Shutdown Patience Wearing Thin? It is Day 31 of the 2025 federal government shutdown. If the shutdown lasts through November 5, 2025, it will break the thirty-five–day record (set between 2018 and 2019) for the longest government shutdown. This week, Republican leaders in the U.S. Senate abandoned plans to hold votes on bills to provide pay for certain military personnel and essential personnel, as well as ensure funding for the Supplemental Nutrition Assistance Program (SNAP). On the bright side, there were indications that senators were talking this week—perhaps because the following impacts of the shutdown are really coming to a head:

• SNAP Benefits. The U.S. Department of Agriculture (USDA) announced that, due to the shutdown, it would not fund SNAP, beginning November 1, 2025. In response, twenty-five states and the District of Columbia filed a legal challenge to this decision, arguing that USDA “has funds available to it that are sufficient to fund all, or at least a substantial portion, of November SNAP benefits” and that “[s]uspending SNAP benefits in these circumstances is both contrary to law and arbitrary and capricious under the Administrative Procedure Act.” Today, Judge Indira Talwani of the U.S. District Court for the District of Massachusetts ruled that the decision to halt SNAP benefits was “unlawful,” and she required the administration to explain by Monday, November 3, 2025, how it would fund aid in November. Shortly after the ruling, Judge John J. McConnell, Jr., of the U.S. District Court for the District of Rhode Island, presiding over a similar case, ordered the Trump administration to tap an emergency reserve and “distribute the contingency money timely, or as soon as possible, for the Nov. 1 payments to be made.” At the time of the Buzz’s publication, it was unclear what the administration’s next step would be.
• Government Employees. In an October 27, 2025, statement titled, “It’s Past Time to End This Shutdown,” American Federation of Government Employees (AFGE) National President Everett Kelley wrote, “The path forward for Congress is clear: Reopen the government immediately under a clean continuing resolution that allows continued debate on larger issues.” AFGE represents 820,000 federal and D.C. government workers, so this statement may put some pressure on lawmakers to negotiate.
• ACA Subsidies. Open enrollment for Affordable Care Act coverage in 2026 begins on November 1, 2025. With insurance premiums expected to increase, the lack of extended subsidies (which are what Democrats are hoping to include in a government funding package), millions of Americans could face dramatic increases to their healthcare costs.
• Military Pay. Covered members of the military are expected to receive their second October paycheck this weekend, but statements from the administration indicate that there may not be enough funds to cover the next pay period on November 15, 2025.

USCIS Ends Automatic Extension of Employment Authorization. On October 30, 2025, U.S. Citizenship and Immigration Services (USCIS) published an interim final rule “to end the practice of automatically extending the validity of employment authorization documents (Forms I-766 or EADs) for aliens who have timely filed an application to renew their EAD in certain employment authorization categories.” Current rules automatically extend by 540 days the work authorization for certain foreign nationals while they wait for the government to process their timely filed renewal applications. The new rule potentially leaves these individuals without work authorization when the government takes too long to process their renewal documents. The new rule is effective for work authorization renewal documents filed on or after October 30, 2025. Matthew S. Groban, Philip K. Sholts, and Maurisa Iacono have the scoop.

Quorum Returns to the EEOC. This week, Brittany Panuccio was reportedly sworn in as a member of the U.S. Equal Employment Opportunity Commission (EEOC). Panuccio, who was confirmed by the Senate on October 7, 2025, previously served as an assistant U.S. attorney in the U.S. Department of Justice’s Appellate Division. She will join Acting Chair Andrea Lucas and Commissioner Kalpana Kotagal (who was appointed by President Biden and is the sole Democrat on the Commission) to give the EEOC a functioning quorum for essentially the first time in this administration. (A four-member Commission existed for about one week into the current administration prior to President Trump’s removal of Commissioners Charlotte Burrows and Jocelyn Samuels.) T. Scott Kelly, James J. Plunkett, and Nonnie L. Shivers discuss how Panuccio’s arrival could impact the EEOC’s agenda here.

Trump Administration Seeks Quicker Deregulation. Jeffrey Bossert Clark, Sr., the acting administrator for the Office of Information and Regulatory Affairs (OIRA), has issued a memorandum to executive branch agencies, titled, “Streamlining the Review of Deregulatory Actions.” The memo builds on multiple deregulatory executive orders issued by President Trump, including Executive Order 14219 (“Ensuring Lawful Governance and Implementing the President’s ‘Department of Government Efficiency’ Deregulatory Initiative”), encouraging agencies “to bolster, streamline, and speed” their deregulatory efforts. The memo sets a presumptive maximum twenty-eight–day OIRA review period when agencies seek to rescind standard rules and a presumptive maximum fourteen-day OIRA review period for instances in which agencies seek to rescind facially unlawful rules. Further, the memo states that while certain executive orders “call for agencies to engage in specific consultations on rules with potential impacts imposed on state and local governments,” to properly address the burdens and costs of those rules, such consultation and analysis are not necessary when eliminating rules. Pursuant to the memo, “facially unlawful regulations” should be repealed expeditiously, without going through the notice and comment process pursuant to the “good cause” exception in the Administrative Procedure Act.

CBP Finalizes Entry/Exit Photograph, Biometric Rule. On October 27, 2025, U.S. Customs and Border Protection issued a final rule amending regulations “to provide that all aliens may be required to be photographed upon entry and departure from the United States.” The rule will also “permit collection of biometrics from aliens departing from airports, land ports, seaports, or any other authorized point of departure.” The regulation is styled as a final rule and will go into effect on December 26, 2025, while public comments are due on or before November 26, 2025. A notice of proposed rulemaking on the matter was issued, and comments were received at the tail end of the first Trump administration, but the rule was never finalized by the Biden administration.

It’s Owl Good … Well, unless you are a barred owl living in the Pacific Northwest. This is because the Senate this week failed to pass a resolution that would have rescinded a Biden-era rule issued by the U.S. Department of Interior’s Fish and Wildlife Service (FWS) that sets forth a plan to … *ahem* “remove” approximately 450,000 barred owls in the Pacific Northwest (at least the barred owls’ heads are already on a swivel). If this all seems owl-trageous, barred owls are not native to the Pacific Northwest and pose an increasing threat to the native northern spotted owl, an endangered species. FWS reasons, “Without management of barred owls, extirpation of northern spotted owls from major portions of their historic range is likely in the near future.” But only twenty-five senators give a hoot about the barred owl, as the resolution to rescind the FWS plan failed by a vote of 25 to 72.

