Assignment Prompt & Instructions
– ## EmploymentLawHRM6302UnitVDB.docx
– ## UnitVStudyGuide.pdf
**## EmploymentLawHRM6302UnitVDB.docx**
2
Employment Law HRM 6302 Unit I DB
Initial posts should be a minimum of 400 words and use at least two supporting references. You can use the text for this course as one of the reference sources.
**Part I:**
Under the Federal Arbitration Act (FAA), employers can require their employees to sign forced (mandatory) arbitration clauses in their contracts. How does forced arbitration affect the average employee? What are some other ways these forced arbitration clauses are used?
Evaluate the benefits for an employer from the HR management perspective. Do you agree or disagree with the idea of employers using forced arbitration in their contracts? Why or why not?
**Part II:**
Identify one of the ideas you shared in the Unit I Discussion Board. What have you learned about the topic in the course to this point. Why?
Continue to track your list throughout and make notes about what you learn in each unit. Identify a related statute, case, law, current event, or situation. You can use this information to help compose the Unit VIII Journal assignment.
**Unit I Discussion Board**
Employment law is dynamic and complex, governing employer-employee relations. This law regulates worker classification, rights and protections, and how organizations can legally structure employment relationships. Employment-at-will, which permits employers to fire workers for any cause and workers to quit, is a key tenet in U.S. employment law (Varner & Schmidt, 2022). However, statutory safeguards, judicial rulings, and contractual responsibilities have created several exceptions to at-will employment, as the Unit I study materials demonstrate. This mix of flexibility and regulation shows why HR managers must study employment law to manage risks and achieve organizational goals.
**Part II: Five Employment Law Topics of Interest**
There are several areas of employment law I would like to learn more about throughout this course, each of which carries significant implications for both employers and workers:
1.
**Worker Classification (Employee vs. Independent Contractor):** The rise of the gig economy, such as Uber and Lyft, makes this topic especially timely. Understanding how courts determine classification affects wages, benefits, and legal protections.
1.
**Discrimination in Employment:** Laws such as Title VII, the ADA, and the ADEA provide critical protections, yet discrimination cases remain prevalent. Exploring how these laws evolve with workplace diversity is essential.
1.
**Employee Benefits and Rights:** Benefits such as health insurance, retirement plans, and leave policies are central to attracting and retaining workers, and I want to learn how regulations like ERISA shape employer obligations.
1.
**Class Action Lawsuits in Employment:** As highlighted in the Uber litigation, class actions are a powerful tool for addressing systemic employment violations. I want to explore how arbitration agreements impact access to collective remedies.
1.
**Unions and Collective Bargaining:** Although union membership has declined in the U.S., collective bargaining remains influential in many industries. I want to examine how labor laws interact with modern workplace practices.
From a classmate’s list, I would likely choose workplace privacy and technology if mentioned. This is because technology has blurred the lines between personal and professional spaces, raising new questions about surveillance, remote work monitoring, and social media policies. Unlike the traditional issues I listed, workplace privacy is rapidly evolving, and I believe it will become increasingly central to employment law discussions in the years ahead.
**Part III: Personal Reflection on Worker Classification**
My close friend was an independent contractor for a marketing company that hired contingent labor for short-term projects. Contractors did not receive health insurance, retirement benefits, or paid leave (Lester et al., 2021). Employee contracts could be terminated at any time without procedural safeguards. This allowed the corporation to scale its workforce based on client demand, but it put workers in charge of taxes, health insurance, and job security.
The positives for workers included greater assignment freedom and better hourly compensation than ordinary employees. Long-term instability, alienation from business culture, and limited legal safeguards under numerous employment regulations like anti-discrimination and overtime rules were major drawbacks (Fauzi et al., 2024). This case shows how misclassifying workers can deprive them of vital protections and expose companies to legal risk.
In conclusion, Unit I stressed the necessity of understanding at-will employment, worker classification, and the changing regulatory environment. As the Uber case shows, old legal categories often fail to match modern employment, causing problems for businesses, employees, and HR specialists. I intend to learn how to identify legal hazards and implement practical solutions by studying these issues in depth, which is crucial for efficient HR management.
**References**
Fauzi, F. A., Hi, B., & Irawan, A. (2024). The Evolution of Employment Law and Its Impact on Workplace Dynamics.
_Advances in Human Resource Management Research_,
_2_(1), 1–10. https://doi.org/10.60079/ahrmr.v2i1.184
Lester, G. V., Brock Baskin, M. E., & Clinton, M. S. (2021). Employer-Sponsored benefits in the united states: The past, present, and future.
_Compensation & Benefits Review_,
_53_(1), 088636872094760. https://doi.org/10.1177/0886368720947609
Varner, K., & Schmidt, K. (2022). Employment-at-Will in the United States and the Challenges of Remote Work in the Time of COVID-19.
_Laws_,
_11_(2), 29. https://doi.org/10.3390/laws11020029
**## UnitVStudyGuide.pdf**
HRM 6302, Employment Law 1
Course Learning Outcomes for Unit V
Upon completion of this unit, students should be able to:
1. Discuss the legal significance of the employer-employee relationship.
1.1 Explain the regulation of wages and hours under the Fair Labor Standards Act (FLSA).
1.2 Assess the legal issues surrounding FLSA that employers face.
4. Characterize conduct that violates federal anti-discrimination laws in employment.
4.1 Determine the elements of a prima facie case of pay discrimination under the Equal Pay Act.
Required Unit Resources
Chapter 11: Wages, Hours, and Pay Equity, pp. 417–456
Unit Lesson
In a 2013 survey by the Society for Human Resource Management (SHRM as cited in Miller, 2014), 60
percent of employees rated pay as “very important” and 36 percent rated it as “important.” These ratings
made pay the top contributor to overall job satisfaction, surpassing job security.
While pay may not always take the top spot in survey results such as the SHRM survey, pay is usually much
higher among the leadership of an organization, and the significance and sometimes disparity of pay in the
employer-employee relationship cannot be refuted (Miller, 2014). Employees rely on compensation to support
themselves and their families. Employers have an interest in holding expenses down, including pay, but must
pay what the market requires for talent that drives the organization’s success. Employees want equitable pay
relative to their coworkers and commensurate with their skills. Employers must navigate complex legal
regulation of wages and hours, as individual states become more active in adding regulations and
requirements to existing federal law.
As pay and compensation is an issue that
affects every worker in an organization,
human resources must play a key role in
setting policy and insuring practices are
fair and compliant. At the federal level
alone, there are five laws that address
compensation and equal pay. Title VII of
the Civil Rights Act of 1964 prohibits
discrimination based on race, color,
national origin, gender, and religion in pay
and pay-related terms of employment,
including promotion and job placement.
The first bill signed into law by President
Obama was the Lilly Ledbetter Fair Pay
Act of 2009. It addressed the situation
where the discriminatory act that caused
an employee in a protected category to be
paid less than a similarly situated
coworker but was unaware of the disparity
until it was too late to sue. This law
UNIT V STUDY GUIDE
Wages and Hours
President Obama signs into law the Lilly Ledbetter Act on
January 29, 2009.
HRM 6302, Employment Law 2
UNIT x STUDY GUIDE
Title
provides that each paycheck of discriminatory wages is a violation of Title VII.
