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On December 15, the Council of the District of Columbia adopted Bill 23-965, the Displaced Workers Right to Reinstatement and Retention Amendment Act of 2020 (“Act”) on a permanent and emergency basis. The Act, introduced by Chairman Phil Mendelson, would establish a right to reemployment for eligible employees of certain contractors and employers at covered establishments. The Act will expire on June 30, 2023, except that the retaliation and enforcement provisions will expire on June 30, 2024. The emergency Act will take effect for 90 days upon approval by the Mayor, and the permanent Act must be signed by the Mayor and complete a 30-legislative-day congressional review period to take effect. The Act as adopted is summarized below.

Eligible Employees

  • An eligible employee is an individual who was employed to work at a covered establishment or for a contractor, and who: (1) ceased working at the covered establishment or for the contractor for reasons other than voluntary resignation or termination for cause, and (2) the individual’s last day of employment for the employer was between December 1, 2019 (hotel employees), or March 1, 2020 (all other eligible employees), and the last day of the COVID-19 public health emergency.
    • Eligible employees do not include individuals:
      • Employed in an executive, administrative, or professional capacity under the Fair Labor Standards Act;
      • Who received severance from the individual’s employer or contractor when the individual’s employment ceased and whose employer or contractor has a written, verifiable proof of the severance; or
      • Whose employer or contractor would have terminated the individual for demonstrable just cause when the individual previously worked for the employer or contractor.
    • Contractors are defined under the Act as an individual or company, other than an employer, that employs 25 or more individuals and who has hired them to work as:
      • Food service workers in a hotel, restaurant, cafeteria, apartment building, hospital, nursing care facility, or similar establishment;
      • Persons to perform janitorial or building maintenance services in an office building, institution, or similar establishment;
      • Nonprofessional employees to perform health care or related services in a hospital, nursing care facility, or similar establishment; or
      • Persons to perform security services in an office building, institution, or similar establishment, except for special police officers who are armed, and employees hired to perform security services for D.C. Public Schools or public charter schools.
    • Employers are defined under the Act as any entity that, directly or indirectly, including through a staffing agency:
      • Employs or exercises control over the wages, hours, or working conditions of an employee at a covered establishment, which is a hotel, restaurant, tavern, brew pub, nightclub, club, event or entertainment establishment venue at which live performing arts, sporting, or other entertainment events are held, or a business engaged in the sale of goods to consumers, not including wholesalers;
      • Is not a contractor;
      • If the entity operates a hotel, the entity employed 50 or more individuals at a hotel on December 1, 2019; and
      • If the entity does not operate such a hotel, the entity employed 50 or more individuals at a covered establishment on March 1, 2020.

Right to Reinstatement

  • Beginning February 1, 2021, as positions become available with the contractor or in the employer’s operation at a covered establishment, the contractor or employer must offer each eligible employee reinstatement to the employee’s previous position or to a position performing the same or substantially similar duties—and that requires essentially the same skills—as those performed by the employee before ceasing work for the contractor or covered establishment.
  • The contractor or employer must make the offer of reinstatement in writing to the employee’s last known address by registered mail, email, text, or other method that is documented and retained. The offer must include a deadline that is no fewer than three calendar days from the date the offer is sent (if made by mail, text, or same-day delivery), or received (if made by registered mail, mail, or other non-same-day delivery) for an eligible employee to accept or decline the offer. If the employee accepts, the employee must report to work not later than seven days, or later if requested by the employer, from the date the offer is received.
  • If more than one eligible employee is entitled to reinstatement to a position, the contractor or employer may make simultaneous, conditional offers based on seniority within job classifications, except for positions at a restaurant, tavern, brew pub, night club, or club.
  • A contractor or employer may not hire a new employee for a position until all eligible employees have either not responded to, or declined, an offer of reinstatement.

