The Future of Title VII: State Legislation, and the Imminent Hope for Clarification

By: Jeremy Wilner

Whether Title VII protects transgender individuals has been contentiously debated since 1989, when the Supreme Court decided that sex stereotyping is within Title VII’s scope.[1] Title VII itself, states that “[i]t shall be an unlawful employment practice for an employer to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual . . . because of such individual’s race, color, religion, sex, or national origin.”[2]

So, the question became: Do terminated transgender individuals fall into the category of “sex stereotyping?”[3] Whether transgenders are part of this category is not the only protection that the Equal Employment Opportunity Commission (“EEOC”) believe should be provided.[4] Without squeezing transgenders into the class of “sex stereotyping,” the EEOC addresses the issue of gender identity by interpreting Title VII’s intent as “[d]iscrimination against an individual because of gender identity, including transgender status, or because of sexual orientation is discrimination because of sex in violation of Title VII.”[5]

Recently, the Sixth Circuit held that an employer violated Title VII for terminating a transgender employee.[6] The court stated that the employer “engaged in unlawful discrimination against [the employee] on the basis of her sex.”[7] The court’s reasoning was that sex discrimination should include forcing an employee “to conform to sex-based stereotypes.”[8]

Without a Supreme Court decision to rely on, the circuits have split interpretations of “sex” under Title VII.[9] Presidential administrations also vary in their support, with the Obama Administration viewing transgender rights much more favorably than the Trump Administration.[10] The Department of Justice (“DOJ”) under Former Attorney General Jeff Sessions directly opposed to the Sixth Circuit’s ruling in 2018.[11] The DOJ’s argument was because Title VII does not expressly define “sex,” the court should adopt a contemporary meaning, which the DOJ defines as either male or female.[12]

Various states have passed laws to fill in this disputed gap, with New York passing its GENDA legislation in early 2019.[13] This new state law “prohibits employers, educational institutions, landlords, creditors, and others from discriminating against individuals on the basis of gender identity or expression, and make offenses committed on the basis of gender identity or expression hate crimes under New York State law.”[14]

Finally, the Supreme Court seeks to clarify the dispute regarding Title VII by granting certiorari to three cases: Bostock v. Clayton County, Georgia, Altitude Express, Inc. v. Zarda, and R.G. & G.R. Harris Funeral Homes v. EEOC.[15] The Supreme Court limited the scope of review to “‘whether Title VII prohibits discrimination against transgender people based on (1) their status as transgender or (2) sex stereotyping’ under the 1989 decision in the Price Waterhouse v. Hopkins case.”[16] It will be interesting to see what this Supreme Court decides, but more so exciting to see a decades long debate end.

[1] Price Waterhouse v. Hopkins, 490 U.S. 228, 251 (1989).

[2] 42 U.S.C.A. § 2000e-2 (Westlaw through Pub. L. No. 155-281).

[3] Price Waterhouse, 490 U.S. at 251 (defines sex stereotyping as retaliating against someone who does not “match the stereotype associated with their group”).

[4] Sex-Based Discrimination, EEOC, http://www.eeoc.gov/laws/types/sex.cfm (last visited Apr. 26, 2019).

[5] Id.

[6] Id.

[7] EEOC v. R.G. & G.R. Harris Funeral Homes, Inc., 884 F.3d 560, 567 (6th Cir. 2018).

[8] Id. at 566-67.

[9] See Harris Funeral Homes, 663 F.3d at 1316-17; see also Zarda v. Altitude Express, 883 F.3d 100, 113 (2d Cir. 2018); Evans v. Georgia Reg’l Hosp., 850 F.3d 1248, 1255-57 (11th Cir. 2017); Etsitty v. Utah Transit Auth., 502 F.3d 1215, 1222 (10th Cir. 2007).

[10] Jacob Passy, As Trump administration seeks to redefine gender, workplace discrimination is still a problem for transgender Americans, MarketWatch (Oct. 22, 2018, 11:06 AM), https://www.marketwatch.com/story/for-transgender-americans-workplace-discrimination-isnt-limited-to-the-military-2017-07-26.

[11] See Brief for the Federal Respondent in Opposition, EEOC v. R.G. & G.R. Harris Funeral Homes, 884 F.3d 560 (6th Cir. 2018) (No. 18-107), 19-23.

[12] Id. at 17.

[13] Governor Cuomo Signs Landmark Legislation Protecting LGBTQ Rights, N. Y. State, https://www.governor.ny.gov/news/governor-cuomo-signs-landmark-legislation-protecting-lgbtq-rights (last visited Apr. 26, 2018).

[14] Id.

[15] Bill Chappell, Supreme Court Will Hear Cases On LGBTQ Discrimination Protections For Employees, NPR (Apr. 22, 2019, 1:52 PM), https://www.npr.org/2019/04/22/716010002/supreme-court-will-hear-cases-on-lgbtq-discrimination-protections-for-employees.

[16] Id.

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Nurses Unite for New Staffing Agreement

By: Deanna Scalia

In 1947, Congress enacted the Taft-Hartley Act, which excluded non-profit hospital workers from any protections under the National Labor Relations Act.[1]  As a result, nurses working in such hospitals were prohibited from being able to unite.[2]  It was not until 1974 when the Health Care Amendments were created to include all health care institutions, which gave non-profit hospital workers the right to unite, organize, and strike.[3]  A healthcare institution is defined as “any hospital, convalescent hospital, health maintenance organization, health clinic, nursing home, extended care facility, or other institution devoted to the care of sick, infirm, or aged person.”[4]  Currently, “there is no single labor union that represents nurses nationwide.”[5]  Some unions that are active and representing nurses are “SEIU United Healthcare East, National Nurses United, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), and the United Food and Commercial Workers International Union.”[6]

