State and local legislatures considered over 1,000 labor and employment bills in February, more than 600 of them new. While only a handful of bills were enacted last month—including new $15 per hour minimum wage bills in New Jersey and Illinois—several dozen other bills advanced through at least one legislative house. Bills that moved include those aiming to restrict salary and criminal history inquiries, establish a system of paid family and medical leave insurance, and void agreements that conceal the details sexual harassment or assault claims. This month's State of the States will highlight bills that appear to have momentum, and flag a few noteworthy trends at the state level.

Salary History Inquiries and Equal Pay

In Illinois, a bill (HB 834) that would prohibit an employer from screening job applicants based on their wage or salary history has cleared a house committee. Last year, the Illinois legislature passed a similar bill, but former Governor Bruce Rauner (R) vetoed it. A Democrat now occupies the governor's office, so should this new bill advance that far, it could face a very different fate.

Like Illinois, Colorado now enjoys a Democratic trifecta following the November elections, meaning that party holds the governorship and majorities in both the state house and senate.  Bills deemed more worker-friendly will therefore have a greater chance of passage in these jurisdictions. This could include a salary history bill (SB 85) advancing in Colorado, which, like Illinois', would prevent an employer from seeking the wage rate history of a prospective employee. Colorado's bill would also prevent an employer from relying on a prior wage rate to set a current salary, discriminating or retaliating against a prospective employee for failing to disclose the employee's wage rate history, and discharging or retaliating against employees who assert their rights under the bill.  SB 85, which has cleared a senate committee, would also require an employer to announce to all employees employment advancement opportunities and job openings and the pay range for the openings.

A more pared-down salary history bill (HB 211) cleared New Hampshire's lower chamber in February. This bill would prohibit an employer from requiring a prospective employee to disclose his or her salary history prior to an offer of employment, or using an employee's prior wage and salary history as a defense to any action alleging pay discrimination under state law. 

A revised equal pay bill in West Virginia has advanced in the state's upper chamber. Senate Bill 412 would prevent employers from restricting salary discussion among co-workers, or requiring employees to sign a waiver of their rights to discuss compensation. The original bill included a ban on seeking salary history information, but that provision was amended out.

In another equal pay development, a newly enacted law in Wyoming (HB 71) raises the pay violations cap from $200 to $500 per offense.

Protected Time Off

Several bills across the country would either allow employees to accrue paid time off to care for themselves or a family member, create a family and medical leave insurance program, or strengthen existing paid leave entitlements. Some of these measures are advancing.

On February 19, 2019, New Jersey's governor signed into law a bill he says provides "the most expansive paid family leave time and benefits in the nation.” Assembly Bill 3975 revises and expands existing state law concerning family leave, temporary disability and family temporary disability leave, and domestic or sexual violence safety leave.¹ Some provisions take effect immediately, while others will be phased in over time.

Indiana’s and New Hampshire's senates have approved bills that would create family and medical leave insurance programs. Indiana's bill (SB 496) would create a voluntary family leave insurance program funded by payroll deductions. New Hampshire's bill (SB 1) would provide employees with up to 12 weeks of paid leave at up to 60% of a worker’s salary, paid for through a .5% payroll tax. An employee could not opt out of this program. Although Democrats, who have expressed support for this bill, compose the majority of New Hampshire's legislature, Governor Chris Sununu (R), along with Vermont Governor Phil Scott (R), have already unveiled a competing bill that would create a joint voluntary paid family leave plan for both New Hampshire and Vermont.

Regarding paid leave laws, a committee on Portland, Maine's city council approved an ordinance that would allow workers to earn one hour of paid sick leave for every 30 hours worked.  The measure will now be put before the full city council for a vote.

In contrast, a Texas senate committee has voted in favor of a preemption bill (SB 15) that would prevent cities from enacting their own laws requiring employers to provide paid leave, among other benefits.

In other protected time off news, Oklahoma's senate has approved a bill (SB 58) that would require employers to allow employees to vote on the day of the election or a day on which absentee voting is allowed by law.

Ban-the-Box

Bills limiting an employer's ability to inquire about an applicant's or employee's criminal history also made headway in February. New Mexico's senate approved SB 96, a bill that would prohibit private employers from including criminal history questions on job applications. Colorado's house advanced a similar bill (HB 1025). Such ban-the-box bills, or those otherwise limiting access to one's criminal history, are pending in at least 18 other states.

Sexual Harassment

Several states have introduced bills that would limit nondisclosure or arbitration agreements covering claims of sexual harassment, assault or discrimination. On February 22, Virginia Governor Ralph Northam signed HB 1820 into law. This bill, which is limited to claims of sexual assault, will add the following section to the state code:

No employer shall require an employee or a prospective employee to execute or renew any provision in a nondisclosure or confidentiality agreement that has the purpose or effect of concealing the details relating to a claim of sexual assault . . . as a condition of employment. Any such provision is against public policy and is void and unenforceable.

Other types of legislation seeking to combat sexual harassment and assault would impose mandatory training requirements on employers. A bill (SB 5258) that has cleared Washington state's senate, for example, would require employers to adopt a sexual harassment policy and provide training for certain "isolated" workers. The law would apply to:

every hotel, motel, retail, behavioral health, or custodial employer, or property services contractor, who employs a custodian, security guard, hotel or motel housekeeper, or room service employee who spends a majority of her or his working hours alone or whose primary work responsibility involves working without another coworker present, at a location that is not her or his home.

