Answer: This popular quiz show, created by Merv Griffin, averages 25 million viewers per week, and it is my favorite show. “What is Jeopardy!?”
Yep! I love Jeopardy!. My love of the show dates to when I was eight and watched the show with my grandparents. One night, I remember the category was Potpourri—a term I did not know as a kid and I’m only slightly more familiar with now. There was a question about farm animals, and I correctly guessed that the answer was “What are sheep?”.
That was the first time I remember getting a question right in Jeopardy!, and I have been hooked ever since. In honor of my love of the trivia game show and the first category I correctly guessed an answer in, let’s do our own version of Jeopardy!. This one isn’t going to deal with sheep. Instead, let’s look at some recent trends in human relations law that certainly will impact employers big and small.
Cannabis
Answer: This plant, which was declared a Schedule I controlled substance in 1970 by the federal government, has seen a growth in popularity in the past 10 years as almost 20 states have legalized it for recreational use.
What is cannabis? That’s right! A little more than a decade ago, Colorado become the first state in the country to legalize recreational cannabis for adult use. In the 10 years since, cannabis legalization has gone from a late-night talk show punchline to a reality in almost 20 states. This number should only increase as cannabis continues to be destigmatized, and states continue to look for avenues to generate tax revenue.
The legalization of a previous illegal drug can create issues for employers. Many employers likely have policies against the use of drugs, but how should employers handle the legal use of cannabis by employees? Some states have answered this question for employers. For example, New York state—which legalized recreational cannabis in 2020—does not allow employers to prohibit the use of cannabis outside of the workplace and workhours. However, employers are free to prohibit cannabis usage during workhours and while employees are at worksites.
This can raise practical issues for employers. If employers can prohibit the use of cannabis, how do they enforce this prohibition? Unlike with a substance like alcohol, where we have a verified method of testing current levels of inebriation, testing for recent cannabis use may be more difficult. While cannabis can be detected through drug tests, it’s difficult to demonstrate whether the cannabis in someone’s system was ingested hours ago while on worktime or days or weeks ago on a weekend. This lack of reliability means that employers should be wary of taking any adverse action against an employee for a positive drug test alone. Doing so could put an employer at risk of a retaliation lawsuit alleging the employee is being punished for engaging in a legally protected activity.
Noncompetes
Answer: A recent regulation by the U.S. Federal Trade Commission would ban the use of these employment agreements.
What are noncompete agreements? You got it! In early 2023, the FTC released a proposed regulation that would ban the use of noncompetition or noncompete clauses. A noncompete clause is a type of restrictive covenant that restricts the ability of individuals to work in a certain sector, geographic area and/or for a certain amount of time.
In recent years, these types of agreements have come under increasing scrutiny from both courts and state Legislatures. Where once courts permitted noncompete agreements of two years. Now, they are refusing to enforce agreements longer than six months in duration.
This reexamination of noncompetes has come as the FTC has said that 30 million people—or roughly 18% of U.S. workers—are subject to non-competition clauses. If the FTC regulation does go into effect, what does that mean for employers? Well, that depends on the usage of noncompetes. While the FTC regulation bans the use of noncompetition clauses, it does not ban the use of less restrictive restrictive covenants, like nonsolicitation or nondisclosure clauses.
Typically, those sorts of agreements protect a business by restricting an employee, or ex-employee, from contacting clients or disclosing client lists, instead of restricting the employees’ ability to work. Those employers that utilize those lesser agreements will be unaffected by the new regulation. Those that do use noncompetition clauses should replace them with another restrictive covenant that does not inhibit the ability of the employee to work elsewhere.
All employers are encouraged to review the employment contracts they utilize to ensure that they do not violate the proposed regulation. One additional note, the regulation does allow one type of noncompete clause: Noncompete clauses still would be permitted for the sale of business or ownership interests. In those situations, a noncompletion clause could be utilized for the person selling a business or ownership interest.
Salary transparency
Answer: In 2022, New York state became the latest state to pass this sort of law designed to combat wage discrimination by requiring disclosure of salary ranges in job postings.
What is a wage transparency law? Correct again! New York state joined a growing list of states and municipalities (including: Connecticut and New Jersey) that have passed laws requiring employers to disclose a salary range for open positions. The specifics of the laws often vary, but the purpose is the same: to increase wage transparency to close the wage gap between different classifications of individual like those of different gender or race.
While these laws were passed for a noble reason, they often can create confusion among employers. This confusion is due to three issues involving the where, who, and what of wage transparency.
Where. Several cities, counties and towns have passed wage transparency laws. This means some businesses in the same state may have to follow different rules. For example, take New York state. Prior to the passage of a statewide law, New York City, the city of Ithaca and Westchester County all had wage transparency laws. A business posting a job in each of those locations (hypothetically) would have to follow three different laws. This leads right into the second issue of who.
Who. While wage transparency laws all have the same goal: Closing the wage gap, they often are worded differently to apply to different jobs. For example, Rhode Island takes a more reactive approach. The law in that state requires all employers to provide salary range to job applicants upon request or before discussing compensation or extending a job offer. Meanwhile, Colorado is more proactive. It requires employers to include a salary range, as well as a list of benefits, for all job ads.
What. The laws don’t just differ in what jobs they apply to, but also which employers. Let’s go back to New York state. New York City’s wage transparency law applies to all employers with four or more workers with at least one of those workers who is located in New York City. The city of Ithaca’s law applies to employers with four or more workers in Ithaca. While Westchester County’s law applies to any employer posting a job that will or can be performed in Westchester. You have three municipalities all within 200 miles of one another, all with slightly different laws regarding transparency.
What are businesses to do? Well, the first step is to stay informed. Check to see if your state, county or city/town have passed similar laws. Several states and municipalities in the Northeast including Connecticut, Maryland, New Jersey, New York and Rhode Island have passed some form of wage transparency law. For those in areas that do have these laws make sure you are complying with them.
For those that are not subject to wage transparency laws, it is probably wise to start considering including salary ranges on job postings. There are several reasons for this. First, this is a trend that is only growing. Even if you are not in an area now where wage disclosure is required, chances are you will be soon. Second, even if your state or city never passes a wage transparency law, the private market may force your hand anyway.
Since wage transparency laws are popping up in many different states and many different levels of government, many companies—especially those with multiple locations—are including salary ranges to ensure compliance proactively. As more and more employers include salary ranges, whether because obligated by law or voluntarily, those that do not may find their job postings getting less attention.
Our category for Final Jeopardy! is Excess & Surplus Lines. Determine your wager. (Exit to the Jeopardy! theme song: Think!.)
This article originally appeared in the April 2023 issue of PIA Magazine.
Bradford J. Lachut, Esq.
Bradford J. Lachut, Esq., joined PIA as government affairs counsel for the Government & Industry Affairs Department in 2012 and then, after a four-month leave, he returned to the association in 2018 as director of government & industry affairs responsible for all legal, government relations and insurance industry liaison programs for the five state associations. Prior to PIA, Brad worked as an attorney for Steven J. Baum PC, in Amherst, and as an associate attorney for the law office of James Morris in Buffalo. He also spent time serving as senior manager of government affairs as the Buffalo Niagara Partnership, a chamber of commerce serving the Buffalo, N.Y., region, his hometown. He received his juris doctorate from Buffalo Law School and his Bachelor of Science degree in Government and Politics from Utica College, Utica, N.Y. Brad is an active Mason and Shriner.