The Buzz will be on hiatus next week but will publish again on November 14, 2025.

Quick Hits

• The EU AI Act took effect on August 1, 2024, and carries extraterritorial reach. U.S. employers can be covered even without a physical EU presence if AI outputs are intended to be used in the EU—e.g., recruiting EU candidates, evaluating EU-based workers or contractors, or deploying global HR tools used by EU teams.
• Several obligations have begun to take effect, with more phasing in through 2026–27. The European Commission also released a voluntary General-Purpose AI (GPAI) Code of Practice to streamline compliance for model providers.
• Employers’ use of AI in the workplace will be treated as potentially “high risk,” triggering duties such as worker notice, human oversight, monitoring for discrimination, logging, and adherence to applicable privacy laws when the core high-risk system requirements begin taking effect starting in August 2026.
• Now is the time to inventory HR and workforce AI, align contracts and governance, and operationalize notice, oversight, and recordkeeping to meet EU requirements alongside evolving U.S. federal and state AI rules.

This is the third article in a four-part series aligned with Cybersecurity Awareness Month, which occurs annually in October. Part 1 discusses compliance tips for U.S. privacy leaders handling practical data rights requests, Part 2 addresses data rights requests in Canada, and Part 4 covers the considerations for responsible use of artificial intelligence (AI) and automated decision-making tools (ADMTs).

Why the EU AI Act Can Apply to U.S. Employers

The EU AI Act adopts a risk-based framework and applies extraterritorially where AI systems or their outputs are intended to be used in the EU. In practice, this means a U.S. employer may have EU AI Act obligations if it:

• uses AI-enabled recruiting or screening tools for roles open to EU candidates, even if the hiring team and systems are U.S.-based;
• applies AI to evaluate performance, promotion, or termination decisions for EU-based employees, contractors, or contingent workers; or
• operates global HR or IT platforms that incorporate AI functionalities accessible to EU establishments.

For instance, a U.S. company using an AI-powered résumé screener for a global applicant pool could be covered if that system ranks or filters EU-based candidates. In practice, if any AI output influences employment outcomes within the EU, even indirectly, the law can potentially apply.

The law treats many workplace AI uses as “high risk.” While the most prescriptive requirements fall on “providers” that build high-risk AI, “deployers” (i.e., employers that implement those tools) also have direct obligations. As with the EU’s General Data Protection Regulation (GDPR), penalties can be significant—rising to the greater of multimillion-euro fines or a percentage of worldwide annual turnover, depending on the breach category.

Where Implementation Stands Today and What to Watch Next

The AI Act entered into force on August 1, 2024, following adoption by EU institutions earlier that year. For employers, the bottom line is twofold: some obligations already apply, and EU institutions are pressing forward on timelines and supporting guidance rather than pausing implementation:

• Prohibited AI practices and AI literacy obligations took effect first on February 2, 2025, requiring discontinuation of certain banned uses particularly in HR contexts such as emotion recognition in workplaces or biometric categorization.
• Codes of practice have begun to be published. For example, the Commission has released the voluntary General-Purpose AI (GPAI) Code of Practice and guidance in the form of frequently asked questions (FAQs) to support transparency and model documentation.
• Governance, supervision, and penalty frameworks have begun to apply before the high-risk system obligations fully phase in, signaling that enforcement infrastructure is underway.
• February 2, 2026: Guidance expected on compliance for high-risk AI systems and illustrative examples clarifying which workplace and HR uses of AI (e.g., recruiting, promotion, performance evaluation) qualify as high-risk systems, helping employers determine which tools must meet the AI Act’s documentation, oversight, and logging requirements.
• August 2026–August 2027: High-risk system obligations fully apply, with a narrow subset delayed until August 2, 2027. Employers will be required to ensure human oversight, worker notice, and logging processes are operational by this point.

Employers will want to monitor additional Commission guidance and national implementation activities by EU member states, which may introduce supplemental detail or supervisory expectations impacting HR deployments.

What Counts as ‘High Risk’ in the Workplace—And What Employers Must Do

The AI Act’s risk tiers run from “unacceptable” (banned) to “high,” “limited,” and “minimal.” In the employment context, AI used for recruiting, screening, selection, performance evaluation, or other employment-related decision-making is explicitly listed as high risk.

In practical terms, this means that many AI tools already used in HR, such as chatbots that screen candidates, résumé-ranking software, or productivity analytics used in performance reviews, may fall within the AI Act’s “high-risk” category. Employers may also want to be careful about relying upon vendor assurances of compliance without independent validation.

In summary, employer obligations are as follows:

• Worker notification is required before implementing high-risk AI in the workplace, including informing workers’ representatives where applicable.
• Human oversight must be established by individuals with appropriate competence, training, authority, and support. Oversight should be meaningful, with the ability to intervene and override outputs where necessary.
• Monitoring is required to detect issues such as discrimination or adverse impacts, with prompt suspension of use and notification obligations where issues arise.
• Logs automatically generated by an AI system must be maintained for an appropriate period, with at least a six-month minimum retention baseline.
• Data privacy compliance remains essential, including alignment with EU privacy laws that may apply to HR data processing and cross-border transfers.

Planning for Compliance

1. Mapping the corporate AI footprint in HR and beyond. This includes inventorying where AI or algorithmic logic influences employment decisions, candidate sourcing, screening, assessments, performance management, scheduling, or compensation. Mapping also includes identifying whether outputs are used for or affect EU candidates, employees, or contingent workers. Employers may also want to classify use cases against the AI Act’s risk tiers and flag any functionality that could edge toward prohibited categories.
2. Assigning internal roles and accountability. Employers may want to clarify who acts as a “deployer” within the organization for each tool, who owns worker notices, who is responsible for human oversight design and day-to-day review, and who tracks compliance and metrics. Employers may also want to establish escalation paths if potentially discriminatory or inaccurate outputs are detected.
3. Operationalizing worker notice and human oversight. Building template notices for workers and, where needed, workers’ representatives that explain the AI system’s purpose and use is an important compliance tool. Template notices typically include defined oversight procedures specifying when humans must review, override, or decline to rely on AI outputs, and how those interventions are documented. Employers may want to ensure that overseers are trained on the technology, its limitations, and AI bias risks.
4. Strengthening vendor diligence and contracts. Requiring providers to supply “instructions of use,” model documentation, and transparency information aligned to the AI Act is another key compliance tool. Employers may want to embed cooperation commitments for discrimination monitoring, prompt remediation, logging, incident reporting, and audit support. Employers may also want to ensure deletion, correction, and security obligations are extended through sub-processors.
5. Implementing logging and recordkeeping. Employers may want to confirm that high-risk systems automatically generate adequate logs and that the retention schedule meets or exceeds the AI Act’s minimums. Ensuring that logs can support investigations, fairness reviews, and regulator inquiries is a step included in this task.
6. Monitoring for discriminatory or adverse impacts. Establishing metrics, thresholds, and cadence for fairness and accuracy reviews will help employers maintain compliance with the AI Act. If issues arise, consider suspending use, notifying as required, and coordinating with providers to address root causes, retraining, or configuration changes.
7. Aligning with privacy and data governance. Employers may want to cross-check AI deployments against EU and U.S. privacy regimes, including transparency, purpose limitation, data minimization, access controls, and security requirements. Harmonizing HR data handling across jurisdictions will help avoid fragmented practices and inconsistent risk controls.
8. Calibrating globally to avoid conflicts. The U.S. landscape is evolving—federal agencies have issued AI-related guidance, and states and cities continue to explore rules affecting employment decision tools. Design controls that satisfy EU requirements while anticipating U.S. developments to reduce rework and ensure consistency across the company’s global HR stack.