A pending bill (SB 330) in Rhode Island would require employers with four or more employees to conduct an anti-sexual harassment education and training program for new employees within one month of starting the job, and additional training for new supervisory and managerial employees.

Hairstyle Discrimination

On February 18, 2019, the New York City Commission on Human Rights (NYCCHR) released enforcement guidance to define discrimination based on natural hair and hairstyles as a subset of race discrimination.² The guidance advises employers that requirements around “maintaining a work appropriate appearance” are acceptable, but warns that policies “that ban, limit, or otherwise restrict natural hair or hairstyles associated with Black people generally violate the NYCHRL’s anti-discrimination provisions.” A similar measure (SB 188) is pending in California.

Other Discrimination

Portland, Oregon has amended its civil rights code to explain that its protection against religious discrimination “expressly includes non-religion, such as atheism, agnosticism, and non-belief in God or gods as has been recognized by the courts.” The city council found the change was needed "to clarify that disbelief, or lack of belief should be included in the protected class of 'Religion' in order to provide every individual an equal opportunity to participate fully in the life of the City." The law already includes protections against discrimination on the basis of race, religion, gender, and national origin in employment, housing, and accommodations.

In nearby Washington, a bill (SB 5165) that would extend anti-discrimination protections to individuals based on citizenship or immigration status has cleared the state senate.

Noncompete

Bills seeking to revise state law regarding employment noncompete agreements are pending in at least 17 states. The scope of these bills covers the gamut. One bill in Illinois, for example, would prohibit all noncompete agreements. Bills in Maine, Hawaii, and New Hampshire would prohibit such agreements for low-wage workers only. A bill in South Dakota would reduce to one year the maximum time period for noncompete covenants. While not many have moved so far, Maryland's state assembly has approved a bill (HB 38) that would provide that any non-compete agreement or conflict-of-interest provision in an agreement is null and void if it restricts the ability of an employee who earns $15 per hour or less (or $31,200 or less annually) to enter into employment with a new employer or become self-employed in the same or similar business or trade.

Joint Employment

While employers wait for the National Labor Relations Board to issue a rule defining joint employment under the National Labor Relations Act, some states are getting a jump on the issue. In February, Mississippi's lower chamber approved a bill (HB 1530) that would clarify that neither a franchisee, nor a franchisee's employee, shall be deemed to be an employee of the franchisor for any purpose. Missouri's state senate passed a nearly identical bill (SB 38). This bill, however, makes an exception if the franchisor exercises direct and immediate control over the hiring, termination, discipline, and direction of the franchisee's employees.

Employer-Mandated Vaccinations

A new legislative trend we're seeing this year is attempts to protect employees who refuse to be vaccinated. Some bills would make it a discriminatory practice for an employer to make an adverse employment decision based on the employee's unvaccinated status. Others would prevent employers from requiring vaccines as a condition of employment, while yet a third category would simply require employers to offer certain alternatives to vaccinations. In Montana, for example, the state senate approved a bill (SB 23) that would require employers to uniformly offer employees accommodations to employer-mandated vaccinations. Specifically, if an employer requires employees to be vaccinated against influenza or any other vaccine-preventable disease and offers alternative accommodations to certain employees for medical, religious, or other reasons, the employer must make the same alternative accommodations available to any employee at the employee's request.³

Big Data in Hiring

Employers are increasingly using artificial intelligence (AI) and "big data" as part of the hiring process. Using sophisticated algorithms to cull desirable job candidates can help reduce human error and bias in hiring. There is always a potential concern, however, with so-called "algorithmic bias"—the idea that humans who design the algorithms can inadvertently build their own unconscious biases into the process, which could negatively impact a particular candidate group. This potential downside has not gone unnoticed. Two bills recently introduced in Illinois, for example, would amend the state's Equal Pay Act and the Consumer Fraud and Deceptive Business Practices Act to provide that when using predictive data analytics in determining creditworthiness or in making hiring decisions, the use of predictive data analytics may not include information that correlates with the applicant's race or zip code. Illinois HB 2991 and HB 3415 both define "predictive data analytics" as the use of automated machine learning algorithms for the purpose of statistically analyzing a person's behavior.

If either bill were to become law, an employer that uses predictive data analytics to evaluate job applicants and that hires more than 50 employees in a calendar year who are Illinois residents must, within 90 days of enactment, devise procedures to ensure that it does not inadvertently consider information that correlates with race or zip code when making a hiring decision.

Neither bill has advanced thus far, but they are worth noting as the use of big data in hiring grows.

What's Next?

Expect the deluge of new bills to continue its gradual slowdown over the next month. Instead, lawmakers will focus on the bills already before them. Significantly more bills will be enacted at the state level in March compared to February. Illinois, New Jersey and New York are a few of the states to watch, as labor and employment bills seem to be advancing rapidly in those jurisdictions. Stay tuned.

For more information on wage and hour developments over the past month, see this month's edition of WPI Wage Watch.⁴