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Toledo, Ohio is the latest jurisdiction (and the second city in Ohio) to enact a law that will prohibit employers from asking job applicants about salary history.
The ordinance, which is scheduled to take effect on June 25, 2020, will apply to employers with fifteen or more employees in Toledo, and will prohibit such employers and their agents from:
inquiring about the salary history of an applicant for employment;
screening applicants based on their current or prior wages or other benefits or compensation, or requiring that salary history satisfy minimum or maximum criteria;
relying on salary history in deciding whether to extend an offer of employment, or in determining the salary, benefits, or other compensation for an applicant during the hiring process, including the negotiation of an employment contract; and/or
refusing to hire or otherwise retaliating against an applicant for not disclosing his or her salary history.
In addition, upon the reasonable request of an applicant who has received a conditional offer of employment, an employer will be required to provide the pay scale for the position.
For purposes of the ordinance, “applicant” is defined broadly to mean any person applying for employment to be performed within Toledo or whose application, in whole or in part, will be “solicited, received, processed, or considered in the City of Toledo, regardless of whether the applicant is interviewed.” “Salary history” means an applicant’s current or prior wages, benefits, or other compensation, but does not include any objective measure of the applicant’s productivity, such as revenue, sales, or other production reports.
While the term “inquire” includes oral or written requests as well as searches of publicly available records, employers may verify an applicant’s non-salary related information or conduct a background check, so long as they do not consider or rely upon any salary history information that may inadvertently be obtained.
Notably, the ordinance’s prohibitions do not apply to “voluntary and unprompted” disclosures of salary information by applicants. The ordinance further permits employers to engage in discussion with applicants about their expectations with respect to compensation, including but not limited to unvested equity or deferred compensation that may be subject to forfeiture or cancellation.
The ordinance also excludes from coverage: (1) applicants for internal transfer or promotion; (2) positions for which compensation is determined pursuant to collective bargaining; (3) actions taken by an employer pursuant to any federal, state or local law that specifically authorizes the reliance on salary history to determine an employee’s compensation; and (4) former employees who are re-hired by the same employer within five years of termination, provided that the employer already has any past salary history information regarding the applicant from the individual’s previous employment.
Applicants alleging a violation of the ordinance will have a private right of action. Available remedies will include compensatory damages and attorney’s fees and costs.
In advance of the June 25, 2020 effective date, employers in Toledo should begin taking steps to ensure compliance by training human resources and other relevant personnel on these new requirements.
As we have reported before, California is set to become the first state to prohibit employers from discriminating based upon hairstyle. Last week, Governor Gavin Newsom signed into law the “CROWN Act” (Create a Respectful and Open Workplace for Natural Hair).
The CROWN Act amends the state’s Education Code and Government Code to define “race or ethnicity” as “inclusive of traits historically associated with race, including, but not limited to, hair texture and protective hairstyles.” The new law expressly defines “protective hairstyles” as including but not limited to “braids, locks, and twists.”
Introduced by Sen. Holly Mitchell (D-Los Angeles), the CROWN Act “protects the right of Black Californians to choose to wear their hair in its natural form, without pressure to conform to Eurocentric norms,” Mitchell said. Governor Newsom called the law “long overdue,” and the bill passed both the Senate and the Assembly unanimously. The new law takes effect on January 1, 2020.
Meanwhile, on the East Coast, both New York and New Jersey also are advancing laws that would protect against hairstyle-based discrimination.
In New York, SB 6209 would amend the definition of “race” under the New York State Human Rights Law (NYSHRL) to include “traits historically associated with race, including but not limited to, hair texture and protective hairstyles,” thus making it unlawful under the NYSHRL to discriminate on the basis of such traits in employment, as well as housing and in public accommodations. The bill also would extend similar protections to students covered under the state’s Education Law.
Similarly in New Jersey, SB 3945 would expand the definition of “race” under the New Jersey Law Against Discrimination (which also prohibits discrimination in employment, housing, and public accommodations) to include “traits historically associated with race, including, but not limited to, hair texture, hair type, and protective hairstyles.”
Like the California law, the New York and New Jersey bills define “protective hairstyles” to include hairstyles such as braids, locks, and twists.
