Prepared by Ted Gentry
October 2013

The Shutdown: How Does It Affect Private Employers?

Wyche at Work is actively working (always!), but the news of the moment involves those who are not working – the federal government shutdown. While there are signs of a potential deal in Washington D.C. that might end the shutdown, there are some things you may need to know about the shutdown and how it impacts you and your employees. The shutdown has affected three key agencies that regulate employment relationships:  the Equal Employment Opportunity Commission (the “EEOC”), the National Labor Relations Board (the “NLRB”), and the Department of Labor (the “DOL”). Each agency has furloughed a huge percentage (80-95%) of its workforce.

The dramatic cuts in agency employment have led to drastic cuts in services. In accordance with the EEOC’s shutdown contingency plan, the agency has ceased handling (i) discrimination hearings or appeals involving federal employees and (ii) mediations connected to ongoing employment discrimination suits. As of today, the EEOC is participating in ongoing discrimination suits only if a court fails to grant a continuance. Finally, the EEOC has agreed to accept, docket, and seek preliminary injunctions (in extreme cases) for new discrimination charges but it will not be investigating any of these new charges.

The NLRB is also operating under a shutdown contingency plan and will handle only ongoing cases and answer inquiries regarding emergency situations affecting life or property. In a similar move, the DOL has adopted its own shutdown plan and suspended most operations. However, the Occupational Safety and Health Administration will still be investigating and responding to incidents of employee exposure to hazards that pose a high risk of death or serious injury.

The shutdown has also affected the E-Verify program. During the shutdown, E-Verify will be unavailable. This means that employers will, among other things, be unable to enroll in E-Verify, verify an employee’s eligibility, view or take action on an existing case, or resolve tentative non-confirmations. As E-Verify will be unavailable, the government has suspended the rule requiring employers to verify an employee’s eligibility within three days of hire. However, employers are still required to complete an I-9 Form within three days of hiring a new employee.

Private employers who rely on governmental services and/or contracts may also feel compelled to cut back operations or reduce workforce during the shutdown. Mass layoffs may trigger notice requirements under the federal WARN Act, and implementing furloughs, temporary shutdowns, or reducing hours can jeopardize the status of employees who are exempt under the Fair Labor Standards Act.  Cutbacks can also impact benefit plans and employees authorized to work under certain visas. Let us know if we can provide any assistance if your company is impacted by the shutdown.

If you have any questions about this or other workplace law topics, please contact Ted Gentry.

This update is provided by Wyche for educational and informational purposes only and is not intended and should not be construed as legal advice.