Recently, nurses in New York have started to exercise their right to unite, organize, and go on strike.[7]  On April 2, 2019, The New York State Nurses Association submitted their mandated 10-day notice of a strike.[8]  This union represents nurses from three of New York City’s largest hospitals including: New-York Presbyterian, Mount Sinai,  and Montefiore Medical Center.[9]  The union reports that more than 97% of the nurses in these hospitals voted to go on strike.[10]  Carl Ginsburg, a spokesman for the New York State Nurses Association, expressed that the issue is that there is “not enough nurses to do the job right.”[11]  Further, he says, “[t]hey are extremely unhappy at years of fruitless efforts to create and enforce a system in which a safe number of patients is assigned per nurse.”[12]  At one point, registered nurses in these three hospitals were required to “care for more than 18 patients each.”[13]  In response, the “multi-employer association representing the hospitals”, the New York Hospital Alliance (“NYHA”), has “filed an Unfair Labor Practice charge against the union.”[14]  These three “hospitals have argued that rigid staffing ratios would lower patient care and increase costs that could result in layoffs of other care teams.”[15]  The New York City Hospital Alliance (“NYCHA”) claims to have offered “significant wage increases, pension and health benefit funding, and an explicit offer to explore increased staffing.”[16]  However, according to the NYCHA, the union has urged their nurses to turn their backs on their patients to “advance their political agenda of mandating rigid, inflexible staffing ratios.”[17]

The NYHA and the New York State Nurses Association have reached a tentative agreement regarding the employees’ concerns.[18]  First, the agreement will be enforced for the next four years and will expire on December 31, 2022.[19]  Next, the hospitals agreed to implement minimum staffing ratios, which will result in hiring an additional 1,450 nurses to make sure those ratios are met.[20]  The exact number of the new ratios have not been released yet, but an additional $100 million will be allocated to hire full-time nurses, monitored and enforced by an independent neutral party.”[21]  Additionally, the agreement secured a three percent wage increase for both past and current nurses.[22]  Lastly, the agreement promises “’millions of dollars’ for health benefits for retired nurses.”[23]   According to the New York State Nurses Association, this tentative agreement will “have a very positive impact, and will be the trendsetter of the industry, Adding that “[w]hat we decide in these major city hospitals tends to set the framework for other hospitals.”[24]  Nurses are hopeful that the new staffing ratios and the help of additional nurses will eliminate the issues with having to pick between patients, and all the patients can receive effective care.[25]  This agreement was “[a] win for nurses, patients, and communities.”[26]

[1] Michael J. Stapp, Ten Years After: A Legal Framework of Collective Bargaining in the Hospital Industry, 2 Hofstra Lab.  L. J. 63, 63 (1984).

[2] Id.

[3] Id. at 64.

[4] 29 U.S.C. § 152 (14).

[5] Pete Gerardo, Should I Join A Nurses Union? Pros And Cons, nurse (June 29, 2017), https://nurse.org/articles/pros-and-cons-nursing-unions/.

[6] Id.

[7] Vincent Barone, City nurses set strike date of April 2 over staffing concerns, am New York (Mar. 18, 2019 at 5:06 PM), https://www.amny.com/news/nyc-nurse-strike-hospitals-1.28661957.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id.

[13] Id.

[14] Id.

[15] Id.

[16] Id.

[17] Id.

[18] Chaunie Brusie, NYC Nurses Reach Historic Deal on Safe Staffing – Strike Called Off, nurse (Apr. 16, 2019), https://nurse.org/articles/new-york-nurse-strike-safe-staffing-ratios/.

[19] Id.

[20] Id.

[21] Id.

[22] Id.

[23] Id.

[24] Id.

[25] Id.

[26] Id.

Addressing Tip Pooling in the Casino Industry

By: Michael Grazio

Tip pooling is a subject that has been litigated heavily in the casino industry in recent years.[1]  Tip pooling has been uniformly defined by the Courts as “ a practice by which tips left by patrons at restaurants and other establishments are shared among employees.”[2] Tip pooling has become an easy and accessible vehicle for owners to commit wage theft against tipped employees, while being able to disguise their wage theft by engaging in what they will say is an “acceptable practice.”[3] While tip pooling is often discussed in the restaurant context, the wage theft problem has become prevalent in the casino industry, as card dealers have become susceptible to wage manipulation through the tip pooling practices implemented in casinos.[4]

Similar to servers in the restaurant industry, casino card dealers also substantially rely on tips to sustain their livelihood.[5]  A seminal case, Moen v. Las Vegas International Hotel, Inc., set the bar for tip pooling in Casinos, when the court held that “tip pooling policies requiring a table dealer to share his tips with other dealers, boxpersons, casino cashiers, and floor men was valid.”[6]  The court’s decision Moen, is in contravention to the purpose of a Nevada statute, which made it “unlawful for any person to take all or part of any tips or gratuities bestowed upon the employees of that person.”[7]

This Nevada statute vaguely asserts that the employee has the right to retain their tips and does not expressly prohibit employers from taking tips and distributing them to other employees who are not customarily tipped.[8] Similar to the problem with restaurant tip pooling statutes in California, the Nevada statute allows employers to circumvent the plain statutorily language and deprive tipped employees of their right against tip manipulation.[9]

The decision in Moen was considered in another case involving casino dealers, where casino tips were being distributed amongst fellow card dealers, boxpersons, and casino service team leaders.[10] In Wynn Las Vegas, the court determined that the casino’s tipping arrangement did not violate the Nevada statute because the casino was not keeping any tips “for themselves.”[11] Although the employer may not keep the tips earned by their dealers for themselves, they are still free to share those tips amongst groups of employees, despite the fact that the group of employees contains staff members of “different ranks”, and were not the employees that directly earned the tips from the patrons.[12] Due to gaming service workers receiving a median salary of about $22,300 per year, averaging about $10.72 per hour, it is important to protect this group of employees from tip manipulation.[13]

 

[1] Kandis McClure, Tip-Pooling at Nevada Casinos – The Case at the Wynn and Why the Nevada State Gaming Control Board and Gaming Commission Should Set Strict Regulations on Tip-Pooling to Protect the Rights of Dealers, Casinos, and the Reputation of the Nevada Gaming Industry, 5 Univ. of Las Vegas Gaming L. J. 81 (2014).

[2] Etheridge v. Reins Int’l Cal., Inc., 172 Cal.App.4th 908, 910 (2009).

