Quick Hits

• A California law taking effect on January 1, 2027, will allow employers to obtain TROs covering conduct directed against a workplace or employees generally, broadening the existing law that only allowed employers to apply on behalf of specific employees who suffered a credible threat of violence.
• The new law allows employers to seek TROs on behalf of a “reasonably identifiable group or class of employees” without being required to “name any individual employee as a protected party.”

Assembly Bill (AB) No. 1961, which Governor Gavin Newsom signed into law on September 30, 2026, expands California Code of Civil Procedure Section 527.8 to allow businesses to seek a TRO applying to the workplace and to a reasonably specified group or class of employees without having to name a specific employee as a protected party.

The law will provide employers with a tool to protect the workplace from individuals who subject them to a credible threat of violence without having to be specifically named as a protected person as part of the petition.

Understanding AB 1961

California Code of Civil Procedure Section 527.8 currently allows employers to seek temporary restraining orders to protect identified employees from individuals who have made credible threats of violence, or engaged in harassment. The law enables employers to file a petition for a temporary restraining order and order to protect specifically named employes at their homes, workplaces, and other applicable locations.

However, this remedy to safeguard employees required employers to specifically identify the protected employees in their petition who had been the targets of a credible threat of violence or harassment.

AB 1961 will expand the law to allow employers to seek restraining orders in situations where an individual has directed a credible threat of violence at a worksite or employees generally. According to the legislative history, the law is designed to address a critical gap in current workplace safety laws given the rise in threats directed at entire workplaces, especially schools, without naming any individual. Supporters of AB 1961 have noted that the bill will help address this problem by changing the definition of “Employee” to include a group of employees based on their employer’s worksite or where their primary job duties are performed.

Specifically, AB 1961 amends Code of Civil Procedure 527.8 to allow an employer to seek a temporary restraining order on behalf of a reasonably identifiable group or class of employees if the threat of violence is directed at the employer’s workplace or employees generally. The law notes that where an employer seeks a temporary restraining order on behalf of a group or class of employees, the employer “shall not be required to name any individual protected employee as a protected party.”

Next Steps

As the effective date of January 1, 2027, approaches, employers may want to start preparing for the expanded protections under AB 1961. Preparations may include updating workplace policies, training human resources personnel and employees, and ensuring that all employees are aware of the new protections.

In the event of a complaint of a credible threat of violence directed at the workplace or at employees generally, employers may wish to explore whether a workplace violence restraining order is an appropriate remedy to address the complaint.

The law is one of several new California employment-related laws set to take effect on January 1, 2027.

Ogletree Deakins’ Workplace Violence Prevention Practice Group will continue to monitor developments and will provide updates on the California, Workplace Safety and Health, and Workplace Violence Prevention blogs.

In addition, the Ogletree Deakins Client Portal provides subscribers with timely updates on California state laws, including California’s updated Workplace Violence Prevention law. Premium-level subscribers have access to comprehensive law summaries, policies, and templates, including a California Workplace Violence Prevention Toolkit. Snapshots and Updates are complimentary for all registered client users. For more information on the Client Portal or a Client Portal subscription, please email clientportal@ogletree.com.

On October 8, 2026, Ogletree Deakins will host a webinar, “Keeping Current in California,” regarding California’s new employment laws, as well as recent court decisions and upcoming state, local, and industry changes related to minimum wage. Click here for details and registration.

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Quick Hits

• Governor Newsom signed the substantial majority of employment-related bills passed in the 2025-2026 California legislative session, touching on artificial intelligence and workplace surveillance, pay equity enforcement, leave expansions, agricultural labor standards, workplace violence prevention, and immigration-related retaliation.
• The governor vetoed AB 1940, which would have added menopause and related conditions to the Fair Employment and Housing Act’s (FEHA) definition of sex.
• Most of the new laws take effect January 1, 2027, though several carry different operative dates.

California Employment Bills Signed Into Law

What This Means for Employers

With most of these laws taking effect January 1, 2027, California employers may want to begin updating handbooks, harassment prevention and other mandatory training materials, surveillance and monitoring policies, Worker Adjustment and Retraining Notification (WARN) Act notice procedures, and immigration-related nondiscrimination practices ahead of the new year. Employers using automated decision systems or AI-driven workplace tools in particular may want to review how those tools are deployed and documented, given the overlapping requirements now in place under AB 1883, SB 947, and SB 951, and previously enacted laws and regulations.

Ogletree Deakins’ California offices will continue to monitor developments and will provide updates on the Arbitration and Alternative Dispute Resolution, Artificial Intelligence and Innovation, California, Cybersecurity and Privacy, Drug Testing, Immigration, Leaves of Absence, Pay Equity, Reductions in Force, Wage and Hour, Workplace Safety and Health, and Workplace Violence Prevention blogs as additional information becomes available.

In addition, the Ogletree Deakins Client Portal provides subscribers with timely updates on California state laws, including California’s updated laws on Bereavement Leave, Automated Employment Decisions, Sexual Harassment Training Requirements, and Workplace Violence Prevention. Premium-level subscribers have access to comprehensive law summaries, policies, and templates. Snapshots and Updates are complimentary for all registered client users. For more information on the Client Portal or a Client Portal subscription, please email clientportal@ogletree.com.

Ogletree Deakins will host a webinar regarding California’s new employment laws, including the “stay or pay” law, which takes effect immediately, on October 8, 2026, from 2 – 3 p.m. ET. Click here for details and registration.

