As featured in #WorkforceWednesday:  This week, we look at significant developments for employers from across the federal government, including at the Occupational Safety and Health Administration (OSHA), the Equal Employment Opportunity Commission (EEOC), and the Securities and Exchange Commission (SEC).

OSHA Readies Vaccine Mandate Requirement

President Biden is embracing vaccine mandates in his new COVID-19 action plan. Among other mandates, the plan includes a new OSHA-enforced requirement that employers with 100 or more employees mandate vaccines or test employees weekly. Read more about the new requirements.

First EEOC Remote Work Lawsuit Alleges Disability Discrimination

The EEOC has brought suit alleging disability discrimination under the Americans with Disabilities Act. This is the first COVID-19-related remote work case where the agency itself has initiated legal action during the pandemic.

SEC Whistleblower Program Tops $1 Billion in Awards

Last week, the SEC announced two whistleblower awards that totaled $114 million. With these awards, the SEC’s whistleblower program has now awarded over $1 billion to whistleblowers since its first award in 2012. “For employers, this is a clarion call that you need to embrace best practices and training,” said attorney Greg Keating in The Wall Street JournalRead more.

See below for the video and podcast links. For Other Highlights and more news, visit

Video: YouTubeVimeo.
Podcast: Apple PodcastsGoogle PodcastsOvercastSpotifyStitcher.

As featured in #WorkforceWednesday:  This week, we focus on Biden’s six-pronged action plan towards combating COVID-19, which requires mandatory vaccination programs for a majority of employers.

Biden Announces Employer Vaccine Mandates

On September 9, President Biden announced that all federal agencies and contractors and employers with 100 or more employees in the private sector must mandate COVID-19 vaccination through a new Occupational Safety and Health Administration-enforced emergency temporary standard. The plan is estimated to impact two-thirds of the country’s workforce. Attorneys Kate Rigby and Adam Tomiak discuss how employers should prepare for compliance. To read more about the President’s plan, click here.

New York HERO Act Safety Plans Now Required

New York Governor Kathy Hochul recently designated COVID-19 a serious public risk under the state’s HERO Act (“Act”), requiring employers’ safety plans developed pursuant to the Act to go into effect. Read more.

Marijuana Legalization Rundown: Recent Judicial Decisions

State legislatures across the country have been busy enacting cannabis legalization laws this year. Along with those laws has come a number of significant court decisions interpreting the application of cannabis legalization around the country. Read more.

See below for the video and podcast links. For Other Highlights and more news, visit

Video: YouTubeVimeo.
Podcast: Apple PodcastsGoogle PodcastsOvercastSpotifyStitcher.

As we wrote in our last Marijuana Legalization Rundown, state legislatures across the country have been busy enacting cannabis legalization laws this year.  Along with those laws has come a number of recent court decisions interpreting the application of cannabis legalization laws.  This post summarizes some of the significant decisions issued this year.


On April 28, 2021, the U.S. District Court for the Central District of California granted summary judgment to the defendant employer on claims brought under the Fair Employment and Housing Act (“FEHA”)—including claims for disability discrimination, retaliation, wrongful termination in violation of public policy, failure to provide accommodation, failure to engage in an interactive process, and failure to prevent discrimination—asserted by a medical marijuana user whose job offer was withdrawn based on a positive pre-employment drug screening test.

In Espindola v. Wismettac Asian Foods, Inc.Case No. 2:20-cv-03702 (C.D. Cal. Apr. 28, 2021), the plaintiff, a Florida resident, applied through a recruiting agency for an executive position with the defendant employer.  The company offered the plaintiff a job and told him that he would be subject to the policies in the company’s employee handbook, which contained a pre-employment drug testing provision.  At the plaintiff’s request, he was granted a delay in scheduling his drug screening in order to address personal matters.   Shortly thereafter, and only a few days before his first day at work, the plaintiff took steps to procure a medical marijuana card in Florida.  As part of his on-boarding paperwork, the plaintiff indicated that he was not disabled and signed a drug testing consent form and the employee handbook.  In a subsequent meeting with the employer’s CEO, the plaintiff disclosed that he had chronic back pain for which he had been prescribed medical marijuana.  The plaintiff did not provide any supporting medical documentation to prove his diagnosis or any work-related limitations, only providing the approval of his application for a medical marijuana card by the Florida Department of Health.  The plaintiff took his pre-employment drug test, which was positive for marijuana.  The employer terminated the plaintiff’s employment due to the positive test, after which the plaintiff filed a complaint in California federal court.

In granting the employer’s motion for summary judgment, the court held that the plaintiff’s disclosure to the employer that he had chronic back pain alone, without supporting documents to substantiate his claim of a physical disability or how chronic back pain affected his ability to work, was insufficient to make out a prima facie claim under the FEHA.  The court concluded that in the context of this case, the plaintiffs “chronic back pain” did not qualify as a disability under the FEHA and the employer could not be said to perceive the plaintiff as having a disability.  For these reasons, the plaintiff’s accommodation, interactive process, and retaliation claims also failed. Moreover, the court held that, even if the plaintiff could establish that he had a qualified disability, he could not meet the evidentiary standard to show that he was terminated from employment for anything other than a legitimate, non-discriminatory reason—the failed drug screen.  The court explained that where, as here, “the employer has a uniform policy requiring employees to complete a pre-employment drug test as a condition of employment, the fact that the employee has notice of that condition, coupled with the result of the test, is determinative.”  Therefore, the employer had a legitimate, non-discriminatory reason for terminating the plaintiff’s employment.  The case has been appealed to United States Court of Appeals for the Ninth Circuit.