The New York bill is currently before Governor Andrew Cuomo, who is expected to sign. The New Jersey bill is still being considered by the state Senate and Assembly Labor Committees. Both bills, if signed, would take effect immediately.
As we find ourselves in the midst of summer, employers in New York should keep an eye on the upcoming October 9th deadline for providing anti-harassment training to all employees.
As we previously reported, effective October 9, 2018, all New York State employers are required to adopt written sexual harassment prevention policies and institute annual anti-harassment training for employees. To satisfy the training requirements, employers may either: (1) adopt the State’s model training script, slides, and/or case studies; or (2) provide other live training or interactive online/video training that meets or exceeds the law’s minimum standards for training. Employers must train all employees – including exempt, non-exempt, part-time, seasonal and temporary employees – on or before October 9, 2019. And, according to the State’s guidance, employers also need to train employees who “work a portion of their time in New York State, even if they’re based in another state.”
As a reminder, employers in New York City must also comply with the Stop Sexual Harassment in NYC Act’s training requirements, which went into effect on April 1, 2019. While there are many similarities between the State and City law requirements – including the requirement that the training be interactive – the City law also requires that employees be trained on bystander intervention. And like the State’s guidance, the City’s guidance similarly extends an employer’s training obligation to employees who are connected to New York City “in any way.” This includes (1) employees who work or will work in New York City; (2) employees who work a portion of their time in New York City; and (3) employees who are based elsewhere but who interact with other employees in New York City (even if they are not physically present in the City). Although employers in New York City have until December 31, 2019 to comply with the City law, employers should consider providing training now that complies with the requirements of both the State and City laws.
As always, Proskauer attorneys are standing by to provide guidance and answer questions you have about these requirements.
The Colorado legislature has been quite active in recent weeks, passing several new employment laws, many of which reflect nationwide trends. Among other things, the new laws address discriminatory pay disparities, salary history inquiries and criminal background checks.
Effective January 1, 2021, the Equal Pay for Equal Work Act (the “Act”) will prohibit employers from paying members of the opposite sex different wages for “substantially similar work” based on sex (including gender identity) or sex plus another characteristic protected by applicable law. The presence of “substantially similar work” is determined by the nature of the job itself, taking into account employee skill, effort and responsibility.
An employer may, however, avoid liability under the Act if it can demonstrate that the difference in compensation is based on at least one of the following factors: (i) a seniority system; (ii) a merit system; (iii) a system that measures earning by quantity or quality of production; (iv) the geographic location where the work is performed; (v) education, training, or other relevant experience to the extent they are reasonably related to the work in question; and (vi) travel, if travel is a regular and necessary condition of the work performed.
Colorado’s Act contains two unique notice provisions not required in other states’ laws. First, it requires employers to make reasonable efforts to announce, post, or otherwise make known all internal opportunities for promotion to all employees on the same calendar day. Additionally, employers must disclose in each posting for each job opening the hourly or salary compensation, or a range of the hourly or salary compensation, and a general description of all benefits and other compensation offered.
Similar to laws in Massachusetts and Oregon, the Act incentivizes employers to be proactive and conduct audits of their compensation practices. While not a complete defense to liability, employers may use evidence of a “thorough and comprehensive pay audit” with the “specific goal of identifying and remedying unlawful pay disparities” to avoid liquidated damages.
The Act further obligates employers to keep records of all job descriptions and wage rate history for the duration of employees’ employment plus two years after the end of employment in order to determine if there is a pattern of wage discrepancy.
The Act also prohibits employers from seeking the wage rate history of job applicants, bringing Colorado in line with nine other states that have enacted similar prohibitions on salary history inquiries. Specifically, employers may not:
Seek the wage history of a prospective employee;
Rely on the wage history of a prospective employee to determine wage rate; or
Discriminate or retaliate against a prospective employee for failing to disclose wage history.
For employees who are paid on an hourly basis, the Act defines “wage rate” to include the hourly compensation paid to the employee plus the value per hour of all other compensation and benefits received by the employee. For employees who are paid on a salary basis, “wage rate” includes the total of all compensation and benefits received by the employee.
The Act also prohibits employers from (1) preventing employees from discussing their own compensation information with others, or (2) requiring employees to sign a waiver that prohibits their ability to do the same.