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Quick Hits

• Federal contractors encounter agency guidance at nearly every stage of contract performance.
• DOJ’s revised policy distinguishes between agency guidance that tracks binding regulations and guidance that is purely advisory.
• Under DOJ’s revised policy, noncompliance with agency guidance, standing alone, cannot establish an FCA violation.
• A contract that requires compliance with agency guidance can make that guidance enforceable or “material,” so the source of the obligation matters.
• DOJ may still rely on guidance as evidence of knowledge, industry practice, or materiality, particularly where a contractor has certified compliance.

The DOJ said in its revised Justice Manual that the department generally may not base an FCA action solely on a contractor’s failure to follow “agency guidance,” which are the broad category of documents that agencies issue to explain, interpret, or implement their programs, such as handbooks, manuals, frequently asked questions (FAQs), policy memoranda, and technical publications. These documents can be persuasive and practically important, but they do not carry the force of law. Under the revised policy, an FCA case must rest on a violation of a binding legal requirement, meaning a statute, a regulation, or an enforceable contract term, alone or in combination. Guidance can still play a supporting role in an FCA case, but noncompliance with guidance cannot itself supply the violation. For federal contractors seeking to understand compliance risk, the change makes the source of each compliance obligation the central question, because guidance that is merely advisory on its own can become binding when a contract incorporates it.

Under the revised policy, DOJ enforcement actions must be based on violations of applicable legal requirements. Consistent with the Justice Manual’s broader limits on the use of guidance documents, noncompliance with an agency guidance document cannot, by itself, establish a violation. Much of this material shapes day-to-day performance, but not all of it carries the force of law. Awareness of the actual legal source of an asserted compliance obligation rather than assuming every government instruction is binding can provide contractors with a more accurate assessment of compliance risk.

A Contract Can Make Guidance Binding

DOJ recognizes that a government contract may require compliance with an agency guidance document. In that situation, the contract, not the guidance itself, creates the enforceable obligation. Because federal contracts routinely incorporate outside documents, guidance that is merely advisory for the public may be mandatory for a particular contractor. To accurately assess compliance obligations and risk, agency guidance can be traced through:

• Federal Acquisition Regulation (FAR), Defense Federal Acquisition Regulation Supplement (DFARS), and agency supplement clauses;
• solicitation requirements;
• contract specifications and statements of work;
• incorporated documents and standards; and
• contractor representations and certifications.

This tracing exercise is not always straightforward. Contract clauses often point to other documents, which may be revised after award. Whether a contractor is bound by the version in effect at award or by later updates can depend on the precise incorporation language.

Cybersecurity is a clear example. A National Institute of Standards and Technology (NIST) publication, an agency FAQ, or a U.S. Department of Defense (DoD) implementation document may not independently create FCA liability. The analysis changes, however, when a DFARS clause or contract term requires the contractor to implement a particular standard, such as the NIST SP 800-171 requirements flowing through DFARS 252.204-7012. At that point, the standard is a contractual obligation and knowingly falling short while seeking payment can support FCA liability.

Contract clauses can also shape the materiality analysis. Some recent clauses, such as the FAR clause implementing Executive Order 14398, require the contractor to recognize that compliance is material to the government’s payment decisions for FCA purposes. That language can make a later materiality defense considerably harder.

Guidance That Arrives After Award

Much of the guidance contractors will follow during performance may not arrive with the solicitation. It surfaces after award through agency policy memoranda, updated handbooks, portal instructions, and emails from program personnel. Under DOJ’s revised policy, those materials do not independently create an FCA violation, and they generally do not change the contract either. Only a contracting officer acting within the scope of his or her authority can modify a contract on the government’s behalf.

That distinction matters in an FCA case. Contractors may want to determine whether post-award agency guidance or instructions were ever incorporated into the contract through a modification, a clause that expressly reaches later-issued documents, or the contractor’s own agreement or certification. If not, the instruction may reflect good practice, but it may not be the legal requirement DOJ’s policy demands.

‘Nonbinding’ Guidance Can Still Matter in an FCA Case

An overreading of the new policy could create risk. DOJ may still use agency guidance as evidence of:

• knowledge or notice of an obligation;
• industry standards or practices; and
• falsity or materiality when the contractor has made representations concerning compliance.

There are several steps contractors can take now to assess compliance risk presented by agency guidance materials during performance.

First, consider identifying the source of every significant compliance requirement, and distinguishing statutes, regulations, and contract requirements from guidance. For key performance requirements, it is important to understand where the obligation comes from and which version applies.

Second, consider a careful review of incorporation and certification language. A contract or contractor certification can give legal significance to requirements that otherwise might be merely advisory.

Finally, don’t assume agency guidance is irrelevant to FCA risk. Even when guidance does not independently impose an obligation, DOJ may use it as evidence of scienter, materiality, or industry practice.

DOJ’s revisions do not eliminate FCA risk associated with agency guidance. Instead, they make the source of the contractor’s obligation increasingly important. For federal contractors, the critical question may no longer be simply whether the government issued a particular requirement, but where that requirement appears and how it became binding.

Ogletree Deakins’ Government Contracting and Compliance Practice Group and Workforce Analytics and Compliance Practice Group will continue to monitor developments and will post updates on the Cybersecurity and Privacy, Government Contracting and Compliance and Workforce Analytics and Compliance blogs as additional information becomes available.

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Quick Hits

• Dismissals following an employee’s refusal to accept a unilateral, far-reaching relocation of the workplace may count toward the thresholds for mass dismissals, the European Court of Justice held in a June 2026 decision.
• Whether a workplace relocation is equivalent to a dismissal depends on the circumstances of the individual case, in particular the distance involved, the permanence of the change, and any compensatory measures offered.
• In the event of a site relocation, employers may want to assess early on whether a mass dismissal notification to the German Federal Employment Agency (Agentur für Arbeit) and the involvement of the works council (Betriebsrat) are required.

