Nicholas Fortuna, February 29, 2024

This term the Supreme Court will determine the amount of deference that courts should give federal agencies’ interpretation of laws that they administer. The Court heard two cases, Relentless v. Department of Commerce and Loper Bright Enterprises v. Raimondo, challenging a federal rule that requires fisheries to pay salaries of compliance observers on their boats. The payment requirement is based on the interpretation of federal law by a federal agency, National Marine Fisheries Service. At issue, is a broader question: Whether the justices will do away with well-established precedent known as the Chevron doctrine that could severely limit the power of federal administrative agencies.

The doctrine is named after the Supreme Court’s 1984 opinion in Chevron v. Natural Resource Defense Council, which upheld a regulation issued by the Environmental Protection Agency. The Court set out a two-part test for courts to use in evaluating an agency’s interpretation of a statute it administers. The court must first determine whether Congress has directly addressed the issue. If it has not, the court will uphold the agency’s interpretation if it is reasonable.

The Supreme Court has already limited Chevron by creating procedural hurdles agencies must clear before invoking it. And in 2022, the Court formally embraced a new principle, the major questions doctrine, which requires agencies to point to clear textual authority before undertaking important policy initiatives.

Agencies do not just do big things; they do lots of small things. That is where the doctrine is most important.  A ruling tossing out Chevron would task judges to referee minor questions – including arcane, deeply technical matters that Congress has not expressly addressed but are the province of experts and specialists in government.

The issue looms large for federal regulators because the Chevron doctrine allows agencies to respond to current industry developments and shifting scientific technologies. For instance, financial regulators who may look to oversee cryptocurrency and artificial intelligence but are relying on statutes that predate the technologies to regulate them. Another example is environmental regulation, with agencies relying on the clean air and clean water acts that were enacted in the 1960s and 70s to address new chemicals, or to combat new pollution threats.

During oral argument, Justice Elena Kagan cited as an example a hypothetical bill to regulate artificial intelligence. Congress, she said, “knows there are going to be gaps because Congress can hardly see a week in the future.” So it would want people “who actually know about AI and are accountable to the political process to make decisions.” Courts, she emphasized, “don’t even know what questions are about AI,” much less the answers.

After oral arguments, it seemed that the Court is likely to limit the application of the Chevron Doctrine. Whether it throws it out completely is up in the air. If it does, Elizabeth Prelogar, the solicitor general of the United States, fears that it would result in an “unwarranted shock to the legal system,” as federal judges would be embroiled in intricate questions for which they lack the scientific, economic, or technical expertise, and the resulting slew of inconsistent lower court decisions leading to many appeals and inaction on important matters regulated by the federal government.

A decision by the Supreme Court is expected by June of this year.

Paula Lopez, February 22, 2024

After vetoing a prior version of bill intended to protect freelancers in New York, on November 22, 2023, Governor Hochul signed into law Senate Bill 5026/Assembly Bill 6040 known as the Freelance Isn’t Free Act (the “Act”). The Act takes effect on May 20, 2024. The Act mirrors New York City’s 2017 Freelance Isn’t Free Act (N.Y.C. Administrative Code §§ 20-927 et seq.), which was the first law passed in the country for the protection of freelance workers. The Act aims to protect freelancers working outside New York City from non-payment and retaliation, as well as to provide freelancers with recourse against businesses who violate the law’s requirements.

The Act defines a freelancer worker as “any natural person or any organization composed of no more than one natural person, whether or not incorporated or employing a trade name, that is hired or retained as an independent contractor by a hiring party to provide services in exchange for” compensation. The definition excludes certain sales representatives, legal practitioners, medical professionals, and construction contractors. The compensation threshold under the Act is “an amount equal to or greater than eight hundred dollars, either by itself or when aggregated with all contracts between the same hiring party and freelance worker during an immediately preceding one hundred and twenty days.”

The law obligates a hiring party, defined as “any person who retains a freelance worker to provide any services,” to enter into a written contract with all independent contractors providing services valued at $800 or more. The definition of “hiring party” excludes the U.S. government, the state of New York, a municipality, and foreign governments.

The Act expressly requires the hiring party and freelance worker to enter into a written contract which includes, at minimum, the following terms:

  1. Names and mailing addresses of the freelance worker and hiring party;
  2. An itemized accounting of all the services to be provided by the freelance worker, the value of the services, the rate and method of compensation for such services;
  3. The payment date;
  4. The date by which the freelance worker must submit a list of services rendered under such contract to enable the hiring party to meet internal processing deadlines for payment.

