Are you short-changing your interns?

Do you use interns and students in your for-profit business instead of hiring secretaries? If they are working for free, and the experience is not purely educational, you might be violating the law. If you are an intern or a student performing purely grunt work that a clerical employee would normally handle, you might have a legal entitlement to receive at least minimum wage for the time spent working as an intern.

Recently, the Wage and Hour Division of the U.S. Department of Labor (US DOL) issued new rules with the factors that should be weighed, when deciding if an unpaid intern is an intern only in name, but an employee in practice. The US DOL stresses that the main focus of the inquiry is to determine who the primary beneficiary is, of the individual's work. If the answer is "the employer," then the intern might be an employee. Factors that the US DOL will consider include:

1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.

2. The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.

3. The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.

4. The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.

5. The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.

6. The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.

7. The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

These factors are flexible, and the US DOL stresses that no single factor is determinative. Instead, the US DOL looks at the relationship as a whole to determine whether there is an employer-employee relationship or whether the employment is more of a learning experience. Here is the link for more information: https://www.dol.gov/whd/regs/compliance/whdfs71.htm

The Supreme Court Rules in Janus against Union Agency Fee Requirements for public employees

I have been meaning to write an article about the Supreme Court's Janus v. AFSCME decision but needed time to digest the 54 pages written by Justice Alito, and the lengthy, equally passionate dissent written by Justice Kagan.

As you may have read, on June 27, the Supreme Court decision ruled in favor of Petitioner Mark Janus, a public employee of the State of Illinois, against AFSCME Council 31. AFSCME Council 31 is union that was elected or chosen to represent him and all other employees in his bargaining unit. Mr. Janus refused to pay either union dues or the optional, less expensive, "agency fees," because he did not agree with the positions that the union took during contract negotiations. He cited to the First Amendment, arguing that the right of free association gives him the option to refrain from providing any financial support to the union.

Interestingly, the decision does not state that either Mr. Janus, or his co-workers, did not want to be represented by this union. They could have petitioned to decertify, or eliminate, the union, but did not do that. He does not challenge the union’s position as the representative of the employees. Instead, he challenged the requirement to pay monthly dues to the union.

In a 5-4 decision the Supreme Court agreed with Mr. Janus, ruling that compelling public employees to pay for the union to represent them, violated their Constitutional rights because it was akin to forcing employees “to mouth support for views they find objectionable. . . “ (p. 8). As Justice Alito wrote, “[c]ompelling a person to subsidize the speech of other private speakers raises similar First Amendment concerns.” (p. 9).

This decision overturned the 1977 decision of Abood v. Detroit Board of Education, which held that employees cannot be compelled to be a member of the union, but can be required to pay agency fees.

As background, public employees are usually required to pay either union dues or “agency fees.” Agency fees are less than union dues. The agency fees represent the portion of the union dues that supports the union’s expenses in negotiating and enforcing union contracts. Agency fees are considered to be enough to finance the costs of union representation, but not enough to finance the union’s political activities if the employee chooses not to become a full-fledged member.

Unions may not legally discrimination against non-members. Unions are legally required to negotiate terms and conditions of employment for all employees in the bargaining unit, even those who pay agency fees. They have a duty of fair representation to members and non-members alike who are part of the bargaining unit. Complying with this legal duty costs money; there are union salaries to pay, and expenses to cover. Those who choose not to pay agency fees, like Mr. Janus, have been criticized as “free riders” who obtain the benefits without any costs.

The Janus case turned the “agency fee” rule on its head. Writing for the majority, Justice Alito wrote that compelling employees to pay any form of financial dues to support an organization that espouses views they find objectionable violates the First Amendment rights to free association.

The Janus decision is, as Justice Kagan wrote, the rare decision that outrightly rejects and overturns established precedent (the Abood case), which has been favorably cited over the past 41 years. Many states have adopted laws intended to comply with Abood.

What does this mean for unions that represent public employees? Public sector unions will be financially weaker because they are expected to lose financial support or members who choose not to pay. Union dues will now be voluntary.

Without the financial support for their work, unions may choose to avoid challenging management decisions – even those that violate the union contract, due to the lack of financial involved in raising such a challenge. While civil service laws provide procedural protections and some level of job security, without a union backing them up, it may be difficult for most employees to bring a legal action on their own.

Without a doubt, the Janus decision will have profound "large scale consequences,” as Justice Kagan noted. "Across the country, the relationships of public employees and employers will alter in both predictable and wholly unexpected ways." (p. 2).

$1.32 million paid to Parents in Landmark Case

The U.S. Supreme Court issued a landmark decision in December 2017 a special education case, Endrew F. v. Douglas County School District, which has culminated in an April 19, 2018 settlement and subsequent payment of $1.32 million to the parents and attorneys representing the student.

The parents had sought reimbursement from Douglas County School District for their son's education after they placed him in a private school for children with autism. The Supreme Court battle concerned the appropriate standard by which school officials are held, in determining if the student's rights under the Individuals with Disabilities Education Act (IDEA) were violated.

Chief Justice John Roberts, who authored the Supreme Court’s unanimous 8-0 opinion in Endrew F., wrote that "a student offered an educational program providing ‘merely more than de minimis’ progress from year to year can hardly be said to have been offered an education at all." The Supreme Court ruled that, to meet its substantive obligation under the Individuals with Disabilities Education Act, a school must offer an individualized education program (IEP) that is reasonably calculated to enable a child to make progress appropriate in light of the child's circumstances, and that there must be a showing that the student made substantive progress in order to comply with the IDEA.