Site Relocation of More Than 600 Kilometers

The employer is an Italy-based company specializing in the manufacture of power generators. It ceased production at a site in Campania and relocated operations entirely to a new site in Sardinia. The two sites were more than 600 kilometers apart, separated by the Mediterranean Sea. Several employees failed to report to the new workplace, whereupon the employer initiated disciplinary proceedings and terminated their employment contracts. The Italian appellate court submitted a request for a preliminary ruling to the ECJ pursuant to Article 267 of the Treaty on the Functioning of the European Union, asking whether such dismissals must be treated as notifiable mass dismissals for the purposes of the Collective Redundancies Directive.

The Significance of the Change Is Decisive

The Collective Redundancies Directive defines mass dismissals as dismissals effected by an employer for one or more reasons not related to the individual workers concerned, provided that certain quantitative and temporal thresholds are met. The ECJ interprets the concept of a notifiable dismissal under the Collective Redundancies Directive broadly: it encompasses any termination of the employment contract that is not sought by the employee, i.e., that occurs without the employee’s consent.

In the ECJ’s view, a significant change to the essential terms of the employment contract that is imposed unilaterally by the employer to the detriment of the employee for reasons not related to the employee personally also falls within the concept of a notifiable dismissal under the Collective Redundancies Directive.

The workplace regularly constitutes an essential term of the contract, as any change to the workplace can have significant economic and organizational consequences for the employee concerned. The ECJ identified three criteria for determining whether a change is significant: the permanence of the relocation, the distance between the original and the new workplace, and any accompanying measures to compensate for the proposed reassignment.

In the case of a permanent relocation of more than 600 kilometers, the ECJ considered that there was much to suggest a significant change. The final assessment, however, remains with the referring Italian court.

Implications for Employers in Germany

In Germany, Sections 17 and 18 of the German Dismissal Protection Act (Kündigungsschutzgesetz (KSchG)) govern, in particular, the mass dismissal notification to the Federal Employment Agency (Agentur für Arbeit), the associated involvement of the works council (Betriebsrat), and the dismissal moratorium that may apply.

Dismissals issued without the required prior notification are void—a point the Federal Labor Court (Bundesarbeitsgericht (BAG)) reaffirmed in its judgment of April 1, 2026 (Ref. No. 6 AZR 157/22).

In two 2025 rulings, the ECJ held that failure to provide proper notification prior to a mass dismissal will result in invalid layoffs

The latest ECJ ruling broadens the perspective: going forward, employers must also include dismissals following a refused long-distance transfer in the threshold calculation. However, not every refusal to accept a transfer automatically triggers a mass dismissal. The decisive factors are the specific circumstances, in particular the distance involved, the duration, and the absence of compensatory measures.

Takeaways: EU-Law Concept of Dismissal Reaches Far

The ruling confirms that the EU-law concept of “dismissal” is broad in scope. Where the new workplace is far away and the change is permanent, employees’ refusal to transfer can result in the need to initiate mass dismissal proceedings.

Employers may therefore want to assess during the planning phase whether transfers, terminations with an offer of changed conditions (Änderungskündigungen), or subsequent terminations of employment must be aggregated and whether proceedings under Section 17 KSchG should be initiated as a precautionary measure. This is particularly important in the context of major restructurings, as procedural errors can significantly delay implementation and, in individual cases, jeopardize the validity of dismissals already issued.

Andre Appel is a partner in Ogletree Deakins’ Berlin office.

Lela Salman, a law clerk in Ogletree Deakins’ Berlin office, contributed to this article.

Ogletree Deakins’ Berlin office and Global Reorganizations Practice Group will continue to monitor developments and will post updates on the Cross-Border, Germany, Global Reorganizations, and Reductions in Force blogs as additional information becomes available.

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Quick Hits

• A federal district court in California has blocked USCIS, CBP, and the State Department from enforcing or implementing policies related to the proclamation-based $100,000 H-1B payment requirement.
• The California ruling represents another adverse federal district court decision involving the $100,000 payment, which is already blocked pursuant to a separate federal district court decision in Massachusetts that is currently on appeal.
• The court order does not affect the U.S. Department of Homeland Security’s (DHS) separately proposed $103,265 fee for H-1B cap-subject petitions, which remains in the rulemaking process and is not currently in effect.

Background

The case, Global Nurse Force v. Trump, was brought by a coalition of employers, labor organizations, schools, healthcare providers, religious organizations, and individuals challenging the $100,000 H-1B payment requirement and the agencies’ implementation of it.

President Donald Trump established the payment requirement through Proclamation 10973, issued on September 19, 2025. As implemented by USCIS, CBP, and the State Department, the requirement primarily affected H-1B workers outside the United States who needed consular processing or admission at a U.S. port of entry.

On September 18, 2026, President Trump issued Proclamation 11069, extending the restriction through September 21, 2027.

On September 30, 2026, the federal district court in California blocked the agencies from enforcing or implementing the proclamation-based payment requirement unless and until they comply with the rulemaking requirements of the Administrative Procedure Act.

Impact on Employers

For employers, the practical impact is straightforward: the proclamation-based $100,000 H-1B payment is not currently being enforced. Employers filing H-1B petitions, including cases requiring consular processing or admission from abroad, are therefore not currently required to pay the $100,000 amount.

The September 30, 2026, California order is the second federal district court decision blocking the payment requirement. A federal district court in Massachusetts has also blocked the requirement, although that decision is currently on appeal before the U.S. Court of Appeals for the First Circuit.