How the EU AI Act Fits Within a Broader Compliance Posture

For many organizations, the AI Act will layer onto existing data subject access request (DSAR) and privacy workflows, ethics reviews, and vendor management practices established under U.S. state privacy laws and the GDPR. Lessons learned from data privacy compliance requirements—such as notification and recordkeeping requirements—translate directly to AI governance.

For in-house teams already managing privacy impact assessments, bias audits, or vendor risk reviews, integrating AI Act compliance into those existing workflows is often the most efficient approach. EU authorities, including the new AI Office, are continuing to develop sector guidance and templates for compliance documentation.

Ogletree Deakins’ Cross-Border Practice Group, Cybersecurity and Privacy Practice Group, and Technology Practice Group will continue to monitor developments and provide updates on the Cross-Border, Cybersecurity and Privacy, and Technology blogs as additional information becomes available.

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Quick Hits

• The German Federal Labor Court recently ruled that annual leave does not lapse during long-term illness if more favorable contractual arrangements are in place.
• Statutory minimum annual leave generally expires fifteen months after the end of the leave year in cases of uninterrupted incapacity for work, unless a more favorable provision applies.
• Employers may want to review employment contracts to ensure clarity on annual leave provisions and align them with collective agreements to avoid inconsistencies.

Established BAG Case Law on Annual Leave During Long‑Term Illness

The statutory minimum annual leave under the Federal Vacation Act (Bundesurlaubsgesetz – BUrlG) serves the purpose of rest and recuperation. Interpreting section 7(3) BUrlG in conformity with EU law, the BAG has held that, in cases of uninterrupted incapacity for work, statutory minimum leave generally expires fifteen months after the end of the leave year in which the employee first became continuously incapacitated. Specifically, leave that cannot be taken due to uninterrupted incapacity for work lapses fifteen months after the end of the leave year in which the incapacity arose. This fifteen‑month limit is intended to prevent the unlimited accumulation of leave during long-term illness without undermining the recuperative purpose of leave. The present decision reaffirms these guiding principles.

At the same time, the BAG ruling emphasizes that more favorable provisions for employees are permissible. Where such provisions apply, the case law on forfeiture for long-term ill employees does not govern.

Key Facts of the Case

The dispute concerned an employee’s claim to financial compensation in lieu of statutory annual leave for the years 2016 to 2021. The employee worked for a church employer and had been continuously unable to work due to illness since July 31, 2015, during which time she was unable to take 144 days of leave. The employment relationship ended on June 30, 2023. Following her dismissal, she claimed € 16,908.92 as compensation for untaken leave. She relied on an individual contractual clause governing leave in cases of long‑term illness and argued that it prevailed over the church employment guidelines (AVR‑DD) referenced in the employment agreement. The AVR‑DD provided for the lapse of leave in cases of long‑term incapacity. The Labor Court dismissed the action, but the Regional Labor Court allowed it. The employer’s appeal to the BAG was unsuccessful. The employer therefore owed compensation for the untaken leave.

The BAG’s Judgment

The employee’s continuous incapacity for work from July 31, 2015, until the termination of the employment relationship did not preclude the accrual of statutory minimum leave. The leave entitlements that had accrued did not forfeit. The parties had effectively agreed to exclude the lapse of leave in cases of long‑term illness. Also, the church employment guidelines referenced in the contract did not override this more favorable individual arrangement. In the event of conflict, the more favorable individualcontractual provision prevails. Accordingly, the BAG’s case law on forfeiture in cases of long-term illness did not apply. The court stated that European Union law does not mandate a time limit for the exercise of paid annual leave where the parties have agreed to more favorable terms. Therefore, individual or collective arrangements that grant employees a more advantageous position than the statutory baseline are permissible.

Key Takeaways

In cases of uninterrupted incapacity for work, the statutory minimum annual leave generally lapses fifteen months after the end of the relevant leave year, unless a more favorable contractual provision prevents forfeiture.

Employers may want to review their employment contracts for clauses on annual leave that may be more favorable to employees. Any doubts regarding the interpretation of a clause in pre-formulated employment contracts are construed in favor of employees.

Employers may also want to align employment contracts with works agreements and other collective arrangements to avoid inconsistencies. Where an individual contractual term is more favorable to the employee than a collective provision, the former takes precedence.

Lastly, employers may want to confirm whether their employment contracts clearly distinguish between statutory minimum leave and any additional contractual leave and expressly regulate the forfeiture of additional leave. The statutory forfeiture and carryover rules do not necessarily apply to additional leave granted by contract, so that different arrangements can be made in this case. If there is no clear differentiation between minimum and additional leave, additional leave is often treated in the same way as minimum leave. In case of doubt, unclear provisions are interpreted in favor of the employee.

Ogletree Deakins’ Berlin and Munich offices will continue to monitor developments and will post updates on the Cross-Border and Leaves of Absence blogs as additional information becomes available.

Daniela Schumann is a senior associate in the Berlin office of Ogletree Deakins.

Pauline von Stechow is a law clerk in the Berlin office of Ogletree Deakins.