[3] Laurie Woolever, High-End Food, Low-Wage Labor, Dissent Magazine (2012), https://www.dissentmagazine.org/article/high-end-food-low-wage-labor.

[4] McClure, supra note 1.

[5] Id.

[6] Moen v. Las Vegas Int’l Hotel, Inc., 402 F. Supp. 157 (D. Nev. 1975).

[7] N.R.S. §608.160.

[8] Id.

[9] See e.g., Chau v. Starbucks Corp., 174 Cal.App.4th 688 (2009); Etheridge v. Reins Int’l Cal., Inc., 172 Cal.App.4th 908, 910 (2009); Leighton v. Old Heidelberg, Ltd., 219 Cal.App.3d 1062, 1067 (1990); Davis v. Int’l Coffee and Tea, LLC, 2018 WL 1602255 (2018).

[10] Wynn Las Vegas, L.L.C. v. Baldonado, 129 Nev. 734 (2013).

[11] Id. at 738-39.

[12] Sue Woods, Mandatory Tip Pooling for Different Ranks of Casino Employees is OK, 19 No. 3 Nev. Emp. L. Letter 1 (2013).

[13] Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, Gaming Services Workers, http://www.bls.gov/ooh/personal-care-and-service/gaming-servicesoccupations.htm (last visited Apr. 22, 2019).

Defining Right-to-Work States and Why More States Should Adopt Them

By: Gary Kenney

Right-to-work laws are state laws that prohibit labor unions from implementing “union security clauses.”[1]  Union security clauses are “provision[s] in [] union contract[s] requiring employees, as a condition of employment, to maintain union membership or pay union dues or requiring an employer to check off dues from employees’ wages.”[2]  However, the Supreme Court recently held that “public employees do not have to pay fees to unions to cover the costs of collective bargaining.”[3]  This decision overturned regulations in twenty-two states’ policies known as “fair share” policies.[4]  Fair share policies required people who were members of unions they did not choose to be members of to pay fees for collective bargaining.[5]  In comparison, there are twenty-seven states with Right-to-work provisions.[6]  In 2016, the Sixth Circuit rejected a ruling from the Western District of Kentucky that right-to-work laws were preempted by the National Labor Relations Act.[7]

There are several reasons why more states should adopt right-to-work policies.  First is the belief the union membership will help workers receive better wages and benefits, though is not always true.[8]  From 2002 to 2012, the growth of personal income was “12.8 percentage points higher in right-to-work states than forced-union states.”[9]  In addition, states with right-to-work laws saw an increase in job creation at more than double the rate of states without right-to-work laws from 2001 to 2006.[10]

There is also a belief that political contributions made by unions are not always representative of the union’s members.[11]  This led to the Supreme Court decisions in Communications Workers of America v. Beck and Janus v. AFSCME.  In Beck, the Supreme Court ruled that unions can only collect fees from non-members in relation to collective bargaining and not for other purposes.[12]  In Janus, the Supreme Court ruled that public sector unions cannot force employees to pay dues for collective bargaining due to the political nature of the contributions.[13]  The decision in Beck created what are now known as “Beck Rights.”[14]  These rights allow union members to request a refund of their dues if the money will not be used for collective bargaining purposes.[15]  Since the Janus ruling, “Beck Rights” are only applicable to private sector unions.[16]  However, if more states adopted right-to-work laws, employees would not have to worry about their union misappropriating their mandatory dues paid to the union because of a union security clause.[17]

Right-to-work laws still allow employees the ability to gather together and bargain for extra rights, but without the added factor of unions establishing mandatory dues.[18]

[1] NLRB, Employer/Union Rights and Obligations, https://www.nlrb.gov/rights-we-protect/rights/employer-union-rights-and-obligations.

[2] US Legal, Union Security Clause Law and Legal Definition, https://definitions.uslegal.com/u/union-security-clause/.

[3] Alana Semuels, Is This the End of Public-Sector Unions in America?, The Atlantic (June 27, 2018), https://www.theatlantic.com/politics/archive/2018/06/janus-afscme-public-sector-unions/563879/.

[4] Id.

[5] Id. 

[6] NLRB, supra note 1.

[7] United Auto., Aerospace & Agric. Implement Workers of Am. v. Hardin Cty., 842 F.3d 407, 422 (6th Cir. 2016).

[8] Travis H. Brown, Right-to-Work Laws v. Forced Unionization: Happier Workers Have the Freedom to Choose, How Money Walks (June 10, 2015), https://www.howmoneywalks.com/right-to-work-laws-vs-forced-unionization-happier-workers-have-the-freedom-to-choose/.

[9] Id. (citing Arthur B. Laffer Et Al., An Inquiry into the Nature and Causes of the Wealth of States: How Taxes, Energy, and Worker Freedom Change Everything (2014)).

[10] Paul Kersey, Right-to-Work Mythbusters, Mackinac Center for Public Policy (Jan. 28, 2008), https://www.mackinac.org/9180.

[11]  See Use of Dues for Politics, Unionfacts, https://www.unionfacts.com/article/political-money/.

[12] Commc’ns Workers of Am. v. Beck, 487 U.S. 735, 780 (1988).

[13] Janus v. AFSCME, 138 S. Ct. 2448, 2486 (2018).

[14] Robert P. Hunter, Why Beck Rights are Important to Workers, Mackinac Center for Public Policy (May 1, 1998), https://www.mackinac.org/1021.

[15] Id.

[16] Janus, 138 S. Ct. at 2486.

[17]  See Use of Dues for Politics, supra note 11.

[18] Kersey, supra note 10.

Is Secretly Recording in the Workplace Legal?

