7/21/25 NLRB GC Memo 25-07 – Surreptitious Recording of Bargaining Sessions Per Se Violation of the Act & President Trump Board Nominations

July 21, 2025

By Nicole Elgin & Xavie Davenport 

National Labor Relations Board (“NLRB”) Acting General Counsel William Cowen published  GC Memorandum 25-07 on June 25, 2025, stating the office’s position that surreptitious recordings of a collective bargaining session are bad faith and per se violations of the National Labor Relations Act (“NLRA”).

This memorandum comes at a good time, considering technology such as AI which gives parties heightened ability to record bargaining sessions secretly. Recall that GC Memos are not binding NLRB Decisions, but rather are policy guidance documents from the prosecutorial wing of the NLRB.  

The Memo explains that the NLRA requires employers and employee representatives to “confer in good faith.” Specifically, the “use of surreptitious recordings during the collective-bargaining process is inconsistent with the openness and mutual trust necessary for the process to function as contemplated by the Act.” The memo references the Board’s analysis in a case from 1978, Bartlett-Collins Co. In Bartlett-Collins, one party’s strict insistence on recording bargaining meetings was found to be an unlawful refusal to bargain.

Acting GC Cowen states that “treating surreptitious recordings of collective-bargaining sessions as a per se violation is a logical extension of Barlett-Collins” and “the brazen disregard for the reasonable expectations of professional behavior shows a disdain for the collective bargaining process itself.” The Memo directs NLRB Regions to issue a complaint against a party when the investigation shows that a party surreptitiously recorded a bargaining session.

On July 17, 2025, President Trump sent several nominations to the Senate, including Scott Mayer (Chief Labor Counsel at The Boeing Corporation) and James Murphy (former NLRB attorney) to serve on the National Labor Relations Board. Recall that the Board currently does not have quorum. If confirmed by the Senate, these two seats will put the Board back in quorum.

For labor relations advice, contact Barran Liebman attorney Nicole Elgin at nelgin@barran.com or 503-276-2109.

7/15/25 Washington Employers Take Note! L&I Rulemaking to Align with Recent Legislative Changes

July 15, 2025

By Nicole Elgin & Xavie Davenport 

A proposal for expedited rulemaking was filed in Washington State on July 1, 2025. The proposal aims to allow the Washington State Department of Labor and Industries to update the language of two statutes, RCW 49.76 and RCW 49.46 relating to domestic violence leave, paid sick leave, and data certain employers must provide to their drivers. L&I has requested expedited rulemaking under the assertion that the proposed language adopts the new statutory language into the rule without making material changes.

The Washington State Legislature recently passed three Bills that prompt the need for language revision, Substitute Senate Bill 5101 (“SSB 5101”), Engrossed Substitute House Bill 1875 (“ESHB 1875”), and Engrossed Substitute House Bill 1332 (“ESHB 1332”).

• SSB 5101 adds “hate crimes” to the acceptable uses of leave under the Domestic Violence Leave Act. The law defines a “hate crime” as “the commission, attempted commission, or alleged commission of an offense described in RCW 9A.46.110… and includes, but is not limited to, offenses that are committed through online or internet-based communication.” This law is effective January 1, 2026.

• ESHB 1875 extends the allowable uses of paid sick leave to include preparation and participation in immigration proceedings for employees. Specifically, employees may use paid sick leave “to prepare for, or participate in, any judicial or administrative immigration proceeding involving the employee or the employee’s family member.” This law is effective July 27, 2025.

• ESHB 1332 requires that electronic receipts and weekly notices given to Transportation Network drivers contain information on financial incentives, promotions, or bonuses paid. Transportation Network Companies now must make records of per trip receipts from the previous 24 months available in a single aggregated, searchable, downloadable format (such as CSV or searchable PDF) within three business days of a driver’s request. This law is effective September 1, 2025.

Because the expedited rulemaking process requires fewer procedural steps, anyone who opposes this use of the expedited rulemaking process should express objections as soon as possible. The objection deadline ends at 5 p.m. on September 2, 2025.

For guidance on compliance with the new laws or further explanation about the expedited rulemaking process and its ramifications, contact Nicole Elgin at nelgin@barran.com, or 503-276-2109

7/14/25 Part 2: Employer-Facing Provisions in the New Tax Act

July 14, 2025

By Jeff Robertson  &  Iris Tilley

Last week, we shared a summary of employee-facing provisions in the new tax act (the “Act”).  However, the Act, also contains a number of employer-facing tax provisions.  We are highlighting a few of those provisions to assist employers in considering updates to their internal policies and making business decisions. 

Tax Provisions Impacting Employers and Their Employees

Family Medical Leave Tax Credit Extended and Expanded

The 2021-2025 Family Medical Leave Tax Credit under IRC § 45S has been revised and its scope has been expanded by the Act.  The Act makes the credit (which was set to expire at the end of 2025) permanent.  Scope expansions include a reduction in the minimum work time eligibility minimum from one year to six months.  In addition, state and local paid leave and insurance policy premiums may now be used to qualify for the credit. 

$20 Bicycle Credit and Moving Expenses Permanently Excluded

In 2018, bicycle commuting expense reimbursements were temporarily eliminated from the definition of a qualified fringe benefit, and tax-free moving expense reimbursements (along with the deduction) were temporarily eliminated in most situations.   The Act makes these temporary exclusions permanent. 

Child Care Credit

Employers operating or considering childcare facilities have an expanded tax benefit relating to such services.  The percentage of childcare services for the credit expands to 40%, allowing for an employer to spend up to $1.25 million on services to claim the full credit amount of $500,000.  Eligible small businesses may be eligible for a credit up to $600,000. 

