Corporate theft can happen in any workplace. What type of employee is most likely to steal from the company or its customers? What can companies do to combat this? Partners Tracey Diamond and Evan Gibbs chatted with Troutman Pepper Partner Chris Willis about the popular movie Office Space, employee misconduct and creative uses of technology to protect against corporate theft.

Q: Are there any risks to using AI to enhance diversity in the workplace?

A: The use of artificial intelligence (AI) has become increasingly prevalent in hiring decisions, particularly as a means to increase diversity in employment. In January 2023, the chair of the Equal Employment Opportunity Commission (EEOC) estimated that 83% of employers rely on artificial technology in decision-making. When used thoughtfully, AI tools can help employers more effectively analyze data and trends necessary to improving diversity, such as employee retention, pay inequality, and bias in job postings and hiring practices. For instance, generative AI platforms can enhance diverse employee retention by preparing career path guides specific to an employee’s skills and values, which allows diverse employees to view opportunities for internal career growth with transparency. Additionally, employers may use AI to assist in screening candidates during the recruiting process to avoid the unconscious biases that human screeners bring to the process. Despite the benefits and growing adoption of AI, however, the EEOC and the Biden administration have recently warned of the inherent risks that employers should be aware of when leveraging AI to enhance workplace diversity. 

Q: Does the federal Pregnant Workers Fairness Act (PWFA) require workplaces to change their accommodation and leave practices in a significant way?

A: Potentially. The PWFA requires covered employers to provide “reasonable accommodations” to a worker’s known limitations related to pregnancy, childbirth or related medical conditions unless the accommodation will cause the employer an “undue hardship.” While 46 states offer some protection to pregnant employees, 26 states already have laws that have requirements that mirror the PWFA. Workplaces that do not already have accommodations for pregnant workers in place must change their accommodation policies to comply with the new law that went into effect on June 27.

Q. As part of the employee onboarding process, my company requests that employees sign several documents, including an arbitration agreement and confidentiality agreement, on the first day of employment. Is the arbitration agreement enforceable?

A. In the famous words of all attorneys, it depends. Even if an arbitration agreement is otherwise enforceable, California courts may consider terms of other documents presented with the arbitration agreement to render the arbitration agreement unconscionable and unenforceable.

Q: Are student athletes considered employees under the Fair Labor Standards Act (FLSA)?

A: Not under current law, but it is widely suspected that before long, courts will deem at least some types of student athletes to be employees under the FLSA. Courts determine whether an employment relationship exists under the FLSA by looking at whether the “economic realities” of the relationship are consistent with employment (although there is no agreement among the circuit courts of which test best determines these economic realities). In the 2021 decision NCAA v. Alston, the Supreme Court characterized student athletes as participants in a labor market for purposes of federal antitrust laws. The Alston opinion left little reason to doubt that the Court would arrive at the same conclusion when considering the “economic reality” of student athletes as employees under the FLSA. The bigger question is where the Court will ultimately draw a line to separate student athlete-employees from truly amateur sports. The Third Circuit is currently considering an appeal that raises this very question, which may be the vehicle by which this appears before the Supreme Court.

High performers are crucial to organizational success but often are accompanied by challenges and sometimes even legal risks. Listen in as Partners Tracey Diamond and Evan Gibbs chat with Shiftsmart Senior Vice President of Operations Kyle Smialek about the popular movie Top Gun Maverick and creative ways to get the best out of high performers.

Published in Law360 on July 19, 2023. © Copyright 2023, Portfolio Media, Inc., publisher of Law360. Reprinted here with permission.

While many individuals are excited about the proliferation of state laws providing for medical and recreational use of marijuana across the country, inconsistencies in these state laws have made it difficult for employers to put in place consistent policies and practices on testing for marijuana as a condition of employment, upon reasonable suspicion, and post-accident. Employers are being forced to revisit their drug-testing policies not just because of changes to their state’s laws regarding medical and recreational use of marijuana, but also because it is becoming increasingly difficult to find employees who have not used, or do not use, marijuana. If employers want to continue testing for marijuana in states where use is legal, policies must be drafted carefully to account for the continued evolution of the law in this area.

What effects can employee burnout have on your company? Does your productivity, work product, and overall employee morale suffer when there is employee burnout? Can employee burnout lead to safety issues and a potential lawsuit? Listen in as partners Tracey Diamond and Evan Gibbs chat with Southern Company Associate General Counsel Kristie Klein to talk about the popular Netflix TV show Beef, the soothing effects of puppies, and creative ways to avoid employee burnout.

Q: Can sexually graphic, misogynistic music played in the workplace be considered sexual harassment even if it is not directed at a particular employee and found offensive by employees of both sexes?

A: Yes. On February 9, the Ninth Circuit Court of Appeals concluded in the case of Sharp v. S.S. Activewear that sexually explicit, misogynistic music broadcasted throughout the workplace can constitute sex-based harassment in violation of Title VII.

Do companies that use workplace surveillance tools to make hiring and firing decisions risk violating the Fair Credit Reporting Act (FCRA)? According to the Consumer Financial Protection Bureau (CFPB or Bureau) in a recent comment, the answer to that question is yes. The Bureau’s official comment comes in response to a request for information issued by the White House’s Office of Science and Technology Policy on the impact of automated tools used by employers to monitor and evaluate workers. The CFPB’s position that the FCRA applies to automated worker surveillance tools is consistent with the Bureau’s March 2023 request for information on data brokers, discussed here, to determine whether the FCRA applies to modern data surveillance practices.