The Women’s Economic Security Act: What Employers Need to Know

On Mother’s Day, Sunday, May 11, 2014, Governor Mark Dayton signed into law the Women’s Economic Security Act (WESA), which amends a number of Minnesota laws concerning pregnancy, nursing, parenting leave, and familial status. These laws will significantly impact employers and will require employers to revise their policies and alter their practices. Many of the provisions go into effect immediately, while others have later effective dates. Below are the key provisions about which private employers need to be aware.

Pregnancy Accommodations

Effective immediately, the WESA creates a new section within Chapter 181 (Minn. Stat. § 181.9414) that requires employers to provide pregnancy accommodations. Pursuant to this new section, an employer must provide reasonable accommodations to a female employee for “health conditions related to pregnancy or childbirth if she so requests, with the advice of her licensed health care provider or certified doula.” The law does not require a pregnant employee to consult her licensed health care provider or certified doula in order to request more frequent restroom, food, and water breaks, seating, and limits on lifting over 20 pounds.

The employer must provide the pregnancy accommodation unless the accommodation would impose an undue hardship on the employer’s business. However, the law provides that requests for more frequent restroom, food, and water breaks; seating; and/or limits on lifting over 20 pounds do not pose undue hardships. The law does not require employers to create a new or additional position or to discharge an employee, transfer an employee with greater seniority, or promote an employee as a reasonable accommodation.

As with other accommodation laws, the new law requires employers to engage in the interactive process with a pregnant employee to determine a reasonable accommodation. The law prohibits an employer from requiring an employee to accept an accommodation or to take leave.

The law also prohibits employers from retaliating against an employee for requesting or obtaining a pregnancy accommodation.

It is worth noting that this law was not placed within the Minnesota Human Rights Act. Thus, unlike disability accommodations and accommodations for pregnancy-related conditions that constitute disabilities, the Minnesota Department of Human Rights does not have oversight over these new requirements.

These new requirements will have a significant impact on manufacturing employers, trucking employers, and other employers with jobs requiring significant physical labor. These employers must carefully assess their accommodation practices and policies given these amendments.

Pregnancy and Parenting Leave

Effective July 1, 2014, the WESA amends Minn. Stat. § 181.941 to provide up to 12 weeks of unpaid leave for (1) a biological or adoptive parent in conjunction with the birth or adoption of a child or (2) a female employee for prenatal care or incapacity due to pregnancy, childbirth, or related health conditions.  Previously, the law provided for six weeks of leave for the birth or adoption of a child.

The law allows employees to take this leave for prenatal care, because of incapacity due to pregnancy, childbirth, or related health conditions, or otherwise within 12 months of the birth or adoption of a child.  Paid leave, vacation time, and leave taken under the federal Family and Medical Leave Act may run concurrently with this leave.

The WESA also amends the definition of “employee” in section 181.940. Previously an employee was an individual who had worked for the employer for 12 consecutive months immediately preceding the leave. The WESA deletes the words “consecutive” and “immediately.” Thus, pursuant to the amendments, an employee need only have worked for the employer for a total of 12 months at some point in time to be eligible for this leave. As a result of this change, employers may need to provide leave to a rehired employee before the one year anniversary date of her rehire.

The WESA’s amendments to section 181.941 do not alter an employer’s ability to maintain reasonable policies regarding the logistics for leave requests, such as the requirement for reasonable notice for a foreseeable leave and communication regarding the expected duration of the leave.

Nursing Mothers Room

Effective July 1, 2014, the WESA amends Minn. Stat. § 181.939, which requires employers to provide nursing mothers with reasonable unpaid break time to express breast milk and to make reasonable efforts to provide a private room for nursing mothers. The amendments state that the private room must be a room other than a bathroom or toilet stall that is “shielded from view and free from intrusion from coworkers and the public and that includes access to an electrical outlet.” The amendments state that an employer will be deemed to have complied with the statute if it makes reasonable efforts to comply with the statute.

Also new, the amendments explicitly prohibit retaliation against an employee who asserts rights under section 181.939.

The WESA also adds language allowing an employee to bring a civil action to recover damages for a violation of section 181.939, including costs and reasonable attorneys’ fees (as well as injunctive and other equitable relief).

The amendments also task the Apprenticeship and Labor Standards Division with investigating administrative complaints brought under section 181.939 by contacting the employer within 2 business days and investigating the complaint within 10 days of receipt of the complaint. As with the pregnancy accommodation amendments, it is notable that the nursing mothers amendments do not fall under the jurisdiction of the Minnesota Department of Human Rights.

A New Protected Class Under the Minnesota Human Rights Act—“Familial Status”

Effective immediately, the WESA amends the Minnesota Human Rights Act (MHRA) to add “familial status” as a protected class against which discrimination is prohibited. The WESA (and now the MHRA) defines familial status as “the condition of one or more minors being domiciled with (1) their parent or parents or the minor’s legal guardian or (2) the designee of the parent or parents or guardian with the written permission of the parent or parents or guardian.” The familial status protection also covers “any person who is pregnant or is in the process of securing legal custody of an individual who has not attained the age of majority.”

This change arguably has the potential to create the most litigation risk for employers due to the high level of uncertainty regarding the limits of this new protected status. The Minnesota Department of Human Rights has indicated that it intends to avoid a broad interpretation of the statute, but employers will need to observe the Department’s actual position once it begins enforcement and the position that courts take regarding the scope of this protected class.

In addition, employers that are state contractors will need to revise their affirmative action plans to include familial status as a protected class before seeking renewals of their compliance certificates.