The litigation continues. The federal district court in California has scheduled a case management conference for October 27, 2026, with a joint case management statement due on October 20, 2026.

Employers should keep the $100,000 proclamation-based payment conceptually separate from DHS’s proposed $103,265 fee for certain H-1B cap-subject petitions. That proposed fee, part of a separate rulemaking process, is not affected by the September 30, 2026, order of court, though the $103,265 fee is not currently in effect. The comment period closed on September 24, 2026, and DHS has not yet issued a final rule.

Next Steps

Employers sponsoring H-1B workers may want to consider the following:

• The proclamation-based $100,000 payment is not currently required. This includes H-1B petitions involving workers who will require consular processing or admission to the United States from abroad.
• Employers should continue monitoring the litigation. USCIS currently advises on its website that, if the applicable court order is later lifted, DHS intends to collect the payment.
• The current litigation posture remains subject to change. Additional court rulings, appellate decisions, or agency actions could alter the requirements applicable to H-1B petitions and admission.
• The separately proposed $103,265 H-1B cap fee is not yet in effect. That proposal is proceeding through a separate rulemaking process and is not affected by the September 30, 2026, court order.

Ogletree Deakins’ Immigration Practice Group will continue to monitor developments and will provide updates on the Immigration blog as additional information becomes available.

For additional insight into the critical immigration issues facing employers today, please join our Virtual Immigration Insights Symposium on Wednesday, October 7, 2026, from noon to 2:30 p.m. ET. Register here.

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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‘Gone Till November.’ This week, the U.S. Senate wrapped up its current legislative period, and its members hit the campaign trail ahead of the November midterm elections. Senators (as well as members of the U.S. House of Representatives) are slated to return to Washington, D.C., on November 9, 2026, for the lame-duck session of the 119th Congress. The political dynamics in that session are sure to be interesting, as we will—theoretically—know where the balance of power will lie in both legislative chambers beginning in 2027. During the “lame duck” legislative waddle, the Buzz will be monitoring the status of the Faster Labor Contracts Act and federal government funding, which, absent congressional action, will expire on December 12, 2026. There are thirty-two days until Election Day.

District Court Blocks Implementation of $100,000 H-1B Visa Fee. On September 30, 2026, the U.S. District Court for the Northern District of California vacated guidance documents issued by U.S. Citizenship and Immigration Services (USCIS), the U.S. Department of State, and U.S. Customs and Border Protection (together, “the agencies”) that implemented President Donald Trump’s Proclamation 10973, which requires employers to include a $100,000 fee with each H-1B petition filed.

Rather than focusing on the president’s authority to establish the fee requirement, the district court focused on the legality of the implementing guidance documents, which “set their own criteria for administering the fee and determining whether to grant exceptions from it.” The court ruled that the agencies violated the Administrative Procedure Act when issuing the guidance documents because they “failed to consider any alternatives or the reliance interests of the regulated parties” (emphasis in the original) or make the policies available for public comment. Importantly, the decision enjoins the agencies from enforcing or implementing the guidance documents issued pursuant to the proclamation, including its extension until September 21, 2027.

This is the second court to block implementation of the proclamation, while a third court—the U.S. District Court for the District of Columbia—upheld the proclamation as a valid exercise of presidential authority. Both of the prior decisions are under appeal. Predicting where this matter will ultimately be decided, the California district court wrote, “[T]he United States Supreme Court is likely to eventually provide further clarity.” Amanda R. Goodman has additional details.

Sonderling Confirmed as Labor Secretary. On September 30, 2026, the U.S. Senate confirmed Keith Sonderling as secretary of labor by a vote of 47–41. Sonderling has served as acting secretary of labor since April 2026; he previously served as a commissioner on the U.S. Equal Employment Opportunity Commission, and, prior to that, was acting administrator of the U.S. Department of Labor’s (DOL) Wage and Hour Division. Sonderling will undoubtedly play a key role in driving the DOL’s regulatory agenda, particularly as the agency seeks to finalize key regulations in the remaining two years of the administration. Key regulatory developments include the finalization of rules addressing joint-employer and independent-contractor tests under the Fair Labor Standards Act, heat injury and illness prevention, and an increase in the prevailing wages that must be paid to certain employment-based immigrant visa holders and H-1B nonimmigrant visa holders.

Senate Approves College Sports Bill. On September 28, 2026, the U.S. Senate passed the Protect College Sports Act of 2026 (S. 4668) by a vote of 77–22. The bill establishes a federal governance framework to address multiple issues associated with college athletics, such as students’ name, image, and likeness rights, student recruitment and eligibility, regulation of sports agents, coaching transitions, and more. As the Buzz has discussed previously, the Protect College Sports Act is hands-off on students’ employee status, as it contains a provision stating that the bill is “neutral on, and does nothing to alter, employee or non-employee status for student athletes.” This contrasts with the House’s own college sports bill, the Student Compensation and Opportunity through Rights and Endorsements (SCORE) Act, (H.R. 4312) which states, “[N]o individual may be considered an employee of an institution, a conference, or an interstate intercollegiate athletic association based on the participation of such individual on a varsity sports team or in an intercollegiate athletic competition as a student athlete.” Therefore, the House and Senate will have to address this issue if a comprehensive legislative solution addressing college athletics is to pass Congress.