By: Francesca Gaspari

The number of employers accused of sexual harassment has been on the rise in recent years.[1] There have been a number of movements that demand employers and employees be cautious and monitor every word and action they make in the workplace.[2] Right to privacy in the workplace is a “hot topic” because of the #MeToo era, combined with the increased use of technology in daily lives.[3] There has recently been instances of employees secretly recording managers in preparation for litigation.[4] “Secret recordings are ‘definitely on the increase,’ not only in whistle-blower cases but also under Title VII of the Civil Rights Act of 1964 and in retaliation cases . . . Such recordings frequently arise in sexual-harassment cases, where an employee will try to use a recorded statement as a smoking gun.”[5] The question of whether privately recording an employer without consent is lawful varies upon the jurisdiction.[6] Some jurisdictions require that only one of the parties to the conversation need consent; typically, that is the person who is recording.[7] The bigger issue with recordings in the workplace is the amount of control the employer has. The question then becomes: Can your employer prohibit you from secretly recording conversations that take place in the workplace?

One study found that seventy-five percent of employees who experience harassment and spoke out about it faced retaliation.[8] Due to this disturbing statistic, employees have been silent for fear of not being believed. The Equal Employment Opportunity Commission (“EEOC”) has the powerful position of investigating charges of discrimination to make the overall determination as to whether the claim was more than an allegation.[9] The laws governing recordings and protections with privacy in communications fall under the Wiretap Act, which requires there to be more than someone simply eavesdropping on a phone call.[10] The Wiretap Act provides that employers and supervisors have an expectation of privacy in their office and meetings, and thus, it would be a violation to record at time when there is a reasonable expectation of privacy.[11] Risks associated with recoding in the workplace go beyond ethics; it can create personal issues as well as protected confidential business dealings.[12]

An employer expects its employees to respectfully refrain from disclosing work materials.[13] Many employees actually outright ban employees from recording within the workplace.[14] “Secret workplace recordings have also provided an employer with an appropriate basis to terminate an employee’s employment.”[15] However, the ban must comply with the National Labor Relations Act; former President Barack Obama ruled that placing restrictions on employees’ right to record at work would violate the National Labor Relations Act.[16] Conversely, upon the election of President Donald Trump, that previous ruling was overturned by The Boeing Co., and the courts now look to a balancing test.[17] The National Labor Relations Board (“NLRB”) considers the substantial legitimate interests in preventing recordings that outweigh the risk of interfering with already protected rights under the NLRA.[18]

“The NLRB’s new approach on recording bans only applies to rules that have little overlap with Section 7 rights. . . . A rule that expressly prohibits activities that are protected by the NLRA, such as recordings of protected workplace protests, or preservation of evidence for use in complaining activities, likely will be treated as unlawful.”[19]

Recording in the workplace will be permitted when the employee is acting together for the greater good, with the mutual aid of other employees for protections.[20] Thus, employers may prohibit the use of recording only if it complies with the protections already set forth by the NLRB.

 

[1] Jennifer Koza, 5 Disturbing Sexual Harassment Statistics We Can’t Afford to Ignore, FAIRYGODBOSS, https://fairygodboss.com/articles/sexual-harassment-statistics.

[2] Elisabeth Buchwald, In the wake of #MeToo, more U.S. companies reviewed their sexual harassment policies, MarketWatch (Jul. 14, 2018), https://www.marketwatch.com/story/in-the-wake-of-metoo-more-than-half-of-companies-have-reviewed-their-sexual-harassment-policies-2018-07-10.

[3] Privacy in the Workplace: Overview, FindLaw, https://employment.findlaw.com/workplace-privacy/privacy-in-the-workplace-overview.html (last visited Apr. 14, 2019).

[4] Allen Smith, Employees Secretly Record Managers for Litigation, SHRM (Aug. 8, 2018), https://www.shrm.org/resourcesandtools/legal-and-compliance/state-and-local-updates/pages/secret-recordings.aspx.

[5] Id.

[6] Laws on Recording Conversations in all 50 States, MWL, 1, https://www.mwl-law.com/wp-content/uploads/2013/03/LAWS-ON-RECORDING-CONVERSATIONS-CHART.pdf (last updated Feb. 26, 2019).

[7] Id.

[8] Koza, supra note 1.

[9] Authority & Role, EEOC, https://www.eeoc.gov/eeoc/index.cfm (last visited Apr. 14, 2019).

[10] 18 U.S.C. § 2511.

[11] Ronda K. O’Donnell, Employers Caught on Tape – Are Secret Workplace Recordings Legal?, The Legal Intelligencer, (Nov. 19, 2018 at 10:38 AM), https://www.law.com/thelegalintelligencer/2018/11/19/employers-caught-on-tape-are-secret-workplace-recordings-legal/?slreturn=20190304131249.

[12] Nina Massen, Recording Conversations at Work, SHRM (Oct. 23, 2014), https://www.shrm.org/hr-today/news/hr-magazine/pages/1114-recordings-at-work.aspx.

[13] Alexander J. Passantino, Wage and Hour Division (WHD), U. S. Dep’t of lab. (Jan. 15, 2009), https://www.dol.gov/Whd/opinion/FLSA/2009/2009_01_15_15_FLSA.htm.

[14] Benjamin A. Johnson and Devon C. Sherrell, Navigating Bans on Recording Devices in the Workplace and Employee Rights, Robinson Bradshaw (Jul. 25, 2017), https://www.robinsonbradshaw.com/newsroom-publications-Navigating-Recording-Device-Bans-in-Workplace.html.

[15] O’Donnell, supra note 11.

[16] Zoe Argento and Julia Arnold, Hit the Pause Button: The Implications of Recording in the Workplace, Littler Insight (Sept. 4, 2018), https://www.littler.com/publication-press/publication/hit-pause-button-implications-recording-workplace.

[17] Id.

[18] Id.

[19] Id.

[20]  29 U.S.C. § 158(a)(1).

So, you think you want to pay your employees with Cryptocurrencies, huh? Well, think again. . .