In so holding, the court confirmed that in California—unlike in New York, Nevada, and soon Philadelphia—an employer may screen out applicants on the basis of a pre-employment drug test for marijuana.  To reduce the likelihood of discrimination claims such as the one asserted in Espindola, employers should take care to notify applicants that a job offer is conditioned on consent to drug testing, to uniformly apply the drug testing policy to all applicants, and to avoid any discussions of an applicant’s underlying medical conditions.


On May 13, 2021, the United States District Court for the Western District of Michigan held that a Black employee whose employment was terminated for a positive drug test for marijuana had plausibly pled his allegations of employment discrimination sufficient to overcome the defendant employer’s motion to dismiss.

In Bownes v. Borroughs Corp., Case No. 1:20-cv-964 (W.D. Mich. May 13, 2021), the plaintiff was a long-time, union employee covered by a collective bargaining agreement (“CBA”). The employer immediately terminated the plaintiff’s employment after he tested positive for marijuana. The CBA, however, provided that if an employee tested positive for a controlled substance, the employer could allow the employee to complete a “rehabilitation/treatment program” as a condition of continuing employment.  The employer could immediately terminate employment after a second positive test, unless the employee “comes forward and admits that he has an alcohol or drug problem after having been rehabilitated.”  The plaintiff alleged that similarly situated White employees who had failed drug tests had been given the opportunity to complete a “rehabilitation/treatment program” and allowed to continue their employment.

In denying the employer’s motion to dismiss, the court held that the plaintiff had sufficiently pled a disparate treatment claim by identifying six White employees allegedly treated more favorably than him.  The court rejected the employer’s attempt to introduce information outside of the complaint that would allegedly show that it had a universally-applied zero tolerance workplace drug policy.

While the employer will have an opportunity to present its defense more fully on summary judgment, this case presents a lesson to employers that they should carefully consider the level of discipline that is appropriate for a drug (in this case, marijuana) offense, and ensure that offenders are disciplined fairly and consistently under the company’s policy.


On August 10, 2021, the Pennsylvania Superior Court affirmed that the state’s Medical Marijuana Act (“MMA”) creates an implied private right of action for medical marijuana users to sue their employers for discrimination.

The MMA provides that “[no] employer may discharge . . . or otherwise discriminate or retaliate against an employee . . . solely on the basis of such employee’s status as an individual who is certified to use medical marijuana.”  In Scranton Quincy Clinic Company, LLC v. Pamela Palmiter, Case No. 498 MDA 2020 (Pa. Super. Ct. Aug. 5, 2021), a medical assistant who uses medical marijuana to treat chronic pain, chronic migraines, and persistent fatigue, was advised that she could not continue to work after failing a drug test, despite providing a copy of her medical marijuana certification.  Although the MMA does not create an express private right of action, the medical assistant brought a claim for discrimination and wrongful discharge in violation of the law.

Acknowledging that the MMA does not create an express private right of action with statutory remedies, the appellate court adopted the lower court’s three-part analysis to determine whether the statute contained an implied right of action.  Specifically, the three-judge panel considered whether: (1) the plaintiff is one of the class for whose “especial” benefit the statute was enacted; (2) there is an indication of legislative intent, explicit or implicit, to create or deny such a remedy; and (3) it is consistent with the underlying purpose of the legislative scheme to imply such a cause of action.  In holding that the MMA contained an implied right of action, the appellate court observed that the General Assembly had “proclaimed a public policy prohibiting such discrimination” against medical marijuana users, and found that the Pennsylvania Department of Health did not have exclusive enforcement authority.

The Superior Court also determined that the MMA supports a claim for wrongful discharge.  Siding with the trial court, the Superior Court again cited public policy reasons, rejecting the employer’s assertion that Department of Health remedies were intended by drafters to be the MMA’s sole enforcement mechanism.

Now that a state appellate court has given employees the “green light” to bring their own claims under the MMA, Pennsylvania employers should exercise care when considering adverse employment actions against employees based on their on their off-site use of medical marijuana.

* * *

These cases illustrate that the legal landscape regarding cannabis and employment law continues to change, even in jurisdictions that have legalized medical and/or recreational cannabis.  Employers should continue to monitor case law developments to determine whether and to what extent they may discipline employees or refuse to hire applicants who test positive for cannabis.

*America Garza, Law Clerk – Admission Pending (not admitted to the practice of law) in the firm’s New York office, contributed to the preparation of this post.

Many employers are aware that they could waive the ability to enforce an arbitration agreement if they delay moving to compel arbitration until after they have engaged in significant litigation activities in court, such as filing a motion to dismiss or serving discovery requests. However, in Hernandez v. Universal Protection Services, a Massachusetts Superior Court judge found that an employer waived its right to compel arbitration based on its actions before an employee filed suit in court. As Hernandez is novel and significant, employers may want to consider adopting practices to remind employees of their arbitration agreements when it appears that litigation is likely.


In September 2018, Universal hired Hernandez. As a condition of her employment, she signed an arbitration agreement requiring her to arbitrate all claims against Universal, including those for discrimination or harassment.