Title VII addresses wage discrimination based on any protected status. However, as women have grown to
comprise almost half of the U.S. workforce, equal pay as a gender issue has garnered a great deal of
attention. Despite the passage in 1963 of the third federal law addressing pay, and specifically pay for women
relative to men, women on average earn 79 cents of every dollar earned by men (U.S. Equal Employment
Opportunity Commission [EEOC], 2016). The Equal Pay Act requires that employers pay men and women
equally in the same establishment when they perform jobs that require the same skill, effort, and
responsibility, and when the job is performed under similar working conditions. Employers can defend pay
differences by proving that pay differences are seniority-based, established with a merit or incentive system,
or a factor other than sex, such as education or training relevant to the job (EEOC, 1997).
Equal Pay Act cases tend to be hard to prove, often because of the broad range of factors that can be a factor
other than sex. Often, employers chalk up salary differentials to negotiation skills. However, in a federal
appeals court case, the court held that an employer is not allowed to satisfy its obligation of proving a wage
disparity was based on a factor other than sex by showing that the male negotiated a higher salary (Drum v.
Leeson Electric Corp., 2009). A female human resource manager was promoted into another position and her
male replacement negotiated a salary $20,000 more than the female had been paid. The court held that the
employer had not justified the difference in the two employees’ pay. The court also rejected the employer’s
argument that the replacement was hired under a new salary structure that was tied to market rates, while the
female employee had been hired under an earlier policy that set pay at slightly below market. Employers
should therefore be cautious in allowing negotiation to create a salary disparity unless there are also skills,
experience, or some other objective factor not related to sex that justify a difference. Further, if a higher rate
of pay for a successor is desired, the employer should consider making salary adjustments for employees in
the same position.
As part of the efforts to investigate and identify potential pay discrimination, EEOC has adopted a new EEO-1
Report requiring employers with more than 100 employees to submit pay information. In addition, employers
must report hours worked by employees in each job category and pay band. Actual hours worked must be
reported for nonexempt employees, and for exempt employees, who generally do not track their hours,
employers may use 40 hours per week for full-time and 20 hours per week for part-time employees, or
provide actual hours if the hours are tracked (EEO-1 Joint Reporting Committee, n.d.).
The other federal laws that address pay discrimination are the National Labor Relations Act (NLRA) and
Executive Orders (EO) applicable to federal contractors. The NLRA prohibits employers from taking adverse
action against non-supervisory employees for discussing their wages or other working conditions with
coworkers, even if there is no union involved. The issues under this law are discussed in another unit. For
federal contractors, EO 11246 mirrors Title VII by prohibiting pay and other discriminations by federal
contractors and subcontractors. The Obama Administration increased regulation of federal contractors
through EO 13665, which became effective in January 2016, prohibiting firing or discriminating against
employees and applicants who ask about, discuss, or disclose their own pay or that of another employee or
applicant. Additionally, EO 13673 requires that effective January 2017, federal contractors must provide a
“paycheck transparency” notice to all workers on a weekly basis specifying the hours and overtime hours
worked for nonexempt employees, rate of pay, gross pay, and itemized additions to or deductions from gross
pay (Executive Order No. 13665, 2014).
The action in the pay equity area has by no means been limited to the federal government. Several states
have enacted tough laws on fair pay that go beyond the Equal Pay Act, and more states are expected to
follow. California, New York, Maryland, and Massachusetts led the way with new laws that broaden the
definition of jobs that are regarded as comparable for purposes of comparing the pay of males and females.
The standard used is substantially similar as opposed to the substantially equal standard under the Equal Pay
Act.
Employers must continue to work to ensure that pay remains a positive term of employment and not subject
to challenge by federal or state agencies or the employer’s workers. HR professionals must review pay
practices, identify any issues, and correct areas of pay disparity. Pay in some areas may need to be adjusted
upward to rectify areas of inequality. These costs will be lower than the legal and public relations costs of
being sued for pay discrimination.
HRM 6302, Employment Law 3
UNIT x STUDY GUIDE
Title
The federal Fair Labor Standards Act also regulates wages and hours. This is an area especially fraught with
risk for employers; wage and hour cases are the most active types of litigation in the area of employment law.
According to Vehling (2016), litigation in this area has exploded since 2000, and the number of cases have
increased every year to a high of almost 9,000 filings in 2015. Issues that fuel this explosion in litigation
include minimum-wage rate hikes passed by many states and municipalities, issues related to independent
contractor classification, and joint employer issues.
There are many hot areas in the wage and hour realm, and one of those is the use of unpaid interns. The
DOL uses a restrictive six-factor test to determine if the intern is appropriately unpaid. Appellate courts have
recently rejected this test in favor of a primary beneficiary test, which applies flexible factors to determine the
primary beneficiary of the interns’ work – the organization or the individual. Key factors that an employer
should consider in designing an intern program include a duration that is not excessive in terms of the period
of beneficial learning and the displacement of paid employees by the intern so that interns are not doing work
that would otherwise be done by paid workers.
Perhaps the most significant development in the wage and hour area in decades was derailed in 2016 after a
federal judge issued a preliminary injunction just days before new regulations were initially set to become
effective on December 1, 2016. The new rules were set to make more than 4 million exempt employees
eligible for overtime pay. Under existing rules, employees who make up to $23,660 annually and engage in
work that is exempt under the administrative, professional, or executive exemptions do not have to be paid
overtime. The new rules would have required that an employee must make at least $47,476 per year and
perform exempt work to avoid having to be paid overtime pay. Further, the $47,476 amount was to increase
every three years to keep pace with inflation. However, a federal court prevented the regulation from going
into effect and put the future of the regulation into question when it ruled that the “significant increase to the
salary level creates essentially a de facto salary-only test” (State of Nevada, et al v. United States Department
of Labor, et al, 2016, p. 14). In that case, the court held that “Congress did not intend salary to categorically
exclude an employee with EAP [executive, administrative, and professional] duties from the exemption” (p.
14). This regulation, or another version of this regulation, may still be considered and implemented in the
future.
In the busy areas of employment law that relate to pay and hours worked, HR professionals must stay
updated on recent developments, ahead of regulators, and in tune with the needs and goals of applicants and
workers.
References
Boghosian, J. (2009, January 29). Lilly Ledbetter Fair Pay Act signing [Photograph]. The White House:
President Barack Obama. https://obamawhitehouse.archives.gov/photos-and-video/photos/lilly-
ledbetter-fair-pay-act-signing
Drum v. Leeson Elec. Corp., 565 F.3d 1071 (8th Cir. 2009).
EEO-1 Joint Reporting Committee. (n.d.). Standard Form 100, Rev/ March 2018, Employer information report
EEO-1 instruction booklet. https://www.eeoc.gov/employers/eeo1survey/2017survey-instructions.cfm
Executive Order No. 13665, 79 Fed. Reg. 20749 (Apr. 11, 2014).
Miller, S. (2014, May 12). Why pay is driving employee satisfaction. Society for Human Resource
Management. https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/pay-drives-
satisfaction.aspx
State of Nevada, et al v. United States Department of Labor State of Nevada, et al v. United States
Department of Labor, Civil Action No. 4:16-CV-00731 (E.D. Tex. 2016).