Pass-Thru Deduction and Qualified Stock Exclusions

The Act makes permanent provisions relating to the 20% pass-through entity deduction (which was scheduled to expire at the end of 2025) and relaxes rules on the transfer of qualified stock.  This change opens up potential planning opportunities relating to Employee Stock Ownership Plans and other stock transfers, including stock-based employee compensation tools.

The Barran Liebman Employee Benefits Group assists employers with retirement and health plans.  Please contact Jeff Robertson at 503-276-2140 or jrobertson@barran.com, Iris Tilley at 503-276-2155 or itilley@barran.com, or your regular attorney at Barran Liebman if you have any questions.

7/10/25 Part 1: Employee-Facing Provisions in the New Tax Act

July 10, 2025

By Jeff Robertson  &  Iris Tilley

The so called “Big Beautiful Bill Act” (the “Act”) was signed into law last week.  We’ve summarized those provisions that should be on employer’s minds as they consider how the Act may affect their employees. 

Tax Provisions Impacting Employers and Their Employees

SALT Deduction

For employees residing in Oregon and California especially, but also for employees with larger property tax bills in other Western non-income tax states, the Act contains an increased ability to deduct State and Local Taxes (SALT) on employees’ Forms 1040. This primarily will impact higher income wage earners, due to itemizing deductions and may affect their withholding decisions. The cap quadruples, subject to some income phase out, for the 2025 tax year.

“Tips” Income for Qualifying Individuals

The Act contains a deduction for up to $25,000 of income reported and received in “tips” from professions that typically receive tips, subject to an income cap.  The Internal Revenue Service is tasked with providing a list of occupations it believes are eligible for this deduction.  This only impacts Federal Income Taxes and not FICA.  State tax treatment will vary, depending on how a state’s tax code interacts with the Federal Tax Code.  The concept of tips as not taxable income may be confusing to employees.  Employers who charge mandatory gratuities in relation to a service may want to reconsider the verbiage to ensure employees can receive such tips tax-free as the law requires the tips to be voluntary from the customer. 

“Overtime” Compensation Deduction

The Act contains an above-the-line tax deduction for individuals receiving overtime compensation of up to $12,500 for individuals and $25,000 for married couples filing jointly.  Similar to tips, overtime compensation is only a Federal Income tax issue, unless a state’s tax code automatically confirms to the Federal Tax Code on an ongoing basis (Oregon’s does not).  Unlike tips, overtime is not typically recorded separately on a paycheck or on W-2, and payroll systems may need to be adjusted.  Overtime for this purpose is only such overtime as defined within the Fair Labor and Standards Act and only applies to the overtime portion, not the regular wage portion of the overtime. 

We anticipate some of the provisions will result in questions for employers, especially regarding whether an employee should be taxed on overtime wages and tips and how to report these income times on Form W-2.  We also anticipate questions regarding the application of FICA to these income types and the proper process for addressing withholding.  We are here to help with policy language and required reporting.

The Barran Liebman Employee Benefits Group assists employers with retirement and health plans.  Please contact Jeff Robertson at 503-276-2140 or jrobertson@barran.com, Iris Tilley at 503-276-2155 or itilley@barran.com, or your regular attorney at Barran Liebman if you have any questions.

7/9/25 U.S. Supreme Court Weighs in on Burden of Proof for Non-Minority Plaintiffs

July 9, 2025

By Avery Tunstill & Paula Barran

In a recent opinion, the U.S. Supreme Court revived a lawsuit by Marlean Ames, a heterosexual white woman, against her employer for “reverse discrimination.” Her case gained national attention and sparked conversations about so-called “reverse discrimination claims” and whether a majority-group employee can properly allege discrimination. The Supreme Court made it clear that “reverse discrimination” is discrimination, and majority group members do not have to meet a higher bar to win their case.

Ames’ lawsuit alleged that her employer, the Ohio Department of Youth Services, denied her a promotion because she was heterosexual. However, the lower court dismissed Ames’ lawsuit, reasoning that because the discrimination was based on Ames’ majority status as a heterosexual person, she needed to prove that her employer was an “unusual” one who discriminated against majority-group employees.

The U.S. Supreme Court issued a unanimous decision clarifying that Title VII of the Civil Rights Act of 1964 has one standard for all plaintiffs bringing employment discrimination suits; it does not require more or different evidence from a plaintiff who is part of a majority group.

Prior to Ames, some courts required employees who were part of majority groups (such as white and heterosexual employees) to show “background circumstances” to prove their employer discriminated against them on account of their majority status. Plaintiffs could clear the “background circumstances” bar by using, for example, statistical evidence that their employer engaged in a pattern of discrimination against majority-group employees or a pattern of favoritism to minority employees.

In some parts of the country, including the West Coast, federal courts did not require majority-group plaintiffs to prove background circumstances. Thus, the Ames decision may not be a major legal change on the West Coast. But for majority-group plaintiffs in other parts of the country, the Supreme Court’s ruling means they no longer need to prove background circumstances, thus removing a legal hurdle. With the Ames decision, the Supreme Court sent a clear message - discrimination is discrimination regardless of whom it disfavors, as long as that person is in a protected class.

Employers should keep in mind that Ames and the associated media coverage may prompt conversation amongst employees about perceived discrimination based on majority status. Adopting a clear anti-harassment policy, promoting an inclusive work culture, and ensuring that decisions about promotions and pay are based on work performance, can prevent such complaints.