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Quick Hits

• Illinois’s recently enacted Prescription Drug Affordability Act regulates PBMs by imposing strict transparency requirements.
• The law prohibits PBMs from utilizing spread pricing, requires that PBMs pass on rebates to health plan sponsors, and prohibits steering patients toward specific pharmacies that a PBM owns or controls.
• The law also adds a new $15.00-per-member fee for PBMs, which will be used to support independent pharmacies in underserved areas.

Illinois House Bill (HB) 1697 (Public Act 104-0027), which was signed into law by Governor JB Pritzker on July 1, 2025, principally regulates PBMs, which operate under state licenses. The statute also imposes a new $15.00-per-member fee on PBMs to fund grants for independent pharmacies in underserved areas, and it provides important audit rights for plan sponsors. In addition, HB 1697 expressly applies to services provided to both self-insured plans and insured plans, and prohibits PBMs from limiting access to specialty medications by using broad definitions of specialty drugs and imposing restrictions on them.

Audits

Under HB 1697, contracts between PBMs and insurers or health benefit plan sponsors must allow for “an audit at least once per calendar year of the rebate and fee records remitted from a pharmacy benefit manager or its affiliated party to a health benefit plan.” And contracts with rebate aggregators, drug manufacturers and others will be required to be available for audit by employer plan sponsors.

Steering

The Illinois law prohibits PBMs from steering participants toward certain pharmacies. The law specifically defines “steer” to include:

• “requiring a covered individual to only use a pharmacy, including a mail-order or specialty pharmacy, in which the [PBM] or its affiliate maintains an ownership interest or control”;
• “offering or implementing a plan design that encourages a covered individual to only use a pharmacy in which the [PBM] or an affiliate maintains an ownership interest or control, if the plan design increases costs for the covered individual”; and
• “reimbursing a pharmacy or pharmacist for a drug and pharmacist service in an amount less than the amount that the [PBM] reimburses itself or an affiliate, including affiliated manufacturers or joint ventures for providing the same drug or service.”

Some reporting and payment requirements went into effect in 2025, but the anti-steering provisions will not apply until a PBM agreement entered into before January 1, 2026, is terminated. The other parts of the law are effective for PBM agreements that take effect or are amended, delivered, or issued on or after January 1, 2026.

Rebates

Though Illinois will require 100 percent rebate pass-throughs for amounts received by “affiliated” aggregators, meaning those owned or controlled in part by a PBM, the law does not require that treatment when a rebate aggregator is not affiliated.

Under the Illinois law, “rebate” is defined as a “discount or drug pricing concession based on drug utilization or administration that is paid by the manufacturer to a [PBM] or its client.” And “rebate aggregator” is defined in part as an entity “including [a] group purchasing organization[], that negotiate[s] rebates or other fees with drug manufacturers on behalf or for the benefit of a [PBM] or its client.”

Specialty Medications

PBMs and their affiliates will be prohibited from “limiting a covered individual’s access to drugs from a pharmacy or pharmacist enrolled with the health benefit plan under the terms offered to all pharmacies in the plan coverage area by designating the covered drug as a specialty drug, contrary to the definition in [the Illinois statute].”

“Specialty drug[s]” under the Illinois law are defined relatively narrowly as those that:

• are “prescribed for a person with a complex or chronic condition or a rare medical condition”;
• have “limited or exclusive distribution”;
• require “specialized product handling by the dispensing pharmacy or administration by the dispensing pharmacy”; and
• require “specialized clinical care, including frequent dosing adjustments, intensive clinical monitoring, or expanded services for patients, including intensive patient counseling, education, or ongoing clinical support beyond traditional dispensing activities, such as individualized disease and therapy management to support improved health outcomes.”

Reporting Requirements

PBMs will be required to submit written annual reports to the Illinois Department of Insurance, each health benefit plan sponsor, and each insurer by September 1 each year. The reports must include information on drugs and rebates, including lists of drugs, specifics on rebates, fees, or discounts for drugs, and information on reimbursement costs. PBMs that fail to submit the required reports could be subject to fines not exceeding $10,000 per day.

The law states that the Department may share the reports with “an established institution of higher education” in Illinois to create an annual “pharmacist dispensing cost report” with a “survey of the average cost of dispensing a prescription for pharmacists in Illinois.

Member Fees

A key provision of the law requires registered PBMs to pay the Illinois Department of Insurance “an amount equal to $15 or an alternate amount as determined by the Director by rule per covered individual enrolled by the pharmacy benefit manager in [Illinois].” The first payment was due on September 1, 2025, and will be due annually on September 1 each year thereafter.

The collected amounts will be deposited into a new “Prescription Drug Affordability Fund,” and each fiscal year, $25 million will be transferred to a grant program for community pharmacies, especially those in rural counties, low-income communities, and medically underserved areas.

Next Steps

Employers with employees in Illinois may want to evaluate whether their existing PBM agreements meet these and other new standards and what changes in their agreements might be needed or desirable under this Illinois law.

Ogletree Deakins’ Chicago office and Employee Benefits and Executive Compensation Practice Group will continue to monitor developments and will provide updates on the Employee Benefits and Executive Compensation, Healthcare, and Illinois blogs as additional information becomes available.

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Quick Hits

• The partial government shutdown in 2025 has curtailed OSHA’s routine operations, but this is unlikely to cause a dramatic near-term deterioration in worker safety.
• During the shutdown, OSHA’s contingency plan focuses on preserving essential functions that protect human life and property, such as responding to reports of imminent danger, investigating fatalities, and maintaining a minimal supervisory structure. This ensures that the most severe hazards are still addressed, even though routine inspections are significantly reduced.
• Employer behavior regarding safety is continuously shaped by reputational risks, contractual obligations, and insurance economics. These factors provide strong incentives for maintaining and improving safety performance, regardless of OSHA’s scaled-back inspection activities during the shutdown.

OSHA’s normal inspection reach is inherently limited relative to the universe of regulated workplaces, which means the marginal deterrence from routine federal inspections is modest compared with other structural forces. The primary drivers of day-to-day safety performance are external to the OSHA inspection cadence and are anchored instead in market, contractual, and financial incentives, including reputational exposure, customer and supply-chain qualification systems, and insurance and workers’ compensation underwriting and cost structures.

The Budget Impasse and How a Federal Shutdown Constrains Agency Operations

A federal budget impasse arises when the U.S. Congress and the president do not enact appropriations or a continuing resolution to fund agencies. In the absence of appropriations, the Antideficiency Act generally requires agencies to suspend operations that are not excepted for the protection of human life or property or otherwise legally authorized to continue. OSHA, like many agencies, executes a contingency plan that places most routine functions on hold while preserving a narrow set of activities that directly mitigate imminent threats. These excepted activities typically include responding to reports of immediate danger, investigating fatalities and catastrophes, and maintaining a minimal supervisory structure to coordinate those responses.