 

Changes in Controlling Interest or Employer

  • Requirements regarding changes in controlling interest or employer do not apply to employees who are entitled to a transition employment period under non-COVID-19 District displaced worker protections, or retained employees who work at restaurants, taverns, brew pubs, nightclubs, or clubs, unless the change would have no demonstrable change to its operations.
    • A change in controlling interest or identity of an employer includes any of the following events that causes either a change in the entity or entities holding a controlling interest in an employer, or a change in the identity of the employer, after February 29, 2020, so long as the new employer’s business operations consist of the same or similar operations as those conducted on or before February 29, 2020:
      • Any sale, assignment, transfer, contribution, or other disposition of a controlling interest in an employer by consolidation, merger, or reorganization of the employer, or any entity or entities that maintains any ownership interest in the employer; or
      • Any purchase, sale, lease, reorganization or restructuring, or relocation of the operation of an employer.
    • Right to Reinstatement: A new employer created as a consequence of a change in controlling interest or identity of an employer must provide a right to reinstatement as provided in the Act.
    • Right to Retention: A new employer must retain (1) any eligible employee reinstated for a 90-day transition period beginning on the date the eligible employee is reinstated, and (2) any retained employee who agrees to remain employed by the new employer for a 90-day transition period beginning on the date of the change in controlling interest or identity of the employer.
      • A retained employee is any individual, except those employed in an executive, administrative, or professional capacity under the Fair Labor Standards Act, who was working for an employer at a covered establishment when a change in controlling interest or identity of an employer occurred, or when an employer was required to give notice of the change.
    • Generally, a new employer may not discharge a retained employee or eligible employee reinstated during the 90-day period without cause. However, if at any time a new employer determines that fewer employees are required to work at the covered establishment than the number required before the change in controlling interest or identity of the employer, the new employer must retain employees by seniority, unless it is a restaurant, tavern, brew up, nightclub, or club.
    • At the end of the 90-day transition period, the new employer must perform a written performance evaluation of each retained employee and each eligible employee reinstated. If the employee’s performance was satisfactory, the new employer must offer continued employment.
    • Beginning February 1, 2021, an employer that anticipates a change in controlling interest or the identity of the employer must, within 15 calendar days before the anticipated date of the change, provide the following notices:
      • To all parties to the transaction that results in the change, and any labor organization that represents the retained or eligible employees: Notice of the name, last known address, date of hire, position, and text or telephone contact information for each eligible employee; and
      • To retained employees and eligible employees and any labor organization that represents the retained or eligible employees: Notice that the employer is experiencing or anticipates a change in controlling interest or identity of the employer and of an employee’s right to reinstatement or retention. This notice also must be posted on the premises of the covered establishment and texted, emailed, or mailed to the last known address of all eligible employees.

Retaliation Prohibited

  • No contractor or employer may terminate, refuse to reinstate or employ, or take an adverse action against any eligible employee or retained employee because the employee asserted rights under or participated in proceedings related to the Act, or because the employee opposed any practice said employee reasonably believes in good faith to be prohibited by the Act.
  • If it is established that an employee engaged in protected conduct, and the contractor or employer thereafter terminated, refused to reinstate or employ, or took adverse action against the person within 60 days afterward, a rebuttable presumption arises that the action was in violation. The contractor or employer may rebut the presumption by producing credible evidence that the sole reason for the action was a legitimate business reason. The business reason may be rebutted by a showing of pretext.
  • The prohibition against retaliation will expire on June 30, 2024.

Enforcement

  • An eligible employee or retained employee may, on behalf of themselves or other similarly situated employees, bring an action to enforce the Act in D.C. Superior Court.
  • Upon prevailing, an employee shall be awarded:
    • Back pay for each day the violation continues at a rate not less than the greater of: (1) the average rate of regular pay during the last three years, or (2) the final regular rate received;
    • Costs of benefits the employer would have incurred for the employee under the employer’s benefit plan;
    • If it is established that the contractor or employer violated the Act with malice or reckless indifference, an employee shall be entitled to treble damages and additional compensatory or punitive damages; and
    • Reasonable attorney fees and costs, including expert witness fees.
  • The enforcement provisions will expire on June 30, 2024.

Relationship to Employment Contracts and Agreements

  • The Act’s requirements do not diminish the obligation of a contractor or employer to comply with the provisions of any contract, including any individual contractual arrangement or any collective bargaining agreement that provides greater or equal rights to employees than the rights afforded under the Act.