We are here to help. Please contact Paula Barran at 503-276-2143 or pbarran@barran.com, or Avery Tunstill at 503-276-2150 or atunstill@barran.com, or your regular attorney at Barran Liebman if you have any questions.

7/1/25 Important Tax and Employee Benefits Provisions to Watch in the Senate Tax Bill Negotiations

July 1, 2025

By Jeff Robertson  &  Iris Tilley

H.R.1, entitled One Big Beautiful Bill Act, (the “Bill”) passed the U.S House of Representatives on May 25, 2025 and is now under negotiation in the U.S. Senate. While the final terms of the Bill are yet to be seen, several notable trends regarding employee benefits have emerged.

 1. Health Savings Accounts and Health Reimbursement Arrangements will be a large part of the administration’s health plan focus going forward

The Bill continues the Administration’s focus and emphasis on health care accounts while limiting the Affordable Care Act. Specifically, the Bill includes expanded eligibility for HSA and HRA accounts, including Medicare eligible individuals. Additionally, the Bill contains expanded qualified expense categories. We can expect expanded regulatory encouragement for employers and individuals to establish health care accounts. This is a specific area to watch for planning purposes if health care premiums go up over the next year or two to unsustainable levels for some employers.

 2. Nonprofit Compensation Excise Tax

Effective as of the 2026 tax year, the Bill expands application of the existing excise tax on compensation paid over $1 million to former employees of nonprofit organizations. This change specifically targets severance compensation. Because many nonprofits utilize severance compensation to provide large historical benefits, this excise tax, if passed, must be considered in exit planning. In addition, the Bill adds back the 2019 repealed tax on parking and qualified transportation fringe benefits. For nonprofit employers considering future exit strategies, the excise tax may be an important consideration.

 3. Continuation of Employer Tax Credits

The Bill continues provisions related to tuition and student loan expenses and family leave credits which were otherwise set to expire. If your Company offers these benefits, the Bill provides some certainty going forward. 

 4. Provisions Impacting Health Plan Pharmacy Benefit Managers

The Trump administration continues its focus on transparency in pharmacy costs. The Bill enacts provisions regulating Pharmacy Benefit Managers and will have implications for employer sponsored health plans and their pharmacy programs, both in operation and with regard to document drafting.

 5.  Limited to No Impact on Employer Retirement Plans

Notably, the Bill does not address employer retirement plans. This indicates the potential of separate legislation akin to a Secure Act 3.0 and expanded regulatory provisions.  The Trump administration has highly encouraged Roth accounts and automatic enrollment.

The Barran Liebman Employee Benefits Group assists employers with retirement and health plans.  Please contact Jeff Robertson at 503-276-2140 or jrobertson@barran.com, or Iris Tilley at 503-276-2155 or itilley@barran.com, or your regular attorney at Barran Liebman if you have any questions.

6/25/25 Pregnancy Accommodation Obligations: Big Changes Ahead for Washington Employers

June 25, 2025

By Becky Zuschlag & Avery Tunstill

Washington Governor Bob Ferguson signed Senate Bill 5217 (E2SSB 5217) into law on May 20, 2025. The law will replace Washington’s law requiring pregnancy accommodations. Although the new law does not go into effect until January 1, 2027, employers should start considering necessary changes to their policies and practices  now to ensure compliance.

Who does this law apply to?

Currently, only employers with 15 or more employees must provide pregnancy-related accommodations to employees who require them, and some exemptions to the law exist for nonprofit and religious organizations.

The new law extends the obligation to provide pregnancy accommodations to all employers  and specifically includes religious and nonprofit organizations.  

What does the law require of employers?

Washington law has long-required employers to provide reasonable breaks and a private location for lactation, but currently does not require employers to pay for such breaks.

Under the new law, employees are entitled to pay at their regular rate for break time used to express milk during work hours and for the time needed to travel to the private space reserved for this purpose. Further, these breaks are in addition to meal and rest breaks, and employers are prohibited from requiring an employee to use paid time off for lactation breaks.

Additionally, while current law includes scheduling flexibility for prenatal visits in the definition of reasonable accommodation, the new law expands this definition to include scheduling flexibility for postpartum medical visits as well.  

What are the consequences for non-compliance?

The new law shifts investigatory and enforcement obligations from the Office of the Attorney General to the Washington Department of Labor and Industries (L&I), requiring L&I to investigate complaints that allege violations of the law. L&I will be able to enforce violations through injunctions and civil penalties. Additionally, the law provides employees with a private right of action to recover damages and attorneys’ fees for their employer’s violation(s).

Although the law is not effective until January 1, 2027, employers should plan and prepare for these big changes in advance to avoid risk of noncompliance and potential litigation.

For questions about these changes or other employment law-related issues, please contact Becky Zuschlag at bzuschlag@barran.com or 503-276-2151, or your regular Barran Liebman attorney for assistance in reviewing your employment compliance. 

6/24/25 Practical Guidance for Understanding Senate Bill 426

June 24, 2025

By Hannah LaChance & Xavie Davenport 

Governor Tina Kotek signed Senate Bill 426 into law on June 9, 2025. The new law effectively makes  property “Owners” and “Direct Contractors” liable for unpaid wages of the employees who work under them or on their projects. This liability extends to the employees of subcontractors, even if the Owner or Direct Contractor has no direct supervision or control over their work or wages. The law takes effect on January 1, 2026. 

The law defines an “Owner” as “any person, firm, partnership, corporation, association, company, organization or other entity, or any combination thereof, with an ownership interest […]” in property. A “Direct Contractor means any person, including a construction manager, joint venture or any combination thereof, the person’s successors, heirs or assigns, that enters into a construction contract with an Owner.” 