Thurgood Marshall Sworn In. Today in 1967, Thoroughgood “Thurgood” Marshall was sworn in as the Supreme Court of the United States’ first Black justice. Marshall, who as chief counsel of the NAACP Legal Defense and Educational Fund successfully argued Brown v. Board of Education, 347 U.S. 483 (1954), would serve on the Court until his retirement in 1991. At the Buzz, we remember Marshall for authoring the 8–1 majority opinion in Emporium Capwell Co. v. Western Addition Community Organization, 420 U.S. 50 (1975), which upheld the discharge of Black employees who picketed their employer to protest alleged racial discrimination, rather than pursue the grievance procedure set forth in their collective bargaining agreement. Marshall viewed the picketing as unprotected concerted activity because it violated the principle of “exclusive representation” embedded in the National Labor Relations Act (NLRA). Marshall wrote, “The policy of industrial self-determination as expressed in [the NLRA] does not require fragmentation of the bargaining unit along racial or other lines in order to consist with the national labor policy against discrimination.” The concept of exclusive representation remains an important—and controversial—topic of labor policy debates.

Quick Hits

• The NLRB general counsel is pushing the Board to reverse Biden-era Board precedents in a recent NLRB case brief.
• The brief argued for the reversal of the 2023 Stericycle standard, which established a presumption that workplace rules were unlawful.
• The brief urged a return to a prior framework dating back to the first Trump administration that focuses on a “reasonable employee” and balancing elements.
• The common thread in the proposals in the brief is a move away from standards that presumed employer conduct was unlawful toward standards that “genuinely” balance employee and employer interests.

The general counsel (GC) brief—filed on September 11, 2026, in Atlassian Corp., Case 16-CA-324971—asks the Board to overrule Biden-era precedents that have made employer compliance with the law in these areas increasingly difficult (and often frustrating). The new brief comes in a case concerning the enforcement of an employer’s social media rules for workers and is notable for laying out detailed proposed replacement standards that offer a window into the possible future of labor law.

A New Standard for Workplace Rules

What the law currently requires. Under the 2023 Stericycle standard, the GC need only show that a workplace rule has a “reasonable tendency to chill employees from exercising their” rights under Section 7 of the National Labor Relations Act (NLRA). This preliminary showing is quite easy to establish. At that point, the rule is considered presumptively unlawful, and the employer must prove both that the rule advances a legitimate and substantial business interest and that no more narrowly tailored rule could serve the same interest. The employer’s intent is irrelevant.

Why the GC says it should go. The GC argues that the existing standard “presumed unlawful interference whenever employer policies potentially interacted with even the most excessively broad interpretations of Section 7.”  The GC further pointed to former NLRB member Marvin Kaplan’s observation in his dissent in Stericycle that the standard’s “reasonable employee” is essentially “predisposed to read into their employer’s work-rules references to Section 7 activity where none exists.” The result, the GC contends, is a “dilemma” that forces employers to “either comply with various legal and regulatory requirements or risk having every workplace policy challenged as potentially violative of the” NLRA. The employer’s rebuttal opportunity is “largely illusory,” the GC argued, because, again quoting former member Kaplan from a different case, “no matter how narrowly tailored the rule, there could always be a rule that is ever so slightly more narrowly tailored.”

What the GC proposes instead. The GC urges a return to a prior framework (dating to the first Trump administration), which uses reasonable-employee and balancing elements. But she would not use that prior framework’s three-category system, where certain rules were considered always lawful, while others received individual scrutiny, and others still were always unlawful. The GC says this category system was well-intentioned but resulted in “confusion among the labor-management bar.” The proposed replacement is a two-step test:

• Step 1: The GC must prove that a facially neutral rule would, in context, be interpreted by an “objectively reasonable employee” to potentially interfere with Section 7 rights. That employee is “aware of his legal rights but also interprets work rules as they apply to the everydayness of his job,” and critically, does not “view every employer policy through the prism of the NLRA.”

• Step 2: If the GC meets that burden, the Board then genuinely balances the employer’s legitimate business justifications—including societal interests and regulatory requirements—against the extent to which the rule interferes with Section 7 rights. Unlikethe extant test, this balance “necessarily entail[s] the possibility that in a particular case, a challenged rule may be lawful to maintain even though it limits the exercise of Section 7 rights to some extent because the legitimate employer interests it advances outweigh that limitation.”

Key shifts. Under this proposed framework, rules must be read in context—not in isolation—considering the rule’s evident purpose, surrounding sections, examples given, industry or work setting, and savings clauses. A rule would not be found unlawful merely because it “could hypothetically be interpreted” to limit Section 7 activity or because the employer “failed to eliminate all ambiguities from the rule.” The employer’s rebuttal would be a genuine balancing test, not a near-impossible burden of proving no narrower rule exists.

Applied to the facts. The GC’s briefing applied this proposed standard to four workplace rules that were litigated in the Atlassian Corp. case, and found three to be lawful: (1) a rule directing employees to “frame opinions, not demands,” (2) a prohibition on “ad hominem attacks,” and (3) a rule against communications with a negative impact on partners, shareholders, or customers. The GC found only the confidentiality rule to be unlawful because an “objectively reasonable employee” would understand the definition of confidential information to include “nonpublic information relating to employees and compensation,” i.e., “wage discussions.”

Practical takeaway: Commonsense civility rules and anti-harassment policies should survive under the proposed standard (even if they could arguably cover talk about unions or concerted activity, and even if more narrowly tailored language could achieve a similar result). But confidentiality rules that sweep in employee compensation remain a problem even under a more employer-friendly framework. Beyond confidentiality, we are likely to see the GC continue to take issue with rules that could fairly be interpreted to prevent concerted activity. Context, purpose, illustrative examples, and savings clauses are the building blocks of a defensible rule.