By: Ryan Lonergan

Cryptocurrencies are bits of code that exclusively live online, which act as a currency.[1] Cryptocurrencies are blocks on a public ledger, also known as the blockchain.[2] The blockchain records and registers all transactions that take place using the cryptocurrency.[3]  This allows for a seamless, unrestricted, and efficient transaction among parties without the need for relying on a third party.[4]  The most popular of cryptocurrencies is Bitcoin.[5] Bitcoin was created in 2009 by an individual or team of individuals that go by the name of Satoshi Nakamoto.[6]  Bitcoin hit an all-time valuation of nearly $18,000.00 per Bitcoin in December of 2017.[7] This valuation far exceeds its initial value of around $13.00 per Bitcoin in 2013.[8]  This extreme valuation sparked interest in the technology’s utility by many laypeople and savvy investors, but also opened the door for others to develop and publicize new or existing cryptocurrencies, such as Ether/Ethereum.[9]

Misleading titles aside, most sovereign nation (including the United States) currently recognizes any cryptocurrency as a valid currency.[10]  At the forefront of controversy is the reluctance to recognize a currency of which that is not backed by any country or valuable material, like gold.[11]  Further, countries are skeptical because of the uncertainty associated with cryptocurrencies.[12]  However, financial gurus and innovative laypeople are eager to the develop uses for the independent currency, especially in ways to circumvent currency exchange fees and possible corrupt third parties.[13]  With this wave of interest, individuals have begun to opt into a system, where  their paychecks would include or even be fully substituted by cryptocurrencies.[14] Unfortunately, this request is met with a slew legal obstacles.

The first legal obstacle is the Fair Labor Standards Act (“FLSA”) which “require[s] payments of the prescribed wages, including [minimum wage and] overtime compensation, in cash or negotiable instrument payable at par.”[15]  As far as the United States Government is concerned, cryptocurrencies are neither cash nor a negotiable instrument payable at par.[16]  This means that an employer cannot pay an employee’s paycheck fully in cryptocurrencies under the current law.  There is no current united stance on the treatment of cryptocurrencies in the United States.  Multiple federal agencies have taken the liberty to publish their ideal treatment of cryptocurrencies.  The Internal Revenue Service (“IRS”) has published a notice explaining that the IRS will treat cryptocurrencies as property for tax return purposes.[17]  The Commodity Futures Trading Commission (“CFTC”) was awarded a decision where a judge stated “that the CFTC has the power to prosecute fraud” involving virtual currency.[18]  Lastly, the Securities and Exchange Commission (“SEC”) has advised all investors of the risks of cryptocurrencies and is seeking to urge judges to empower the SEC to regulate cryptocurrencies in general, outside of the controlled event of Initial Coin Offerings.[19]  All of these agencies are acting independently to urge law makers to extend the authority to regulate cryptocurrencies to their agency, leaving laypeople and many professionals in a disarray of legal complexities.[20]

Congress should unite the agencies and create stability by amending the FLSA, recognizing the technology as currency, and allowing cryptocurrencies to develop in society.  Further, the judiciary has already taken steps to help this rewriting of the law to take place.[21]  A district court judge in the SEC v. Shavers, decided that cryptocurrencies are already being used as money and should be regulated as such.[22]  This rewriting of the FLSA would be a step toward a future of embracing technology.

[1] J. Scott Colesanti, Trotting Out the White Horse: How the S.E.C. Can Handle Bitcoin’s Threat to American Investors, 65 Syracuse L. Rev. 1 (2014).

[2] Nolan Bauerle, How Does Blockchain Technology Work?, Coin Desk, https://www.coindesk.com/information/how-does-blockchain-technology-work/ (last visited Apr. 2, 2019).

[3] See Id.

[4] Reuben Grinberg, Bitcoin: An Innovative Alternative Digital Currency, 4 Hastings Sci. & Tech. L.J. 159, 160 (2012).

[5]  Ray King, Top 10 Cryptocurrencies 2019: What’s The Most Popular Cryptocurrency Today?, BitDegree (Jan. 4, 2019), https://www.bitdegree.org/tutorials/top-10-cryptocurrencies/.

[6] Jonathan B. Turpin, Bitcoin: The Economic Case for a Global, Virtual Currency Operating in an Unexplored Legal Framework, 21 Ind. J. Global L. Studies 335, 337 (2014).

[7] Bitcoin Price History Chart, Buy Bitcoin Worldwide, https://www.buybitcoinworldwide.com/price/ (last visited Sept. 7, 2018).

[8] Id.

[9] Alexavier Guzman, The Ripple Effect of Cryptocurrencies, Forbes (Jan. 11, 2018 at 2:40 PM), https://www.forbes.com/sites/forbesproductgroup/2018/01/11/the-ripple-effect-of-cryptocurrencies/#e4f46cc60800; Tiffany L. Minks, Ethereum and the SEC: Why Most Distributed Autonomous Organizations Are Subject to the Registration Requirements of the Securities Act of 1933 and A Proposal for New Regulation, 5 Tex. A&M L. Rev. 405, 413 (2018) (“Ether is the virtual medium of exchange used on the Ethereum platform, also known as ’the crypto-fuel for the Ethereum network.’”).

[10] Prableen Bajpai, Countries Where Bitcoin Is Legal & Illegal (DISH, OTSK), Investopedia, https://www.investopedia.com/articles/forex/041515/countries-where-bitcoin-legal-illegal.asp (last visited Apr. 2, 2019).

[11] See Turpin supra note 6, at 335-336 (stating that a currency backed by a sovereign nation, but not backed by precious metal or other value material, is called a fait currency).

[12] Jonathan Todd Barker, Why Is Bitcoin’s Value So Volatile?, Investopedia (Dec. 27, 2017), https://www.investopedia.com/articles/investing/052014/why-bitcoins-value-so-volatile.asp.

[13] John Naughton, Why Bitcoin scares banks and governments, Guardian (Apr. 6, 2013), https://www.theguardian.com/technology/2013/apr/07/bitcoin-scares-banks-governments.

[14] Eric Mack, Corporate Bitcoin Salaries Are Now a Thing (Sort Of), Inc. (Dec. 15, 2017), https://www.inc.com/eric-mack/meet-publicly-traded-company-paying-employees-in-bitcoin.html.

[15] 29 C.F.R. § 531.27(a) (2018).

[16] See Bajpai, supra note 10.

[17] Internal Revenue Serv., U.S. Dep’t of the Treasury, Pub. No. 938, Notice, 2014-16 (2014), https://www.irs.gov/pub/irs-drop/n-14-21.pdf [hereinafter IRS].

