As we have reported on previously in this column, on February 28, 2017 President Trump issued an Executive Order directing US Environmental Protection Agency (“EPA”) and the Corps of Engineers to review and rescind the 2015 “waters of the United States” rule that was issued under the Clean Water Act. The rule has been subject to extensive litigation nation-wide at the federal District and Court of Appeal level where it has been challenged by various industry, agriculture, development groups and affected states. The agencies decided to take a two step process regarding the waters of the US rule. Step one is the repeal of the 2015 rule and recodification of the regulation in place prior to 2015. Step two is a substantial analysis and revision of the definition of the water of the US rule. On December 11, 2018 the EPA and Corps took the second step by proposing a revised definition of “waters of the US” to address federal jurisdiction under the Clean Water Act. The proposed rule was published in the Federal Register on February 14, 2019 and will be subject to a 60 day public comment period. The public comment period will close on April 15, 2019. As part of the public comment and outreach, the agencies held a webcast on the rule in February and also held a public hearing on the rule in February 2019. At the time it was announced Acting EPA Administrator Andrew Wheeler stated that “[o]ur proposal would replace the Obama EPA’s 2015 definition with one that respects the limits of the Clean Water Act and provides states and landowners the certainty they need to manage their natural resources and grow local economies…For the first time, we are clearly defining the difference between federally protected waterways and state protected waterways.” The agencies believe that the proposed rule will be more easy to understand and provide “clarity, predictability and consistency so that the regulated community can easily understand where the Clean Water Act applies---and where it does not.” As was indicated in President Trump’s Executive Order, the revised rule was written in accordance with the plurality decision of Justice Scalia in Rapanos v. United States, 547 U.S. 715 (2006). That opinion differed from the concurring opinion of Justice Kennedy that provided non-navigable waters that could be subject to jurisdiction included those that had a significant nexus to navigable waters, which was followed in the Obama era rule. Conversely, Justice Scalia’s opinion, which is a basis for the new rule, provided that only waters which are relatively permanent, standing or continuously flowing and form geographic features that meet the common definition of “streams, oceans, rivers and lakes” qualify as waters of the United States under the Clean Water Act. Specifically, under the proposed rule Clean Water Act jurisdiction would apply to traditional navigable waters, tributaries to those waters, certain ditches, certain lakes, and ponds, impoundments of jurisdictional waters, and wetlands adjacent to jurisdictional waters would be federally regulated. Conversely, it also details what do not constitute “waters of the United States” such as features that only contain water during or in response to rainfall (e.g. ephemeral features), groundwater, many ditches, including most roadside or farm ditches, prior converted cropland, stormwater control features, and waste treatment systems. Although some waters will fall outside of federal jurisdiction, the agencies recognize that there are existing state and tribal regulations that may apply to such waters. Hence, the agencies believe the proposed rule will respect state regulation of local waters “while protecting the nation’s navigable waters as intended by Congress when it enacted the Clean Water Act.” The proposed rule defines tributary to include “a river, stream or similar naturally occurring surface water channel that contributes perennial or intermittent flow to a traditional navigable water or territorial sea in a typical year.” In a departure from the 2015 Obama rule, the definition does not include temporary flows and features that are dry most of the year and only contain water during rain events. The rule also addresses what constitutes an “adjacent” wetland, namely wetlands that “abut or have a direct hydrologic surface connection” to a regulated water in a normal year. In order to qualify under the proposed rule, the wetland must abut one point or side of a regulated water subject to jurisdiction. In addition, a direct hydrologic connection requires flow or inundation from a regulated water to the wetland or an intermittent flow between the water and wetland. In either scenario, to fall within the definition under the proposed rule there must be an actual connection. Until the rule is finalized the agencies will continue to implement the program under the 1986/1988 regulatory definition of “waters of the US.” The Clean Water Act “waters of the US” rule is a complex rule that has a broad impact on US business and residents that buy, sell, develop, farm and use property in proximity to waterbodies and wetlands. As with any complicated rule-making process, interest groups on both sides are active in support and opposition to the proposed changes. Regardless of the substance of the final waters of the US rule, it is certain that there will be challenges brought to prevent the changes from being implemented. Download the Reprint from The Daily Record As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

