Third Republican Officially Joins NLRB. On August 17, 2026, James R. Macy was sworn in as a member of the National Labor Relations Board (NLRB) for a term that will conclude on August 27, 2030. Macy, a Republican, and David M. Prouty, a Democrat, were both confirmed by the U.S. Senate on August 7, 2026. Approximately eighteen months into the Trump administration, the Board is finally poised to revisit Biden-era cases that largely favored labor unions. How quickly policy changes might come about depends on a variety of factors—in particular, whether cases on the Board’s current docket involve issues that are ripe for reversal.

OFCCP Finalizes Repeal of Affirmative Action Regulations. Today, the Office of Federal Contract Compliance Programs published a final rule rescinding the regulations that implemented Executive Order 11246. These regulations required federal contractors to adhere to contractual nondiscrimination provisions and to develop and maintain a written affirmative action plan (AAP) for each of their establishments. However, on January 21, 2025, President Trump issued Executive Order 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” which rescinded Executive Order 11246, thereby providing “a standalone and sufficient basis for rescinding regulations promulgated solely to implement that Order.” This week’s action, which goes into effect on October 26, 2026, finalizes a proposed rulemaking that was issued on July 1, 2025. The final rule does not impact federal contractors’ obligations under Section 503 of the Rehabilitation Act or the Vietnam Era Veterans’ Readjustment Assistance Act. Lauren B. Hicks, Christopher J. Near, and Zachary V. Zagger have the details.

Unions, Education Groups Challenge “Duration of Status” Regulation. This week, labor unions and educational organizations filed a legal challenge to the U.S. Department of Homeland Security’s / U.S. Immigration and Customs Enforcement’s (ICE) July 17, 2026, final rule that eliminated the “duration of status” framework for nonimmigrant students and exchange visitors and instead installed a “period of stay” requirement of four years. The complaint, filed in the U.S. District Court for the District of Massachusetts, alleges that the rule is arbitrary and capricious under the Administrative Procedure Act because ICE failed to conduct an adequate cost-benefit analysis. In particular, the complaint alleges that ICE “entirely refused to quantify costs to stakeholders or the economy writ large caused by a decline in enrollment of international students.” The complaint further alleges that ICE “made no effort to estimate the purported benefits of the Final Rule” while also failing to rationally explain why the elimination of duration of status would address national security concerns, the agency’s purported rationale for the change.

USCIS Issues Public Charge Inadmissibility Guidance. On August 18, 2026, U.S. Citizenship and Immigration Services published new policy guidance “explaining how the agency will determine whether an alien applying for adjustment of status to that of a lawful permanent resident is likely at any time to become a public charge.” The new guidance implements the July 20, 2026, final rule that removed the public charge determination from governance via regulation, which limited hearing officers’ ability to “consider any other factors or information relevant to determining an alien’s likelihood at any time of becoming a public charge in the totality of the alien’s circumstances.” Pursuant to the Immigration and Nationality Act, hearing officers must consider an applicant’s age, health, family status, assets, resources, and financial status when making public charge determinations. Under the new guidance, in addition to these factors, hearing officers are instructed to consider “any other factor relevant to assessing the alien’s likelihood at any time of becoming a public charge, including the alien’s receipt of means-tested public benefits, such as cash assistance for income maintenance, housing assistance, food stamps, financial aid for college, or any other similar benefit.” The guidance becomes effective on September 18, 2026.

A Proclamation to End the War. On August 20, 1866—160 years ago this week—President Andrew Johnson brought about a legal end to the American Civil War by issuing “Proclamation 157—Declaring that Peace, Order, Tranquillity, and Civil Authority Now Exists in and Throughout the Whole of the United States of America.”

Although most military hostilities had ceased on April 9, 1865, at Appomattox Court House, Virginia, when Ulysses S. Grant, lieutenant general of all U.S. armies, accepted the surrender of Confederate General Robert E. Lee and his Army of Northern Virginia, reassertion of federal authority over the former Confederate states proved challenging. As pockets of resistance were quelled, President Johnson issued proclamations—first in June 1865 and again in April 1866—acknowledging an end to the rebellion in various states. But Texas remained in turmoil for several more months until President Johnson declared, via the proclamation, “that the insurrection which heretofore existed in the State of Texas is at an end … and that peace, order, tranquillity, and civil authority now exist in and throughout the whole of the United States of America.”

Congress subsequently confirmed August 20, 1866, as the official end of the Civil War by passing legislation to extend soldiers’ pay “for three years from and after the close of the rebellion, as announced by the President of the United States by proclamation, bearing date the twentieth day of August, eighteen hundred and sixty-six.”

Quick Hits

• The SEC is forming a new enforcement unit to combat fraud in accounting and financial reporting.
• The new unit signals the agency’s intent to heighten regulatory scrutiny of accounting, financial reporting, and auditing practices.
• Whistleblower information may play an important role in bolstering the Division of Enforcement’s efforts in this area.

The SEC announced it will establish a new unit within the Division of Enforcement to pursue accounting and financial reporting fraud cases, as well as general misconduct in the accounting and auditing areas. The Financial Reporting and Accounting Unit will be staffed by attorneys and accountants with expertise in financial reporting, accounting, and auditing in securities regulation.

