President Trump Removes EEOC Commissioners and NLRB Member

President Trump removed a member of the NLRB, and two EEOC commissioners, leaving both without a quorum for the time-being. Can he do that? Under the statutory text of the NLRA, clearly no (it requires a hearing and neglect of duty or malfeasance). Under the statutory text of Title VII (re: EEOC), removal is not expressly addressed - it does generally specify five year terms though.

There is, however, a constitutional issue. The executive power is vested in one person, the President. This power *generally* includes the power to remove people who assist him in wielding the executive power. In Humphrey’s Executor v. U.S. in 1935, SCOTUS recognized an exception, holding "that Congress could create expert agencies (specifically, the FTC) led by a group of principal officers removable by the President only for good cause."

In 2020, SCOTUS limited that holding by striking down the CFPB framework in which "an independent agency [is] led by a single Director" subject to statutory limitations on the President's power to remove them. Seila Law v. CFPB (linked below). The key distinction was a multi-member board versus a single director.

The NLRB and EEOC seem a lot more like the FTC in Humphrey's Executor than the CFPB in Seila Law. Some Justices appear inclined to overrule Humphrey's Executor though, and these recent removals may put the issue in front of SCOTUS.

President Trump rescinds federal contractor affirmative action executive order

Earlier this week, President Trump signed a new executive order, Ending Illegal Discrimination and Restoring Merit-Based Opportunity. One major piece of this order is that it rescinds Executive Order 11246 (1965, since amended). EO 11246 generally required federal contractors to "take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, sexual orientation, gender identity, or national origin."

Notably, affirmative action did *not* mean implementing quotas, set-asides for specific groups, or hiring based on protected characteristics over merits (indeed, these would violate anti-discrimination statutes like Title VII). Instead, the order required employers to create organizational profiles with workforce analysis - tracking total number of employees by job title and identifying areas of underrepresentation compared to the availability of qualified women and minorities in the labor market; setting targets; and implementing action-oriented programs like recruitment and training programs. 

Note that federal contractors are still subject to other affirmative action requirements regarding disabilities and veterans.  

SCOTUS: Preponderance of the evidence standard for FLSA exemptions

New Supreme Court Decision! Today, the Supreme Court held that employers looking to prove an employee is exempt from the minimum wage and overtime requirements of the FLSA must do so by a "preponderance of the evidence." This is, of course, the standard burden of proof in civil litigation. Some courts, however, had applied a higher standard like "clear and convincing evidence." Here in the Third Circuit, some cases have used language like "plainly and unmistakably." Today's decision makes clear that preponderance of the evidence is the standard.

You can read the full decision here. 

New Pennsylvania law restricting noncompetes with health care practitioners is now in effect

The Fair Contracting for Health Care Practitioners Act took effect on January 1, 2025. The Act generally bans the use of noncompete agreements with certain health care practitioners but with some notable exceptions.

Who

The Act defines “health care practitioner” as a medical doctor, doctor of osteopathy, certified registered nurse anesthetist, registered nurse practitioner, or physician assistant.”

What

“Noncompete covenant” is broadly defined as “An agreement that is entered into between an employer and a health care practitioner in this Commonwealth which has the effect of impeding the ability of the health care practitioner to continue treating patients or accepting new patients, either practicing independently or in the employment of a competing employer after the term of employment.” 35 Pa. Stat. Ann. § 10323.

When

The Act took effect on January 1, 2025.

The General Rule

Any noncompete entered into with a health care practitioner after January 1, 2025 is “deemed contrary to the public policy and is void and unenforceable by an employer.” 35 Pa. Stat. Ann. § 10324(a).

The Exceptions

1.      Less than one year, not dismissed. The general prohibition does not apply to noncompetes where (1) the duration of the restrictive covenant is less than one year; and (2) the health care practitioner was not dismissed by the employer. 35 Pa. Stat. Ann. § 10324(b). 

2.      Recovery of reasonable expenses. An employer may still contract with a health care practitioner to recover reasonable expenses, if the expenses are: (1) Directly attributable to the health care practitioner and accrued within the three years prior to separation, unless separation is caused by dismissal of the health care practitioner; (2) related to relocation, training and establishment of a patient base; and (3) amortized over a period of up to five years from the date of separation by the health care practitioner. 35 Pa. Stat. Ann. § 10324(c)(1).

3.     Ownership transfers. Noncompetes remain permissible for: (1) the sale of an ownership interest or all or substantially all of the assets of the business entity; (2) a transaction resulting in the sale, transfer or other disposition of the control of the business entity, including by merger or consolidation; and (3) the health care practitioner’s receipt, by purchase, grant, award, issuance or otherwise, of an ownership interest in the business entity. 35 Pa. Stat. Ann. § 10324(c)(2).

Patient Notification

            The Act also requires employers to notify the health care practitioner’s patients of: (1) the health care practitioner’s departure; (2) if the patient chooses to receive care from the departed health care practitioner or another health care practitioner, how the patient may transfer the patient’s health records to a health care practitioner other than with the employer; and (3) that the patient may be assigned to a new health care practitioner within the existing employer if the patient chooses to continue receiving care from the employer. 35 Pa. Stat. Ann. § 10325. The notice must be sent within 90 days of the employee’s departure and only to patients the employee saw within the past year and had an ongoing outpatient relationship with for two or more years.