The contours of the OSHA shutdown plan reflect long-standing institutional choices about how to prioritize mission under fiscal constraint. Because the agency’s enforcement arm is built to triage risk—using complaint and referral systems, serious event reports, industry emphasis programs, and targeted inspections—its contingency posture narrows to the cases with the most acute consequences. While that narrowing reduces routine oversight, it preserves the ability to address the highest-severity hazards. It also means that the day-to-day cadence of scheduled or emphasis-based inspections slows sharply, with predictable effects on citation issuance and abatement orders.

OSHA’s Baseline Reach Is Limited, Even in Normal Years

Understanding OSHA’s normal reach is essential to placing shutdown impacts in context. In any given fiscal year, OSHA conducts 30,000 to 35,000 inspections across roughly 8 million workplaces. The nation’s workplace universe is so large that even in a fully funded year, only a small fraction of establishments will see a federal Compliance Safety and Health Officer (CSHO). By some estimates, it would take OSHA more than 225 years to inspect all workplaces at its recent annual rates of inspection activities.

What Continues During a Shutdown: Excepted OSHA Functions

The common fear that a shutdown removes the agency’s ability to respond to the worst hazards is misplaced. OSHA’s contingency plans preserve core functions designed to protect human life and property. Field offices retain skeleton crews, primarily managers, capable of responding to reports of imminent danger, serious injuries, fatalities, and multi-hospitalization events. These events are where the prospects for severe harm are concentrated, and the ability to investigate them serves both immediate abatement needs and longer-run deterrence of similar hazards.

Fatality and catastrophe investigations, in particular, often address employer practices with systemic implications. Even during a shutdown, initiating these investigations preserves the chain of custody for physical evidence, secures witness testimony while memories are fresh, and signals to the regulated community that the most serious incidents will not be ignored. In many cases, the mere prospect of a fatality investigation motivates rapid abatement and management attention independent of the eventual issuance of citations.

Why a Prolonged Reduction in Federal Inspections Does Not Upend Safety Outcomes

The central reason the shutdown’s reduction in routine inspections is unlikely to produce dramatic, near-term safety deterioration is that the primary drivers of workplace safety are embedded in employer incentives that operate continuously and are largely independent of the federal inspection cadence. Employers confront a set of pressures that shape safety investments, and these pressures do not pause when appropriations lapse.

Reputation is one such pressure. High-visibility incidents and poor safety records impose costs far beyond regulatory penalties. Customers, investors, employees, and local communities respond to perceived indifference to safety with real economic consequences. Management teams understand that a serious event can erode brand, impair recruiting and retention, and invite private litigation and contractual consequences. These reputational impacts discipline safety performance on a continuous basis and are indifferent to whether OSHA is fully staffed in a given week.

Contractual and supply-chain governance is another powerful driver. Large owners and prime contractors increasingly impose stringent safety prequalification and performance requirements on vendors. These requirements go far beyond compliance with minimum legal standards and are enforced through access to work, often using third-party safety platforms to monitor and institutionalize associated processes. The penalty for deficiency is immediate: loss of site access or disqualification from bidding. Because these systems operate continuously and are monitored by counterparties with strong economic leverage, their influence does not wane during a federal shutdown.

Insurance and workers’ compensation economics provide a third structural incentive. Underwriters price risk based on a firm’s loss history, safety programs, and industry exposures. Sustained poor safety performance translates into higher premiums, tighter terms, deductibles that shift more risk back to the insured, and sometimes difficulty securing coverage at all. In the workers’ compensation arena, experience modification factors mechanically tie an employer’s claim history to its premium cost structure, and unfavorable modifiers can also bar entry into certain bid pools. These financial mechanisms reward continuous reduction of incident frequency and severity and penalize deterioration regardless of OSHA’s weekly inspection totals. They also motivate investment in controls, training, and supervision as levers to reduce claim frequency and costs.

Short-Term Risks From a Prolonged Shutdown and Why They Are Bounded

None of this is to say that a prolonged shutdown carries no safety risk. Routine inspections can deter some noncompliance, and the absence of that deterrence may embolden a minority of actors already inclined to cut corners. Backlogs in case processing, citation issuance, and settlement approvals can slow formal abatement orders and create gaps in the feedback loop that normally prompts corrective action. Outreach, training, and compliance assistance programs that help small and mid-sized employers build capacity are also important in the long run, and pausing them is a genuine loss.

However, these risks are bounded in several ways. First, OSHA’s excepted functions preserve the ability to respond to imminent danger and high-severity incidents, focusing scarce resources where the stakes are highest. Second, the backlog effect is transient. When appropriations resume, cases can be prioritized based on risk, and long-dwelling hazards identified before the shutdown can still be addressed. Third, the persistent and continuous incentives described above—contractual prequalification, insurance economics, reputational risk, and private governance—continue to shape employer behavior every day, and their magnitude generally exceeds the marginal deterrence effect of the possibility of a routine federal inspection. Fourth, many employers maintain internal audit and assurance programs that function independently of external enforcement, motivated by corporate policy, customer commitments, and board oversight.

Practical Guidance

For employers, the practical steps during the shutdown period are the same steps that drive safety performance in any environment. Maintaining robust hazard identification and control processes, reinforcing supervision and worker participation, monitoring leading indicators, and executing prompt corrective actions remain the most effective strategies for preventing injuries. Maintaining documentation, training records, and incident investigations will ease the transition when oversight resumes and will also support insurance renewals, customer audits, and platform requalifications. For contractors, continuous alignment with third-party safety platforms, and client-specific requirements is non-negotiable because those systems are the gateways to continued work and will continue to be enforced.

Conclusion

The 2025 federal budget impasse and resulting shutdown will reduce OSHA’s routine footprint for as long as appropriations remain lapsed. Yet a sober assessment of the agency’s baseline reach, the preservation of excepted life-safety functions, and the structure of private incentives points toward a limited near-term impact on aggregate worker safety. OSHA’s routine inspections represent a small share of the interactions that shape employer behavior in any given year.