[18] Commodity Futures Trading Commission, Release Number 7820-18 (2018), https://www.cftc.gov/PressRoom/PressReleases/7820-18; see CFTC v. My Big Coin Pay, Inc., 334 F. Supp. 3d 492 (D. Mass. 2018) [hereinafter CFTC].

[19] Kennedy K. Luvai, The End of the ICO Gold Rush? The Regulatory Squeeze on Token Offerings as A Funding Mechanism for Blockchain-Related Ventures, 31 Utah B.J. 20, 20 (2018) (explaining that this new form of funding for new cryptocurrency ventures include “[t]hese tokens [being] denominated in fiat currencies or, more commonly, in cryptocurrencies like bitcoin or ether. After issuance, tokens may be resold in secondary markets and have their own market value independent of the cryptocurrency used on the associated platform.”).

[20] See IRS, supra note 17; CFTC, supra note 18; Luvai, supra note 19.

[21] See Sec. & Exch. Comm’n v. Shavers, No. 4:13-CV-416, 2013 WL 4028182, at *1 (E.D. Tex. Aug. 6, 2013).

[22] See Id.

Paying Student Athletes and the Legal Ramifications

By: Armand Magardician

The “March Madness” season is in full swing, and with the annual tournament’s commencement comes the same question that always arises: Should student-athletes be paid? Many people express their personal opinions on this matter, but only one conclusion has ever been upheld by the courts; student-athletes cannot receive compensation for their time spent playing, other than in scholarship form.[1]

The National Collegiate Athletic Association (“NCAA”) was formed in 1910 for the purposes of governing collegiate athletics and to moderate schools’ participation in these activities.[2] Today, the NCAA has about 1,100 schools and is “organized into three divisions: Division I, Division II, and Division III.[3]” Division I is the division with the most well-known schools, and as such, provides the most financial aid to its student-athletes.[4] In its efforts to maintain the amateur status of its divisions, the NCAA has issued forth a rule that does not allow student-athletes to be compensated.[5] Student-athletes must be considered amateurs in order to be NCAA eligible.[6] Two notable examples of the NCAA’s encouragement of this rule are: (1) a student “athlete can lose [their] amateur status, for example, if he signs a contract with a professional team, enters a professional league’s player draft, or hires an agent”, and (2)  student-athletes “[are] prohibited – with few exceptions – from receiving [compensation] based on [their] athletic ability.[7]

There are two well known cases that have been brought by student-athletes that attempted to mend these rules that the NCAA has established: Berger v. National Collegiate Athletic Association, and O’Bannon v. National Collegiate Athletic Association.[8]

In Berger, Gillian Berger and Taylor Henning were two student-athletes at the University of Pennsylvania (“Penn”).[9] These students brought the claim that student-athletes deserve to be paid since they could be considered “employees” under the Fair Labor Standards Act of 1934 (“FLSA”).[10] The court rejected this argument, stating that collegiate sports are not included in the definition set forth in the FLSA and therefore, student-athletes do not deserve compensation.[11]

In O’bannon, a former college basketball player at UCLA, Ed O’bannon, came across a video game that was using his likeness.[12] O’bannon brought an anti-trust action against the NCAA asserting that student-athletes should be allowed to receive compensation if their names, images, and likeness is being used.[13] Through a series of analyses, the court came to the conclusion that student-athletes are allowed to receive the cost of a full scholarship, but no other form of payment.[14]

These two cases have made it clear that the NCAA’s amateurism rules restricting payment of student-athletes must be upheld.[15] There are many policy arguments that can be made against these holdings, however the law stands firm.[16] Student-athletes cannot be paid for the services outside of a full scholarship.[17] The NCAA, along with the federal courts’ decisions, should have no problem asserting this rule and squashing any claim against it.[18]

[1] Berger v. Nat’l Collegiate Athletic Ass’n, 843 F.3d 285, 294 (7th Cir. 2016); O’Bannon v. Nat’ l Collegiate Athletic Ass’n, 802 F.3d 1049, 1053 (9th Cir. 2015).

[2]  O’Bannon, 802 F.3d at 1053.

[3] Id.

[4] Id. at 1056.

[5] Id. at 1054.

[6] Id.

[7] Id. at 1055.

[8] Berger, 843 at 285; O’Bannon, at 1049.

[9] Berger, 843 F.3d at 289.

[10] Id.

[11] Id. at 293.

[12] O’Bannon, 802 F.3d at 1055.

[13] Id.

[14] Id. at 1053.

[15] See Berger, 843 F.3d at 285; see also O’Bannon, 802 F.3d at 1049.

[16]  Id.

[17] O’Bannon, 802 F.3d at 1053.

[18] See Berger, 843 F.3d at 285; see also O’Bannon, 802 F.3d at 1049.

Class Action Waivers in Arbitration Agreements

By: Brittany Frank

On May 21, 2018, the United States Supreme Court decided three cases, which were all argued together in Epic Systems Corp. v. Lewis.[1]  These three cases were Epic Systems Corp. v. Lewis, Ernst & Young LLP v. Morris, and NLRB v. Murphy Oil USA.[2]  Each case involved an arbitration agreement between an employee and employer that provided for individualized arbitration proceedings in the case of a dispute.[3]  However, employees in each case brought claims in federal court against their employer for violations of the Fair Labor Standards Act as a class action rather than an individual proceeding.[4]

Typically, courts are required to enforce arbitration agreements by the Federal Arbitration Act.[5]  But, the Federal Arbitration Act’s saving clause is a caveat, allowing a court to refuse enforcing an arbitration agreement “upon such grounds as exist at law or in equity for the revocation of any contract,”[6] or if a more general contract defense applies – “such as fraud, duress, or unconscionability.”[7]

The employees argued that the saving clause exception applied to an arbitration agreement with a requirement of individualized arbitration proceedings, and thus violated the Nation Labor Relations Act (NLRA).[8]  The employees pointed to section 7 of the NLRA, which guarantees employees “the right to self-organization, to form, join, or assist labor organizations, to bargain collectively…, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.”[9]  Nonetheless, the United States Supreme Court refused to read “concerted activities,” protecting class actions because the remainder of the section only refers to activities directly related to collective bargaining.[10]