Employers who violate the Act (as it relates to salary history or pay disparity, as discussed above) may be subject to fines and other legal and equitable relief, including reinstatement, promotion, pay increase, payment of lost wage rates, liquidated damages and reasonable attorneys’ fees.
Ban the Box
Colorado also recently enacted a law (HB19-1025) that will prohibit employers from requiring the disclosure of or inquiring about a job applicant’s criminal history on their application form. For employers with more than ten employees, the law takes effect on September 1, 2019; for employers of all other sizes, the law becomes effective on September 1, 2021.
Specifically, the law will prohibit employers from:
Advertising that a person with a criminal history may not apply for a position;
Placing a statement in an employment application that a person with a criminal history may not apply for a position; or
Inquiring about an applicant’s criminal history on an initial application.
Employers are, however, permitted to inquire about criminal history later in the hiring process. There are also exceptions to the law for (i) individuals with certain criminal histories who are prohibited by law from performing a particular job, (ii) criminal history inquiries that are implemented to promote employment of individuals with criminal histories, and (iii) employers that are otherwise required by law to conduct a criminal history check for a particular job.
While employees may not bring a private right of action for violations of the law, the state’s department of labor and employment may issue warnings and orders of compliance for violations, as well as impose civil penalties for subsequent violations.
Employers in Colorado should start taking steps now to ensure all onboarding documents and other policies are compliant with these new requirements. In particular, employers should train HR and other relevant personnel and may also want to consider conducting an audit of their existing pay practices to determine what, if any, changes need to be made with respect to employee compensation.
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Clara Goldrich, an Industrial and Labor Relations (ILR) Intern in Proskauer’s New York office and a student at Cornell University, co-authored this post.
In an effort to assist employers, the EEOC has posted guidance and sample forms for the new EEO-1 Component 2 Compensation Data reporting requirements on its website. The new materials provide useful information for employers to comply with the new reporting requirement. As we have previously reported, employers must now report employee pay data and hours worked, by job category, in addition to the usual workforce demographic information. The EEOC informed employers this spring that it will require submission of 2017 and 2018 data by September 30, 2019.
The new materials include a sample Component 2 Form, an 18-page instruction book for filers and a two page Fact Sheet. The EEOC also provides useful links to EEO-1 and NAICS job classification guides. Covered employers should bookmark this webpage, as the EEOC will release an additional “Users Guide” on or after July 15, 2019, when the Component 2 filing period begins. Employers are encouraged to review these materials in advance of the filling period.
Employers should also consult with counsel to ensure that their Component 2 submissions are compliant and work through the numerous of issues the new submission requirements raise. We will continue to provide updates on this matter as they become available.
As we previously reported, the Universal Paid Leave Amendment Act of 2016 will provide Washington, DC employees with paid leave for several reasons, including:
Up to eight weeks of paid parental leave to bond with a new child;
Up to six weeks of paid family leave to care for a covered family member with a serious health condition; and
Up to two weeks of paid medical leave to care for the employee’s own serious health condition.
The paid leave benefits will be funded by a 0.62 percent quarterly payroll tax on employees’ total wages, which the District of Columbia will begin collecting on July 1, 2019. Although the tax is calculated based on employees’ quarterly wages, the cost cannot be deducted from employee pay.
On July 1, employers must submit wage reports (Form UC-30) to cover both unemployment insurance and paid leave requirements. These reports are based on the wage tracking that employers must conduct on covered employees between April 1, 2019 and June 30, 2019. If an employer pays unemployment insurance tax on an employee for a quarter, then the employee will automatically be presumed to be a covered employee for paid leave.
Employers have until July 31, 2019 to pay the paid leave tax. Employers who fail to make contributions by this deadline will be assessed an interest rate of 1.5% per month until the contributions are made. If contributions are not paid, or wage reports are not filed on or before the first day of the second month following the close of the calendar quarters for which they are due, an added penalty of $100 or 10% of the amount due (whichever is higher) will be assessed.
In addition to tracking employee wages and making quarterly tax payments, employers also are required to post a notice about PFL in a conspicuous place in the workplace, and provide such notice to all employees upon hire and annually thereafter. Employers must also provide this notice at the time it becomes aware that the leave is needed, though employees may not begin using paid leave until July 1, 2020. An employer who fails to provide notice in accordance with the law will be subject to civil penalties, not to exceed $100 for each covered employee to whom individual notice was not delivered and $100 for each day that the employer fails to post notice in a conspicuous place.