Sick Leave and Safety Leave

Effective July 1, 2014, the WESA amends Minn. Stat. § 181.9413, which governs the use of sick leave benefits to care for family members. In 2013, the legislature amended section 181.9413 to allow an employee to use accrued sick leave to care for the employee’s adult child, spouse, sibling, parent, grandparent, or stepparent, in addition to the employee’s minor children (who were previously covered by the law). Under the WESA’s amendments, an employee will now be allowed to use sick leave to care for the employee’s mother-in-law, father-in-law, and/or grandchildren.

In addition, the amended section 181.9413 will now allow an employee to use sick leave for “safety leave” for the employee or covered family members. Safety leave is defined as “leave for the purpose of providing or receiving assistance because of sexual assault, domestic abuse, or stalking.”

The amendments do not alter an employer’s ability to limit the use of sick leave to care for covered relatives (other than the employee’s child) and safety leave up to a maximum of 160 hours in a 12-month period.

As with other WESA amendments, this provision prohibits employers from retaliating against an employee for requesting or obtaining leave under section 181.9413.

Wage Non-Disclosure Agreement Prohibition

Effective July 1, 2014, the WESA creates a new statutory section—Minn. Stat. § 181.172. The new section 181.172 prohibits an employer from (1) requiring nondisclosure by an employee of his or her wages as a condition of employment; (2) requiring an employee to sign a waiver or other document that purports to deny an employee the right to disclose the employee’s wages; or (3) taking any adverse employment action against an employee for disclosing the employee’s own wages or discussing another employee’s wages that have been disclosed voluntarily.

Under the new law, employees are not permitted to disclose proprietary information, trade secret information, or information otherwise protected by law or legal privilege without the employer’s written consent. Employees also are prohibited from disclosing other employees’ wage information to an employer’s competitor.

Employers are prohibited from retaliating against an employee for asserting his or her rights under this new statute.

Employers that have employee handbooks must include a notice of the employees’ rights and remedies under section 181.172 in their employee handbooks.

The amendments also provide that an employee may bring a civil action against an employer that violates section 181.172. If a court finds a violation, the court may award damages, costs (including attorneys’ fees) and/or order reinstatement, back pay, restoration of a lost service credit, or the expungement of any related adverse records of an employee who was the subject of the violation.

Equal Pay Certificate

Effective August 1, 2014, the WESA creates a new statutory section—Minn. Stat. § 363A.44. The new section requires that most employers with 40 or more full-time employees in Minnesota (or in a state where the employer has its primary place of business) must obtain an equal pay certificate from the state if it does business with the state in excess of $500,000. A certificate will be valid for four years. This requirement will apply to any “solicitation made on or after” August 1, 2014.

To obtain an equal pay certificate, an employer must pay a $150 filing fee and submit an equal pay compliance statement signed by the CEO or Chairman of the Board that certifies:

1. that the business is in compliance with Title VII of the Civil Rights Act of 1964, the Equal Pay Act of 1963, the Minnesota Human Rights Act, and the Minnesota Equal Pay for Equal Work Law;
2. that the average compensation for its female employees is not consistently below the average compensation for its male employees within each of the major job categories in the EEO-1 employee information report for which an employee is expected to perform work under the contract, taking into account factors such as length of service, requirements of specific jobs, experience, skill, effort, responsibility, working conditions of the job, or other mitigating factors;
3. that the business does not restrict employees of one sex to certain job classifications and makes retention and promotion decisions without regard to sex;
4. that wage and benefit disparities are corrected when identified to ensure compliance with the laws cited in clause (1) and with clause (2); and
5. how often wages and benefits are evaluated to ensure compliance with the laws cited in clause (1) and with clause (2).

The equal pay compliance statement must also state whether the business, in setting compensation and benefits, utilizes,

1. a market pricing approach;
2. state prevailing wage or union contract requirements;
3. a performance pay system;
4. an internal analysis; or
5. an alternative approach to determine what level of wages and benefits to pay its employees. If the business uses an alternative approach, the business must provide a description of its approach.

The new law gives the Commissioner of the Minnesota Department of Human Rights the authority to audit state contractors to ensure compliance with these new requirements.

Prior to the passage of the WESA, the Commissioner issued a letter addressing concerns regarding the equal pay certificate provisions. In the letter, the Commissioner indicated that the Department interprets the law to require compliance with equal pay laws and that it does not require employers to adopt comparable worth policies.

Unemployment Eligibility Changes

Effective for unemployment decisions issued after October 5, 2014, the WESA amends Minn. Stat. § 268.095 to make it easier for an employee to establish eligibility for unemployment insurance if the employee quit his or her employment because of domestic abuse, sexual assault, or stalking.

Employers’ “To Do” List

Based on the changes made by the WESA, employers have an immediate “to do” list and other tasks to complete in the next few months.

Immediately:

• Update handbooks, policies, and forms to incorporate the new familial status protected class and pregnancy accommodation requirements.
• Notify and train managers and HR professionals on the new familial status protected class and pregnancy accommodation requirements so that they can modify their practices as needed.

By July 1, 2014:

• Update handbooks, policies, and forms to incorporate the changes to the Minnesota parenting leave and sick and safety leave time and to include notice of employee rights under the new wage disclosure law.
• Notify and train managers and HR professionals on the Minnesota parenting leave changes, sick and safety leave time changes, and new employee rights under the new wage disclosure law so that they may modify their practices as needed.
• Review whether any hiring or other documents or contracts need to be revised to comply with the new prohibitions on prevention of wage disclosures.
• Review a nursing mother room(s) to ensure that it complies with the new requirements. If it is not possible to comply with the new requirements, an employer should document the efforts made to comply, which could assist with a defense against a claim of noncompliance.

By August 1, 2014:

• Identify any government contracts that will require an equal pay certification upon renewal.