Meanwhile, reputational exposure, third-party safety platforms, and the economics of insurance and workers’ compensation provide continuous and potent incentives to maintain and improve safety performance. State Plans, private standards, and internal governance further reinforce those incentives. Short-term risks from reduced public presence are real but bounded, particularly where imminent danger response is preserved. The wise course for employers is likely to treat the shutdown not as a reprieve but as an opportunity to deepen safety systems that will stand up to renewed oversight and to the relentless scrutiny of customers, insurers, workers, and the public.

Next Steps

Ogletree Deakins’ Workplace Safety and Health Practice Group will continue to monitor developments and will provide updates on the Governmental Affairs and Workplace Safety and Health blogs as additional information becomes available.

This article and more information on how the Trump administration’s actions impact employers can be found on Ogletree Deakins’ Administration Resource Hub.

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Quick Hits

• USCIS will end its practice of automatically extending EADs for foreign nationals who file renewal applications—including for adjustments of status and H-4 EAD renewals—based on certain employment authorization categories. The new policy will not affect automatic extensions granted for EAD applications filed before October 30, 2025.
• If an EAD renewal application (Form I-765) was timely filed before the EAD expiration and before October 30, 2025, then it is not impacted and is still eligible for the auto-extension.
• If an EAD renewal application (Form I-765) is filed on or after October 30, 2025, then it is impacted by the policy change. Impacted individuals will need a valid EAD card in hand to continue working.

Background

Certain foreign nationals in the United States are eligible to apply for employment authorization by filing Form I-765 with U.S. Citizenship and Immigration Services (USCIS). Under previous temporary final rules and a December 2024 final rule that took effect on January 13, 2025, USCIS granted eligible foreign nationals an automatic extension of employment authorization for up to 540 days while their timely filed employment authorization applications were pending adjudication.

Scheduled for publication on October 30, 2025, and affecting employment authorization applications filed on or after October 30, USCIS will no longer automatically extend employment authorization for individuals previously eligible under the 2024 rule, unless required by law or notice in the Federal Register for employment authorization related to Temporary Protected Status (TPS). DHS indicates it is prioritizing proper vetting and screening of noncitizens before extending employment authorization and that ending the practice of automatic extensions is consistent with President Donald Trump’s executive orders titled “Protecting the American People Against Invasion” (Executive Order 14159) and “Protecting the United States From Foreign Terrorists and Other National Security and Public Safety Threats” (Executive Order 14161).

Impact

The IFR does not impact automatic extensions of employment authorization granted to EAD renewal applicants who filed timely renewals prior to October 30, 2025, and who were previously eligible for a 540-day extension. Automatic extensions of employment authorization provided by Federal Register notice for TPS-related employment authorization or by law—such as STEM Optional Practical Training (OPT) EAD renewals filed by F-1 students—are not impacted by this IFR.

The IFR states that agencies that utilize EADs for other purposes, such as to verify an individual’s identity or immigration status, should no longer consider an expired EAD valid unless the applicant can present an I-797 receipt notice demonstrating a timely filed EAD renewal before October 30, 2025.

USCIS’s SAVE system, used by government agencies to verify benefit eligibility and licensing determinations, will provide results that indicate the expiration of employment authorization (if any) and will not include the previous maximum 540-day automatic extension period. Common EAD categories are listed below. For the full list, please visit USCIS’s website.

What This Means for Employers

Employees in affected categories who file timely EAD renewal applications on or after October 30, 2025, will no longer be able to rely on an automatic extension of employment authorization when their existing EADs expire. Depending on USCIS processing times, employees who rely on a valid EAD as their sole basis for employment authorization may face a gap in employment authorization. Additionally, USCIS will provide updated guidance for employers regarding I-9 verification for the impacted EAD categories via I-9 Central and in its Handbook for Employers, M-274.

Ogletree Deakins’ Immigration Practice Group will monitor developments with respect to these and other policy changes and will provide updates on the Immigration blog as additional information becomes available.

This article and more information on how the Trump administration’s actions impact employers can be found on Ogletree Deakins’ Administration Resource Hub.

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Quick Hits

• In Galarza v. One Call Claims, LLC, No. 23-13205 (October 16, 2025), a three-judge panel of the Eleventh Circuit Court of Appeals unanimously reversed a federal district court’s 2023 ruling that insurance adjusters were independent contractors for One Call Claims and the Texas Windstorm Insurance Association.
• The court concluded that the employers managed the adjusters’ work schedules, controlled their pay rates, directed work tasks, and limited their ability to work for other businesses. Accordingly, a jury could reasonably find that the workers were employees.

Under the Fair Labor Standards Act (FLSA), these factors may be relevant in determining whether an individual is an employee or independent contractor:

• the degree of the employer’s control over the work;
• the individual’s opportunity for profit or loss based on managerial skill;
• the individual’s investment in materials or hiring additional workers to complete the work;
• the degree to which the work requires a special skill;
• the degree of permanency and duration of the working relationship; and
• the extent to which the work is an integral part of the employer’s business.

Background

Texas Windstorm Insurance Association provides wind and hail insurance for properties on the Texas coast. One Call Claims is an outsourcing company that matches insurance companies’ needs with a roster of licensed adjusters and examiners. Three insurance adjusters sued the two organizations for allegedly misclassifying them as independent contractors and failing to pay them overtime compensation for hours worked above forty hours in a week.

In 2017, One Call Claims assigned the plaintiffs to adjust insurance claims for Texas Windstorm Insurance Association following Hurricane Harvey. The contracts between One Call Claims and the plaintiffs classified the plaintiffs as independent contractors and specified that their employment was temporary. The contracts also indicated that the plaintiffs would work up to ten hours per day, with hours determined by Texas Windstorm Insurance Association.

One Call Claims invoiced Texas Windstorm Insurance Association for each day of work provided by the plaintiffs and paid them a nonnegotiable daily rate. Texas Windstorm Insurance Association did not record or track the exact hours worked by the plaintiffs. The plaintiffs could choose when to start and end their workdays and when to take lunch breaks. The adjusters were provided with email accounts, a computer network, applications, and software. For teleworking, the plaintiffs were responsible for providing their own workspaces, internet service, cellphones, and computers.

The insurance adjusters argued that they should have been classified as employees because One Call Claims set their pay rate, and Texas Windstorm Insurance Association restricted opportunities to earn more through outside employment. The plaintiffs also claimed that Texas Windstorm Insurance Association set their work schedules, directed their daily tasks, reviewed their timesheets, and could dock their pay for unreported absences or tardies. The plaintiffs were prohibited from working on Sundays. The plaintiffs claimed Texas Windstorm Insurance Association used software to track performance metrics, including when they worked, how fast they typed, and how many words they typed.