According to Hernandez’s complaint, in March 2020, her supervisor sexually harassed her. She reported the alleged harassment to the local police department, who, in turn, told Universal about it. Shortly after Universal learned of the Hernandez’s allegations, it terminated her supervisor’s employment.

Nonetheless, Hernandez filed a complaint with the Massachusetts Commission Against Discrimination (MCAD) against Universal and her former supervisor alleging that her former supervisor sexually harassed her at work. Around the same time, she also requested that Universal provide her with a copy of her personnel record under Massachusetts’ personnel-record law (M.G.L. c. 149, § 52C).  . Universal gave Hernandez a copy of her personnel record, but it  did not include the arbitration agreement she had signed.

After Universal responded to Hernandez’s MCAD complaint, she removed the case to the Massachusetts Superior Court. Promptly after Hernandez served Universal with a copy of her court complaint, Universal moved to dismiss or compel arbitration based on the agreement Hernandez had signed in 2018. Hernandez opposed that motion, arguing Universal had waived its right to compel arbitration.


The court agreed with Hernandez and found that Universal had waived its right to enforce the arbitration agreement for three reasons. First, although M.G.L. c. 149, § 52C requires employers to include “any waiver signed by the employee” in an employee’s personnel record, Universal did not provide Hernandez with a copy of her arbitration agreement (which waived her right to file her claims in court) when it responded to her request for her personnel record. Second, the court found that Universal had “failed to disclose the existence of or its intent to enforce an arbitration agreement” after it learned of Hernandez’s allegations, during the MCAD proceedings, or at any other time before the employee filed a complaint in Superior Court. Finally, in the court’s view, the employee ostensibly suffered prejudice by removing her case from the MCAD to Superior Court, which was “irreversible” and done “at her own cost.” Accordingly, the court denied Universal’s motion to dismiss or compel arbitration.

Takeaways for Employers

While Massachusetts courts have long recognized that an employer can waive its ability to enforce an arbitration agreement, Hernandez is a novel decision. Typically, courts find a waiver based on an employer’s actions in court, such as taking actions inconsistent with an intent to arbitrate, failing to move to compel arbitration promptly after service of process, invoking the judicial machinery, or taking other actions that have prejudiced the employee. In stark contrast to these cases, Hernandez found a waiver based on the employer’s actions before the employee filed her court complaint.

As a trial court decision, Hernandez is not binding precedent in Massachusetts, and other courts may disagree with its reasoning. However, employers can take a few steps to avoid a potential waiver based on Hernandez:

  • Exercise diligence when searching for and assembling documents in response to an employee’s personnel-record request to avoid omitting arbitration agreements.
  • Remind employees of their obligation to arbitrate claims in response to threats of litigation (such as a formal demand letter).
  • Refer to arbitration agreements in initial submissions to state and federal agencies (such as the U.S. Equal Employment Opportunity Commission and MCAD) to put employees on notice of the applicability of the agreement to the dispute if they remove their claims to court.

Taking these steps is unlikely to impose significant burden on most employers and may help ensure that employers are able to compel employees to abide by the agreements they signed.

On September 9, 2021, President Biden announced that his Administration is implementing a six-pronged, comprehensive national strategy to ensure that all available tools are being used to combat COVID-19.  The plan addresses: (1) vaccinating the unvaccinated; (2) further protecting the vaccinated; (3) keeping schools safely open; (4) increasing testing and requiring masking; (5) protecting the economic recovery; and (6) improving care for those with COVID-19.  The first strategy is germane to employers.

Vaccinating the Unvaccinated – To accomplish this, the U.S. Government will require the following:

  • All private sector employers with 100 or more employees will be required to ensure their workers are vaccinated. Those who remain unvaccinated will need to produce a negative test result on at least a weekly basis before coming to work. The Administration has directed the Occupational Safety and Health Administration (OSHA) to develop and issue a new Emergency Temporary Standard (ETS) to implement this requirement.

The new ETS is expected to include a requirement that private employers with 100 or more employees provide paid time off for workers to receive the vaccine and recover from any side effects.   While a timeline for issuance of the rule has not been announced, an ETS was already issued for workers in health care settings, effective June 21, 2021. That ETS does not contain a vaccination mandate, but does direct employers to provide reasonable paid leave for vaccinations and vaccine side effects.

  • All federal workers and contractors that do business with the federal government will need to be vaccinated. By Executive Orders issued September 9, 2021, President Biden directed that all federal executive branch workers be vaccinated (Executive Order on Requiring Coronavirus Disease 2019 Vaccination for Federal Employees); and that all employees of contractors that do business with the federal government be vaccinated (Executive Order on Ensuring Adequate COVID Safety Protocols for Federal Contractors). The Order covering federal employees eliminated the testing option for those who are not vaccinated.  Under the Order covering federal contractors, however, although the testing option appears to have been eliminated, further guidance is needed as to whether testing will be available for those employees of federal contractors who are not “performing [work] on or in connection with a Federal Government contract.”  The Safer Federal Workforce Task Force is expected to issue guidance on September 24, 2021.

The latter Order takes effect immediately and applies to new contracts, new solicitations, extensions or renewals, and exercises of options on existing contracts where the relevant contract will be entered into, extended or renewed, or option exercised on or after October 15, 2021.  The Order does not address penalties for the failure of federal government contractors to comply.