The obligations of the new law do not apply to property owners who are hiring contractors to work on their principal residence, to public agencies as defined under Oregon law, or to a financial institution who acquires ownership of a property by foreclosure and do not undertake more than the work necessary to preserve or secure the property. It also only applies to “unrepresented employees” who are not represented by a construction trade labor organization or those who are not covered by a collective bargaining agreement that contains specific provisions. The new law includes a “rebuttable presumption” of employment, meaning the worker is assumed to be an employee rather than an independent contractor, and it is the Owner or Direct Contractor’s burden to prove otherwise.

For employees, the bill provides extra protection in addition to existing wage and hour laws. For example, if an employee has not been paid by their primary employer, the employee can take action against not only their employer, but also the businesses or persons who contract with their employer. This provides the opportunity for employees of contractors and subcontractors to seek payment from those who have ultimately benefitted from their work when they have not been paid by their direct employer.  

For Owners and Direct Contractors, this creates another layer of liability. If subcontractors and specialist companies working on the project have not paid their workers, the workers can recover wages from the Owner or Direct Contractor, even if they have already paid the subcontractor for its work.

 
The new law specifically includes a provision that Owners and Direct Contractors cannot contract out of this liability, but it does provide some safeguards that can minimize exposure. There is a complaint and recovery process that must be followed before legal proceedings can begin and the employee seeking to recover wages from an Owner or Direct Contractor must send notice of the alleged violation via first-class certified mail. The notice must include a description of the violation, the nature of the claim and must state that the Owner and Direct Contractor have 21 days from the delivery date to correct the violation. The new law limits the timeframe within which an employee can bring a claim to two years from the date the wages became due. 

Another protection for Owners and Direct Contractors that is built into the new law is with respect to its records and disclosure requirements. Upon request, subcontractors are required to provide information including but not limited to certified payroll reports, contact information, any subcontractors the Direct Contractor has hired, and names of all workers who have performed work on the project. 

We are here to help. Please contact Hannah LaChance, at hlachance@barran.com or 503-276-2112, or your regular Barran Liebman attorney for more information and guidance on how to comply with the new order.

6/18/25 Immigration Enforcement: Practical Tips for Employers

June 18, 2025

By Abby Fitts

Immigration enforcement is on the rise, with an increasing number of visits to workplaces across the country. In addition to ICE, agents from the DEA, IRS, ATF and U.S. Marshals have now been deputized to assist. Employers need to prepare their workplaces and employees in advance of an agency visit. See our first E-Alert on this subject for additional guidance for employers navigating immigration enforcement.

Preparing for a Visit:

Here are some tangible ways to prepare and handle an immigration visit:

• Mark private spaces with signs like “No Trespassing” or “Private.” Private spaces are locations where there is a reasonable expectation of privacy like exam rooms, break rooms, rest rooms, and offices with doors that close.

• Designate a representative and an alternate. Train the representative in how to read a warrant and what to do/not do in interacting with ICE and other federal agents.

• Remind employees that they have the right to remain silent if/when agents try to engage with them. They do not have to tell agents where an employee is from or where they are at when asked.

During a Visit:

When agents arrive, remember the following:

• Typically, agents will have an operation plan and the first step in that plan is to read the warrant out loud. The designated representative should listen to the reading and may ask to see the document. Know the difference between an arrest warrant and a search warrant because that will determine where agents can go and what they can do. Remember, a judicial search warrant permits agents to search within the location and time frame listed in the search warrant. You are not required to give permission to search in areas not listed and should be clear that you are not consenting (or that your designated representative does not have authority to consent).

• Employees and the designated representative may take pictures or video during the raid.

• The designated representative may follow the agents in their search.

Finally, employers must remember to not interfere with federal agents during a raid. Employees should not impede, barricade, run away or do anything else that might be considered interference, as such actions come with significant consequences.

We are here to help. Please contact Abby Fitts at afitts@barran.com or 503-276-2190, or your regular Barran Liebman attorney for assistance in reviewing your employment compliance. 

6/17/25 EBSA Confirmation Hearings Provide Important Health/Retirement Plan Compliance Roadmap for Next Two Years

June 17, 2025

By Jeff Robertson  &  Iris Tilley

Recent confirmation hearings related to the potential head of the Employee Benefits Security Administration (“EBSA”) provide a roadmap to the likely issues facing retirement plans over the next few years. 

During the hearings, the presumptive nominee was asked for the regulatory priorities if confirmed and responded with an overall philosophy that plans and fiduciaries should be allowed to operate retirement plans within the fiduciary guidelines.  Specifically the presumptive nominee identified the following priorities: 

• De-Regulating the Enforcement of Employee Stock Ownership Plans (“ESOP”).  These comments were related primarily to government enforcement and retroactive consideration of issues particularly relating to valuation.  It appears that the next few years will be favorable to those companies considering an ESOP as a liquidity event.

• “Modernizing” 401(k) investments.  Providing for lifetime income options, crypto currencies, private equity and alternative investments from a strict mutual fund lineup operated in asset/risk classes. 

• Cybersecurity.  There continues to be an increased focus on  plan-level cybersecurity procedures.  We often come across plans whose fiduciaries have never affirmatively asked about the cybersecurity procedures.

• Plan forfeitures and missing participants.  While the current administration seems to favor a lighter audit and enforcement approach, the issues of plan forfeitures, suspense accounts and locating missing participants will continue to be a priority. 

• Expanded retirement and health plan access.  We believe the Trump administration will continue to work to expand access to employer-sponsored retirement and health plans, including to independent contractors. 

