Extensive Changes to Employment Laws Affect Most Virginia Employers
New laws enacted in 2020 make sweeping changes affecting employers in Virginia, including small business owners, in coming months. Virginia employers will face additional legal requirements and greater potential liability as a result of these changes, many of which take effect as soon as July 1, 2020.
New Non-Discrimination Requirements
Under the Virginia Values Act, employers of 5 or more individuals in Virginia are expressly prohibited from discriminating (in various ways) on the basis of sexual orientation and gender identity, as well as race; color; religion; sex; marital status; pregnancy, childbirth or related medical conditions; age; veteran status; or national origin. Prohibited discrimination “on the basis of race” expressly includes discrimination based on or because of traits historically associated with race, including hair texture, hair type, and protective hairstyles such as braids, locks, and twists.
The new law authorizes the Division of Human Rights – a division in the Office of the Attorney General – to investigate complaints filed by individuals who believe they have been discriminated against in any way (even short of wrongful termination). In addition, either the Office of the Attorney General or the individual who believes they have been discriminated against can file a lawsuit against any such employer. In addition to individualized damages, civil penalties of up to $50,000 for a first violation and up to $100,000 for a second violation, as well as attorneys’ fees and costs, may be awarded against an employer found to have violated these provisions. These laws not only expand the protections against nondiscrimination for employees in Virginia beyond the protections previously available under federal law; they also cast a far wider net in terms of affected employers – both large and small – and expand and uncap the remedies available to successful claimants.
Other legislation requires accommodations, and that specific notices be provided to employees regarding the ability to request and receive accommodations, for pregnancy, childbirth, or related medical conditions. Like the Virginia Values Act, this law applies to employers of more than 5, and greatly expands protections for employees beyond what previously has been available under federal law. Further, this new provision prohibits employers from retaliating against an employee who requests or accepts such accommodations. Violations will entitle the affected employee to compensatory damages, back pay, attorneys’ fees and costs, and injunctive relief.
Other New Private Rights of Action
The General Assembly created other new private rights of action for employees as well.
1. Wage Payment Violations. Should an employer violate the Virginia Wage Payment Act (which among other things requires wage payments at least twice a month, only certain deductions from wages, and no delay in wage payment for a terminated employee), the affected employee(s) now may file a private action. A court is authorized to award – in addition to wrongly withheld wages – liquidated damages, prejudgment interest, attorneys’ fees and costs, and treble damages in the event of a “knowing” violation.
2. Misclassification of Independent Contractors. Individuals performing services for remuneration are now presumed to be employees under Virginia law. Any individual who believes he/she has been misclassified as an independent contractor by an employer may file a private action. If the employer cannot rebut the presumption, the court can award damages including both wages and benefits lost, expenses incurred that would otherwise have been covered by insurance, as well as attorneys’ fees and costs. In addition, the Virginia Department of Taxation is authorized to investigate such misclassifications and may impose civil penalties for violations as well as potentially debar the employer from participating in procurement statewide. The new law also prohibits retaliation against employees who report misclassifications or participate in an investigation or legal action regarding misclassifications.
3. Limits on Use of Non-Competes. Employers are now prohibited from using non-competes with any “low-wage employee,” which includes (but is not limited to) interns, students, apprentices, or trainees. Employers must post a notice about the prohibition. Failure to post or provide the required notice will result in civil penalties of up to $250 for a second violation after warning and up to $1,000 for every subsequent violation. Employers who improperly use non-competes with low-wage employees may face civil penalties of $10,000 per violation. In addition, the affected employee can bring a private action to recover liquidated damages, lost compensation and other damages, and attorneys’ fees and costs. The new law also prohibits retaliation against an employee for bringing such a civil action.
Minimum Wage Increase
The General Assembly also passed, for the first time, a law that sets the minimum wage in Virginia above the federal minimum wage. The law sets minimum wage in Virginia to $9.50 effective May 1, 2021, with annual increases in the ensuing five years.
Planning to implement these new requirements – and minimizing legal risks associated with them – is advisable for all affected employers. Should any Virginia employer have questions, or need assistance planning for or evaluating compliance, or responding to employee’s questions or claims under these new provisions, please contact Mandi Smith.