The Act also provides that the labor commissioner may implement rules requiring additional terms. The labor commissioner will also make sample contracts available to the public on its website. A copy of the written contract must be provided to the freelance worker and the hiring party is required to keep the contract for a period of six years.

The compensation provided for in the written contract must be paid either on or before the date set in the contract, or no later than 30 days after the freelancer completes the services under the contract. The Act further states that, once a freelancer has started performing under the contract, the hiring party cannot condition timely payment on the freelancer accepting less than full compensation.

The Act also includes an anti-retaliation provision prohibiting a hiring party from denying a work opportunity to, discriminating against, or taking any action that penalizes or deters a freelance worker from exercising any right under the Act.  A freelance worker is afforded the right to file a complaint with the commissioner of labor or bring a civil action for violations of rights under the Act. A freelancer must institute an action for non-payment under the contract within six years and an action for failure to provide a written contract within two years.

A freelancer who prevails for claims for non-payment may recover 200% of the underpayment, injunctive relief, reasonable attorneys’ fees and costs. A freelancer can recover statutory damages in the amount of $250.00 for violation of the written contract requirement, and statutory damages in an amount equal to the value of the underlying contract for violations of the anti-retaliation provision. In addition to providing for the recovery of civil and criminal penalties, the Act empowers the Attorney General to commence a civil action and recover civil penalties of up to $25,000 from a hiring party who has engaged in a pattern or practice of violation the Act.

New York businesses engaged in hiring independent contractors should familiarize themselves with the increased obligations and risks imposed by the Act. Businesses should review their contracts and recordkeeping policies to ensure compliance with the requirements of the Act and should periodically monitor the New York Department of Labor website for further guidance on compliance with the Act.

 

 

 

By: Megan J. Muoio, December 28, 2023

In May 2023, the New York City Council approved, and Mayor Eric Adams signed Local Law 61, which prohibits body size discrimination in New York City. The law, which went into effect in November 2023, amends the New York City Human Rights Law to add an individual’s actual or perceived height and weight to the list of protected characteristics and prohibits discrimination on the basis of those characteristics in employment, housing, and public accommodations. New York City Council Speaker Adrienne Adams hailed the law as the first of its kind in the nation. The law was backed by the Retail, Wholesale, and Department Store Union, which represents workers in the fashion retail industry, and the Retail Action Project, which advocates for retail workers.

Although employers now may not consider height or weight in making employment-related decisions, including in hiring, there are exceptions. Employers would be permitted to consider height or weight: (a) where required by federal, state, or local law or regulation; (b) where the New York City Commission on Human Rights (“CHR”) has identified jobs or categories of jobs for which an employee’s height or weight could prevent the performance of the essential requisites of the job and the CHR has not found alternative action that employers could take to allow those employees to perform the essential requisites of the job; or (c) where the CHR has identified jobs or categories of jobs for which the consideration of height or weight is reasonably necessary for the execution of the employer’s normal operations. To date, the CHR has not identified any jobs or categories of jobs for which the consideration of height or weight may be considered, but is expect to issue regulations addressing these exceptions in the near future. Employers will also be allowed to assert, as an affirmative defense, that the employee or prospective employee’s height or weight prevented them from performing the essential requisites of the job, or that the employer’s height- or weight-based decision was reasonably necessary for the employer’s normal operations.

Employers should immediately review their anti-discrimination policies to ensure compliance with Local Law 61. Employers who believe that their employees’ height or weight affects their business’s normal operation or that their employees’ height or weight prevents the performance of the essential requisites of the job should consult with an employment attorney immediately in order to ensure compliance with the law as well.

By: Paula Lopez, December 22, 2023

The New York City Council passed a “Workers’ Bill of Rights” bill, Int. No. 569-B on December 3, 2023. On December 4, 2023, the bill became law when it was returned unsigned by Mayor Adams without a veto. The law will go into effect on January 3, 2024. The law requires inter-agency cooperation in creating a “Worker’s Bill of Rights,” informing employees, prospective employees, and independent contractors working in New York City about their rights under federal, state and local law. The agencies involved in creating the “Worker’s Bill of Rights” include The New York City Department of Consumer and Worker Protection (DCWP), Mayor’s Office of Immigrant Affairs, the New York City Commission on Human Rights, and community and labor organization identified by the Commissioner of DCWP.