Previously, the United States Court of Appeals for the Seventh Circuit heard Lewis v. Epic Systems Corporation, holding that filing collective actions or class action lawsuits constituted “concerted activities” under section 7 of the NLRA, so arbitration agreements calling for individualized proceedings are not lawful and should not be enforced.[11]  Similarly, in Morris v. Ernst & Young, the United States Court of Appeals for the Ninth Circuit found that collective and class actions constituted concerted activities and refused to enforce an arbitration agreement requiring individualized arbitration proceedings.[12]  Nevertheless, the Supreme Court  reversed these decisions.[13]

Justice Ruth Bader Ginsburg’s dissent stated the Supreme Court’s decision was “egregiously wrong”,[14] explaining that “[f]or workers striving to gain from their employers decent terms and conditions of employment, there is strength in numbers.  A single employee, Congress understood, is disarmed in dealing with an employer.”[15]  This is due to the fact that “[i]ndividually, their claims are small, scarcely of a size warranting the expense of seeking redress alone.”[16]  In other words, courts “routinely recognize the importance of aggregate litigation because it often remains the only means of judicial relief where a plaintiff’s claim is too small economically to support individual litigation.”[17]  Employees must have the ability to act collectively in order to match their employer’s economic power in setting the standards of their employment.[18]

For these reasons, the Supreme Court’s decision in Epic Systems Corp., creates an imbalance of power between employers and employees.[19]  This decision is an obstacle for employees and places an overwhelming burden on employees to enforce the rights, protections, and benefits that the law intends to give employees.[20]

 

[1] Epic Systems Corp. v. Lewis, 138 S.Ct. 1612, 1612 (2018).

[2] Id.

[3] Id. at 1616.

[4] Id.

[5] Id.

[6] Id. (citing 9 U.S.C.A. § 2 (2015)).

[7] Id.

[8] Id.

[9] Id. at 1617 (citing 29 U.S.C. § 157 (2019)).

[10] Id.

[11] Lewis v. Epic Systems Corp., 823 F.3d 1147, 1152 (7th Cir. 2016), cert. granted, 137 S.Ct. 809 (2017), rev’d, 138 S.Ct. 1612 (2018).

[12] Morris v. Ernst & Young, LLP, 834 F.3d 975, 975 (9th Cir. 2016), cert. granted, 137 S.Ct. 809 (2017), rev’d, Epic Systems Corp. v. Lewis, 138 S.Ct. 1612 (2018), vacated, 894 F.3d 1093 (9th Cir. 2018).

[13] See Epic Systems Corp., 138 S.Ct. at 1616 (2018).

[14] Id.  at 1633 (Ginsburg, J., dissenting).

[15] Id.

[16] Id.

[17] Nantiya Ruan, What’s Left to Remedy Wage Theft? How Arbitration Mandates that Bar Class Actions Impact Low-Wage Workers, 2012 Mich. St. L. Rev. 1103, 1118 (2012).

[18] Epic Systems Corp., 138 S.Ct. at 1634 (2018) (Ginsburg, J. dissenting).

[19] See id. at 1640 (“[T]he Court ignores the reality that sparked the NLRA’s passage: Forced to face their employers without company, employees ordinarily are no match for the enterprise that hires them.  Employees gain strength, however, if they can deal with their employers in numbers.”).

[20] See id. at 1637 (“[I]n enacting § 7 of the NLRA, Congress sought generally to equalize the bargaining power of the employee with that of his employer by allowing employees to band together in confronting an employer regarding the terms and conditions of their employment.”) (citing NLRB v. City Disposal Systems Inc., 465 U.S. 822, 835 (1984)).

 

Soccer: A Universal Game Where Performance Should be Measured by Success in Competitions

By: Joseph Farneti

Earlier this month, soccer players on the United States Women’s National Team (USWNT) filed a lawsuit in federal court against the United States Soccer Federation (USSF).[1] The players allege that the USSF are in violation of the Equal Pay Act because the United States Men’s National Team (USMNT) is compensated more.[2]

The Equal Pay Act prohibits wage discrimination based on sex, meaning men and women cannot receive different wages for the same work.[3] To determine if there is a violation of the Equal Pay Act a “careful analysis of relevant job descriptions and assessment of whether the jobs require equal skill, effort and responsibility and are performed under similar working conditions” must be done.[4] But, “[s]ometimes there are lawful explanations for differing wage rates,” such as “a seniority system, a merit system, or a system that measures earnings ‘by quantity or quality of production.’”[5]

Soccer is a universal sport played by many different people. Because the USWNT and the USMNT both play by the same rules they are playing the same game.[6] Additionally, soccer is inexpensive, affording people from different socioeconomic backgrounds the same opportunity to play the sport.[7] Moreover, soccer is played at highly competitive levels, as well as less competitive levels.[8] Highlighting the fact that soccer is a universal sport by incorporating the socioeconomic aspect of soccer strengthens the USWNT’s claim.[9]

To the naked eye, it may seem that the USMNT and the USWNT are similar because they both play soccer for the United States National Team.[10] Yet, the USWNT players claim they receive 38% less compensation for playing the same number of yearly games as the USMNT.[11] The USSF may support this decision if they show their pay structure is based on a merit system.[12] However, the USWNT has proof their international competition success far surpasses the USMNT’s, which is a valid reason the USWNT should be paid more than the USMNT.[13] The USWNT has won three Women’s World Cups and four Olympic gold medals, which are both viewed by millions worldwide,[14] whereas the USMNT has won neither.[15]

Since the USWNT surpassed the USMNT’s performance, so at the very least the USWNT’s compensation should be equal to the USMNT’s compensation. But, when comparing the USWNT’s and the USMNT’s international performance, the USWNT’s compensation should exceed the USMNT’s compensation. In conclusion, this pay discrepancy by the USSF is a clear violation of the Equal Pay Act.