Connecticut Governor Ned Lamont recently signed into law the Time’s Up Act (the “Act”), which amends existing state law to impose greater sexual harassment training and notice requirements on employers.
Currently, Connecticut law requires employers with 50 or more employees to provide two hours of sexual harassment training to all supervisory employees. While not required, the Commission on Human Rights and Opportunities (CHRO) encourages employers to provide an update of legal interpretations and related developments concerning sexual harassment to supervisory employees once every three years. Effective October 1, 2019, the Act expands this requirement such that employers with three or more employees must provide sexual harassment training to all employees by October 1, 2020. Employers with fewer than three employees will be required to provide such training only to supervisory employees.
Although there is still no annual training requirement, employers are required to provide periodic supplemental training that updates all supervisory and nonsupervisory employees on the content of such training and education not less than every ten years. Such training must include information concerning the federal and state statutory provisions concerning sexual harassment and remedies available to victims of sexual harassment. The CHRO will develop an online training video or other interactive training material that employers may use to comply with the Act’s requirements.
While existing employees need not receive training until October 1, 2020, new employees hired on October 1, 2019, or later must receive training within six months of hire. Also, employers who have already provided two hours of sexual harassment training to their employees since October 1, 2018 need not retrain such employees before the October 1, 2020 deadline. Failure to provide the required trainings will be considered a “discriminatory practice” and employers may be subject to fines up to $1,000.
The Act also imposes new notice requirements. Currently, employers with at least three employees must post a notice regarding “the illegality of sexual harassment and remedies available to victims of harassment” in a prominent and accessible place. The new law will require employers to also provide new employees a copy of this information by email within three months of hire; the email’s subject line must be “Sexual Harassment Policy,” or something similar. Employers are only required to email this information, however, if (i) the employer has given the employee an email account, or (2) the employee has provided the employer with a personal email. Employers who do not provide employees an email account will be required to post the information on their website, if they have one. Employers may also comply with the law by providing a link to the CHRO in writing.
The Act empowers the CHRO to inspect an employer’s premises during work hours to ensure compliance with required trainings and notices. While CHRO representatives will be permitted to examine an employer’s records, policies, procedures, postings and sexual harassment training materials, the inspection cannot “unduly disrupt” the employer’s business operations.
Connecticut employers should review their existing policies and training materials to ensure compliance with all of the new requirements.
Continuing the trend of states passing increasingly progressive employment regulations, Nevada recently enacted three new laws addressing paid leave, workplace drug testing, and minimum wage.
Paid Personal Leave
Following in the footsteps of Maine, which recently became the first state to enact a personal leave law, SB 312 will require private employers with 50 or more employees in Nevada to provide certain employees working in the state with up to 40 hours of paid leave per year, to be used for any purpose, including non-medical personal reasons.
Beginning January 1, 2020, covered employees will be entitled to accrue 0.01923 hours (or approximately 1.15 minutes) of paid leave for every hour worked, up to 40 hours per year. If using this accrual method, employees must be permitted to carry over any unused paid leave into the following year up to a maximum of 40 hours, though employers can limit total usage of paid leave in a given year to 40 hours. Alternatively, at the beginning of each year, employers can “front load” all the paid leave that the employee would be expected to accrue during that year, in which case the employer would not need to track accruals or require carryover of unused time.
Although employees will begin to accrue leave at the start of employment, employers are not required to permit use of such leave before the employee has been employed for 90 days. Employers also will be permitted to set a minimum usage increment of no greater than four hours. Employees must provide notice “as soon as practicable” of their need to use paid leave, but cannot be required to provide the reason for using the leave.
Temporary, seasonal, and on-call employees are exempt from coverage under the law. Further, employers already providing an equivalent amount of paid leave (whether pursuant to a collective bargaining agreement or other contract, agreement, or policy) to all employees who would otherwise be covered by the law will be exempt from coverage. New businesses will not be required to provide paid leave under the law during their first two years of operation.
Employers will be required to keep records of employees’ receipt and use of paid leave, as well as provide each employee with an accounting of the amount of paid leave available for the employee’s use on each payday. Employers also will be required to post a bulletin overviewing the law in a conspicuous location in the workplace, the form of which will be provided by the state Labor Commissioner.