One thing remains very clear: operating retirement and health plans with regular documented oversight is the best protection against compliance concerns, litigation and governmental investigation which defaults to “did the fiduciaries operate a prudent procedure in decisions” standard. 

Your employee benefits lawyers at Barran Liebman are available to help you establish and operate a regular document procedure to limit the risk related to your retirement and health plans. 

The Barran Liebman Employee Benefits Group assists employers with retirement and health plans.  Please contact Jeff Robertson at 503-276-2140 or jrobertson@barran.com, or Iris Tilley at 503-276-2155 or itilley@barran.com, or your regular attorney at Barran Liebman if you have any questions.

5/29/25 DOL Rescinds Crypto Guidance in 401(k) Plans

May 29, 2025

By Jeff Robertson  &  Iris Tilley

The Department of Labor (“DOL”) has rescinded its 2022 guidance directing 401(k) Plan fiduciaries to exercise “extreme care” before adding a cryptocurrency component or option to a 401(k) plan lineup.

This does not mean that the DOL endorses the use of cryptocurrency as a retirement plan investment option. It means that any cryptocurrency investment option would be evaluated under the same ERISA standards as any other investment option as to its prudency and exclusive benefit to plan participants.

While the DOL’s decision to rescind this guidance is notable, the U.S. Secretary of Labor also noted, in her opinion, that the DOL was “rolling back this overreach and making it clear that investment decisions should be made by fiduciaries, not D.C. bureaucrats.” This may mean we will see lighter enforcement from the DOL. In addition, it puts into question some of the DOL’s recent compliance efforts regarding forfeiture/ERISA expense accounts and missing participants. It also furthers the importance of a clear written Investment Policy Statement and clear written records documenting plan level investment decisions.

The Barran Liebman Employee Benefits Group assists employers with retirement and health plans.  Please contact Jeff Robertson at 503-276-2140 or jrobertson@barran.com, or Iris Tilley at 503-276-2155 or itilley@barran.com, or your regular attorney at Barran Liebman if you have any questions.

5/21/25 Employee vs. Independent Contractor: The Economic Reality Test Is Back

May 21, 2025

By Becky Zuschlag and Xavie Davenport

On May 1, 2025, the US Department of Labor’s Wage and Hour Division (“DOL WHD”) released a field assistance bulletin providing guidance to its field staff for determining employee versus independent contractor status when enforcing the Fair Labor Standards Act (“FLSA”). The new guidance instructs DOL investigators against using the Biden administration’s 2024 Final Rule on independent contractor classification. Instead, the bulletin explains, the WHD will rely on the “economic reality” test, as outlined in Fact Sheet #13, and Opinion Letter FLSA2019-6, when enforcing the FLSA, though the guidance does note that, “until further action is taken [by the DOL], the 2024 [Final] Rule remains in effect for purposes of private litigation[.]”   

The 2024 Final Rule went into effect on March 15, 2024, and provided an employee-friendly six-factor test, also known as the “totality of the circumstances” to determine employee versus independent contractor status. Each factor was to be weighed equally, thus making it difficult for employers to appropriately classify their employees.

The economic reality test considers various factors, with the goal of the test being to determine whether the worker is economically dependent on the employer, and therefore an employee, or in business for themselves, and thus an independent contractor. Some of the factors considered are listed below:

1.  The worker’s opportunity for profit or loss,

2. Investments by the worker in facilities and equipment,

3. Permanence of the work relationship,

4. Nature and degree of control by the employer,

5. Whether the work performed is integral to the employer’s business,

6. Skill and initiative required in market competition required for success of the worker, and

7. The degree of independent business organization and operation by the worker.

The economic reality test reflects a longstanding interpretation of the employee versus independent contractor distinction, focusing on the economic dependence of the worker. Whether a worker is economically dependent on the employer is a fact-specific inquiry and will vary by each working relationship. Economic dependence of a worker is more than reliance on a paycheck. A worker is typically considered dependent if they are unable to work on their own terms or are operating for their employer as a united economic entity. On the other hand, an economically independent worker is typically one who possesses more control over their work and may function as a separate economic entity.  If the answers to the above factor test lean toward the worker being economically independent, the worker may be an independent contractor. In contrast, if the factors lean toward the worker being economically dependent, this suggests a traditional employment relationship. 

While the guidance from the DOL is directed to its investigators, employers subject to the FLSA should be aware of the change to the rule DOL investigators will apply should an investigation occur. However, employers must also ensure that they meet the test outlined in the 2024 Final Rule given private litigation will still proceed under this rule. Additionally, Oregon’s various regulatory agencies use their own legal tests when determining an individual’s employee or independent contractor status. 

When analyzing a worker’s employment status, it is important to understand the distinction between an employee and an independent contractor because the protections of the FLSA, and other employment laws, apply to employees but not to independent contractors. Now is a good time for employers to review how their employees are classified to ensure compliance with applicable law, regulations, and the recent DOL guidance. When in doubt, however, it is always safe to classify a worker as an employee. 

We are here to help. Please contact Becky Zuschlag at bzuschlag@barran.com or 503-276-2151, or your regular Barran Liebman attorney for assistance in reviewing your employment compliance and ensuring your employees are classified appropriately.