In contrast, One Call Claims and Texas Windstorm Insurance Association argued that the plaintiffs were properly considered independent contractors because the plaintiffs maintained sufficient control over how they handled claims adjustments. The defendants also claimed the plaintiffs were free to market their services to other companies, as long as any outside employment didn’t interfere with or conflict with their job duties and obligations to the defendants.

On August 29, 2023, the U.S. District Court for the Southern District of Alabama granted summary judgment to the defendants, finding that the plaintiffs were independent contractors and, therefore, not eligible for overtime pay. The plaintiffs appealed.

The Eleventh Circuit’s Decision

Using a set of six factors from a 2013 case, Scantland v. Jeffrey Knight, Inc., the Eleventh Circuit reversed the district court’s grant of summary judgment and found that a jury could reasonably determine that the workers were employees. The defendants argued that the workers had an opportunity for profit because they exerted control over certain expenses, such as transportation, meals, lodging, internet service, and phone service, but the court found that “many of them are little more than personal expenses” and that “cutting costs where possible on mostly personal expenses to save money has nothing to do with a worker’s ability to ‘earn additional income,’ let alone the ability to do so through initiative and managerial skill.” (Emphasis added by the court.)

Although the plaintiffs paid for their license fees, membership dues, travel expenses, and insurance premiums, the court concluded that the defendants supplied the bulk of the equipment and materials necessary for the work. Thus, that factor weighed in favor of employee status.

The court did note that the insurance adjusters had acquired their training and licenses before starting the assignment, so the skill factor weighed in favor of their classification as independent contractors. Additionally, the court stated, “a jury could reasonably conclude that the companies exerted sufficient control over the manner in which the workers performed their tasks so as to suggest that the workers were not a ‘separate economic entity’ distinct from the companies.”

Considering the permanency and duration of the working relationship, the court reasoned that the employers had “retained the workers for an indefinite and extendable period of time during which the workers did not service any other companies, supporting employee status.” It also noted that the plaintiffs were an integral part of the employers’ business models.

Finally, the court noted that when viewing the facts in a light most favorable to the plaintiffs on summary judgment, “the workers acted more like employees depending on an employer than independent contractors with their own businesses.”

Next Steps

This decision sheds light on the circumstances under which courts may determine that workers classified as independent contractors can be classified as employees, and it may serve as a reminder of the value of thoroughly analyzing the economic realities of a worker’s relationship with the company. In this case, the court concluded that five of the six factors in the economic realities test weighed in favor of the insurance adjusters’ being employees, while only one factor suggested that they were independent contractors. Further, although these plaintiffs were permitted to work for other companies, the court found that they did not actually do so during their employment—a controlling economic reality that weighed in favor of their employee status.

Going forward, companies may want to take all six factors into account when classifying workers as employees or independent contractors. More importantly, they may wish to consider the economic reality of the situation, which can affect how courts will view the workers’ classification.

Ogletree Deakins will continue to monitor developments and will provide updates on the State Developments and Wage and Hour blogs as new information becomes available.

Margaret Santen is a shareholder in Ogletree Deakins’ Charlotte and Atlanta offices.

Virginia M. Wooten is a shareholder in Ogletree Deakins’ Charlotte office.

This article was co-authored by Leah J. Shepherd, who is a writer in Ogletree Deakins’ Washington, D.C., office.

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Quick Hits

• The Federal Labor Court of Germany ruled on October 23, 2025, that gender-based discrimination is presumed if a woman earns less than a comparable male colleague, even if he is a top earner.
• The court clarified that the presumption of gender-based discrimination does not require a “preponderant probability” and that the size of the male comparator group and median pay levels are irrelevant; the employer must rebut the presumption if a female employee shows that a male colleague performing equivalent work is paid more.

Background

In the case at hand, a female employee sought retroactive equal pay with respect to several remuneration components of certain male colleagues. She based her claims, inter alia, on information provided by the employer in an intranet “dashboard” made available for the implementation of the German Pay Transparency Act (Entgelttransparenzgesetz). The pay of the comparators she identified exceeded the median pay level of all male employees in the same hierarchical tier. The employer argued that the cited top-earning colleagues did not perform the same work or work of equal value. It further submitted that the lower pay was justified by performance deficiencies on the employee’s part.

The Regional Labor Court of Baden-Württemberg (judgment of October 1, 2024 – Ref. No. 2 Sa 14/24) dismissed the employee’s claims for payment of the difference up to the pay of the highest-earning comparator and awarded only the difference up to the median. It reasoned that the presumption of gender-based discrimination could not be based solely on a single comparator of the other sex. Given the size of the male comparator group and the median pay levels of both sexes, there was, in its view, no preponderant probability of gender-based discrimination.

Decision of the Federal Labour Court

The Federal Labor Court partially set aside the decision of the Regional Labor Court and remitted the matter for further findings of fact.

However, the Federal Labor Court clarified that no “preponderant probability” of discrimination is required, as such a standard would be incompatible with EU law. Rather, gender-based discrimination is already to be presumed where the employee shows, and where necessary proves, that the employer pays a male colleague who performs the same work or work of equal value a higher pay level. It is then for the employer to rebut that presumption. The size of the male comparator group and the amount of the median pay levels of both groups of workers are irrelevant in the question of whether gender-based discrimination exists.

Outlook

Although the principle of “equal pay for equal work or work of equal value” and the requirement for a transparent pay structure already apply today, the Federal Labor Court’s judgment serves as a wake-up call for all companies that have still not prepared for the implementation of the European Union’s pay transparency directive (Directive (EU) 2023/970). The member states must implement the directive’s requirements by June 7, 2026. In Germany, an expert commission is expected to submit proposals to the competent ministry for implementing the pay transparency directive by the end of October 2025.

Ogletree Deakins’ Berlin and Munich offices, Cross-Border Practice Group, and Pay Equity Practice Group will continue to monitor developments and will post updates on the Cross-Border and Pay Equity blogs as additional information becomes available.

Dr. Ulrike Conradi is a managing partner in the Berlin office of Ogletree Deakins.

Teodora Ghiniou is a law clerk in the Berlin office of Ogletree Deakins.

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Quick Hits

• Recent case law has indicated a gradual shift toward holding employers liable for employees’ sexual misconduct.
• To expand this liability for employers while acknowledging the risk of creating too much liability, the rule only applies to sexual assault that meets specific criteria, including only applying in circumstances where the victim is “particularly vulnerable.”
• This rule only applies to employer-employee relationships and does not create any liability for actions of independent contractors.
• Although restatements are not law, they do provide persuasive authority for the courts.
• Higher-risk industries include healthcare, hospitality, education, religious institutions, and law enforcement.

