Released August 21, 2023

Newsletter Highlights

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New Laws Enacted

  • Maine’s 2023 legislative session included a trio of bills that expanded employee protections and increased employer liability for violations of anti-discrimination laws. These bills included the (1) the creation of individual liability for supervisors, directors, and officers who engage in sexual harassment of employees, (2) the expansion of Maine’s Equal Pay law to include race, and (3) the increase in the limits on damages and punitive awards for violations of Maine’s anti-discrimination law.
  • Michigan has recently broadened its anti-discrimination laws by passing two new bills—Senate Bill 90 (SB 90) and Senate Bill 4 (SB 4). SB 90, also known as the CROWN Act, prohibits discrimination based on natural hairstyles and hair texture historically associated with race. SB 4 expands Michigan’s protected categories to include sexual orientation and gender identity or expression, furthering protections following a 2022 Michigan Supreme Court decision.

Pending Bills

  • New York introduced two bills which would require employers to submit an “affirmative acknowledgement” of implementing a sexual harassment prevention policy which meets or exceeds the state’s minimum standards. The acknowledgement must be filed upon the completion of the employer’s annual training or the training of a newly hired employee.

Court & Agency News

  • The U.S. Equal Employment Opportunity Commission (EEOC), alongside several federal agencies, has issued guidance on avoiding discrimination in employment decisions involving artificial intelligence (AI), highlighting potential violations of Title VII of the Civil Rights Act of 1964. The guidance emphasizes the importance of regular assessments of AI tools to prevent disparate impact, employer liability in case of discrimination (even if an AI system was developed by an external vendor), and the necessity of transparency and accurate assumptions in AI tool design.
  • The White House Office of Science and Technology Policy (OSTP) has announced a public request for information (RFI) to understand how employers use automated tools to surveil, monitor, and manage their workers. This effort, which stems from concerns over potential risks to employee safety, mental health, and rights, will be used to inform new policy responses and the sharing of best practices among stakeholders.

For the full stories, keep reading below.

New Laws Enacted

Maine Legislature Enacts Significant Changes to Anti-Discrimination and Anti-Harassment Laws

Maine’s 2023 legislative session saw several changes in its employment laws. Specifically, Maine enacted a trio of bills that expand employee protections and increase employer liability in the event of violations. This includes (1) the enactment of a bill that would provide for individual liability for supervisors, officers and directors who engage in sexual harassment; (2) the expansion of Maine’s Equal Pay Law to prevent employers from discriminating on the basis of race by paying an employee less than another employee of a different race for comparable work; and (3) increasing the limit on damages employers may be liable for in discrimination lawsuits.

First, Maine enacted an amendment to the Workers’ Compensation Act on June 4, 2023, which enables employees who suffer damages due to intentional acts and omissions related to sexual harassment and sexual assault to pursue direct civil actions against the employees, officers, supervisors or directors themselves who engaged in the tortious actions. Under the previous version of the law, employees were limited to filing a worker’s compensation claim. The law, L.D. 53, explicitly states that individual employees, supervisors, officers, or directors of an employer may be held liable for such actions. The law also notes that this does not limit or impact the employee’s right to allege employment discrimination under Maine’s Human Rights Act or Title VII of the Civil Rights Act.

Second, Maine enacted a significant change to the Maine Equal Pay Law, as detailed in Legislative Document (L.D.) 1703, signed into law by Governor Janet Mills on June 22, 2023. The law previously prohibited wage discrimination between employees in the same establishment on the basis of sex. The new amendment expands these protections to race, making it unlawful for employers to pay an employee at a lesser rate than employees of a different race for comparable work with similar requirements in terms of skill, effort, and responsibility.

Finally, the legislature also substantially increased the cap on damages for violations of Maine’s anti-discrimination law, the Maine Human Rights Act (MHRA). These changes were introduced under L.D. 1423 and signed into law by Governor Mills on June 22, 2023. The MHRA prohibits discrimination in employment due to factors such as race, color, sex, sexual orientation, age, physical or mental disability, genetic predisposition, religion, ancestry, or national origin. With the new legislation, the maximum limits for compensatory and punitive damages under the MHRA have more than doubled. For businesses with 15-100 employees, the limit is now $100,000, up from $50,000. For businesses with 101-200 employees, the cap is now $300,000, up from $100,000. For those with 201-500 employees, the cap is now $500,000, raised from $300,000, and for businesses with more than 501 employees, the cap is now $1 million, raised from $500,000.

In sum, these three laws underscore the importance of employer compliance with anti-discrimination laws, anti-sexual harassment laws, and equal pay laws. The stakes for legal violations have significantly increased, as companies found liable may now face increased damage awards, and individual employees, supervisors, and Board members who engage in sexual harassment may now face direct legal liability.

Michigan Adds Additional Protected Classes to its Anti-Discrimination Law

The state of Michigan has broadened its anti-discrimination law, the Elliott-Larsen Civil Rights Act (ELCRA), by adding two new protected categories. The ELCRA, first passed in 1976, aimed to prohibit discriminatory practices based on religion, race, color, national origin, age, sex, height, weight, familial status, or marital status. With the passage of two bills this year–SB 90 and SB 4–Michigan expands the classes which are protected under the ELCRA to also include natural hair types and hairstyles, and sexual orientation and gender identity or expression, respectively.

SB 90, known as the Creating a Respectful and Open World for Natural Hair (CROWN) Act, amends the ELCRA to include a ban discrimination based on traits historically associated with race, including hair texture and hairstyles such as braids, locks, twists, and bantu knots. The Act was signed into law by Governor Gretchen Whitmer, following which Michigan joined the ranks of 23 other states with similar protections against hair discrimination.