In 2018, fewer discrimination charges were filed with the Equal Employment Opportunity Commission than in any other year in the last decade. In fact, 8,000 fewer charges were filed last year than in 2017. This may seem surprising, given the #MeToo movement, but there are a myriad of reasons why the numbers may be falling. First, employers are more aware of potential consequences of discrimination claims, including negative publicity and low morale. Second, there is a lower unemployment rate and a high demand for workers, which translates into fewer layoffs and job rejections for employees to challenge. As always, employers should take special care to ensure that harassment and discrimination claims are treated appropriately.  Additionally, New York State employers must have their workforce complete the new State mandated sexual harassment training by October.  Contact Underberg & Kessler now to get on our training calendar. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

The trend to legalize marijuana continues.  Governor Andrew Cuomo recently announced his intention for New York to be one of the next states to legalize marijuana.  While his initial timeline has met some resistance and will not coincide with the State’s annual budget, which was due April 1, it appears New York could legalize recreational marijuana in the very near future.  Governor Cuomo’s proposed legislation – Cannabis Regulation and Taxation Act - would create an office of Cannabis Management to oversee cultivation, processing, distribution, sale and adult use of marijuana for recreational purposes. As lawmakers continue to hash out the details, employers must prepare for the post-legalization world and it’s impact on the workplace.  Employers should review polices, handbooks, hiring practices, training procedures and drug screening policies that may require modification to comply with any new law. Employers are encouraged to contact their Underberg & Kessler employment attorney to learn more. As always, if you have any questions, please feel free to contacts us here or call us at 585.258.2800. #LaborLaw #EmploymentLaw

This question and answer was printed in a Monroe County Medical Society 2019 Bulletin. This relatively short question implicates many employment law concepts. One fundamental point is that short-term disability is a partial income replacement insurance product for employees out of work because of their own medical condition. New York State employers are required to pay for short-term disability insurance for their employees, and it provides those employees with up to 26 weeks of benefits in any 52-week period. Short-term disability payouts are 50% of the employees’ average wages (calculated from the last 8 weeks of employment), up to the maximum payment of $170 per week. Given the far higher payout for employees out of work caring for a family member under Paid Family Leave, the Legislature is considering raising the short-term disability maximum payout. As an income replacement insurance product, short-term disability does not specifically guarantee an employee his/her job. However, many factors make it risky to terminate an employee out on short-term disability. First, if an employee earned or accrued sick leave or paid time off, then s/he is entitled to exhaust that time prior to any possible termination. Second, for employers who have more than 50 employees within a 75-mile radius, the federal Family and Medical Leave Act entitles an employee to 12 weeks of unpaid leave without losing his/her job (employers may require those employees out on Family and Medical Leave to use their sick/vacation/paid time off benefits concurrently). Lastly, if an employee has used up his/her sick time, paid time off and Family and Medical Leave, or was not entitled to one or more of them, the federal Americans with Disabilities Act and the New York State Human Rights Law prohibit discrimination on the basis of disability, which is broadly interpreted under the general definition of a condition affecting a major life function. The disability discrimination laws require that the employer and employee engage in an interactive dialogue regarding any reasonable accommodation that the employer could provide so that the employee remains employed. This principal is usually applied in the context of an employee who contends s/he is able to be at work and perform the duties of his/her job with a reasonable accommodation. If the employer wishes to terminate an employee out on short-term disability, it must analyze how much leave beyond the sick/paid time off/Family and Medical Leave entitlement the employee had is reasonable given the position at issue, potential coverage for that position, the employer’s number of employees and other factors unique to each situation. Often, the employer’s strongest basis to terminate an employee on short-term disability leave is where the employee’s doctor has no estimate of when the employee will be able to return to work (i.e., the prognosis is indefinite). Other times, the employer may have a good argument in favor of termination if there is a company or practice-wide layoff, and the employer can prove that the employee out on short-term disability would have been laid off even if s/he was not out on leave. As demonstrated by those two rather narrow examples, it is generally unwise to terminate an employee out on short-term disability. As always, companies and practices considering any employee termination, much less one on short-term disability leave, should discuss all the relevant considerations with experienced employment law counsel. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

The third opinion letter issued by the US Department of Labor on March 14 addressed a New York law that contradicted federal overtime laws. The opinion addresses employees who work for a New York real estate company as live-in janitors (“supers”) to maintain their rental buildings.  New York law exempts these workers from minimum wage and overtime law, while the Fair Labor Standards Act does not. The DOL said these workers are not exempt from federal minimum wage and overtime requirements because the federal law does not contain those exemptions. The letter goes on to caution New York employers by saying that the State law cannot be used to shield New York employers from the damages available under the federal law. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

