposed Rulemaking seeking to roll back yet another Obama-era regulation. This time, the target is the Department of Labor’s 2011 rule restricting mandatory tip pooling. As many employers in the hospitality and food service industries know, the Fair Labor Standards Act permits employers to establish tip pools among employees that “customarily and regularly” receive tips, like waiters, bartenders, and other service-oriented staff members.  Tip pools have generally been restricted to staff members who participate in front-of-house positions that more directly serve customers. The FLSA requires that the means of distribution must be fair and reasonable and that the pool cannot distribute tips to the employer or an agent of the employer. Like each workplace, tip pools vary widely in how they are set up and executed. It should then come as no surprise that lawsuits have sprung up to challenge the validity of tip pools or the laws or regulations permitting them—often with inconsistent results. One such result was the 2010 Ninth Circuit Court of Appeals case Cumbie v. Woody Woo, Inc., in which the court held that so long as an employer paid the front-of-house staff over the minimum…