U.S. Equal Employment Opportunity Commission. (1997, January 15). Facts about equal pay and
compensation discrimination. https://www.eeoc.gov/eeoc/publications/fs-epa.cfm
HRM 6302, Employment Law 4
UNIT x STUDY GUIDE
Title
U.S. Equal Employment Opportunity Commission. (2016, March 16). Written testimony of Lisa M. Maatz Vice
President of Government Relations American Association of University Women.
https://www.eeoc.gov/eeoc/meetings/3-16-16/maatz.cfm
Vehling, A. (2016, January 12). FLSA class actions to hit record high in 2016. Law360.
http://www.law360.com/articles/745603/flsa-class-actions-to-hit-record-high-in-2016
Suggested Unit Resources
In order to access the following resources, click the links below.
The following PowerPoint presentation supplements the textbook chapter reading and is provided for further
knowledge and review of the unit materials.
Chapter 11 presentation (PowerPoint) or Chapter 11 presentation (PDF)
Learning Activities (Nongraded)
Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit
them. If you have questions, contact your instructor for further guidance and information.
At the end of each chapter of your textbook, scenario-driven questions provide legal issues and realistic
situations that relate to employment law. Exploring these questions allows you the opportunity to further your
understanding of the concepts in each chapter and prepares you for similar situations you may encounter in
your workplace.
• Review the Chapter 11 questions in your textbook on pages 458–459.
**## UnitVStudyGuide.pdf**
HRM 6302, Employment Law 1
Course Learning Outcomes for Unit V
Upon completion of this unit, students should be able to:
1. Discuss the legal significance of the employer-employee relationship.
1.1 Explain the regulation of wages and hours under the Fair Labor Standards Act (FLSA).
1.2 Assess the legal issues surrounding FLSA that employers face.
4. Characterize conduct that violates federal anti-discrimination laws in employment.
4.1 Determine the elements of a prima facie case of pay discrimination under the Equal Pay Act.
Required Unit Resources
Chapter 11: Wages, Hours, and Pay Equity, pp. 417–456
Unit Lesson
In a 2013 survey by the Society for Human Resource Management (SHRM as cited in Miller, 2014), 60
percent of employees rated pay as “very important” and 36 percent rated it as “important.” These ratings
made pay the top contributor to overall job satisfaction, surpassing job security.
While pay may not always take the top spot in survey results such as the SHRM survey, pay is usually much
higher among the leadership of an organization, and the significance and sometimes disparity of pay in the
employer-employee relationship cannot be refuted (Miller, 2014). Employees rely on compensation to support
themselves and their families. Employers have an interest in holding expenses down, including pay, but must
pay what the market requires for talent that drives the organization’s success. Employees want equitable pay
relative to their coworkers and commensurate with their skills. Employers must navigate complex legal
regulation of wages and hours, as individual states become more active in adding regulations and
requirements to existing federal law.
As pay and compensation is an issue that
affects every worker in an organization,
human resources must play a key role in
setting policy and insuring practices are
fair and compliant. At the federal level
alone, there are five laws that address
compensation and equal pay. Title VII of
the Civil Rights Act of 1964 prohibits
discrimination based on race, color,
national origin, gender, and religion in pay
and pay-related terms of employment,
including promotion and job placement.
The first bill signed into law by President
Obama was the Lilly Ledbetter Fair Pay
Act of 2009. It addressed the situation
where the discriminatory act that caused
an employee in a protected category to be
paid less than a similarly situated
coworker but was unaware of the disparity
until it was too late to sue. This law
UNIT V STUDY GUIDE
Wages and Hours
President Obama signs into law the Lilly Ledbetter Act on
January 29, 2009.
HRM 6302, Employment Law 2
UNIT x STUDY GUIDE
Title
provides that each paycheck of discriminatory wages is a violation of Title VII.
Title VII addresses wage discrimination based on any protected status. However, as women have grown to
comprise almost half of the U.S. workforce, equal pay as a gender issue has garnered a great deal of
attention. Despite the passage in 1963 of the third federal law addressing pay, and specifically pay for women
relative to men, women on average earn 79 cents of every dollar earned by men (U.S. Equal Employment
Opportunity Commission [EEOC], 2016). The Equal Pay Act requires that employers pay men and women
equally in the same establishment when they perform jobs that require the same skill, effort, and
responsibility, and when the job is performed under similar working conditions. Employers can defend pay
differences by proving that pay differences are seniority-based, established with a merit or incentive system,
or a factor other than sex, such as education or training relevant to the job (EEOC, 1997).
Equal Pay Act cases tend to be hard to prove, often because of the broad range of factors that can be a factor
other than sex. Often, employers chalk up salary differentials to negotiation skills. However, in a federal
appeals court case, the court held that an employer is not allowed to satisfy its obligation of proving a wage
disparity was based on a factor other than sex by showing that the male negotiated a higher salary (Drum v.
Leeson Electric Corp., 2009). A female human resource manager was promoted into another position and her
male replacement negotiated a salary $20,000 more than the female had been paid. The court held that the
employer had not justified the difference in the two employees’ pay. The court also rejected the employer’s
argument that the replacement was hired under a new salary structure that was tied to market rates, while the
female employee had been hired under an earlier policy that set pay at slightly below market. Employers
should therefore be cautious in allowing negotiation to create a salary disparity unless there are also skills,
experience, or some other objective factor not related to sex that justify a difference. Further, if a higher rate
of pay for a successor is desired, the employer should consider making salary adjustments for employees in
the same position.
As part of the efforts to investigate and identify potential pay discrimination, EEOC has adopted a new EEO-1
Report requiring employers with more than 100 employees to submit pay information. In addition, employers
must report hours worked by employees in each job category and pay band. Actual hours worked must be
reported for nonexempt employees, and for exempt employees, who generally do not track their hours,
employers may use 40 hours per week for full-time and 20 hours per week for part-time employees, or
provide actual hours if the hours are tracked (EEO-1 Joint Reporting Committee, n.d.).
The other federal laws that address pay discrimination are the National Labor Relations Act (NLRA) and
Executive Orders (EO) applicable to federal contractors. The NLRA prohibits employers from taking adverse
action against non-supervisory employees for discussing their wages or other working conditions with
coworkers, even if there is no union involved. The issues under this law are discussed in another unit. For
federal contractors, EO 11246 mirrors Title VII by prohibiting pay and other discriminations by federal
contractors and subcontractors. The Obama Administration increased regulation of federal contractors
through EO 13665, which became effective in January 2016, prohibiting firing or discriminating against
employees and applicants who ask about, discuss, or disclose their own pay or that of another employee or
applicant. Additionally, EO 13673 requires that effective January 2017, federal contractors must provide a
“paycheck transparency” notice to all workers on a weekly basis specifying the hours and overtime hours
worked for nonexempt employees, rate of pay, gross pay, and itemized additions to or deductions from gross
pay (Executive Order No. 13665, 2014).
The action in the pay equity area has by no means been limited to the federal government. Several states
have enacted tough laws on fair pay that go beyond the Equal Pay Act, and more states are expected to
follow. California, New York, Maryland, and Massachusetts led the way with new laws that broaden the
definition of jobs that are regarded as comparable for purposes of comparing the pay of males and females.
The standard used is substantially similar as opposed to the substantially equal standard under the Equal Pay
Act.