Another notable opinion from the U.S. Department of Labor letters issued on March 14 is that workers are not required to be paid for community service they perform through an employer program unless they are forced into volunteering. An employer submitted a question to the DOL asking if it had to compensate employees who are allowed to pick their own or employer sponsored volunteer activities.  The employer pays them for activities that occur during the work day or on the employer’s premises, but much of the volunteer time falls outside of working hours. The employer offers a bonus to employee groups that spend the most time volunteering each year. The DOL said that so long as the employer does not unduly pressure its employees to participate, it does not have to pay employees for volunteer hours. Since they suffer no adverse consequences for sitting out, they need not be paid. The DOL went further and said employers could even use an app to track workers' volunteer hours, so long as it does not direct or control the employees’ activities. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

The IRS recently released Technical Advice Memorandum 201903017 (the TAM) providing guidance to IRS personnel as to whether the value of meals and snacks provided without charge by an employer to its employees constitutes taxable wages. The employer in the TAM provided free meals to all employees, contractors and guests.  No distinction was made as to the employee’s position, job duties, responsibilities or other circumstances.  Unlimited drinks and snacks were also provided to all employees, contractors and visitors in unrestricted snack areas. The TAM concluded that the lack of policies justifying the employer’s need to provide meals to its employees could not support excluding the value of the meals from its employees’ wages.  The snacks, however, were not taxable due to the difficulty of quantifying portions and the low value of each snack. Employers should establish written policies that support the importance (i.e., convenience) of furnishing meals to employees, and employer’s belief in the importance of furnishing meals must be supported by the circumstances. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

If you made gifts in 2018 in excess of the gift tax annual exclusion amount - $15,000 per donee in 2018, or $30,000 if a husband and wife elect to split gifts - you must file a gift tax return and apply your lifetime gift tax exemption to report these gifts. If you made a gift to a Trust that has the potential to distribute property to a grandchild, it is important to file a gift tax return to have a clear record of the Generation-Skipping Transfer (GST) tax exemption allocated to the Trust. In 2018, each person had a gift tax exemption of $11,180,000, reduced by the value of any prior lifetime gifts.  A gift tax return to report gifts made in 2018 is due on April 15, 2019, but may be extended until October 15, 2019. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

Another recent NLRB decision narrows the standard for what constitutes protected activity. In that case, a manager asked a group of airport baggage handlers to help unload the equipment of a soccer team. One of the baggage employees said they’d done a similar job previously and didn’t receive a tip.  When the equipment arrived, the baggage handlers didn’t help unload, and the employee who complained about the lack of tip was fired.  He filed a complaint alleging he was fired for complaining about the lack of tip, which he claimed was protected activity.  The NLRB disagreed, and held that a worker’s statement must concern a genuine workplace issue; personal gripes don’t count. This decision supports the continued dialing back of Obama-era NLRB decisions, and the continued employer-friendly Trump administration NLRB trend. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

On January 15, 2019, the New York Legislature passed a bill that protects transgender people from discrimination and adds gender identity or gender expression as a protected class in employment, housing, places of public accommodations and other areas.  After more than a decade of attempts, the Gender Expression Non-Discrimination Act (GENDA) awaits Governor Cuomo’s expected signature. GENDA adds “gender identity or expression” as a protected category under the Human Rights Law, affording it the same protected status as other categories, such as race, sex, religion or age.  Gender identity or expression is defined as a “person’s actual or perceived gender-related identity, appearance, behavior, or expression or other gender-related characteristic regardless of the sex assigned to that person at birth, including, but not limited to, the status of being transgender.”  The passing of GENDA means that employers, housing establishments, and places of public accommodation are prohibited from discriminating against individuals because of their gender identity or gender expression. Now is a good time for all New York State employers to review existing anti-discrimination policies to ensure they comply with the Human Rights Law and GENDA.  Employers should also ensure annual sexual harassment training incorporates gender identity and gender expression and emphasizes that discrimination or harassment on those bases is unlawful. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