Workplace Misconduct Standard Overturned

Notably, the GC’s brief in Atlassian Corp. portended the reversal of the Board’s 2023 standard from Lion Elastomers II for when an employee is unlawfully disciplined for misconduct that occurs during the exercise of Section 7 protected concerted activity. The brief urged the Board to move away from applying different “setting-specific” tests depending on where the misconduct took place, and to readopt a single burden-shifting framework, regardless of setting.

On September 23, 2026, the Board issued a supplemental decision in the Lion Elastomers case that vacated the decision in Lion Elastomers II, thereby restoring the prior General Motors standard and the familiar Wright Line framework used in mixed-motive discipline cases. However, that ruling expressly leaves open the possibility that the issue could be revisited in a future case, meaning there could be more to come on this issue.

What This Means for Employers

Overall, the GC’s proposed changes share a common thread: the GC is urging the Board to move from standards that presumed employer conduct was unlawful to standards that genuinely balance employee and employer interests. If the Board follows the GC’s lead, employers would benefit from a more contextual, commonsense approach and greater certainty.

But change has not arrived yet. The five-seat Board would have to issue a case adopting these standards before they become law. Notably, the Board is positioned to do just that now that it has obtained a 3-1 Republic majority.

Rapid action by the NLRB is not expected, but employers may want to position themselves for the expected shift to more employer-friendly standards. That means reviewing social media policies and other key workplace rules now—with an eye toward crafting rules that would survive under either the current standard or the more balanced framework the GC is advocating.

Ogletree Deakins’ Traditional Labor Relations Practice Group will continue to monitor developments and will provide updates on the Traditional Labor Relations blog.

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Quick Hits

• On September 29, 2026, the SBA removed disparate impact liability and race-conscious affirmative action requirements from 13 CFR Part 112, effective immediately, without prior notice and comment.
• The revised rule states Title VI of the Civil Rights Act of 1964 prohibits only intentional discrimination and rests on the same legal authorities as the earlier agency rescissions, Alexander v. Sandoval, Loper Bright, Students for Fair Admissions, and Executive Order 14281.
• The SBA rule preserved the government’s and litigants’ ability to use disparate outcome data to prove intentional discrimination, reinforcing that data collection and preservation obligations remain squarely in place for employers even as the federal enforcement posture changes.

The SBA’s rule change follows the same template that the U.S. Departments of Justice, Interior, Transportation, Agriculture, and Labor used over the preceding ten months, but it also removes affirmative action provisions that the other rescissions did not need to reach.

The SBA Rule

The SBA amended 13 CFR Part 112, its Title VI implementing regulation for federally assisted programs, in three respects. It removed the affirmative action provisions at Sections 112.3(b)(3) and 112.7(d), which authorized, and in some cases required, measures conscious of race, color, and national origin to overcome the consequences of practices that had limited participation, even where the recipient had never used discriminatory policies. It deleted the disparate impact language in Section 112.4 that extended the employment-discrimination prohibition to practices that merely “tend” to have a discriminatory effect, and removed the companion illustration at Section 112.7(a).

Same Pattern, One Additional Layer

The SBA rule follows the pattern in other federal agencies’ actions to rescind disparate impact regulations under Title VI. Indeed, the rule notes that DOJ reviewed and approved it. The SBA relies on the same reasoning as the other agencies: Title VI’s “single, best meaning” is that it prohibits intentional discrimination only. The SBA describes its disparate impact regulations as in “considerable tension” with Title VI and the Supreme Court of the United States’ precedents (including Students for Fair Admissions, Inc. v. President & Fellows of Harvard College). The SBA also invokes Executive Order 14281, which directs the elimination of disparate impact liability “to the maximum degree possible.” SBA issued its regulation without notice and comment and with an immediate effective date, invoking the Administrative Procedure Act’s exception at 5 U.S.C. § 553(a)(2) for rules relating to public property, loans, grants, benefits, or contracts.

The SBA rule goes further than the other rescissions by also addressing affirmative action. Prior sections of its rules authorized and sometimes required funding recipients to use race-conscious measures, such as racial preferences, special consideration of race, and affirmative steps to achieve racial balance, without requiring the narrow tailoring to a compelling governmental interest that strict scrutiny demands. The SBA characterized these provisions as encouraging “the exact conduct the Equal Protection Clause forbids.” The rescission of those provisions is a separate action from the disparate impact removal, and SBA took the position that each amendment operates independently, meaning that invalidation of one would not affect the others.

Disparate Impact Is Out, but the Same Data Can Still Support Liability

Consistent with every prior Title VI disparate impact rescission (by the U.S. Departments of Justice, Interior, Transportation, Agriculture, and Labor (DOL)), SBA stated that eliminating disparate impact liability “does not preclude the use of data on disparate outcomes to help prove intentional discrimination.” It drew the same distinction the DOL rule drew most clearly: using statistical disparity to help establish liability for intentional discrimination as an evidentiary matter “materially differs from using such disparity to impose liability for an unintentional disparate impact.”

That language is now in six federal agency rescission rules. The federal government has not told funding recipients or employers that their data is safe to disregard. It has told them that the same statistics once used to establish disparate impact liability are now positioned as evidence of intentional discrimination, the theory that remains fully enforceable.

SBA’s own cost-benefit analysis acknowledged that the removed provisions were already “effectively inoperative,” which only sharpens the point. The practical change for funding recipients may be modest, but the evidentiary reframing of disparate outcome data, from a standalone basis for liability to a tool for proving intent, is not.