Employers must continue to work to ensure that pay remains a positive term of employment and not subject
to challenge by federal or state agencies or the employer’s workers. HR professionals must review pay
practices, identify any issues, and correct areas of pay disparity. Pay in some areas may need to be adjusted
upward to rectify areas of inequality. These costs will be lower than the legal and public relations costs of
being sued for pay discrimination.
HRM 6302, Employment Law 3
UNIT x STUDY GUIDE
Title
The federal Fair Labor Standards Act also regulates wages and hours. This is an area especially fraught with
risk for employers; wage and hour cases are the most active types of litigation in the area of employment law.
According to Vehling (2016), litigation in this area has exploded since 2000, and the number of cases have
increased every year to a high of almost 9,000 filings in 2015. Issues that fuel this explosion in litigation
include minimum-wage rate hikes passed by many states and municipalities, issues related to independent
contractor classification, and joint employer issues.
There are many hot areas in the wage and hour realm, and one of those is the use of unpaid interns. The
DOL uses a restrictive six-factor test to determine if the intern is appropriately unpaid. Appellate courts have
recently rejected this test in favor of a primary beneficiary test, which applies flexible factors to determine the
primary beneficiary of the interns’ work – the organization or the individual. Key factors that an employer
should consider in designing an intern program include a duration that is not excessive in terms of the period
of beneficial learning and the displacement of paid employees by the intern so that interns are not doing work
that would otherwise be done by paid workers.
Perhaps the most significant development in the wage and hour area in decades was derailed in 2016 after a
federal judge issued a preliminary injunction just days before new regulations were initially set to become
effective on December 1, 2016. The new rules were set to make more than 4 million exempt employees
eligible for overtime pay. Under existing rules, employees who make up to $23,660 annually and engage in
work that is exempt under the administrative, professional, or executive exemptions do not have to be paid
overtime. The new rules would have required that an employee must make at least $47,476 per year and
perform exempt work to avoid having to be paid overtime pay. Further, the $47,476 amount was to increase
every three years to keep pace with inflation. However, a federal court prevented the regulation from going
into effect and put the future of the regulation into question when it ruled that the “significant increase to the
salary level creates essentially a de facto salary-only test” (State of Nevada, et al v. United States Department
of Labor, et al, 2016, p. 14). In that case, the court held that “Congress did not intend salary to categorically
exclude an employee with EAP [executive, administrative, and professional] duties from the exemption” (p.
14). This regulation, or another version of this regulation, may still be considered and implemented in the
future.
In the busy areas of employment law that relate to pay and hours worked, HR professionals must stay
updated on recent developments, ahead of regulators, and in tune with the needs and goals of applicants and
workers.
References
Boghosian, J. (2009, January 29). Lilly Ledbetter Fair Pay Act signing [Photograph]. The White House:
President Barack Obama. https://obamawhitehouse.archives.gov/photos-and-video/photos/lilly-
ledbetter-fair-pay-act-signing
Drum v. Leeson Elec. Corp., 565 F.3d 1071 (8th Cir. 2009).
EEO-1 Joint Reporting Committee. (n.d.). Standard Form 100, Rev/ March 2018, Employer information report
EEO-1 instruction booklet. https://www.eeoc.gov/employers/eeo1survey/2017survey-instructions.cfm
Executive Order No. 13665, 79 Fed. Reg. 20749 (Apr. 11, 2014).
Miller, S. (2014, May 12). Why pay is driving employee satisfaction. Society for Human Resource
Management. https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/pay-drives-
satisfaction.aspx
State of Nevada, et al v. United States Department of Labor State of Nevada, et al v. United States
Department of Labor, Civil Action No. 4:16-CV-00731 (E.D. Tex. 2016).
U.S. Equal Employment Opportunity Commission. (1997, January 15). Facts about equal pay and
compensation discrimination. https://www.eeoc.gov/eeoc/publications/fs-epa.cfm
HRM 6302, Employment Law 4
UNIT x STUDY GUIDE
Title
U.S. Equal Employment Opportunity Commission. (2016, March 16). Written testimony of Lisa M. Maatz Vice
President of Government Relations American Association of University Women.
https://www.eeoc.gov/eeoc/meetings/3-16-16/maatz.cfm
Vehling, A. (2016, January 12). FLSA class actions to hit record high in 2016. Law360.
http://www.law360.com/articles/745603/flsa-class-actions-to-hit-record-high-in-2016
Suggested Unit Resources
In order to access the following resources, click the links below.
The following PowerPoint presentation supplements the textbook chapter reading and is provided for further
knowledge and review of the unit materials.
Chapter 11 presentation (PowerPoint) or Chapter 11 presentation (PDF)
Learning Activities (Nongraded)
Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit
them. If you have questions, contact your instructor for further guidance and information.
At the end of each chapter of your textbook, scenario-driven questions provide legal issues and realistic
situations that relate to employment law. Exploring these questions allows you the opportunity to further your
understanding of the concepts in each chapter and prepares you for similar situations you may encounter in
your workplace.
• Review the Chapter 11 questions in your textbook on pages 458–459.
**## EmploymentLawHRM6302UnitVDB.docx**
2
Employment Law HRM 6302 Unit I DB
Initial posts should be a minimum of 400 words and use at least two supporting references. You can use the text for this course as one of the reference sources.
**Part I:**
Under the Federal Arbitration Act (FAA), employers can require their employees to sign forced (mandatory) arbitration clauses in their contracts. How does forced arbitration affect the average employee? What are some other ways these forced arbitration clauses are used?
Evaluate the benefits for an employer from the HR management perspective. Do you agree or disagree with the idea of employers using forced arbitration in their contracts? Why or why not?
**Part II:**
Identify one of the ideas you shared in the Unit I Discussion Board. What have you learned about the topic in the course to this point. Why?
Continue to track your list throughout and make notes about what you learn in each unit. Identify a related statute, case, law, current event, or situation. You can use this information to help compose the Unit VIII Journal assignment.
**Unit I Discussion Board**
Employment law is dynamic and complex, governing employer-employee relations. This law regulates worker classification, rights and protections, and how organizations can legally structure employment relationships. Employment-at-will, which permits employers to fire workers for any cause and workers to quit, is a key tenet in U.S. employment law (Varner & Schmidt, 2022). However, statutory safeguards, judicial rulings, and contractual responsibilities have created several exceptions to at-will employment, as the Unit I study materials demonstrate. This mix of flexibility and regulation shows why HR managers must study employment law to manage risks and achieve organizational goals.
**Part II: Five Employment Law Topics of Interest**
There are several areas of employment law I would like to learn more about throughout this course, each of which carries significant implications for both employers and workers:
1.
**Worker Classification (Employee vs. Independent Contractor):** The rise of the gig economy, such as Uber and Lyft, makes this topic especially timely. Understanding how courts determine classification affects wages, benefits, and legal protections.
1.
**Discrimination in Employment:** Laws such as Title VII, the ADA, and the ADEA provide critical protections, yet discrimination cases remain prevalent. Exploring how these laws evolve with workplace diversity is essential.
1.
**Employee Benefits and Rights:** Benefits such as health insurance, retirement plans, and leave policies are central to attracting and retaining workers, and I want to learn how regulations like ERISA shape employer obligations.
1.
**Class Action Lawsuits in Employment:** As highlighted in the Uber litigation, class actions are a powerful tool for addressing systemic employment violations. I want to explore how arbitration agreements impact access to collective remedies.