  • All staff at Medicare and Medicaid-certified hospitals and other health care facilities will be subject to a vaccine mandate. The U.S. Centers for Medicare and Medicaid Services (“CMS”) announced the nationwide mandate on September 9, 2021, applicable but not limited to, hospitals, dialysis facilities, ambulatory surgical settings, and home health agencies. This action is a continuation of efforts announced on August 18, 2021, when CMS advised that it was collaborating with the Centers for Disease Control and Prevention (“CDC”) to develop an emergency regulation requiring staff vaccinations at nursing homes participating in Medicare and Medicaid. It will apply to nursing home staff as well as staff in hospitals and other CMS-regulated settings, including clinical staff, individuals providing services under arrangements, volunteers, and staff who are not involved in direct patient, resident, or client care.

CMS is developing an Interim Final Rule with Comment Period that will be issued in October.  Until that Final Rule takes effect, CMS expects certified Medicare and Medicaid facilities to act in the best interest of patients and staff by complying with new COVID-19 vaccination requirements.

Employers should operate on the assumption that, while controversial, the President’s orders may withstand any legal challenge, especially with respect to government contractors, given that there is no inherent right to do business with the government or gain from a federal contract. There is long-standing precedent of the United States Department of Labor (“DOL”) and the Office of Federal Contract Compliance Programs (“OFCCP”) successfully enforcing federal contract mandates that support an administration’s policy goals.

What Employers Should Do

With the issuance of President Biden’s COVID-19 Action Plan and Executive Orders, there remain many unanswered questions regarding the details. Until those questions are answered, employers should do the following:

  • Follow guidance and watch for updated guidance/rules issued by the Center for Disease Control (CDC), OSHA, the Task Force, and, if applicable, CMS and other regulatory agencies.
  • Consider using all available resources to support employee vaccinations, including employee education and clinics.
  • If implementing a vaccination mandate, recall that, as we have previously explained, such programs must be compliant with applicable laws protecting workers’ medical information privacy, limiting disability-related inquiries, and prohibiting discrimination based on disability or other protected categories, including sincerely held religious beliefs and genetic information. Employers should refer to the U.S. Equal Employment Opportunity Commission’s guidance and seek our support.
  • Stay tuned – we will keep abreast of developments as guidance is released or updated, to help employers stay compliant.

As we previously reported, the American Rescue Plan Act of 2021 (ARPA) was signed into law on March 11, 2021, requiring, among other things, the Pension Benefit Guaranty Corporation (PBGC) to issue its implementing regulations by July 9, 2021. As promised, PBGC issued an interim final rule, 86 Fed. Reg. 36598 (July 12, 2021) (the IFR), on a major element of the rescue plan―the Special Financial Assistance Program (SFA)―intended to provide a one-time payment to the estimated 200 most financially troubled multiemployer pension plans to help them survive and pay pensions through 2051. These 200 plans are a subset of the total of approximately 1,400 multiemployer pension plans covered by the ERISA insurance program. The IRS simultaneously issued Notice 2021-38 to provide guidance on how the SFA impacts minimum funding, as well as the reinstatement of certain suspended benefits by plans that receive the SFA.

This update describes key features of the IFR and IRS guidance, important not only to those multiemployer pension plans, and their participants and beneficiaries, but also to the employers who are obligated through their collective bargaining agreements (CBAs) to contribute to those plans. Even though the SFA calls upon eligible plans to apply for the payment, assuming they elect to receive it and comply with the detailed application process, contributing employers have good reason to monitor the activities of the plans that receive those employer contributions. Thus, beyond the key features of the SFA rules, this article also discusses what contributing employers may wish to monitor in those affected plans and what they may need to consider in terms of their own business planning.

I. Interim Final Rule

 A. Who is Eligible for Financial Assistance?

 ARPA, as explained by the IFR, provides that a multiemployer plan is eligible for financial assistance if it meets one or more of the following criteria:

  1. The plan is in critical and declining status for a plan year beginning in 2020, 2021, or 2022;
  2. the plan has been approved for “a suspension of benefits” on or before March 11, 2021 under the Multiemployer Pension Reform Act of 2014 (MPRA);
  3. the plan is certified by an actuary to be in critical status for a plan year beginning in 2020, 2021 or 2022, with a current liability funded percentage below 40% and with the plan having a ratio of active plan participants to inactive plan participants of less than 2 to 3; and/or
  4. “the plan became insolvent … after December 16, 2014, has remained insolvent, and has not been terminated . . . as of March 11, 2021.”

The IFR identifies certain plans that are not eligible, such as plans terminated by a mass withdrawal prior to January 1, 2020, plans terminated in a plan year that ended before January 1, 2020, or plans that elect to be in critical status, but do not otherwise meet the requirements for critical status.

For an eligible plan to receive SFA, the plan’s trustees must formally elect to receive the assistance, and in so doing, submit detailed information to PBGC for approval. The agency may require adjustments in the application, but the agency’s failure to act on the application within 120 days will result in the application being deemed approved.