Depending on where you obtain your statistics, one third to one half of all marriages end in divorce. The perception is that divorce is an ugly, messy process that destroys everyone in its path. Often only one spouse wants to divorce and the other puts their head in the sand. Nevertheless, the process moves forward whether or not both parties are on board. Couples facing divorce have an avalanche of thoughts, ”I want to pay as little to my spouse as possible “, “I’m worried about the business I’ve worked so hard to build”, “I’m worried I won’t get to see my children as much as I’d like to”, “I want to take him/her to the cleaners”, “What will happen to the money my parents left me when they died“, “I want to inflict as much damage on my spouse as possible“, “I don’t want to pay child support, so I will fight for custody”, etc. These are natural thoughts as individuals face fear of the unknown, and most certainly, a significant change in their everyday “normal.” The hardest, and perhaps the most important thing, is to look past the emotion. Decisions you make during your divorce have the potential to affect you and your family for decades to come. There are so many issues to untangle: financial issues, including those where one spouse owns their own business, or one’s compensation includes an annual bonus or significant overtime dollars; debts; if there are children, issues of custody and child support; and spousal support, to name a few. One thing is certain - if you and your spouse don’t and can’t agree on how to resolve these issues, the decision will be taken out of your hands and left to a judge or magistrate who doesn’t know you and your family. One option to consider is a process called collaborative divorce. Collaborative divorce allows you and your spouse to craft creative solutions that are right for your family. The solutions don’t have to be what “traditional” families do, and they don’t need to be what the law would otherwise require couples to do. Collaborative divorce allows the parties to maintain the decision making and avoid the often irreparable damage of contentious litigation. Collaborative professionals, including attorneys, are specially trained in the process and required to maintain a certain number of continued training hours each year. Although it may seem counter-intuitive, parties that engage in collaborative divorce make a commitment to avoid litigation. They and their attorneys sign an agreement that requires them to essentially start over with new attorneys if either party chooses to terminate the process and litigate their issues. However, just like in traditional litigation, the lawyer’s obligation is to their client, and their goal is to obtain the “best” outcome for that client. The parties and their attorneys meet with each other and other professionals to resolve all the issues. By having their own attorneys present, some of the misgivings of mediation are eliminated, i.e., that one party or the other is not well versed in “the law,” or is more emotionally vulnerable, and thus will be taken advantage of. Attorneys inform the parties of what the law would require in a litigation setting and what possible outcomes might be. The process is excellent for couples with a substantial amount of assets, and even those with significant debts. It benefits both spouses who have children and the issues that come along with separating a family, and spouses without children. Rather than have each side hire their own “expert,” which can get expensive and often doesn’t help parties resolve litigated divorces short of trial, the collaborative process allows the parties to hire one expert who will act as a “neutral” and act on behalf of the family as a whole. These experts can include financial planners, business evaluators, child specialists, communication facilitators and real estate appraisers, among others, and eliminate the need for “dueling experts.” Often court proceedings take many months or even years to complete, as the parties engage in a formal exchange of information that can prolong the process. Collaborative divorce is typically a quicker process, as the team sets up several meetings in advance and aims to be efficient by assigning homework between meetings and circulating an agenda. Even with the momentum, there are periods of time built in between collaborative meetings to allow the parties to process the information, gather additional data and speak to their individual attorneys. Very often what is important to one spouse may not be as important to the other. Thus, the regular face to face meetings enable the parties to communicate directly with each other and eliminate the guess work and posturing of litigation. It allows individuals to keep their integrity intact, while dealing with sophisticated legal and financial issues that could otherwise destroy any possibility of civility in the future. Collaborative divorce allows the parties to control the final outcome in a way that works for them. Make no mistake, collaborative divorce, like any divorce, isn’t easy. There will still be disagreements and strong emotions. The process will, however, assist the parties in dealing with these in a constructive way to minimize conflict and damage, and maximize the best interests of both parties. Download the Reprint from The Rochester Business Journal As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.

As the government shutdown persists, private employers continue to be affected.  As we discussed earlier this month, E-Verify remains shut down.  Employers must continue to manually verify eligibility through the use of I-9 forms.  In addition, the EEOC is mostly shut down, other than a relatively small number of employees still in place to receive new charges so potential charging parties don’t miss the statute of limitations.  Federal courts remain open, but cases involving the federal government are stayed and court staff is reduced. The US Small Business Association is also on furlough, which means that small business loans may be affected. Agencies like OSHA, the Department of Labor and the NLRB remain open and fully staffed. Employers should not assume that deadlines will be extended due to the shutdown, and should take care to ensure that all deadlines are met. As always, if you have any questions, please feel free to contact us here or call us at 585.258.2800.