1.
**Unions and Collective Bargaining:** Although union membership has declined in the U.S., collective bargaining remains influential in many industries. I want to examine how labor laws interact with modern workplace practices.
From a classmate’s list, I would likely choose workplace privacy and technology if mentioned. This is because technology has blurred the lines between personal and professional spaces, raising new questions about surveillance, remote work monitoring, and social media policies. Unlike the traditional issues I listed, workplace privacy is rapidly evolving, and I believe it will become increasingly central to employment law discussions in the years ahead.
**Part III: Personal Reflection on Worker Classification**
My close friend was an independent contractor for a marketing company that hired contingent labor for short-term projects. Contractors did not receive health insurance, retirement benefits, or paid leave (Lester et al., 2021). Employee contracts could be terminated at any time without procedural safeguards. This allowed the corporation to scale its workforce based on client demand, but it put workers in charge of taxes, health insurance, and job security.
The positives for workers included greater assignment freedom and better hourly compensation than ordinary employees. Long-term instability, alienation from business culture, and limited legal safeguards under numerous employment regulations like anti-discrimination and overtime rules were major drawbacks (Fauzi et al., 2024). This case shows how misclassifying workers can deprive them of vital protections and expose companies to legal risk.
In conclusion, Unit I stressed the necessity of understanding at-will employment, worker classification, and the changing regulatory environment. As the Uber case shows, old legal categories often fail to match modern employment, causing problems for businesses, employees, and HR specialists. I intend to learn how to identify legal hazards and implement practical solutions by studying these issues in depth, which is crucial for efficient HR management.
**References**
Fauzi, F. A., Hi, B., & Irawan, A. (2024). The Evolution of Employment Law and Its Impact on Workplace Dynamics.
_Advances in Human Resource Management Research_,
_2_(1), 1–10. https://doi.org/10.60079/ahrmr.v2i1.184
Lester, G. V., Brock Baskin, M. E., & Clinton, M. S. (2021). Employer-Sponsored benefits in the united states: The past, present, and future.
_Compensation & Benefits Review_,
_53_(1), 088636872094760. https://doi.org/10.1177/0886368720947609
Varner, K., & Schmidt, K. (2022). Employment-at-Will in the United States and the Challenges of Remote Work in the Time of COVID-19.
_Laws_,
_11_(2), 29. https://doi.org/10.3390/laws11020029
**## UnitVStudyGuide.pdf**
HRM 6302, Employment Law 1
Course Learning Outcomes for Unit V
Upon completion of this unit, students should be able to:
1. Discuss the legal significance of the employer-employee relationship.
1.1 Explain the regulation of wages and hours under the Fair Labor Standards Act (FLSA).
1.2 Assess the legal issues surrounding FLSA that employers face.
4. Characterize conduct that violates federal anti-discrimination laws in employment.
4.1 Determine the elements of a prima facie case of pay discrimination under the Equal Pay Act.
Required Unit Resources
Chapter 11: Wages, Hours, and Pay Equity, pp. 417–456
Unit Lesson
In a 2013 survey by the Society for Human Resource Management (SHRM as cited in Miller, 2014), 60
percent of employees rated pay as “very important” and 36 percent rated it as “important.” These ratings
made pay the top contributor to overall job satisfaction, surpassing job security.
While pay may not always take the top spot in survey results such as the SHRM survey, pay is usually much
higher among the leadership of an organization, and the significance and sometimes disparity of pay in the
employer-employee relationship cannot be refuted (Miller, 2014). Employees rely on compensation to support
themselves and their families. Employers have an interest in holding expenses down, including pay, but must
pay what the market requires for talent that drives the organization’s success. Employees want equitable pay
relative to their coworkers and commensurate with their skills. Employers must navigate complex legal
regulation of wages and hours, as individual states become more active in adding regulations and
requirements to existing federal law.
As pay and compensation is an issue that
affects every worker in an organization,
human resources must play a key role in
setting policy and insuring practices are
fair and compliant. At the federal level
alone, there are five laws that address
compensation and equal pay. Title VII of
the Civil Rights Act of 1964 prohibits
discrimination based on race, color,
national origin, gender, and religion in pay
and pay-related terms of employment,
including promotion and job placement.
The first bill signed into law by President
Obama was the Lilly Ledbetter Fair Pay
Act of 2009. It addressed the situation
where the discriminatory act that caused
an employee in a protected category to be
paid less than a similarly situated
coworker but was unaware of the disparity
until it was too late to sue. This law
UNIT V STUDY GUIDE
Wages and Hours
President Obama signs into law the Lilly Ledbetter Act on
January 29, 2009.
HRM 6302, Employment Law 2
UNIT x STUDY GUIDE
Title
provides that each paycheck of discriminatory wages is a violation of Title VII.
Title VII addresses wage discrimination based on any protected status. However, as women have grown to
comprise almost half of the U.S. workforce, equal pay as a gender issue has garnered a great deal of
attention. Despite the passage in 1963 of the third federal law addressing pay, and specifically pay for women
relative to men, women on average earn 79 cents of every dollar earned by men (U.S. Equal Employment
Opportunity Commission [EEOC], 2016). The Equal Pay Act requires that employers pay men and women
equally in the same establishment when they perform jobs that require the same skill, effort, and
responsibility, and when the job is performed under similar working conditions. Employers can defend pay
differences by proving that pay differences are seniority-based, established with a merit or incentive system,
or a factor other than sex, such as education or training relevant to the job (EEOC, 1997).
Equal Pay Act cases tend to be hard to prove, often because of the broad range of factors that can be a factor
other than sex. Often, employers chalk up salary differentials to negotiation skills. However, in a federal
appeals court case, the court held that an employer is not allowed to satisfy its obligation of proving a wage
disparity was based on a factor other than sex by showing that the male negotiated a higher salary (Drum v.
Leeson Electric Corp., 2009). A female human resource manager was promoted into another position and her
male replacement negotiated a salary $20,000 more than the female had been paid. The court held that the
employer had not justified the difference in the two employees’ pay. The court also rejected the employer’s
argument that the replacement was hired under a new salary structure that was tied to market rates, while the
female employee had been hired under an earlier policy that set pay at slightly below market. Employers
should therefore be cautious in allowing negotiation to create a salary disparity unless there are also skills,
experience, or some other objective factor not related to sex that justify a difference. Further, if a higher rate
of pay for a successor is desired, the employer should consider making salary adjustments for employees in
the same position.
As part of the efforts to investigate and identify potential pay discrimination, EEOC has adopted a new EEO-1
Report requiring employers with more than 100 employees to submit pay information. In addition, employers
must report hours worked by employees in each job category and pay band. Actual hours worked must be
reported for nonexempt employees, and for exempt employees, who generally do not track their hours,
employers may use 40 hours per week for full-time and 20 hours per week for part-time employees, or
provide actual hours if the hours are tracked (EEO-1 Joint Reporting Committee, n.d.).