The IFR also contains requirements aimed at ensuring uniformity in SFA applications. The IFR specifically instructs which data are to be used from a plan’s Form 5500 to determine whether a plan is in critical status for eligibility. To that end, the IFR contains direction on which actuarial assumptions are to be used in determining critical status or critical and declining status, drawing the line on the date the plan was zone certified. That is, if the certification of critical status or critical and declining status was issued prior to January 1, 2021, then PBGC will accept those assumptions that are incorporated into the certification, unless they are clearly erroneous. If a plan sponsor (that is, the plan’s board of trustees) applies for SFA and asserts eligibility based on a zone certification that was not accomplished prior to January 1, 2021, the plan sponsor must determine whether the plan is still in critical or critical and declining status using the same assumptions previously provided, unless those assumptions are now unreasonable.

Plans should consult their legal counsel to determine whether they meet eligibility requirements, and to ensure that appropriate information, assumptions, and other data points are used throughout the application process.

B. How Much SFA Can Eligible Plans Receive?

The IFR addresses a question left unanswered by the statute itself—how much financial assistance eligible plans may receive. Under ARPA, the amount of SFA available for eligible plans was to be “such amount required for the plan to pay all benefits due during the period beginning on the date of payment of the special financial assistance payment and ending on the last day of the plan year ending in 2051.” PBGC interpreted this to mean all of the plan’s existing and projected “obligations”—i.e, the sum of the present values of benefits and reinstated benefits, administrative expenses, etc.—in excess of “resources”—i.e, the present values of the fair market value of plan assets and the present value of future anticipated contributions, withdrawal liability payments, and other payments expected to be made to the plan—through the plan year ending in 2051. These projected amounts are calculated from the “measurement date,” which is the last day of the calendar quarter immediately preceding the date the plan’s application was filed, using certain interest rates, and consistent plan assumptions.

In drafting the IFR, PBGC has paid particular attention to ensure that electing plans do not inflate the amount of SFA which they may seek. The agency will scrutinize a plan’s revisions to any of its actuarial assumptions.  In addition, the IFR specifically states that the amount of the SFA cannot be increased by virtue of certain events, including plan merger, asset transfers, benefit increases (other than required restorations of benefit suspension), and contribution decreases.

C. When Will the PBGC Process Applications and When Will Plans Receive Payment?

ARPA requires PBGC to process completed applications within 120 days of receipt; however, it allows the agency to establish a procedure to prioritize applications for the most financially troubled plans. The agency thus prioritized the application process into seven priority groups:

PBGC indicated that it will only accept as many applications as it can process in the required timeframe, after which it will temporarily close the electronic submission filing window and will not accept any additional applications. If the application is approved, the IFR provides that PBGC will typically provide relief in a one-time lump sum payment within 60 days after approval and no later than 90 days after approval.

If PBGC denies an application, the electing plan may accept the denial and revise the specific reason for the denial, without changing anything else in the application. The plan does not have to refile an entire application, but if it chooses to do so, it cannot change any of the underlying “base data” used in the denied application. PBGC notes that there is no limit to the number of times a plan may revise its application for SFA, except that the last revised application must be filed by the statutory deadline of December 31, 2026.

For plans that have been approved for a partition by PBGC before March 11, 2021, the agency provides an alternative process to file a single application with information about the original plan and the successor plan. Such application falls within the priority group 2, as identified above.

Plans should consult with their legal counsel and actuaries to ensure that the applications meet the requirements set forth by the IFR, and that they file before the appropriate deadlines.

D. What Restrictions Apply to SFA?

ARPA and the IFR place certain restrictions on how plans can use SFA funds. The SFA and earnings thereon—

  1. May only be used to make benefit payments and pay administrative expenses (Importantly, plans have broad discretion to use SFA funds to pay benefits and administrative expenses before using other plan assets);
  2. Must be segregated from other plan assets; and
  3. Must be invested in “investment grade” bonds or other permissible investments.

PBGC defines “investment grade” as “publicly traded securities for which the issuer has at least adequate capacity to meet the financial commitment under the security for the projected life of the asset or exposure.” The IFR identifies several types of investment grade bonds or investments, including exchange traded funds, mutual funds, and pooled trusts.

ARPA and the IFR also restrict plans receiving SFA from—

  1. Retroactively increasing benefits other than any required reinstatement of suspended benefits;
  2. Prospectively increasing benefits, unless an actuary certifies the reasonableness of the increase;
  3. Reducing contribution rates that were provided for in a CBA or plan document in effect on March 11, 2021;
  4. Transferring assets or liabilities, or engaging in a merger, or spinoff, without PBGC approval;
  5. Failing to invest plan assets in permissible investments; and
  6. Failing to meet certain annual reporting and audit requirements.

Notably, ARPA requires that plans receiving SFA reinstate any benefits that were suspended pursuant to the MPRA.  The IRS, in conjunction with PBGC, issued Notice 2021-38, providing guidance on how these benefits are to be reinstated.  Reinstated benefits must be paid in either a lump sum within three months of the date the SFA is received or in equal monthly installments over a five year period, beginning within three months of the date the SFA is received. These reinstated benefits are not subject to adjustments for interest. Retrospective and prospective benefit increases during the SFA coverage period, beyond benefits that are required to be reinstated, are barred unless special requirements are met. Plans must also adhere to specific administrative requirements, such as a notice to participants and beneficiaries and adoption of plan amendments.

To ensure compliance with these various nuances under ARPA and the IFR, plans should consult with legal counsel, prior to using the SFA they receive, to ensure the funds are allocated in a way that does not exceed the manner allowed under the law.