5/19/25 E-Verify System Error Results in False “Final Nonconfirmation” Notices

May 19, 2025

By Abby Fitts

The United States Citizenship and Immigration Services (USCIS) issued a notice today reporting a system error with E-Verify that impacted certain Social Security Administration (SSA) mismatch cases referred to SSA between April 9, 2025, and May 5, 2025. E-Verify functions by comparing information provided by employees on Form I-9, Employment Eligibility Verification, with records held by the Department of Homeland Security (DHS) and the SSA. If the information does not match, the system returns a “tentative nonconfirmation” or mismatch. In such cases, employers must follow prescribed steps to allow employees an opportunity to address and resolve the discrepancy. A “final nonconfirmation” is only issued when E-Verify cannot confirm eligibility after the employee has an opportunity to resolve the mismatch. 

Most mismatches typically result from errors in DHS records or employees failing to update their status with the SSA. However, due to the recent error, even employees who attempted to resolve their mismatch by visiting an SSA office—but did not contact DHS—may have still experienced a mismatch result.

Key Takeaways:

USCIS has advised that employers who received E-Verify FNCs after an SSA or Dual SSA and DHS mismatch referred between April 9 and May 5 to take the following steps:

• Create a new E-Verify case  

• Do not terminate employment and do not take any adverse employment action

We are here to help. Please contact Abby Fitts at afitts@barran.com or 503-276-2190, or your regular Barran Liebman attorney for assistance in reviewing your employment compliance. 

5/15/25 Documentation and Review: Reminders for the ERISA Plan Fiduciaries in Your Life

May 15, 2025

By Jeff Robertson  &  Iris Tilley

As part of our ongoing series focusing on employee benefits compliance, this installment focuses on concrete steps plan sponsors should consider as part of their ongoing compliance efforts.

1. Establish a Process for Service Provider Selection and Monitoring

Plan vendors are all too easy to set and forget. Since they operate in the background, plan sponsors often only consider vendor selection where a vendor implements a large price increase or just becomes wildly unresponsive to the client’s needs. However, plan fiduciaries have a duty to prudently select and monitor service providers.

In order to ensure that a plan engages in a prudent selection process and satisfies its duties to monitor plan service providers on an ongoing basis, we recommend that plans establish formal processes surrounding both of these duties. Formal processes help to avoid engagement of a service provider based on a personal relationship (and not necessarily what is best for plan participants) as well as a regimented structure to ensure that ongoing monitoring takes place, even where staff changes.

2. Update and Review Service Provider Contracts for Reasonable Fees and Transparency

Part of any good service provider monitor process will include the regular review of service provider contributions to ensure that fees charged are reasonable and that agreements are drafted with appropriate transparency. Determining the reasonableness of fees charged can sometimes feel like a big lift as the process of putting services out to bid using a request for proposal can be time consuming. However, speak with plan consultants about requests for information and other benchmarking work that can be used to determine the reasonableness of fees between larger requests for proposal efforts.

Group health plans and insurers are prohibited from entering into agreements with providers, networks, or other entities offering access to a network that contains provisions that preclude a plan from disclosing specified information. Plans must certify compliance with these rules on an annual basis. Most provider contracts have been adjusted (if necessary) at this point to make necessary adjustments. However, if you have not considered the contents of your health plan contracts in some time, now is a good time to take a fresh look.

3. Ensure That Plan Documents Comply With Any Applicable State or Federal Rules That May Apply

As the health plan industry continues to consolidate, we have started to see plan documents come across our desks from national providers that do not necessarily comply with applicable state law. As a general rule, self-insured health plans are subject to federal law, not state law. However, insured plans are subject to state law, and those self-insured plans that cover employees of unrelated employers, and that are sponsored by governmental employers, are subject to state law.

With this in mind, it remains important to understand what bodies of law apply to your health plans and ensure that they are drafted in compliance with the full scope of applicable law.

4. Understand the Fees Charged and Paid for Administration, Consulting, and Plan Networks

As employers who sponsor self-insured health plans can attest, health plan fees are overwhelming, and it can be difficult to parse what each vendor brings to the table. However, these fees are generally paid directly out of plan assets, which means that plan fiduciaries have an obligation to understand these fees and ensure that they are reasonable.

Plan fiduciaries should ask for training and explanation as needed to ensure that they can easily explain why each amount is paid from plan assets and how they know that the fees charged are reasonable.

5. Update Contracts and Procedures for Cybersecurity Responsibility

Cybersecurity remains an ever-expanding threat, and many older vendor contracts do not contain any language related to this topic. In response to this ongoing threat, the U.S. Department of Labor has published tips and identified recommended cybersecurity plan provisions: https://www.dol.gov/sites/dolgov/files/ebsa/pdf_files/tips-for-hiring-a-service-provider-with-strong-security-practices.pdf. Plan sponsors should consider their own vendor contracts in light of this guidance and demand contractual changes as necessary.

The Barran Liebman Employee Benefits Group assists employers with retirement and health plans.  Please contact Jeff Robertson at 503-276-2140 or jrobertson@barran.com, or Iris Tilley at 503-276-2155 or itilley@barran.com, or your regular attorney at Barran Liebman if you have any questions.

4/30/25 Trends in ERISA Litigation: What Plan Sponsors Should Consider Now

April 30, 2025

By Jeff Robertson  &  Iris Tilley

We recently published five considerations for retirement plan fiduciaries in changing markets.  This E-Alert focuses on five trends in ERISA litigation that plan sponsors should consider in their risk mitigation efforts. 

1. Forfeiture Accounts

Regulatory agencies and plaintiff lawyers have increasingly focused on forfeiture balances in retirement plan accounts.  A retirement plan’s forfeiture balance must be allocated every December 31st (if it is a calendar year plan). Yet, many plans maintain forfeiture account balances beyond that date and “plan expense” accounts.  Additionally, many plan sponsors allocate those balances in the year following the year in which they were forfeited to offset plan expenses, raising questions of self-dealing.  It is critical to maintain a forfeiture policy in governing plan documents and present a plan of action to address forfeiture balances at the end of each plan year.