The state Labor Commissioner will be responsible for enforcement of the law, and employers who violate the law will be subject to penalties of up to $5,000 per violation.
Pre- and Post-Employment Drug Testing
Also effective January 1, 2020, AB 132 will make it unlawful for Nevada employers to fail or refuse to hire a prospective employee because the individual submitted to a pre-hire drug screening and the test indicated the presence of marijuana.
The law exempts certain types of positions from the pre-employment testing restriction, including:
firefighters and emergency medical technicians;
positions requiring the operation of motor vehicles for which federal or state law requires the employee submit to screening tests;
positions funded by federal grant; and
positions that, in the determination of their employer, could “adversely impact the safety of others.”
In addition, for drug tests required within the first 30 days of employment, the law will allow an employee to contest a positive result by submitting to a second drug test at the employee’s expense. The employer would then have to “accept and give appropriate consideration to the results” of such a follow up test.
The provisions of the law will apply to all “screening tests,” defined as a blood, urine, hair, or saliva test designed to detect the general presence of a controlled substance or any other drug. This broad definition means that employers will be required to allow an employee to take a follow up test to contest any positive result, not just marijuana.
The law will not apply where it conflicts with provisions of a collective bargaining agreement or employment contract, as well as to the extent inconsistent or otherwise in conflict with the provisions of federal law.
State Minimum Wage Increase
Nevada also passed AB 456, which will gradually increase the state minimum wage (currently $7.25 per hour for employers offering a qualified health plan, and $8.25 per hour for other employers) by 75 cents annually over the next five years. The first increase will take place on July 1, 2020.
The increases will culminate in July 2024 with an $11 per hour minimum wage for employers offering a qualified health plan, and a $12 per hour rate for all other employers. A qualified health plan is defined in the Nevada state constitution as a plan where the employee’s premiums are not more than 10% of that employee’s annual income from the employer providing the coverage.
The bill also will expand the categories of employees covered by the state minimum wage law to include, among others, outside salespeople whose earnings are based on commission, taxi and limo drivers, agricultural workers, domestic employees residing in the household, and casual babysitters.
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Rebecca Fishbein, a summer associate in Proskauer’s New York office and a rising 3L at Columbia Law School, co-authored this post.
The New York state legislature has passed a bill that would allow employees making certain claims for unpaid wages to obtain a lien against their employers’ property for the value of the claim, inclusive of liquidated damages. If signed by Governor Cuomo, the bill would take effect 30 days after becoming law.
The bill would apply to claims involving non-payment of wages under both the federal Fair Labor Standards Act and the New York Labor Law (and associated wage orders), including claims relating to minimum wage, overtime, spread of hours, call-in pay, uniform maintenance pay, withheld gratuities, unlawful deductions from wages, or improperly taken meal and tip credits, as well as unpaid compensation pursuant to an employment contract.
Employees making such claims would be permitted to obtain an “employee’s lien” against the employer’s interest in real property and certain personal property, excluding “deposit accounts” or “goods,” as defined in Section 9-102 of the Uniform Commercial Code. Liens also could be obtained by the NYS Department of Labor or state attorney general against employers who are the subject of an investigation, court action, or administrative agency action, either on behalf of an individual employee or a class of employees.
Notice of a lien could be filed up to three years following the end of the employment giving rise to the wage claim. Within five days before or 30 days after filing the lien notice, the party seeking the lien would be required to serve a copy of the notice upon the employer, as well as affix a copy to any real property identified in the lien. The lien would extend for up to one year after the notice of lien is filed, unless an extension of up to one additional year is timely filed or action is taken to enforce the lien, in which case it would be extended during the pendency of such action and for a period following entry of final judgment. An employer would, however, be able to purchase a bond in order to discharge the lien at any time.
In the event that an action is not commenced to obtain judgment on the wage claim or to foreclose the lien, the lien would be automatically extinguished unless extended by court order. Further, should a court find that the employee willfully exaggerated the amount of the lien, the lien would be discharged and the employee would be restricted from obtaining another lien against the employer based on the same claim.
