On August 6, 2019, in State of Texas v. Equal Employment Opportunity Commission, the U.S. Court of Appeals for the Fifth Circuit ruled that the Equal Employment Opportunity Commission (EEOC) overstepped its limited rulemaking and enforcement power when it issued its 2012 Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964.
On July 30, 2019, a lawsuit was filed in the U.S. District Court for the Eastern District of Texas seeking to enjoin the City of Dallas’s paid sick leave ordinance, which is set to take effect on August 1, 2019.
On July 24, 2019, a Bexar County district court judge entered an order delaying the implementation of the San Antonio paid sick leave (PSL) ordinance from its current August 1, 2019 date to December 1, 2019. The order represented a compromise between the City of San Antonio and a coalition of San Antonio business groups that filed suit against the city on July 15.
The Texas Legislature’s 86th session adjourned on May 27, 2019, and there is little likelihood that the governor will call a special session. The legislature primarily focused on educational reforms this year. Regarding employment matters, most observers expected the legislature to adopt laws preempting any attempt by municipalities to pass paid sick leave laws. While the legislature failed to pass any such law, they did pass other laws impacting the employer-employee relationship.
Despite broad-based support, the Texas Legislature failed to pass a law preempting the type of paid sick leave ordinances enacted in Austin, San Antonio, and most recently Dallas before the end of its regular session on May 27, 2019. While a Texas court of appeal enjoined implementation of Austin’s paid sick leave ordinance and later ruled it unconstitutional, no litigation has been filed concerning the San Antonio and Dallas ordinances. Accordingly, companies with employees in San Antonio and Dallas may want to review their current policies to ensure compliance with these ordinances, both of which will take effect for most employers on August 1, 2019.
In 2018, the city councils in both Austin and San Antonio passed ordinances to require employers to provide paid sick leave to employees. The ordinances have faced legal challenges, including a ruling in November 2018 that the Austin law is unconstitutional due to preemption by the Texas Minimum Wage Act. Neither ordinance has taken effect to date. Now the state senate has taken up the matter.
The issue of whether workers who utilize online digital platforms to obtain business and deliver services to third parties are employees or independent contractors has already been subject to much debate and litigation. In the growing gig economy, questions surrounding these issues can create uncertainty for both businesses and gig workers.
Texas law allows for the enforcement of covenants not to compete that impose reasonable restrictions on competition.
On November 16, 2018, the Third Court of Appeals in Austin, Texas, entered a temporary injunction blocking the implementation of the paid sick leave ordinance that the Austin City Council passed in February 2018.
On August 16, 2018, the San Antonio City Council voted 9 to 2 to adopt a paid leave ordinance which will require all employers in San Antonio to provide paid leave to their employees. The ordinance requires employers to provide paid leave to be used for specified reasons for employees’ and their family members’ health-related issues.
The ecclesiastical abstention doctrine can provide religious institutions with protection from employment-related lawsuits. Based upon the religious freedom amendments contained in the U.S. and Texas constitutions, this doctrine generally bars courts from adjudicating disputes related to the governance and operations of religious institutions.
Texas courts interpreting Chapter 21 of the Texas Labor Code generally attempt to interpret it consistently with federal anti-discrimination laws and frequently look to federal court decisions for guidance. However, differences do exist between Texas and federal anti-discrimination laws. One recent case explored the differences between Chapter 21 and the Americans with Disabilities Act (ADA) related to claims for release of confidential health information.
Texas law permits businesses to utilize noncompetition agreements to protect their legitimate business interests in certain circumstances. Companies, attorneys, and the courts generally focus on the consideration that must be exchanged in order for the parties to create a legal, enforceable noncompetition agreement. However, since courts analyze noncompetition agreements under standard contract interpretation principles, the language beyond the exchange of consideration can also be critical to the enforceability of a noncompetition agreement. A recent case from the Court of Appeals of Texas in Texarkana highlights this importance.
Companies conducting business in more than one state frequently seek to select the state law that will govern the interpretation and enforcement of their contracts by including a choice of law provision in their agreements. One of the purposes behind using a choice of law provision is allowing a company to choose the law of a state with which the company is familiar and/or which a company feels will be more beneficial. Choice of law provisions are commonly contained in employment contracts and associated agreements, such as covenants not to compete.
The United States and Texas Constitutions each provide for the free exercise of religion and the separation of church and state. These constitutional prescriptions frequently bar the application of civil laws, including employment laws, to religious institutions if they require the evaluation of a church’s self-governance. However, in certain circumstances, as reflected in the case below, churches and religious institutions can still be subject to civil laws dealing with employment matters.
While employers may enter into arbitration agreements with employees relatively easily, ensuring the enforcement of arbitration agreements can be a different matter. For this reason, employers are rightfully cautious to avoid taking any steps in litigation that a trial court might consider to be a waiver of their right to enforce an arbitration agreement with a current or former employee. Two recent decisions from the Fifth Circuit Court of Appeals and the Supreme Court of Texas serve as a reminder that under Texas law it is difficult for employers to waive arbitration agreements, even when an employer may have waited more than a year to compel arbitration.
In Equal Employment Opportunity Commission v. LHC Group Inc., the Fifth Circuit Court of Appeals evaluated a trial court’s grant of summary judgment to an employer on an employee’s disability discrimination claims. In reaching its decision on the disability discrimination claim related to the employee’s discharge, the Fifth Circuit adopted…..
Employers drafting and seeking to enforce noncompete agreements struggle with structuring the temporal and geographic scope of the proposed noncompete covenant. The Texas Supreme Court has wrestled over the last few years to define the boundaries of when noncompete covenants can be enforced against employees. A recent decision by the…..
Employers occasionally become dejected over the prospects of defending against tort and other civil claims in state courts. However, a recent case out of Houston reaffirms that employers can and do win these kinds of cases when they have implemented the appropriate policies. In Ogunbanjo v. Don McGill of West Houston,…..
In recent years, courts have consistently supported employers’ use of arbitration agreements in employment settings. During the last few terms, the Supreme Court of the United States has issued several decisions, such as American Express Company v. Italian Colors Restaurant (2013) and AT&T Mobility, LLC v. Concepion (2011), upholding the…..