E. What Future Information and Guidance Will PBGC Provide?

In its IFR, PBGC repeatedly advises the public that updates relating to SFA will be provided on the agency’s website. Subjects to be covered on the website may include: the actuarial assumptions reflected in a plan’s application for SFA; the plan’s administrative expenses and contribution rates; the current status of filing windows; compliance with emergency filing requirements and substantiation of a claim of emergency status; withdrawal of an application for SFA; annual statements of compliance by plans receiving SFA; general instructions on SFA notice of benefit reinstatement; SFA instructions related to cash flow projections (Baseline); requirements for preparing the application for SFA; and information regarding the current priority group(s) for which applications are being accepted.

In contrast to subjects that will be addressed on its website, PBGC’s regulation states that “Unless confidential under the Privacy Act, all information that is filed with PBGC for an application for special financial assistance…may be made publicly available, at PBGC’s sole discretion, on PBGC’s website…or otherwise publicly disclosed.”

As suggested below, contributing employers may have a strong business interest in openness and transparency in PBGC’s management of the SFA program and the activities of any eligible plan(s) to which the employer contributes. It is unclear how PBGC will utilize the disclosure discretion it reserved. Once again, plans should work closely with counsel to stay apprised of developing legal and regulatory requirements that are being issued.

II. Employers’ Perspectives

Beyond the nuts and bolts of the IFR, and beyond the various nuances that the plans must navigate, employers that contribute to one or more of the 200 financially troubled plans will be interested in practical aspects on how to react to the unprecedented subsidy to certain plans.

SFA is an ambitious program providing its one-time payment intended to be sufficient to carry a troubled plan for 30 years, past future contingencies that cannot be clearly foreseen today.  Moreover, SFA does not address the underlying problems plaguing troubled plans or the industries on which they depend.

But even apart from the dynamics of the modern business world, and as sophisticated as the interest and other assumptions applied to the plans may be, some experts have suggested that the SFA math does not add up. Interest and other rate projection issues are beyond the scope of this article, but employers that contribute to a troubled plan have a strong business interest in the prospects of the plan(s). The potential collapse of one or more plans, despite the SFA, may prompt employers to become more active in monitoring and analyzing the troubled plans to which they contribute.

Before suggesting an organized approach for an employer to monitor a plan dealing with SFA, it may be useful to focus on one subject of concern to many employers: withdrawal liability.  The IFR suggests potential uncertainties that are difficult to predict. Besides the on-going structural problems dogging troubled plans—e.g., difficult demographics—the IFR requires that withdrawal liability be determined in different ways when compared to pre-ARPA rules. Plans may recognize SFA as a “resource,” and that would suggest a lower withdrawal liability. On the other hand, the interest rate used in the liability calculation will be drawn from the mass withdrawal rules, and that could have a hugely negative result for a withdrawing employer. Given that the purpose of the SFA subsidy is to aid troubled plans and their participants and beneficiaries, PBGC intends to prevent windfall situations for employers who might wish to withdraw from a plan.

The mass withdrawal interest rate rule noted above will continue for the later of ten years after receipt of SFA or the depletion of SFA funds. How long will that be? The IFR gives individual plans discretion to use SFA funds or other funds in paying its obligations. For this reason, it appears that a plan’s withdrawal liability calculation may have to use mass withdrawal interest assumptions for some period between ten and thirty years (i.e., ending in 2051). It remains to be seen how individual plans will exercise their discretion in prioritizing the use of SFA funds, and contributing employers may wish to monitor the plan’s asset management decisions more closely than in the past.

For withdrawal liability settlements over $50 million, PBGC must approve the settlement.

As if these uncertainties were not enough, Footnote 18 of the IFR states that “PBGC intends to propose a separate rule of general applicability…to prescribe actuarial assumptions which may be used by a plan actuary in determining an employer’s withdrawal liability.”

The factors described above suggest that PBGC may take a more active role in withdrawal liability matters in the future. Withdrawal liability is just one of the issues confronting contributing employers. Other issues may include the plan’s withdrawal rates when other employers withdraw, the overall demographics of the plan ten or twenty years from now, etc. Depending on how strongly a contributing employer believes its obligation to the plan affects the employer’s business interests, there are measures management may consider for the purpose of monitoring and analyzing the plan’s dealings with important issues in the next three decades.

Depending on the intensity of the views of the contributing employer’s management, the employer may consider one or more of the following measures going forward—

  1. Establish a management person or group to closely monitor the plan and PBGC. For example, someone might be tasked with reviewing the plan’s activities in applying for and utilizing SFA.  That “someone” or group, might also be tasked with becoming familiar with the SFA activities of PBGC—for example, frequently checking the agency’s website postings, as suggested earlier in this article.
  2. Conduct research, analysis, and monitoring of PBGC’s administration of ARPA-related rules as they may impact the employer’s relationship with the plan and the employer’s overall business.
  3. Conduct research, analysis, and monitoring of the employer’s relationship with the plan and related options with a view to enhancing the company’s business position going forward. Included here might be calculations of the company’s withdrawal liability pre- and post-ARPA.
  4. Review and monitor the plan’s financial status, including its funding zone, and analyze the communications issued by the plan as to the issues facing it.
  5. Review the employer’s relations with its bargaining unit’s personnel and the union’s relationship with the plan. This might include clarification of the bargaining unit’s misunderstanding of the effect of SFA.
  6. Utilize legal counsel for matters that could involve issues with the employer’s continued relationship with the plan and the bargaining unit.
  7. Given the SFA’s heavy orientation to various actuarial rules affecting multiemployer plans, consider input from a management-side actuary who might provide technical analysis and other advice leading to options for negotiating with the bargaining unit or the plan as to future changes.
  8. Encourage the appropriate involvement of company personnel who have regular contact with the plan to ensure that any dealings with the plan are well coordinated.

