Employment Law This Week®: Anti-Whistleblower Provisions, Federal Wage Exemption, Reimbursement Lawsuit Settlement, FLSA and EPPA Posters

(1) SEC Cracks Down on Anti-Whistleblower Provisions

Our top story: The Securities and Exchange Commission (SEC) cracks down on anti-whistleblower provisions. The SEC has charged BlueLinx Holdings with violating anti-whistleblower protections in its severance agreements. The company required all exiting employees to sign an agreement waiving their rights to whistleblower payments. Without admitting or denying any wrongdoing, BlueLinx agreed to amend its severance agreements and pay $265,000 to settle with the SEC. Less than a week later, the agency settled with a health care company on similar charges, for $340,000. Since the spring of 2015, the SEC has charged four companies for discouraging whistleblower activity. Tamara Bock, from Epstein Becker Green, has more.

"The SEC charged two different companies with alleged violations of 21F-17 of the Securities and Exchange Commission. This is part of a targeted sweep that the SEC has been conducting since the fall of 2014. . . . As you may recall, 21F-17 provides that companies cannot impede individuals from communicating directly with the SEC about possible securities law violations. . . . Companies should review their employment agreements, and if they have a provision stating that employees may not collect awards in connection with sharing information with government agencies—which, by the way, is allowed by many agencies—then that company should create a specific carve-out for communications with the Securities and Exchange Commission."

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(2) Nonprofit Loses Federal Wage Exemption

A nonprofit’s federal minimum wage exemption is revoked. To promote the hiring of the disabled, employers can obtain certificates from the Department of Labor (DOL) and pay subminimum wages to certain disabled workers. But a community rehabilitation center in West Virginia failed to do the studies needed to determine the proper wage rate and didn’t pay a valid subminimum wage to the disabled workers. That’s according to the DOL, which revoked the organization’s certification. This is a part of a larger strategic initiative from the DOL to ensure that all disabled workers are protected from exploitation.

(3) California Company Settles Reimbursement Suit

A distinction in California law has led to a reimbursement suit settlement. Medical device manufacturer Synthes has agreed to a proposed $5 million settlement with its California-based sales consultants. The sales consultants accused the company of making illegal wage deductions and failing to reimburse expenses. Unlike in most states, California’s Labor Code requires reimbursement for work-related expenses. The company settled but denied any wrongdoing or liability.

(4) DOL Revises FLSA and EPPA Posters

The Department of Labor updates two mandatory posters. The DOL recently released updated versions of its mandatory Fair Labor Standards Act (FLSA) and Employee Polygraph Protection Act (EPPA) posters. The DOL made several changes to the revised posters, including removing the penalty amount for violations. The new FLSA poster also includes various additions, such as information about the rights of nursing mothers. As of August 1, 2016, employers are required to post the updated versions, which can be downloaded from the DOL's website.

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(5) Tip of the Week

Shaun Francis, Senior Vice President Transformation & Chief Human Resource Officer for CSM Bakery Solutions, joins us via Skype with some advice on building effective client relationships.

"In my view, building effective client relationships comes down to the two 'Cs': credibility and courage. The first, around credibility, is the HR professional needs to be able to have a true understanding of the global business language, which is finance.  Are you able to link the balance sheet and the income statement? . . . And being able to do this, you'll be able to link the business’s needs to the employees' needs and drive that right colleague agenda throughout the whole enterprise. The second piece is around courage. Often, when the decision makers are around a table, you're never short in finding leaders that will put the business’s needs as the top priority. Typically, there's one person that puts the employees' needs as the top priority, and that’s the most senior HR professional at the table. So you have to have courage, when everyone else is putting business first, to have that debate."