The second piece of legislation, SB 4, extends the ELCRA’s protected categories to include sexual orientation and gender identity or expression. The bill defines “gender identity or expression” as a gender-related self-identity or expression, whether or not associated with an individual’s assigned sex at birth, while “sexual orientation” encompasses heterosexuality, homosexuality, or bisexuality or having a history or identification with such orientations.

The enactment of SB 4 follows a 2022 Michigan Supreme Court decision that classified discrimination based on sexual orientation as a form of sex discrimination. However, the new amendment goes a step further by explicitly protecting gender identity and expression, which weren’t addressed in the court’s opinion.

Pending Bills

New York Introduces Bills Requiring Employers to Submit Acknowledgment of Sexual Harassment Training Each Time the Employer Conducts Training

The State of New York has introduced bills aimed at bolstering accountability among employers regarding sexual harassment prevention. The bills (New York Assembly Bill A7864, which has also been introduced in the Senate as S2788), if enacted, would require employers to submit an affirmative acknowledgement that they have implemented a sexual harassment prevention policy meeting or surpassing the minimum standards set by the state. This confirmation must be submitted to the State’s Department of Labor following the employer’s annual training on sexual harassment prevention, and after the training of any new employee. 

Presently, New York law (Section 201-g) requires employers to adopt a sexual harassment prevention policy and provide sexual harassment prevention training to all employees annually and upon hire. This policy must meet or exceed guidelines provided by the state, encompassing definitions and examples of sexual harassment, information about federal and state laws and remedies available to victims of sexual harassment, a standard complaint form, and a procedure for timely and confidential investigation of complaints. Currently, employers in New York must maintain records of compliance with the training requirements as evidence of compliance in the event of an audit but are not required to proactively submit those records to the Department of Labor.

The proposed bills seek to strengthen these existing regulations. Under the proposed amendment, the Department of Labor, in consultation with the Division of Human Rights, is mandated to develop a system that enables employers to affirmatively acknowledge their compliance with these requirements. Each employer would need to utilize this system to submit an affirmation that they have met or exceeded the sexual harassment prevention policy standards, subsequent to their annual training and the training of any new hires.

This enhanced requirement not only seeks to ensure that companies are actively implementing these policies but also provides an official record of compliance with sexual harassment prevention guidelines. The proposed amendment also empowers the commissioner to create new regulations for executing the provisions of this section, thereby granting more robust authority to the Department of Labor to ensure adherence to sexual harassment prevention policy standards.

Court & Agency News

EEOC Issues Guidance on the Use of AI in Employment Decisions

The U.S. Equal Employment Opportunity Commission (EEOC) has issued guidance addressing the potential discriminatory implications of AI in employment decisions, as part of a joint statement with the Department of Justice, the Consumer Financial Protection Bureau, and the Federal Trade Commission. The guidance focuses on ensuring that AI tools used in making employment decisions do not contravene federal anti-discrimination law (Title VII of the Civil Rights Act of 1964).  

According to the EEOC, AI tools can potentially lead to unlawful disparate impact if they disproportionately exclude individuals based on protected characteristics, without being job-related and consistent with business necessity. Key points in the guidance include treating automated decision-making tools as selection procedures subject to EEOC guidelines; holding employers potentially liable for discrimination even if an AI tool was developed by an outside vendor; and encouraging employers to regularly assess their AI tools for possible disproportionate effects. 

Furthermore, in their joint statement, the agencies expressed concern about the “lack of transparency” of some AI models, the potential for bias in data and datasets, and the danger of flawed assumptions in AI tool design.  

The EEOCs concerns are shared with some in Congress who have introduced the “No Robot Bosses Act” which would place limits on what employment decisions could be made by technology and AI without the oversight of a human. 

These actions align with an ongoing focus on AI from the EEOC, which has been addressing concerns related to algorithmic discrimination since at least 2022. The joint statement emphasizes that developers, deployers, and users of AI systems could face regulatory oversight from multiple federal and state authorities, stressing the importance of keeping abreast of the latest developments and forthcoming legislation.  

White House Examining the Use of Technology to Track Employee Productivity

The White House Office of Science and Technology Policy (OSTP) has announced a public request for information (RFI) aimed at understanding the automated tools that employers use to monitor, evaluate, and manage their workforces. The initiative follows last year’s investigation by The New York Times, which revealed that eight of the ten largest private U.S. employers use tracking technology to assess productivity. Applications vary, from nurses wearing RFID badges to track their location, to office workers being monitored via software that records their mouse and keyboard activity. 

Although the OSTP noted such technologies may present benefits for both parties in certain cases, it expressed concerns about potential risks to employees. For example, OSTP stated that the overuse of performance tracking can threaten safety and mental health, while monitoring of conversations could inhibit workers’ rights to organize and bargain collectively. Furthermore, when tied to decisions about pay, discipline, and promotion, automated surveillance could lead to differential treatment or discrimination. 

OSTP aims to collect information on workers’ experiences with surveillance technologies, employers’ methods for developing and using these technologies, effective strategies for mitigating risks, relevant data and research, and recommendations for federal response. The findings will help shape new policies, disseminate research and data, and promote best practices among stakeholders. According to OSTP, this new initiative is also aligned with the Biden-Harris Administration’s Blueprint for an AI Bill of Rights. 

Disclaimer: this information is not intended as legal advice. Please consult with legal counsel to ensure your organization’s compliance with applicable legal requirements.