The other federal laws that address pay discrimination are the National Labor Relations Act (NLRA) and
Executive Orders (EO) applicable to federal contractors. The NLRA prohibits employers from taking adverse
action against non-supervisory employees for discussing their wages or other working conditions with
coworkers, even if there is no union involved. The issues under this law are discussed in another unit. For
federal contractors, EO 11246 mirrors Title VII by prohibiting pay and other discriminations by federal
contractors and subcontractors. The Obama Administration increased regulation of federal contractors
through EO 13665, which became effective in January 2016, prohibiting firing or discriminating against
employees and applicants who ask about, discuss, or disclose their own pay or that of another employee or
applicant. Additionally, EO 13673 requires that effective January 2017, federal contractors must provide a
“paycheck transparency” notice to all workers on a weekly basis specifying the hours and overtime hours
worked for nonexempt employees, rate of pay, gross pay, and itemized additions to or deductions from gross
pay (Executive Order No. 13665, 2014).
The action in the pay equity area has by no means been limited to the federal government. Several states
have enacted tough laws on fair pay that go beyond the Equal Pay Act, and more states are expected to
follow. California, New York, Maryland, and Massachusetts led the way with new laws that broaden the
definition of jobs that are regarded as comparable for purposes of comparing the pay of males and females.
The standard used is substantially similar as opposed to the substantially equal standard under the Equal Pay
Act.
Employers must continue to work to ensure that pay remains a positive term of employment and not subject
to challenge by federal or state agencies or the employer’s workers. HR professionals must review pay
practices, identify any issues, and correct areas of pay disparity. Pay in some areas may need to be adjusted
upward to rectify areas of inequality. These costs will be lower than the legal and public relations costs of
being sued for pay discrimination.
HRM 6302, Employment Law 3
UNIT x STUDY GUIDE
Title
The federal Fair Labor Standards Act also regulates wages and hours. This is an area especially fraught with
risk for employers; wage and hour cases are the most active types of litigation in the area of employment law.
According to Vehling (2016), litigation in this area has exploded since 2000, and the number of cases have
increased every year to a high of almost 9,000 filings in 2015. Issues that fuel this explosion in litigation
include minimum-wage rate hikes passed by many states and municipalities, issues related to independent
contractor classification, and joint employer issues.
There are many hot areas in the wage and hour realm, and one of those is the use of unpaid interns. The
DOL uses a restrictive six-factor test to determine if the intern is appropriately unpaid. Appellate courts have
recently rejected this test in favor of a primary beneficiary test, which applies flexible factors to determine the
primary beneficiary of the interns’ work – the organization or the individual. Key factors that an employer
should consider in designing an intern program include a duration that is not excessive in terms of the period
of beneficial learning and the displacement of paid employees by the intern so that interns are not doing work
that would otherwise be done by paid workers.
Perhaps the most significant development in the wage and hour area in decades was derailed in 2016 after a
federal judge issued a preliminary injunction just days before new regulations were initially set to become
effective on December 1, 2016. The new rules were set to make more than 4 million exempt employees
eligible for overtime pay. Under existing rules, employees who make up to $23,660 annually and engage in
work that is exempt under the administrative, professional, or executive exemptions do not have to be paid
overtime. The new rules would have required that an employee must make at least $47,476 per year and
perform exempt work to avoid having to be paid overtime pay. Further, the $47,476 amount was to increase
every three years to keep pace with inflation. However, a federal court prevented the regulation from going
into effect and put the future of the regulation into question when it ruled that the “significant increase to the
salary level creates essentially a de facto salary-only test” (State of Nevada, et al v. United States Department
of Labor, et al, 2016, p. 14). In that case, the court held that “Congress did not intend salary to categorically
exclude an employee with EAP [executive, administrative, and professional] duties from the exemption” (p.
14). This regulation, or another version of this regulation, may still be considered and implemented in the
future.
In the busy areas of employment law that relate to pay and hours worked, HR professionals must stay
updated on recent developments, ahead of regulators, and in tune with the needs and goals of applicants and
workers.
References
Boghosian, J. (2009, January 29). Lilly Ledbetter Fair Pay Act signing [Photograph]. The White House:
President Barack Obama. https://obamawhitehouse.archives.gov/photos-and-video/photos/lilly-
ledbetter-fair-pay-act-signing
Drum v. Leeson Elec. Corp., 565 F.3d 1071 (8th Cir. 2009).
EEO-1 Joint Reporting Committee. (n.d.). Standard Form 100, Rev/ March 2018, Employer information report
EEO-1 instruction booklet. https://www.eeoc.gov/employers/eeo1survey/2017survey-instructions.cfm
Executive Order No. 13665, 79 Fed. Reg. 20749 (Apr. 11, 2014).
Miller, S. (2014, May 12). Why pay is driving employee satisfaction. Society for Human Resource
Management. https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/pay-drives-
satisfaction.aspx
State of Nevada, et al v. United States Department of Labor State of Nevada, et al v. United States
Department of Labor, Civil Action No. 4:16-CV-00731 (E.D. Tex. 2016).
U.S. Equal Employment Opportunity Commission. (1997, January 15). Facts about equal pay and
compensation discrimination. https://www.eeoc.gov/eeoc/publications/fs-epa.cfm
HRM 6302, Employment Law 4
UNIT x STUDY GUIDE
Title
U.S. Equal Employment Opportunity Commission. (2016, March 16). Written testimony of Lisa M. Maatz Vice
President of Government Relations American Association of University Women.
https://www.eeoc.gov/eeoc/meetings/3-16-16/maatz.cfm
Vehling, A. (2016, January 12). FLSA class actions to hit record high in 2016. Law360.
http://www.law360.com/articles/745603/flsa-class-actions-to-hit-record-high-in-2016
Suggested Unit Resources
In order to access the following resources, click the links below.
The following PowerPoint presentation supplements the textbook chapter reading and is provided for further
knowledge and review of the unit materials.
Chapter 11 presentation (PowerPoint) or Chapter 11 presentation (PDF)
Learning Activities (Nongraded)
Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit
them. If you have questions, contact your instructor for further guidance and information.
At the end of each chapter of your textbook, scenario-driven questions provide legal issues and realistic
situations that relate to employment law. Exploring these questions allows you the opportunity to further your
understanding of the concepts in each chapter and prepares you for similar situations you may encounter in
your workplace.
• Review the Chapter 11 questions in your textbook on pages 458–459.
**## EmploymentLawHRM6302UnitVDB.docx**
2
Employment Law HRM 6302 Unit I DB
Initial posts should be a minimum of 400 words and use at least two supporting references. You can use the text for this course as one of the reference sources.
**Part I:**
Under the Federal Arbitration Act (FAA), employers can require their employees to sign forced (mandatory) arbitration clauses in their contracts. How does forced arbitration affect the average employee? What are some other ways these forced arbitration clauses are used?
Evaluate the benefits for an employer from the HR management perspective. Do you agree or disagree with the idea of employers using forced arbitration in their contracts? Why or why not?
**Part II:**
Identify one of the ideas you shared in the Unit I Discussion Board. What have you learned about the topic in the course to this point. Why?
Continue to track your list throughout and make notes about what you learn in each unit. Identify a related statute, case, law, current event, or situation. You can use this information to help compose the Unit VIII Journal assignment.
**Unit I Discussion Board**
Employment law is dynamic and complex, governing employer-employee relations. This law regulates worker classification, rights and protections, and how organizations can legally structure employment relationships. Employment-at-will, which permits employers to fire workers for any cause and workers to quit, is a key tenet in U.S. employment law (Varner & Schmidt, 2022). However, statutory safeguards, judicial rulings, and contractual responsibilities have created several exceptions to at-will employment, as the Unit I study materials demonstrate. This mix of flexibility and regulation shows why HR managers must study employment law to manage risks and achieve organizational goals.