Reflecting a gradual trend toward increased employer liability for the sexual misconduct of employees, ALI recently issued guidance suggesting expanded vicarious liability for employers in certain specific circumstances.

ALI believes that this special rule, approved at ALI’s annual meeting in May 2025, furthers the goals of deterrence, compensation, and fairness by encouraging “employers to research, develop, and identify new mechanisms to address and mitigate foreseeable human error”; allowing victims to recover from an employer, not just the offending employee who may have limited assets; and holding employers liable for the “foreseeable consequences that flow” from an employment relationship that it forged and benefited from which ultimately “facilitated its employee’s sexual misconduct.”

The rule suggests the imposition of liability on employers for sexual assaults committed by their employees in specific situations that involve the following circumstances: (1) “a reasonably foreseeable risk of sexual assault,” (2) a victim who is “particularly vulnerable, by reasons of age, mental capacity, disability, incarceration, detention, confinement, medical need, or other similar circumstance,” (3) “the employer facilitat[ing] the sexual assault by providing the employee with substantial power, authority, or influence over the victim,” and (4) sexual assault that “occurs when the employee is performing work assigned by the employer or engaging in a course of conduct subject to the employer’s control.”

In the comment to the rule, the drafters provide numerous examples illustrating when these requirements are and are not met. The foreseeability requirement is met in instances where “the employer’s business or activity creates an environment in which an employee’s sexual assault is a reasonable possibility.” Providing further detail around age-based vulnerability, the authors explain that age is a consideration when the victim is of a “tender or advanced age,” not just when there is an age differential, no matter how significant the age gap may be. As for the third requirement, the drafters distinguish between victims over whom the employer does or does not have power. While a caregiver does have power, authority, or influence over a patient, the caregiver may not have such power, authority, or influence over that patient’s relative. Finally, the comment also explicitly excludes supervisor-subordinate relationships and an employee’s sexual assault of another employee from this rule, explaining that (1) subordinate employees are not particularly vulnerable; (2) a supervisor has limited power, authority, or influence over an employee; (3) the ubiquitous nature of supervisor-subordinate relationships would greatly expand the reach of the special rule; and (4) Title VII of the Civil Rights Act of 1964, “a relatively well-developed body of federal law, … governs employer liability for sexual harassment and sexual assaults of its employees.”

All four of these requirements must apply, and if they do, an employer may be found strictly liable for sexual assault committed by its employee.

Considerations for Employers

This expanded liability underscores the value in investing in preventive measures, particularly in workplaces where there is a higher risk of sexual assault that meets the requirements of this rule. Employers may want to consider taking the following actions and/or reviewing existing policies and procedures to reduce risk:

• performing thorough background and reference checks on employees, particularly those who will work with particularly vulnerable individuals;
• preparing and disseminating policies on workplace violence prevention and workplace safety obligations;
• conducting training for all employees to communicate rules, risks, and reporting procedures for any suspected inappropriate behavior;
• conducting various trainings, including bystander and other workplace safety/violence prevention trainings for employees;
• ensuring there is a clearly communicated reporting policy in place that employees can easily follow to report any concerns;
• ensuring multiple avenues for reporting concerns exist, including anonymous hotlines;
• thoroughly investigating any reports of concerning behavior or inappropriate conduct and administering appropriate disciplinary action; and
• evaluating current surveillance measures, and, if needed, enhancing those measures in areas where there is less employee oversight and higher risk (in accordance with applicable law).

Where to Learn More

Ogletree Deakins’ Workplace Investigations and Organizational Assessments will continue to monitor developments and will provide updates on the Employment Law, Workplace Investigations and Organizational Assessments, and Workplace Violence Prevention blogs as additional information becomes available.

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Quick Hits

• Discrimination claims often hinge on the motive behind employment decisions, leading to extensive scrutiny of the decision-maker’s comments, knowledge, and timing, with plaintiffs’ lawyers seeking to expand the field of scrutiny and defense lawyers aiming to limit it to a single, unbiased decision-maker.
• Involving multiple people in employment decisions can increase the risk of unhelpful evidence and bias claims, as seen in scenarios where delayed communication and additional input complicate the defense and potentially introduce retaliation claims.

Yet, the defendant itself can sometimes be its own worst enemy here, making more targets for the plaintiff to shoot at. Why do multiple people become involved in making the decision? Perhaps those with authority take solace from being able to share the responsibility. Perhaps modern management styles compel those with authority to “empower” others with decisional input. Or perhaps those in authority simply are not sure what to do. Afterall, firing an employee is a major step that can bring with it (unwanted) attention, time costs, and monetary expenses.

The more people involved in the decision, however, the greater the risk that some kind of unhelpful evidence emerges. The more people there are giving input, the more targets plaintiff’s counsel has in the search for bias. And, the more people involved, the longer the decisional process. The passage of time itself allows for further developments that may also prove unhelpful to the defense.

Imagine two different scenarios where “too many cooks” could spoil the defense broth.

1. The manager with decisional authority knows upon hearing about misconduct that he is going to fire the employee, once the misconduct is verified. The manager asks human resources to investigate. But even after the misconduct is confirmed, that fact is not immediately communicated to the manager. Instead, among other things, the human resources leader polls others on her team about what they think should happen, and then makes a recommendation to the manager. In the meantime, the manager discusses the issue with other members of his team, some of whom offhandedly weigh in with their own thoughts. Instead of a straightforward defense that there is no evidence the single decision-maker had any prohibited bias, the defendant may find itself having to explain away the alleged bias of one or more of the others whose views had been directly or indirectly conveyed to the manager.

2. A high-level manager advises that an employee should be discharged, but leaves the final decision to a group of managers. Instead of acting immediately on the guidance, the group of managers continues to discuss options including lesser forms of discipline. In between the guidance and the final decision, however, the plaintiff files a complaint with human resources that she has been the target of discrimination. Now, instead of a straightforward decision by a high-level manager who has no known bias, the defense must deal not only with the discrimination case (and more targets for bias), but also with a retaliation claim that would not have existed if the guidance had simply been carried out immediately.

There may often be good reason for consultation and investigation, but sometimes less is more.

Ogletree Deakins’ Appellate Practice Group will continue to monitor developments and will post updates on the Employment Law blog as additional information becomes available.

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