In this unsettled time for financially troubled plans, contributing employers will be well served to be more rather than less focused on their employees’ multiemployer pension plans.

As featured in #WorkforceWednesday:  This week, we look at the renewed focus on mandatory vaccination policies and how those policies may need to shift in light of COVID-19 booster shots.

President Biden Calls on Employers to Mandate Vaccines

Shortly after the U.S. Food and Drug Administration granted full approval of the Pfizer vaccine for those 16 and older, President Biden encouraged private employers to “step up” their vaccination requirements.

COVID-19 Booster Shots Raise Employment Issues

Employers with mandatory vaccine policies must now decide whether they will also mandate the booster shots. Some may have to adjust the definition of terms like “fully vaccinated” and designate recommendations versus requirements.

EEOC Delays EEO-1 Collection Deadline

August 23rd would have been the deadline for submitting 2019 and 2020 EEO-1 Component 1 data. But on August 18th, the U.S. Equal Employment Opportunity Commission announced that it pushed the cutoff date to October 25, 2021.

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Video: YouTubeVimeo.
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Last week, a divided Massachusetts Supreme Judicial Court (“SJC”) in Osborne-Trussell v. Children’s Hospital Corp. ruled in favor of a broad interpretation of the 2014 Domestic Violence and Abuse Leave Act (“DVLA”), a law that provides certain employment protections for victims of domestic violence, including a prohibition against retaliation for seeking or using protected leave. Specifically, the DVLA prohibits an employer from taking adverse action against, or otherwise discriminating against, an employee who exercises rights under the DVLA, such as taking leave from work to seek or to obtain medical attention or legal assistance, or to go to court hearings stemming from the harassment or abuse. The DVLA also prohibits employers from interfering with an employee’s exercise, or attempted exercise, of these statutorily protected rights. For their part, employees are required to provide employers with “appropriate advance notice” of the leave associated with domestic violence and abuse.

The SJC’s decision interpreted, for the first time, two key components of the DVLA’s non-retaliation and non-interference provisions.  First, the SJC determined the DVLA’s definition of “employee” includes individuals who have been hired, even if they have not yet started working for the employer. Second, the SJC held for the DVLA’s protections to apply, employees do not need to explicitly or formally request leave, or to provide specific dates they will be out of work.   Rather, the SJC interpreted what qualifies as “appropriate” and “advance” notice of leave to include disclosures by employees that imply they may want to exercise their rights under the DVLA leave provisions at some point in the future.


Because the SJC addressed this issue in the context of a motion to dismiss, the SJC had to accept as true – and could only consider – the sufficiency of the factual allegations of the complaint.  The Defendant Children’s Hospital Corporation (doing business as Boston Children’s Hospital) (“CHC”) will have an opportunity to rebut the allegations as the case proceeds.

Plaintiff Kehle Osborne-Trussell is a registered nurse and the victim of “repeated stalking, threats, harassment, abuse, and overt threats.”  In December 2018, Ms. Osborne-Trussell obtained a harassment prevention order (“HPO”) against the abuser. The HPO barred the abuser from “directly or indirectly contacting [Ms. Osborne-Trussell], ordered [the abuser] to remain away from [Ms. Osborne-Trussell’s] home or place of work, and prohibited [the abuser] from making any social media postings that reference [Ms. Osborne-Trussell].”  In February 2019, after an application and interview process, Ms. Osborne-Trussell accepted a position as a staff nurse at CHC, which was to start in mid-March 2019.  CHC subsequently issued Ms. Osborne-Trussell a photograph identification card identifying her as a CHC “staff nurse,” provided her with a CHC employee identification number, and assigned her a training schedule.

Shortly thereafter, her abuser posted threats and false statements about her on social media, in violation of the HPO she obtained a few months prior. Ms. Osborne-Trussell reported the violation of the HPO to the Merrimac Police Department and CHC’s human resource department. CHC requested additional information about the abuser, and CHC’s human resources representative told Ms. Osborne-Trussell that he “intended to speak with [the abuser] to hear her side of the story.” Less than two weeks later, CHC sent Ms. Osborne-Trussell a termination letter stating that her “employment offer for the Staff Nurse position at Boston Children’s Hospital has been rescinded effective March 12, 2019” and that “the work clearance process is not able to be initiated, so we are unable to complete the onboarding process at this time.”

Ms. Osborne-Trussell subsequently filed a three-count complaint against CHC in the Superior Court, asserting that her termination violated the non-retaliation and noninterference provisions of the DVLA and public policy.  CHC moved to dismiss the claims arguing that Ms. Osborne-Trussell was not an “employee” under the DVLA because she had never commenced employment with the hospital. The hospital also argued that even if the DVLA applied, her claim should still be dismissed because she never requested leave related to the harassment by the abuser.