2. Health Plan Fee Litigation

Lawsuits are increasing for both tobacco surcharges and pharmacy benefit fees in group health plans.  We often find that plan sponsors, especially those sponsoring self-funded health plans or health trusts, do not consider the costs of a pharmacy benefit or a pharmacy benefit manager in written plan records. Additionally, many plan documents, including wrap documents, are not regularly reviewed by legal counsel.  It has been awhile since we saw the wave of cases and claims regarding weight loss drugs related to anti-smoking, but there may be a new wave of litigation on its way related to GLP-1 medications.   Procedures and documents remain critical in defending against any action which may relate to plan document claims.

 3. SECURE 3.0?

Partisan Washington DC lawmakers have been successful in one area – passing retirement plan legislation.  We expect to see further interest in automatic enrollment, mandatory employer retirement plan contributions, and lowering contribution age limits from 21 to 18.  It is also important to timely amend plan documents for the SECURE Act, the CARES Act, and the SECURE 2.0 Act.  For most plans, the amendment deadline is December 31, 2026, but collectively bargained and governmental plans have a longer runway.

 4. Health Plan Cost and Fee Transparency

While it can be at times difficult to follow the Trump Administration’s priorities, it is clear that a regulatory and legislative priority is to improve cost transparency at the health services level.  Most health plan sponsors do not have access to the information required to explain costs and services to their participants. Consider whether your health and welfare plan documents are understandable and updated.  Does your summary plan description or wrap document contain correct and updated disclosures?

 5. Health Plan Regulation

While the DOGE (Department of Government Efficiency) continues to make spending cuts to the federal government, it has not altered regulatory changes and disclosures related to HIPAA policies and procedures, telehealth, MHPAEA (Mental Health Parity and Addiction Equity Act), and a recent increase in 1094/1095 IRS penalty assessments.  

We are here to help. 

The Barran Liebman Employee Benefits Group assists employers with retirement and health plans.  Please contact Jeff Robertson at 503-276-2140 or jrobertson@barran.com, or Iris Tilley at 503-276-2155 or itilley@barran.com, or your regular attorney at Barran Liebman if you have any questions.

4/15/25 New Oregon Minimum Wage Rates Announced

April 15, 2025

By Abby Fitts

On April 11, 2025, Oregon’s Labor Commissioner Christina Stephenson announced Oregon’s new minimum wage rates based on a 2.4% Consumer Price Index increase from March 2024 through March 2025. The annual automatic increases to Oregon’s minimum wage are effective each July 1 and are indexed to year-over-year inflation based on the CPI.

New Minimum Wage Rates

These are the new minimum hourly wage rates for each region in Oregon effective July 1, 2025:

• Portland metro area within the urban growth boundary: $16.30

• Standard minimum wage: $15.05

• Non-urban Oregon: $14.05

The “standard minimum wage” applies to Benton, Clatsop, Columbia, Deschutes, Hood River, Jackson, Josephine, Lane, Lincoln, Linn, Marion, Polk, Tillamook, Wasco, and Yamhill counties as well as parts of Clackamas, Multnomah, and Washington counties outside the urban growth boundary.

Oregon’s non-urban minimum wage rate applies in Baker, Coos, Crook, Curry, Douglas, Gilliam, Grant, Harney, Jefferson, Klamath, Lake, Malheur, Morrow, Sherman, Umatilla, Union, Wallowa, and Wheeler counties.

Employers can determine if an employee is working within the urban growth boundary by referring to this Metro map.

Compliance Reminders
Employers should take the time now to ensure their wage rates are consistent with the new minimum wage rates and should remember that the minimum wage rate depends on where the employees perform their work. Employers are required to display an updated minimum wage poster in a conspicuous place. BOLI will make free, updated posters available for download on their website by June 15.

 We are here to help. Please contact Abby Fitts at afitts@barran.com or 503-276-2190, or your regular Barran Liebman attorney for assistance in reviewing your wage and hour compliance. 

4/14/25 Facing a Chaotic Market: Reminders and Recommendations for Retirement Plan Fiduciaries

April 14, 2025

By Jeff Robertson and Iris Tilley

In these chaotic markets, it is important to revisit your 401(k) fiduciary process to ensure you and your employees are making prudent decisions within the rules of ERISA. When markets are high, participants tend to overlook structural plan issues in favor of increasing balances. However, when markets are down, participants, especially near-retirees, try to find opportunities to recoup market losses from faults in your retirement plan. 

With that in mind, here are five ways to protect yourself and your plan:

1.    Clarify Identities of the 401(k) Plan Fiduciaries

When we review documents listing the plan fiduciaries, we often find that they do not align with the actual current decision makers at a company. This happens due to turnover, promotions, and failure to regularly review and update documents. Where no active delegation has been made, a company’s Board of Directors will be the responsible entity. If the Board of Directors does not regularly review the 401(k) plan, it should be very clear within plan records that it has delegated that authority to the proper individuals at the company.

2.    Take Prudent Action in Relation to Your 401(k) Plan

A 401(k) plan is intended to be a long-term savings vehicle toward retirement. While employees retire at different times, the fiduciary duty remains the same—to act with a prudent process to the plan overall. This is a good time to evaluate the investment opportunities offered in the plan: Are there too many? Are the options diversified? How does the plan account for management fees in the investments? Do the fiduciaries follow an investment policy statement? 