What This Means for Employers and Funding Recipients

The SBA rule narrows part 112 regulations under Title VI. It does not affect Title VII, which independently codifies disparate impact liability, or the state and local statutes that continue to apply it. Employers with SBA relationships may wish to consider:

• Identifying the SBA relationship at issue, i.e., determining whether the organization is applying for or receiving SBA financial assistance covered by part 112, participating in an SBA contracting program, or both.
• Continuing to evaluate intentional and disparate impact discrimination risk by, for example, conducting and structuring adverse impact analyses under attorney-client privilege before a problem surfaces, not after.
• Accounting for continued private and state-level exposure. Private plaintiffs retain a right of action under Title VII of the Civil Rights Act of 1964, and state and local agencies continue to apply disparate impact analysis under their own statutes.
• Recognizing what the data now proves. The demographic and selection data that employers collect and maintain does not become safe because disparate impact liability is rescinded. That same data is now positioned as potential proof of intentional discrimination, the theory the U.S. Equal Employment Opportunity Commission (EEOC) says it is prioritizing.

Ogletree Deakins’ Diversity, Equity, and Inclusion Compliance Practice Group, Government Contracting and Compliance Practice Group, and Workforce Analytics and Compliance Practice Group will continue to monitor developments and will provide updates on the Diversity, Equity, and Inclusion Compliance, Employment Law, Government Contracting and Compliance, and Workforce Analytics and Compliance 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

• AI tools can be extremely helpful in supporting the need for constant safety oversight in manufacturing environments
• However, employers retain the responsibility to comply with OSHA regulations, even if the employer implemented an AI process designed to protect worker safety.

AI has many positive use scenarios in a manufacturing setting. A camera notices that a worker walked into a press area without safety glasses. A sensor on a conveyor motor picks up a vibration pattern that has previously indicated an impending failure. A forklift slows down as a pedestrian comes around a blind corner. In this AI age, manufacturing employers implement AI resources not only to increase efficiency, but to better promote workplace safety—striving for fewer injuries, fewer disruptions, and a stronger safety culture. But one principle applies to AI in any setting: AI works best as a tool that supports human judgment, not one that replaces it. Without real human oversight, AI safety systems can leave gaps that could lead to worker injuries and OSH Act compliance shortfalls.

How AI Is Supporting Worker Safety

Used well, AI can extend what a safety team is able to see, predict, and respond to. Applications of AI are growing each day, but common uses in manufacturing can include:

• Personal protective equipment (PPE) compliance: Cameras paired with AI models can flag missing hard hats, eye and face protection, or proper gloves.
• Safety alarms: Systems can watch the restricted areas around hazardous machinery or blind spots and send warnings when employees enter an area where collision could occur.
• Predictive maintenance: AI can analyze sensor data and spot signs of equipment wear or failure before a breakdown, reducing the need for emergency maintenance.
• Incident analytics: AI can sort through large volumes of incident and near-miss reports to find trends that would be hard to see manually.
• Collaborative robots: “Co-bots” can take over repetitive or hazardous tasks and reduce workers’ exposure to strain and repeat use injuries.

Each of these tools can make a safety program stronger, but relying too heavily on any of them can create inadvertent gaps in even the most well-intentioned safety program. These gaps create openings for unintended compliance shortfalls and—potentially—employee injuries. Employers may want to continue intentionally monitoring their safety programs—even those supported by AI tools—to identify these gaps and create solutions to fill them.

Why Human Oversight Still Matters

However, AI does not replace competent or qualified persons, hazard assessments, or enforcement of safety rule violations. If employees assume “the system will catch it,” basic safety practices can slip. And it is the employer that remains responsible: the duty to comply with the OSH Act’s general duty clause (Section 5(a)(1)) and applicable Occupational Safety and Health Administration (OSHA) regulations cannot be handed off to a vendor or an algorithm.

Mapping AI to Commonly Cited OSHA General Industry Standards

OSHA has not issued regulations specific to AI use in safety programs. However, the following OSHA general industry standards come up often in manufacturing and are among OSHA’s Top Ten Most Frequently Cited Standards for the most recently reported year. AI can assist with each, but people must still oversee these processes to ensure compliance with OSHA requirements.

The pattern is the same across the board: AI can improve detection and efficiency, but human involvement is necessary to verify the accuracy of written programs, conduct training, carry out inspections, and implement enforcement programs. After all, it is still the employer that will be liable for an OSH Act violation, even if the employer implemented an AI process designed to protect against those violations.

Top Five Tips for Effective Use of AI in Manufacturing Safety Systems

Employers thinking about adopting AI safety tools, or already using them, may want to consider the following tips:

• Robust safety teams. Assessing the current human safety team before implementing AI tools for any safety tasks is a critical early step. Employers may want to identify whether the team is comprised of the right people, with the right experience and knowledge of the workplace, to identify potential hazards and whether AI tools can assist in reducing those risks.
• Intentionality. Consider starting with a traditional hazard identification and assessment. This step includes intentionally identifying the hazards that may exist before implementing an AI process, as well as the hazards that could be caused by the AI tool itself, and implementing only AI processes that are necessary or are tied to a specific safety-related goal.
• Integration, not replacement. Because human oversight is crucial in all safety programs, it is important to note that AI safety tools are not a substitute for an employer’s existing safety and health programs. Human involvement could take many forms, including:
  • Defining alert ownership. Factors include deciding who reviews alerts, how quickly they must respond, and what they are expected to do.
  • Validating and auditing performance. Standard elements in this step include testing systems under real site conditions, and auditing them again after changes to equipment, layout, or processes.
  • Keeping a human in the loop for stop-work decisions. Employers may want to remind their employees that people, not AI, should make the final call on whether to stop or restart work.
  • Training workers and supervisors. Employers may want to ensure that workers and supervisors understand what the tools do, where they fall short, and why ordinary safety practices still apply.
  • Documenting oversight activities. Keeping records of validation, audits, alert responses, and corrective actions demonstrates that employees exercise oversight of the safety programs.
  • Encouraging reporting without retaliation. Employers may want to invite workers to report AI failures or concerns and make sure no one faces retaliation for doing so.