In addition to creating the new right of lien, the bill would, in connection with covered wage claims:
allow plaintiffs to seek an order of prejudgment attachment on an employer’s assets pursuant to Section 6210 of the New York CPLR, and require courts to hold a hearing on such a request within 10 days of the employer’s opposition; the bill also would limit the amount of bond that a plaintiff would need to post when seeking an attachment to no more than $500 (or allow a court to waive the bond requirement altogether);
provide employees and their agents with a right to access the minutes of shareholder meetings and records of shareholders, as well as certain information about members of LLCs, related to their claims; and
expand the potential personal liability for the 10 largest shareholders of non-public New York corporations, currently limited to the amount of unpaid wages in the event the company cannot pay, to also include liquidated damages, penalties, interest, attorney’s fees and costs.
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We will continue to monitor this bill and report on any further developments.
Illinois will soon become the eleventh state to legalize the recreational use of marijuana. On June 25, 2019, Governor Pritzker signed into effect House Bill 1438—the Cannabis Regulation and Tax Act (“CRTA”). The CRTA, which is set to take effect on January 1, 2020, leaves some open questions for employers, but there are a few important features with which Illinois employers should quickly become familiar.
Prohibitions on Disciplining or Discharging Employees for Off-Duty Consumption
The CRTA differs from many state laws legalizing recreational marijuana in that it explicitly protects an employee’s right to consume marijuana during off-duty hours. (§ 900-50.) By contrast, in some states that have legalized recreational consumption, employers remain free to adopt and enforce policies prohibiting employees from using marijuana both on and off-the-job.
The CRTA will amend Illinois’s Right to Privacy in the Workplace Act, which prevents employers from disciplining or discharging employees for using “lawful products off the premises of the employer during nonworking hours.” (820 ILCS § 55/5.) The CRTA will define the previously undefined phrase “lawful products” to mean “products that are legal under state law.” (§ 900-50) (emphasis added). This is a noteworthy change because marijuana is still illegal at the federal level.
By defining “lawful products” to mean those products that are legal at a state level, the CRTA appears to prevent employers from disciplining or discharging employees for recreationally consuming marijuana during off-duty hours. Notably however, federally regulated employers, such as those subject to federal DOT regulation, are carved out from this exemption. (§ 10-50(g).)
Employers May Continue Drug Testing and Prohibit Working Under the Influence
Under the CRTA, employers retain the ability to adopt and enforce “reasonable zero tolerance or drug free workplace policies, or employment policies concerning drug testing, smoking, consumption, storage, or use of cannabis in the workplace or while on call.” (§ 10-50(a).)
The only explicit restrictions on these policies are that employees will not be considered to be “on-call” unless they have had at least 24-hours’ notice (§ 900-50(a)), and drug policies must be “applied in a nondiscriminatory manner.” (§ 10-50(a).)
Is a Positive Drug Test Alone a Sufficient Basis for Discipline?
The CRTA states that employers “may consider an employee to be impaired or under the influence of cannabis if the employer has a good faith belief that an employee manifests specific, articulable symptoms while working that decrease or lessen the employee’s performance.” (§ 10-50(d)) (emphasis added.) The CRTA lists symptoms of marijuana impairment, some of which include: impairment of speech or physical coordination; mental effects such as unusual behavior, odd demeanor, or negligence or carelessness in operating equipment or machinery; and disregard for their own safety or the safety of others. (§ 10-50(d).) The statute does not clearly indicate that employers may only take disciplinary action against employees if they exhibit these particular symptoms or what, if any, proof of such symptoms may be required.
Employees Must Have a “Reasonable Opportunity” to Contest the Employer’s Determination that They are Impaired
The CRTA requires employers to give employees a “reasonable opportunity to contest” the basis of the employer’s “good faith belief” of their impairment due to marijuana. (§ 10-50(d).) However, the CRTA lacks guidance as to what would constitute a “reasonable opportunity.”
In view of the CRTA’s significant changes and ambiguities, Illinois employers would be well served by:
Reviewing and updating workplace drug use and testing policies;
Implementing steps to ensure policies are consistently enforced;
Refraining from disciplining or discharging employees until the employee has exhibited signs of actual impairment and has been given an opportunity to explain the behavior; and
Documenting symptoms of on-the-job impairment, including workplace misconduct or safety incidents.