3.    Take Care Not to Provide “Investment Advice” to Employees

A company’s officers, who are fiduciaries of the plan, are not the plan’s investment advisors. Nevertheless, we often encounter employees who by interest or job focus are (or believe they are) skilled in market trading and economic concepts and provide advice to other employees. ERISA rules prevent employee-fiduciaries from providing advice to participants. Utilize the plan’s independent investment advisors and their services to provide information and education to participants.

4.    Understand What a Company Offers as Investments and Why

A lot of companies set up an investment menu when a plan is established, and while they might perform a periodic review, do not change core investments. However, a regular review is important, especially in times of market downturn, to limit potential liability. One way to start this review is to ask your investment advisors whether they would change any funds if they were setting up the plan from scratch. This question includes the review of proprietary funds to the administrative platform that may have been prudent choices on adoption, but can potentially be more costly in your current investment lineup. 

5.    Document

If you do not regularly meet as a committee or do not document minutes of when you meet, now is the ideal time to document decisions. Many ERISA cases are determined by language included (or often not included) in the Summary Plan Description or Plan Committee Minutes. 

We are here to help. Please contact Jeff Robertson at jrobertson@barran.com or 503-276-2140, Iris Tilley at itilley@barran.com or 503-276-2155, or your regular Barran Liebman attorney for assistance in reviewing your 401(k) plan. 

4/9/25 Temporary Injunction Issued Against Oregon Project Labor Agreement Requirement

April 9, 2025

By Nicole Elgin and Lex Shvartsmann

On March 24, 2025, Marion County Circuit Court Judge Thomas M. Hart issued a temporary injunction against Governor Tina Kotek’s 2024 Executive Order requiring Project Labor Agreements (PLAs) for many state-funded construction projects. We outlined EO 24-31 in a prior E-Alert, which you can find here. 

The injunction resulted from a lawsuit brought against Governor Kotek in February by the Associated General Contractors, Oregon-Columbia Chapter (AGC) alongside several other contractor associations and construction firms. The lawsuit challenges the Governor’s authority to implement the requirements of EO 24-31 without involvement from the Oregon Legislature. According to the Plaintiffs in the lawsuit, “EO 24-31 seeks to change Oregon law without legislative authority and in direct violation of the separation of powers.”

 
Practically, the temporary injunction means that EO 24-31 is suspended from taking effect. The underlying lawsuit will proceed and will either result in a permanent block of the Order or a finding that its implementation was constitutional. 

For questions regarding EO 24-31, project labor agreements, or other labor matters, contact Nicole Elgin at 503-276-2109 or nelgin@barran.com.

4/1/25 NLRB Without Quorum…Again & New General Counsel Nominee

April 1, 2025

By Nicole Elgin and Lex Shvartsmann

As discussed in our previous E-Alerts, the removal of National Labor Relations Board (NLRB) Member Gwynne Wilcox and the ensuing litigation has been an important and rapidly evolving issue since President Trump took that historic action during his first month in office.

Most recently, on March 28, 2025, the Court of Appeals for the District of Columbia granted the Government’s motion for an emergency stay of the reinstatement order that the District Court for the District of Columbia issued earlier this month. This means that Member Wilcox is not reinstated to her position until the Court of Appeals issues its decision on the matter.

The Court will hear oral arguments on the merits of the case on May 16, 2025. For now, the stay of the District Court’s order means that the NLRB does not have enough members for a quorum, and therefore cannot operate in its usual capacity. Two vacant seats remain on the Board.

On March 24, 2025, President Trump also nominated attorney Crystal Carey to serve as the new National Labor Relations Board General Counsel. The appointment must be confirmed by the Senate to become effective.

Barran Liebman attorney Nicole Elgin will be covering several recent changes from the National Labor Relations Board and what they mean for unionized and non-unionized employers alike at our upcoming Barran Liebman webinar on April 8, 2025. Click this link to register.

For questions on this alert or labor relations, contact Barran Liebman attorney Nicole Elgin at 503-276-2109 or nelgin@barran.com.

3/21/25 Rescinded Executive Orders Impact Federal Contractors

March 21, 2025

By Nicole Elgin and Lex Shvartsmann

On March 14, 2025, President Trump issued an Executive Order titled “Additional Rescissions of Harmful Executive Orders and Actions.” This EO rescinded several prior EOs and other Memoranda and Determinations, including EO 14026 (increasing the Minimum Wage for Federal Contractors) and EO 14126 (Investing in America and Investing in American Workers). A link to the White House’s announcement is available here.

EO 14026: Increasing the Minimum Wage for Federal Contractors

This EO from April 2021 increased the minimum wage for federal contractors to $15 an hour with annual adjustments for inflation. As of January 1, 2025, that minimum wage had already increased to $17.75 per hour.

EO 14126: Investing in America and Investing In American Workers

This EO from September 2024 directed federal agencies to prioritize project labor agreements, collective bargaining agreements, voluntary union recognition, and employer neutrality, amongst other factors. The EO had specific implementation priorities and approaches, including that agencies should include those type of labor agreements as specific selection factors for federal financial award recipients.

President’s Trump’s revocation of this order means that the Department of Labor will no longer be enforcing the requirements of EO 14026 and federal agencies are no longer required to follow the prioritization agenda from EO 14126.

Webinar Alert: Barran Liebman attorney Nicole Elgin will be covering several recent changes from the National Labor Relations Board and what they mean for unionized and non-unionized employers alike at our upcoming Barran Liebman webinar on April 8, 2025. Click this link to register for this webinar.

For questions on this alert or labor relations, contact Barran Liebman attorney Nicole Elgin at 503-276-2109 or nelgin@barran.com.