The “Workers’ Bill of Rights” must be published on the City’s website no later than March 1, 2024. It must be posted in English, the designated citywide languages, temporary languages, and must expressly identify “which rights apply to workers regardless of immigration status” as well as “include information about the right to organize a union.” Beginning on July 1, 2024, New York City Employers are required to distribute the City-created “Workers’ Bill of Rights” to existing employees, and to each new employee on such employee’s first day of work. The law also requires each employer to conspicuously post the “Workers’ Bill of Rights” at its place of business in an area “accessible and visible” to employees. The “Workers’ Bill of Rights” must be posted in English and the language spoken by at least 5% its employees. Employers who regularly communicate with their employees through electronic means are also required to make the notice available online or through their mobile application.

An employer who violates the law is liable for a $500 civil penalty for a first violation but will be given the opportunity to correct the violation within 30 days and avoid the penalty. This opportunity to cure appears to be limited to a first-time violation.

Beginning in March 2024, New York City employers should look out for publication of the Worker’s Bill of Rights and take the necessary steps to comply with the notice requirements.

By: Nicholas Fortuna, November 28, 2023

The Supreme Court issued an ethics code on November 13 to stem criticism after a series of revelations about expensive gifts, luxury travel, payment of private school tuition, and a real property transaction benefiting some of the Justices. The code does not specify how the rules will be enforced or by whom.

For years there has been a push to impose an ethical code on Supreme Court Justices. It came to a head in April, when ProPublica, an independent, non-profit newsroom that produces investigative journalism in the public interest, chronicled years of private jet and yacht excursions paid by a high-profile Republican donor, Harlan Crow, for Justice Clarence Thomas. We learned that private school tuition for Justice Thomas’s grand nephew was paid for by Crow. He also purchased Justice Thomas’s mother’s house to facilitate his mother’s continued use of it.

After ProPublica’s revelations, Politico reported that Justice Neil Gorsuch did not identify the purchaser who bought a 40-acre plot of land co-owned by the Justice. The purchaser turned out to be a member of the law firm, Greenberg Traurig, that has had numerous cases before the court.

In June, ProPublica revealed that a luxury fishing expedition in Alaska for Justice Samuel Alito was paid for by Republican donors.

In July, The Associated Press uncovered that Justice Sonia Sotomayor allegedly used court staff to schedule speaking engagements related to her literary work to pitch sales of the Justice’s books.

It seems that the Supreme Court Justices confused the nomenclature “Supreme” to mean they are above it all, and they should not be bound by ethics, instead of what it is – the pragmatic end to legal proceedings. The Supreme Court is nothing more than the final stop in litigation. Once the case is decided by the Supreme Court, it is over. Nothing about the Supreme Court’s position as the last word on a case or controversy suggests that its decisions are of a particular quality or that the members of the Court are competent to fulfill the role they occupy. The arrogance of the Justices believing that they have supreme legal minds led to the situation we find ourselves in – Justices of the Supreme Court acting as if the rules should not apply to them.

The Justices’ comments prefacing the code make it clear that they think their actions should not be questioned. In fact, they state that the reason they are issuing this toothless code is because the perception is that the Justices of the Court “regard themselves as unrestricted by ethical rules.” Is it the public’s misunderstanding or the Justices sense that the rules don’t apply to them that explains accepting gifts, money for private school tuition, luxury travel, etc. from people with business or interests before the Court?

What the Justices did with the issuance of their “code of ethics” is an old trick practiced by industries that are trying to thwart governmental regulation: make a show that the industry will police themselves to convince government regulators that there is no need for regulation. Except in this case, there is no attempt by the Court to police the behavior of individual Justices. Cynically, the Justices issued a series of fuzzy rules that each Justice should consider. There is no enforcement mechanism or oversight. Nothing meaningful was enacted to curb the kinds of abuses recently reported. If someone with business before the court wants to buy a relative of a Justice a house, it seems that is okay.

The code does not place specific restrictions on gifts, travel, or real estate deals. It cautions justices that they should not, leaving open that they may, take part in activities that “detract from the dignity of the justice’s office,” “interfere with performance of the justice’s official duties,” “reflect adversely on the justice’s impartiality.” In other words, feel free to continue as before.

What is needed is real reform, an ethics code that will control the Justices’ behavior. Simply, bind the Justices to the code of ethics all lower court judges must follow. In addition, implement an approach to governing the Court that disabuses the Justices of their belief in their own supremacy, such as term limits, replacing Justices with conflicts on a particular case with a judge from the Court of Appeals, limiting the Court to an even number of Justices to encourage incremental decision making, and dividing the court evenly between liberal and conservative lawyers. Without real change, the Court will continue to see its reputation, legitimacy, and place within our Constitutional system eroded.