Labor and employment

In a nutshell

Labor & employment

Labor and employment law governs the workplace and the relationships between employers and employees; between managers and unions; and between employers and government. BigLaw firms tend to represent employers.

Employment work involves both litigation and counseling. The former tackles claims of discrimination, including age, disability, national origin, race, religion, whistle-blower/retaliation, sex and sexual harassment. Such claims are brought by individuals or administrative agencies like the US Equal Employment Opportunity Commission (EEOC). Other common disputes concern unpaid overtime ('wage and hour' claims) under the Fair Labor Standards Act (FLSA), and claims relating to the Family and Medical Leave Act (FMLA), both of which may be filed with the US Department of Labor (DOL).

Lawyers who offer employment counseling advise on compliance with various employment laws. This involves advising on clients’ wholesale employment policies and practices, as well as on 'difficult situations,' be they sexual harassment complaints or reductions in force. They will often advise on the employment aspects of business transactions like M&A or restructurings. Attorneys will either provide both litigation and counseling advice, or specialize in one discipline.

BigLaw labor lawyers commonly advise management on union matters governed by the National Labor Relations Act (NLRA), which is administered by the National Labor Relations Board (NLRB). They have expertise in collective bargaining, union and strike avoidance, and strike breaking. They will also advise on Occupational Safety and Health Act (OSHA) matters, which the DOL (via the Occupational Safety and Health Administration) enforces. Labor attorneys may also engage in litigation of NLRA and OSHA disputes.

Employee Benefits, Executive Compensation & ERISA 

Many firms have a distinct practice focused on executive compensation, employee benefits and ERISA work. For the uninitiated, ERISA is the Employee Retirement Income Security Act of 1974 – the federal statutory framework that governs the administration of employee benefit plans and the rights of the beneficiaries. Kyoko Takahashi Lin, partner at Davis Polk, tells us: “The work we do is really about people: how do you motivate them? How do you get them to be incentivized and work hard and do the right thing and treat employees well? That is what we are trying to advise companies on.” There is much, much more to this specialization, however.

What lawyers do

Employment litigation

  • Receive notice of a charge or complaint filed with the EEOC or DOL, respectively.
  • Advise the client on how to respond to the EEOC, DOL or other government investigations.
  • Negotiate with the agencies, work with them in investigations, and try to come to settlement in appropriate cases.
  • If a class action, oppose class certification.
  • If no settlement can be reached, begin discovery – paper and electronic. Settlement can occur at any stage of a case.
  • Provided the case is not settled, standard litigation will commence.

Employment counseling

  • Review and draft employment contracts and policy documents.
  • Advise the client on the steps to take when problems arise.
  • Keep the client abreast of changes to laws and regulations, often by way of newsletters or seminars.
  • Advise on the employment implications of business transactions.
  • Focus on minimizing risk for the client, by instilling a proactive and preventive approach. 

Labor relations

  • Act as a liaison between management and unions.
  • Lead negotiations between the different sides.
  • Litigate cases before the NLRB and in federal courts.