The Massachusetts Superior Court previously ruled that while Ms. Osborne-Trussell was CHC’s employee, she could not pursue a DVLA claim, because she never requested leave under the statute.


The SJC unanimously held that Ms. Osborne-Trussell, who had been hired by the hospital, but had not started work, qualified as an employee under the DVLA. The court explained, “[a] construction that excludes from the definition of ‘employees’ those who have accepted employment, but have not yet begun work would be directly contrary to the clear intent of the DVLA to allow employees to attend to the consequences of the abuse without risking loss of their jobs, and to prevent future harassment and abuse when victims step forward to confront their abusers.”

By a slim 4-3 margin, the SJC also held that Ms. Osborne-Trussell provided sufficient notice to trigger protections under the DVLA. The DVLA provides, “Except in cases of imminent danger to the health or safety of an employee, an employee seeking leave from work under this section shall provide appropriate advance notice of the leave to the employer as required by the employer’s leave policy.”

The SJC concluded that Ms. Osborne-Trussell provided “appropriate” and “advance” notice of leave by simply communicating a qualifying reason for leave being requested under the DVLA, namely, that her abuser had posted on social media about her in violation of the HPO and that she was working with law enforcement to enforce the provisions of the HPO. The SJC explained that this disclosure was sufficient, because it put the hospital on notice that, “while [Ms. Osborne-Trussell] did not then know of any specific date on which she would require leave, she might need to exercise the leave provisions of the DVLA and was invoking her rights to leave under it.”  The SJC further reasoned that holding otherwise would be at “odds with the remedial purposes of the DVLA to encourage appropriate advance notice” and that under the hospital’s “narrow view of the notice provision, an employer could preclude an employee from exercising the rights provided under the DVLA by preemptively terminating an employee who discloses her abuser’s violation of a protective order before a date certain for leave is known.”

Employer Takeaways

  • The definition of “employee” under the DVLA includes individuals that have not yet started work. According to the SJC’s decision, employees who have just been hired are immediately entitled to the protections of the DVLA.
  • An employee does not need to make explicit statements such as, “I request leave,” or request time off for a particular date to provide the requisite notice required by the DVLA. A simple disclosure that implies that the employee may need to exercise the leave provisions of the DVLA may be sufficient to trigger DVLA protections. Such statements should be interpreted on a case-by-case basis for possible protection under the DVLA.

This is the SJC’s first interpretation of the non-retaliation and non-interference provisions of the DVLA. We will continue to monitor court decisions for any additional interpretations of these provisions.

Washington, D.C. employers have more time to get their non-compete ducks in a row. On August 23, 2021, Mayor Bowser signed the Fiscal Year 2022 Budget Support Act of 2021 (B24-0373) (the “Support Act”), which includes various statutory changes necessary to implement the D.C. FY 2022 budget. As expected, the Support Act postpones the applicability date of the Ban on Non-Compete Agreements Amendment Act of 2020 (the “Non-Compete Act”) until April 1, 2022. The postponement not only provides more time for employers to prepare for the non-compete ban—it also permits the D.C. Council to continue its consideration of additional amendments to the Non-Compete Act. For a summary of those other possible changes, please see our recent post here.

The D.C. Council also passed the Fiscal Year 2022 Local Budget Act of 2021 (B24-275) (the “Local Budget Act”), which allocates $105,000 to the Department of Employee Services to fund the Non-Compete Act. The Local Budget Act is currently awaiting the Mayor’s signature, which is expected.

Mayor Bowser must now send the Support Act to Congress for the 30-day congressional review period required under the Home Rule Act. Once signed by the Mayor, the Local Budget Act will follow the same legislative process. Although Congress may alter D.C. budgets, it rarely chooses to do so. As such, D.C. employers should mark March 31, 2022 on their calendars as the last day (barring further action by the D.C. Council to amend or clarify the Non-Compete Act) that they can enter into a non-compete agreement with most employees.

As featured in #WorkforceWednesdayThis week, we look at new federal guidance recommending all employees wear masks in the workplace and unique vaccination considerations for unionized workplaces.

OSHA Updates COVID-19 Mask, Vaccination Guidance

The Occupational Safety and Health Administration (OSHA) recently updated its COVID-19 guidance, now recommending that all employees wear masks in the workplace, even if they’re vaccinated. Meanwhile, employers with unionized workforces face unique considerations with regard to vaccination polices. Attorneys Bob O’Hara and Neresa De Biasi tell us more.

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Podcast: Apple PodcastsGoogle PodcastsOvercastSpotifyStitcher.

New NLRB General Counsel’s Priorities and Enforcement Agenda

Jennifer Abruzzo, the new National Labor Relations Board (NLRB) general counsel, recently released her priorities and enforcement agenda. Abruzzo identified at least 40 different NLRB decisions and principles that she would like to “carefully examine” and undo. Read more.

Updates on Biometrics in the Workplace

There is a patchwork of privacy and cybersecurity laws employers must navigate when it comes to collecting biometric data. New York City recently joined California, Illinois, Texas, and Washington in proscribing notification requirements involving biometric identifying data. New York State is also considering a more robust statewide biometric privacy regulation additionally mandating consent, which, if passed, would be similar to extant laws in Illinois, Washington, and Texas. Learn more.

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