[1] Michael McCann, Inside USWNT’s New Equal Pay Lawsuit vs. U.S. Soccer-and How CBA, EEOC Relate, Sports Illustrated (Mar. 8, 2019), https://www.si.com/soccer/2019/03/08/uswnt-lawsuit-us-soccer-equal-pay-cba-eeoc-gender-discrimination.

[2] Id.

[3] Id.

[4] Id.

[5] Id.

[6] Dan Russell, The International Football Association Board: Laws of the Game 2018/2019, FIFA, 11 (June 2018), https://img.fifa.com/image/upload/khhloe2xoigyna8juxw3.pdf.

[7] Brian Henninger, Why Is Soccer The World’s Most Popular Sport?, Dynasty Sports (Feb. 12, 2018), https://www.shopdynastysports.com/blogs/news/why-is-soccer-the-world-s-most-popular-sport.

[8] Jerry Carino, Talking soccer: Why U.S. women outperform our men, from someone who would know, APP (updated Aug. 7, 2018, 8:17 PM), https://www.app.com/story/sports/college/2018/08/06/u-s-womens-national-soccer-team-sky-blue/870860002/.

[9] Henninger, supra note 7.

[10] Will Hobson, Women’s soccer players sue U.S. federation for gender discrimination, Washington Post (Mar. 8, 2019), https://www.washingtonpost.com/sports/dcunited/womens-soccer-players-sue-us-federation-for-gender-discrimination/2019/03/08/c90ca69c-41ba-11e9-922c-64d6b7840b82_story.html?noredirect=on&utm_term=.7ebebfccb6d9.

[11] McCann, supra note 1.

[12] Id.

[13] Id.

[14] Id.

[15] Hobson, supra note 11.

Dress Codes: A New Way to Racially Discriminate

By: Nicole Fluke

Sharon Dorram Color at Sally Hershberger, a luxury hair salon on the Upper East Side of New York City, is known for its celebrity clientele and expensive services.[1]  During the summer of 2015, three African American women were hired as receptionists for the famous salon.[2]  Two of the women wore their hair in dreadlocks and one woman wore an afro.[3]  Sharon Dorram, one of the salon’s owners, ordered the general manager, David Speer, to create and enforce a dress code mandating employees wear “black and that bluejeans, ripped clothing and nose rings [are] forbidden, [and] it required shoulder-length hair to be pulled up or back.”[4]  Dorram denied that this dress code was implemented because of the three new receptionists’ races.[5]  Instead, Dorram claimed the new policy was to keep the salon’s employees dressed and groomed in the same “traditional” style found in the many other Upper East Side salons.[6]  However, Speer provided text messages from Dorram ordering the dress code, showing that it was “racially motivated.”[7]  The text message from Dorram to Speer stated, “[t]oday looked awful, Rail yne (sic) had her dreads down; Regine just got hers to match as long and of course Tarren (sic) All 3 at desk and we look like we should be on E. 134th Street. Sorry nor (sic) racist . . .  we are on Mad. And 71st.”[8]  Additionally, Dorram said, “[c]an’t be 3 girls at the desk. 2 like this and 1 w/ big Afro. What is our image Please instruct them not to wear hair down.”[9]

Following the implementation of this dress code, complaints were brought by current and former employees against the salon to the New York City human rights commission alleging racial discrimination.[10]  The first complaint was filed in July of 2016 by Speer, a white man, stating “he felt sickened by being asked to implement an employee hair policy that he said was applied more to black workers than white ones.”[11]  Then in December of 2016, a former receptionist, an African American woman, filed a second complaint, alleging she was the target of racial discrimination while working there.[12] The third complaint was filed in June of 2018 by another receptionist, a hispanic woman, claiming she was told to “steer clients away from stylists who refused to sign a document attesting to the fairness of the salon’s dress code.”[13]

The second case, brought by the African American woman, was brought before the Eleventh Circuit Court of Appeals and alleged racial discrimination when she was denied employment due to her dreadlocks.[14]  The court noted, “precedent holds that Title VII prohibits discrimination based on immutable traits.”[15]  An immutable trait is defined as one that is “not capable of or susceptible to change.”[16]  The plaintiff argued that dreadlocks are an immutable characteristic of her race.[17] After the case was dismissed by the district court, the Equal Employment Opportunity Commission appealed to the Court of Appeals, who affirmed in part.[18]  The Court of Appeals stated that although dreadlocks are “culturally associated with race,” the plaintiff failed to assert that they are “an immutable characteristic of black persons.”[19]

It may be difficult proving racial discrimination based on dress code requirements under Title VII.[20]  But, New York City is seeking greater protection for citizens by targeting “the unfair treatment of black people . . . [and] the right of New Yorkers to maintain their ‘natural hair, treated or untreated hairstyles such as locs, cornrows, twists, braids, Bantu knots, fades, Afros, and/or the right to keep hair in an uncut or untrimmed state.”[21]  Local law realizes Title VII’s purpose, which broadly prohibits discrimination,[22] by acknowledging that dress codes, like Sharon Dorram Color at Sally Hershberger’s, are new forms of racial discrimination.[23]

[1] Stacey Stowe, Upper East Side Salon Under Investigation for Racial Discrimination, N.Y. Times (Feb. 23, 2019), https://www.nytimes.com/2019/02/23/style/sharon-dorram-color-sally-hershberger-hair-discrimination.html.

[2] Id.

[3] Id.

[4] Id.

[5] Id.

[6] Id.

[7] Id.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id.

[13] Id.

[14] EEOC v. Catastrophe Mgmt. Sols., 852 F.3d 1018, 1020 (11th Cir. 2016).

[15] Id.

[16] Immutable, Merriam-Webster Dictionary (New ed. 2016).

[17] EEOC v. Catastrophe Mgmt. Sols., 852 F.3d at 1020.

[18] Id.

[19] Id.

[20] See id.

[21] Stowe, supra note 1.

[22] McDonnell Douglas Corp. v. Green, 411 U.S. 792, 800 (1973).

[23] Stacy Stowe, New York City to Ban Discrimination Based on Hair, N.Y. Times (Feb. 18, 2019), https://www.nytimes.com/2019/02/18/style/hair-discrimination-new-york-city.html.

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