Realities of the job

  • Only a small percentage of cases filed in the courts are putative class actions. Most are wage and hour or discrimination cases.
  • Cases are heard in state and federal courts, as well as before administrative and regulatory boards.
  • Many labor and employment laws will sound familiar: the Americans with Disabilities Act, the Civil Rights Act of 1964, the Equal Pay Act, the Age Discrimination in Employment Act, and the National Labor Relations Act.
  • Most charges are found to have 'no reasonable cause' and many others will be settled before litigation.
  • The best labor lawyers will have good people skills, because they will be interacting with both management and unions. The most successful ones will be able to convince both management and unions that they have common goals. According to Thomas Linthorst, a partner in Morgan Lewis's labor & employment practice, “those that really can get close to their clients, understand what the client needs, and can think creatively about meeting the client's needs will find that to be a successful approach.”
  • When the economy is down, clients are concerned about surviving, which often involves downsizing. Advising on reductions in a labor force is never pleasant.
  • Alison Marshall, a partner at Jones Day, says: "I do think that we move more quickly in comparison to some of the big commercial litigation cases. Also, our cases are not always as big, so associates often get more responsibility. That is a plus, but juniors need to be prepared to take on that responsibility."
  • Sometimes the intensity of the workload is high, especially when lawyers are gearing up for a big trial. Being responsive is critical. Bettina Plevan, a partner at Proskauer Rose, points out: "Sometimes clients have pressing emergencies, and you have to be responsive immediately."
  • Often lawyers will be dealing with a non-lawyer – an HR professional for example – so they need to be able to translate complex legal principles into clear concepts for them. It’s critical to be able to write well, with a view toward addressing practical problems, and not overwhelming the client. This is also true when it comes to explaining elements of a case or situation to the judiciary.
  • Joseph Costello, a partner at Morgan Lewis, warns: “This is an area of law that requires flexibility and adaptability. Every day there’s a new challenge, and the issues are not always predictable: an employee may have a disability that needs to be accommodated; there might be a union-organizing drive; or maybe an employee has complained about a post on social media, which another employee has published. Any of these situations could trigger a call to us."
  • Stephen Poor, chair emeritus of Seyfarth Shaw, informs us that in this field, “there is still that focus on the real world, which can be messier and stickier than the relatively sterile laboratory of the justice system. In other words, success in this field requires a practical bent and a propensity to solve problems rather than win arguments.”

Current issues

June 2019

  • At the time of Neil Gorsuch's appointment to the Supreme Court, some predicted he would be unwilling to give judicial deference to labor and employment agency regulations and unlikely to interpret statutes in a manner as to benefit employees. Such critics may feel vindicated by the Supreme Court's decision in Epic Systems v. Lewis in early 2018. This ruling allowed companies to require their employees to forgo class action litigation in favor of arbitration in contract disputes, thus limiting the options employees can have when in dispute with employers.
  • In February 2018, the Supreme Court ruled unanimously that employees are not protected from retaliation if they report alleged corporate misdeeds unless they take it to the Securities and Exchange Commission. This comes two years after the Whistleblower Augmented Reward and Nonretaliation Act of 2016 (or WARN Act) was introduced, which aimed to strengthen the protections and incentives available to whistleblowers who report financial crimes. Instances of whistleblowing have risen year-on-year since 2011, according to the Annual Report on the Dodd-Frank Whistleblower Program, released by Office of the Whistleblower (OWB).
  • Another hot area is that of wage and hour claims. At the time of writing the Department of Labor plans to raise the level of pay at which mainly white-collar workers no longer qualify for overtime pay. The current benchmark is $23,660, but the new threshold could be in the $30,000 to $35,000 range. This could significantly increase the costs of many employers (as well as the wages of many employees.) The DOL stated it would begin the rulemaking process in March 2019. Keep an eye out for developments.
  • Thomas Linthorst shared his view on wage and hour claims: “There has been lots of class and collective action litigation as everyone seems to be suing for overtime.” Some of the claims are being brought by those covered by the 'white-collar exemptions' to the overtime requirements, while others have been brought by employees claiming that they have not been properly compensated for 'off-the-clock' work. "One of the reasons for this spike,” explains Linthorst, “is that under the federal overtime law, the Fair Labor Standards Act, a claim can be filed on behalf of all those who are 'similarly situated’ to the plaintiff and, upon a determination by the court that the case is appropriate for notice, notice can be sent to all others ‘similarly situated.’ When that happens, there can suddenly be hundreds of claims.”
  • More generally, Linthorst pointed to “the rise of labor and employment laws, regulations and ordinances at the state and local level.” He continued that “a lot of state and local governments are passing laws; some of them are around wage theft, some relating to paid sick leave, and some are just new posting requirements for existing laws, but it creates a real challenge for those employers that operate nationally.”
  • Immigration and Customs Enforcement raids rose 400% during 2018. The agency carried out 1,525 workplace-related arrests during last year, against just 172 in 2017. While such activity generates much moral and political condemnation (or support) there is a dryer commercial angle: employers can find themselves thwacked with fines if they knowingly hire those without the right paperwork.
  • One result of the MeToo movement is a slew of laws that California enacted in 2018. These include prohibiting provisions in settlement agreements that prevent disclosure of relevant factual information, greater training requirements for employees regarding sexual harassment, and a requirement for all public companies to have at least one woman on the board by the end of 2019.