**Part II: Five Employment Law Topics of Interest**
There are several areas of employment law I would like to learn more about throughout this course, each of which carries significant implications for both employers and workers:
1.
**Worker Classification (Employee vs. Independent Contractor):** The rise of the gig economy, such as Uber and Lyft, makes this topic especially timely. Understanding how courts determine classification affects wages, benefits, and legal protections.
1.
**Discrimination in Employment:** Laws such as Title VII, the ADA, and the ADEA provide critical protections, yet discrimination cases remain prevalent. Exploring how these laws evolve with workplace diversity is essential.
1.
**Employee Benefits and Rights:** Benefits such as health insurance, retirement plans, and leave policies are central to attracting and retaining workers, and I want to learn how regulations like ERISA shape employer obligations.
1.
**Class Action Lawsuits in Employment:** As highlighted in the Uber litigation, class actions are a powerful tool for addressing systemic employment violations. I want to explore how arbitration agreements impact access to collective remedies.
1.
**Unions and Collective Bargaining:** Although union membership has declined in the U.S., collective bargaining remains influential in many industries. I want to examine how labor laws interact with modern workplace practices.
From a classmate’s list, I would likely choose workplace privacy and technology if mentioned. This is because technology has blurred the lines between personal and professional spaces, raising new questions about surveillance, remote work monitoring, and social media policies. Unlike the traditional issues I listed, workplace privacy is rapidly evolving, and I believe it will become increasingly central to employment law discussions in the years ahead.
**Part III: Personal Reflection on Worker Classification**
My close friend was an independent contractor for a marketing company that hired contingent labor for short-term projects. Contractors did not receive health insurance, retirement benefits, or paid leave (Lester et al., 2021). Employee contracts could be terminated at any time without procedural safeguards. This allowed the corporation to scale its workforce based on client demand, but it put workers in charge of taxes, health insurance, and job security.
The positives for workers included greater assignment freedom and better hourly compensation than ordinary employees. Long-term instability, alienation from business culture, and limited legal safeguards under numerous employment regulations like anti-discrimination and overtime rules were major drawbacks (Fauzi et al., 2024). This case shows how misclassifying workers can deprive them of vital protections and expose companies to legal risk.
In conclusion, Unit I stressed the necessity of understanding at-will employment, worker classification, and the changing regulatory environment. As the Uber case shows, old legal categories often fail to match modern employment, causing problems for businesses, employees, and HR specialists. I intend to learn how to identify legal hazards and implement practical solutions by studying these issues in depth, which is crucial for efficient HR management.
**References**
Fauzi, F. A., Hi, B., & Irawan, A. (2024). The Evolution of Employment Law and Its Impact on Workplace Dynamics.
_Advances in Human Resource Management Research_,
_2_(1), 1–10. https://doi.org/10.60079/ahrmr.v2i1.184
Lester, G. V., Brock Baskin, M. E., & Clinton, M. S. (2021). Employer-Sponsored benefits in the united states: The past, present, and future.
_Compensation & Benefits Review_,
_53_(1), 088636872094760. https://doi.org/10.1177/0886368720947609
Varner, K., & Schmidt, K. (2022). Employment-at-Will in the United States and the Challenges of Remote Work in the Time of COVID-19.
_Laws_,
_11_(2), 29. https://doi.org/10.3390/laws11020029
**## UnitVStudyGuide.pdf**
HRM 6302, Employment Law 1
Course Learning Outcomes for Unit V
Upon completion of this unit, students should be able to:
1. Discuss the legal significance of the employer-employee relationship.
1.1 Explain the regulation of wages and hours under the Fair Labor Standards Act (FLSA).
1.2 Assess the legal issues surrounding FLSA that employers face.
4. Characterize conduct that violates federal anti-discrimination laws in employment.
4.1 Determine the elements of a prima facie case of pay discrimination under the Equal Pay Act.
Required Unit Resources
Chapter 11: Wages, Hours, and Pay Equity, pp. 417–456
Unit Lesson
In a 2013 survey by the Society for Human Resource Management (SHRM as cited in Miller, 2014), 60
percent of employees rated pay as “very important” and 36 percent rated it as “important.” These ratings
made pay the top contributor to overall job satisfaction, surpassing job security.
While pay may not always take the top spot in survey results such as the SHRM survey, pay is usually much
higher among the leadership of an organization, and the significance and sometimes disparity of pay in the
employer-employee relationship cannot be refuted (Miller, 2014). Employees rely on compensation to support
themselves and their families. Employers have an interest in holding expenses down, including pay, but must
pay what the market requires for talent that drives the organization’s success. Employees want equitable pay
relative to their coworkers and commensurate with their skills. Employers must navigate complex legal
regulation of wages and hours, as individual states become more active in adding regulations and
requirements to existing federal law.
As pay and compensation is an issue that
affects every worker in an organization,
human resources must play a key role in
setting policy and insuring practices are
fair and compliant. At the federal level
alone, there are five laws that address
compensation and equal pay. Title VII of
the Civil Rights Act of 1964 prohibits
discrimination based on race, color,
national origin, gender, and religion in pay
and pay-related terms of employment,
including promotion and job placement.
The first bill signed into law by President
Obama was the Lilly Ledbetter Fair Pay
Act of 2009. It addressed the situation
where the discriminatory act that caused
an employee in a protected category to be
paid less than a similarly situated
coworker but was unaware of the disparity
until it was too late to sue. This law
UNIT V STUDY GUIDE
Wages and Hours
President Obama signs into law the Lilly Ledbetter Act on
January 29, 2009.
HRM 6302, Employment Law 2
UNIT x STUDY GUIDE
Title
provides that each paycheck of discriminatory wages is a violation of Title VII.
Title VII addresses wage discrimination based on any protected status. However, as women have grown to
comprise almost half of the U.S. workforce, equal pay as a gender issue has garnered a great deal of
attention. Despite the passage in 1963 of the third federal law addressing pay, and specifically pay for women
relative to men, women on average earn 79 cents of every dollar earned by men (U.S. Equal Employment
Opportunity Commission [EEOC], 2016). The Equal Pay Act requires that employers pay men and women
equally in the same establishment when they perform jobs that require the same skill, effort, and
responsibility, and when the job is performed under similar working conditions. Employers can defend pay
differences by proving that pay differences are seniority-based, established with a merit or incentive system,
or a factor other than sex, such as education or training relevant to the job (EEOC, 1997).
Equal Pay Act cases tend to be hard to prove, often because of the broad range of factors that can be a factor
other than sex. Often, employers chalk up salary differentials to negotiation skills. However, in a federal
appeals court case, the court held that an employer is not allowed to satisfy its obligation of proving a wage
disparity was based on a factor other than sex by showing that the male negotiated a higher salary (Drum v.