Conclusion

AI has real potential to make manufacturing workplaces safer. It can catch hazards people might miss, predict failures before they happen, and take workers away from dangerous tasks. But the technology is a safety ally, not a safety manager. Employers that pair AI with strong human oversight, clear accountability, and a solid OSHA compliance program will be in the best position to reduce injuries and manage legal risk.

Ogletree Deakins’ Artificial Intelligence and Innovation Practice Group and Workplace Safety and Health Practice Group will continue to monitor developments and provide updates on the Artificial Intelligence and Innovation, Manufacturing, and Workplace Safety and Health blogs as additional information becomes available.

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Quick Hits

• A New Jersey federal district court rejected a concrete company’s bid to overturn an arbitrator’s award in favor of an employee who was discharged after testing positive for marijuana.
• The court found that the odor of marijuana alone is not sufficient to establish reasonable suspicion of cannabis use, possession, or impairment as required for an adverse action under CREAMMA.
• Under CREAMMA, an employer may take an adverse employment action against an employee based on—but not solely due to—the presence of cannabinoid metabolites in the employee’s bodily fluids.

Under CREAMMA, marijuana is legal for recreational use. The law prohibits employers from taking adverse employment actions solely based on a positive marijuana test. Employers can require an employee to undergo a drug test when there is reasonable suspicion of an employee’s use of marijuana while on duty, when there are observable signs of marijuana intoxication, or following a work-related accident subject to investigation by the employer.

Background on the Case

In April 2025, as an employee for County Concrete Corp. drove his personal vehicle during a lunch break past a supervisor and coworker on company property, the supervisor and coworker claimed that they detected a strong smell of marijuana from the vehicle. The supervisor ordered the employee to take a drug test, which returned positive for marijuana. The company fired the employee, who had previously tested positive for marijuana in December 2023. The employer had a two-strike policy, stating that two positive drug tests could result in termination of employment. The employee was represented by the International Brotherhood of Teamsters Local 863, which filed a grievance that proceeded to arbitration.

In December 2025, the arbitrator awarded the employee reinstatement to his former position with full back pay, seniority, and benefits. She found that the company failed to establish the employee’s use of, possession of, or impairment from cannabis at the workplace.

County Concrete filed a petition to vacate the arbitrator’s award. It argued that the arbitrator disregarded controlling New Jersey law and exceeded her contractual authority derived from the collective bargaining agreement.

The company argued that the arbitrator ignored CREAMMA when she, in issuing her decision, considered the nonbinding best practices for employers published by the New Jersey Cannabis Regulatory Commission, including relying on observable, physical signs of impairment while on duty and documenting evidence within twenty-four hours or before drug test results arrive, and designating a point person with sufficient training to determine impairment. The union and the employee argued that an odor on clothing or in a car only established that marijuana may have been present at some prior time, not that an employee consumed the drug on an employer’s property or was impaired while on duty.

Federal District Court Ruling

The U.S. District Court for the District of New Jersey noted that, in cases like this one concerning a collective bargaining agreement, courts must give deference to the arbitrator’s decision even if the arbitrator made errors in law or fact. An arbitrator’s award can only be vacated if it was procured by corruption, fraud, or undue means; if there was evident partiality or corruption in the arbitrator; if the arbitrator was guilty of misconduct in refusing to postpone a hearing or hear evidence; or if the arbitrator exceeded his or her powers.

In reviewing the arbitrator’s decision, the district court concluded that the arbitrator did not manifestly disregard CREAMMA or exceed her contractual authority. In confirming the award, the court explained that odor, standing alone, does not establish reasonable suspicion that an employee was using cannabis while performing his or her job duties or that the employee was impaired on employer property. Rather, “[a]n odor, standing alone, establishes only that cannabis may have been present at some point.” The court noted that, in this case, “[t]here was no testimony that Grievant slurred his speech, no evidence that his eyes were glassy, and no evidence that he was impaired while on duty, and no report or evidence of poor work performance.” Further, the employer “allowed the Grievant to complete his shift until 4:30 pm that day without any reports of being impaired.”

The court made further reference to the fact that, contrary to best practices identified by the New Jersey Cannabis Regulatory Commission, the employer did not document the observance until more than a week later, and neither the supervisor nor coworker who observed the marijuana smell were trained in drug impairment recognition. The court found the arbitrator’s award was aligned with established legal precedent and was “rationally derived” from the collective bargaining agreement.

Next Steps

This case shows that, in New Jersey, the odor of marijuana and a positive drug test, without additional evidence, is not sufficient to justify an adverse employment action against an employee suspected of cannabis use, possession, or impairment. It also highlights the importance of drug impairment recognition training for individuals assessing an employee’s potential marijuana use.

Employers in New Jersey may wish to review their employee handbooks and collective bargaining agreements to ensure compliance with state laws regarding drug testing and off-duty marijuana use. Courts in New Jersey are likely to show deference to an arbitrator’s interpretation of a collective bargaining agreement except in rare circumstances.

Ogletree Deakins’ Arbitration and Alternative Dispute Resolution Practice Group and the Drug Testing Practice Group will continue to monitor developments and will post updates on the Arbitration and Alternative Dispute Resolution, Drug Testing, and New Jersey blogs as additional information becomes available.

Leslie A. Lajewski is a shareholder in Ogletree Deakins’ Morristown office.

Steven J. Luckner is a shareholder in Ogletree Deakins’ Morristown 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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