Leeson Electric Corp., 2009). A female human resource manager was promoted into another position and her
male replacement negotiated a salary $20,000 more than the female had been paid. The court held that the
employer had not justified the difference in the two employees’ pay. The court also rejected the employer’s
argument that the replacement was hired under a new salary structure that was tied to market rates, while the
female employee had been hired under an earlier policy that set pay at slightly below market. Employers
should therefore be cautious in allowing negotiation to create a salary disparity unless there are also skills,
experience, or some other objective factor not related to sex that justify a difference. Further, if a higher rate
of pay for a successor is desired, the employer should consider making salary adjustments for employees in
the same position.
As part of the efforts to investigate and identify potential pay discrimination, EEOC has adopted a new EEO-1
Report requiring employers with more than 100 employees to submit pay information. In addition, employers
must report hours worked by employees in each job category and pay band. Actual hours worked must be
reported for nonexempt employees, and for exempt employees, who generally do not track their hours,
employers may use 40 hours per week for full-time and 20 hours per week for part-time employees, or
provide actual hours if the hours are tracked (EEO-1 Joint Reporting Committee, n.d.).
The other federal laws that address pay discrimination are the National Labor Relations Act (NLRA) and
Executive Orders (EO) applicable to federal contractors. The NLRA prohibits employers from taking adverse
action against non-supervisory employees for discussing their wages or other working conditions with
coworkers, even if there is no union involved. The issues under this law are discussed in another unit. For
federal contractors, EO 11246 mirrors Title VII by prohibiting pay and other discriminations by federal
contractors and subcontractors. The Obama Administration increased regulation of federal contractors
through EO 13665, which became effective in January 2016, prohibiting firing or discriminating against
employees and applicants who ask about, discuss, or disclose their own pay or that of another employee or
applicant. Additionally, EO 13673 requires that effective January 2017, federal contractors must provide a
“paycheck transparency” notice to all workers on a weekly basis specifying the hours and overtime hours
worked for nonexempt employees, rate of pay, gross pay, and itemized additions to or deductions from gross
pay (Executive Order No. 13665, 2014).
The action in the pay equity area has by no means been limited to the federal government. Several states
have enacted tough laws on fair pay that go beyond the Equal Pay Act, and more states are expected to
follow. California, New York, Maryland, and Massachusetts led the way with new laws that broaden the
definition of jobs that are regarded as comparable for purposes of comparing the pay of males and females.
The standard used is substantially similar as opposed to the substantially equal standard under the Equal Pay
Act.
Employers must continue to work to ensure that pay remains a positive term of employment and not subject
to challenge by federal or state agencies or the employer’s workers. HR professionals must review pay
practices, identify any issues, and correct areas of pay disparity. Pay in some areas may need to be adjusted
upward to rectify areas of inequality. These costs will be lower than the legal and public relations costs of
being sued for pay discrimination.
HRM 6302, Employment Law 3
UNIT x STUDY GUIDE
Title
The federal Fair Labor Standards Act also regulates wages and hours. This is an area especially fraught with
risk for employers; wage and hour cases are the most active types of litigation in the area of employment law.
According to Vehling (2016), litigation in this area has exploded since 2000, and the number of cases have
increased every year to a high of almost 9,000 filings in 2015. Issues that fuel this explosion in litigation
include minimum-wage rate hikes passed by many states and municipalities, issues related to independent
contractor classification, and joint employer issues.
There are many hot areas in the wage and hour realm, and one of those is the use of unpaid interns. The
DOL uses a restrictive six-factor test to determine if the intern is appropriately unpaid. Appellate courts have
recently rejected this test in favor of a primary beneficiary test, which applies flexible factors to determine the
primary beneficiary of the interns’ work – the organization or the individual. Key factors that an employer
should consider in designing an intern program include a duration that is not excessive in terms of the period
of beneficial learning and the displacement of paid employees by the intern so that interns are not doing work
that would otherwise be done by paid workers.
Perhaps the most significant development in the wage and hour area in decades was derailed in 2016 after a
federal judge issued a preliminary injunction just days before new regulations were initially set to become
effective on December 1, 2016. The new rules were set to make more than 4 million exempt employees
eligible for overtime pay. Under existing rules, employees who make up to $23,660 annually and engage in
work that is exempt under the administrative, professional, or executive exemptions do not have to be paid
overtime. The new rules would have required that an employee must make at least $47,476 per year and
perform exempt work to avoid having to be paid overtime pay. Further, the $47,476 amount was to increase
every three years to keep pace with inflation. However, a federal court prevented the regulation from going
into effect and put the future of the regulation into question when it ruled that the “significant increase to the
salary level creates essentially a de facto salary-only test” (State of Nevada, et al v. United States Department
of Labor, et al, 2016, p. 14). In that case, the court held that “Congress did not intend salary to categorically
exclude an employee with EAP [executive, administrative, and professional] duties from the exemption” (p.
14). This regulation, or another version of this regulation, may still be considered and implemented in the
future.
In the busy areas of employment law that relate to pay and hours worked, HR professionals must stay
updated on recent developments, ahead of regulators, and in tune with the needs and goals of applicants and
workers.
References
Boghosian, J. (2009, January 29). Lilly Ledbetter Fair Pay Act signing [Photograph]. The White House:
President Barack Obama. https://obamawhitehouse.archives.gov/photos-and-video/photos/lilly-
ledbetter-fair-pay-act-signing
Drum v. Leeson Elec. Corp., 565 F.3d 1071 (8th Cir. 2009).
EEO-1 Joint Reporting Committee. (n.d.). Standard Form 100, Rev/ March 2018, Employer information report
EEO-1 instruction booklet. https://www.eeoc.gov/employers/eeo1survey/2017survey-instructions.cfm
Executive Order No. 13665, 79 Fed. Reg. 20749 (Apr. 11, 2014).
Miller, S. (2014, May 12). Why pay is driving employee satisfaction. Society for Human Resource
Management. https://www.shrm.org/resourcesandtools/hr-topics/compensation/pages/pay-drives-
satisfaction.aspx
State of Nevada, et al v. United States Department of Labor State of Nevada, et al v. United States
Department of Labor, Civil Action No. 4:16-CV-00731 (E.D. Tex. 2016).
U.S. Equal Employment Opportunity Commission. (1997, January 15). Facts about equal pay and
compensation discrimination. https://www.eeoc.gov/eeoc/publications/fs-epa.cfm
HRM 6302, Employment Law 4
UNIT x STUDY GUIDE
Title
U.S. Equal Employment Opportunity Commission. (2016, March 16). Written testimony of Lisa M. Maatz Vice
President of Government Relations American Association of University Women.
https://www.eeoc.gov/eeoc/meetings/3-16-16/maatz.cfm
Vehling, A. (2016, January 12). FLSA class actions to hit record high in 2016. Law360.
http://www.law360.com/articles/745603/flsa-class-actions-to-hit-record-high-in-2016
Suggested Unit Resources
In order to access the following resources, click the links below.
The following PowerPoint presentation supplements the textbook chapter reading and is provided for further
knowledge and review of the unit materials.
Chapter 11 presentation (PowerPoint) or Chapter 11 presentation (PDF)
Learning Activities (Nongraded)
Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit
them. If you have questions, contact your instructor for further guidance and information.
At the end of each chapter of your textbook, scenario-driven questions provide legal issues and realistic
situations that relate to employment law. Exploring these questions allows you the opportunity to further your
understanding of the concepts in each chapter and prepares you for similar situations you may encounter in
your workplace.
• Review the Chapter 11 questions in your textbook on pages 458–459.
– 1
– 2