Accounting and financial reporting misconduct includes the intentional manipulation, falsification, or omission of financial records to deceive investors, lenders, or regulators. For example, it could involve misrepresenting revenue, debt, expenses, or assets.

Key Takeaways

• The establishment of the new unit signals prioritization of these types of matters by the Division of Enforcement. Information from whistleblowers submitted via the SEC’s Office of the Whistleblower has been an important tool in enforcement actions and will likely bolster the division’s efforts in this area.
• Because of expected enhanced scrutiny in this area, companies may wish to ensure internal reporting systems are robust to capture internal reports related to accounting and financial reporting misconduct or fraud.
• Companies may wish to ensure management is trained in identifying and appropriately escalating concerns related to accounting and financial disclosures.
• Standard practices include making sure to communicate to an internal reporter that the organization is taking their report seriously. Many times, employees report to a regulator when they believe their concerns have not been heard or taken seriously internally.

Ogletree Deakins’ Whistleblower and Compliance Practice Group and Financial Services Industry Group will continue to monitor developments and will post updates on the Employment Tax and Ethics/Whistleblower 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.

Jane A. Norberg is a shareholder in Ogletree Deakins’ Washington, D.C., 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

• In Hill v. 1359768 Ontario Inc. (B&B Towing) (2026 ONCA 577), the Ontario Court of Appeal unanimously held that a trial judge did not err in finding that an employment contract was not frustrated where an employee’s physical limitations were temporary, could be accommodated, and did not prevent the employee from performing the essential duties of his position within a reasonable time.
• However, the court allowed the appeal in part on the issue of damages, holding that the trial judge erred in awarding more than $125,000 in damages for the loss of use of a company tow truck and cellphone that were work tools rather than personal employment benefits.

The decision reinforces the high threshold employers must meet to establish frustration and provides a practical framework for distinguishing compensable fringe benefits from mere employment tools in damages assessments.

The Facts

Jack Hill worked for B&B Towing for approximately seventeen years as its “road boss,” managing fifteen to twenty-seven drivers, ordering parts, maintaining vehicles, handling complaints, hiring and discharging employees, and overseeing administrative work; physical towing comprised about 10 percent of his duties. After emergency surgery in May 2020, he received long-term disability benefits and, by late 2021, his doctors recommended a trial return with accommodations, including lifting no more than thirty pounds and a preference for administrative duties.

While Hill was on leave, B&B’s principals assumed his road boss duties and told him in September 2021 that the position had been eliminated for financial reasons; he would return as a tow truck driver at lower pay. He returned under protest in January 2022, injured his back on February 17 when an accommodation winch malfunctioned, and formally took the position that he had been constructively dismissed on February 25. He never returned to work.

The Decisions Below

The trial judge found that the appellant had constructively dismissed Hill by demoting him and rejected the employer’s frustration defence. She assessed the reasonable notice period at twenty-two months and awarded damages of $236,163.77, which included $123,000 for the loss of use of a company tow truck and $2,640 for the loss of use of a cellphone during the notice period.

The Court of Appeal’s Analysis

Frustration: Defence Dismissed

Despite the trial judge’s brief reasons, the court of appeal held that she applied the correct contextual framework, which required consideration of:

1. whether Hill could perform the material duties of the road boss position at termination of employment;
2. whether he could return to a comparable position within a reasonable time with reasonable accommodation; and
3. whether his limitations were temporary or constituted a frustrating event.

The court upheld the result: Hill’s nineteen-month absence was relatively short; the business operated without him; his doctors supported a trial return; and B&B had previously accommodated his restrictions. His February 2022 injury resulted from a malfunctioning accommodation device, not his underlying limitations.

Damages: Tow Truck and Cellphone Not Compensable Benefits

The court allowed the appeal on damages, deducting $125,640 for the tow truck and cellphone, and distinguished employment tools from compensable fringe benefits.

A company vehicle or cellphone is compensable only if the employee proves it provided a personal benefit as part of contractual compensation; otherwise, it is an employment tool. The court found that Hill’s negligible personal use of the specialized tow truck—which was not pleaded or reported as a taxable benefit and had a lease value disproportionate to his salary—did not establish a compensable benefit, and that his cellphone claim likewise failed for lack of evidence beyond a bare assertion.

What This Means for Employers

Frustration remains a high bar, and accommodation history matters. Employers must show that a disability is serious, lengthy, and ongoing, prevents performance of essential duties within a reasonable time, and cannot be accommodated without undue hardship; a relatively short absence, medical evidence supporting a return, or prior accommodation will undermine the defence.

Work tools are not fringe benefits. Specialized equipment supplied to perform the job—such as tow trucks, radios, and machinery—does not create damages exposure merely because the employer tolerates negligible personal use.

Evidentiary markers of personal benefit matter. Courts will consider objective indicia such as T4 reporting, Canada Revenue Agency (CRA) disclosure, pleadings, and the benefit’s value relative to salary; employees must prove meaningful personal benefit, not merely assert it.

Documenting the purpose of company assets. Employers may want to state whether vehicles, phones, and other equipment are work tools or personal benefits, and align reporting practices accordingly.

The Bottom Line

Hill v. B&B Towing provides useful guidance on frustration and damages, confirming that temporary disabilities may not frustrate an employment contract where accommodation is feasible and that specialized company equipment is not a compensable benefit absent evidence of personal use. The decision offers a practical, evidence-based framework for employers that provide specialized equipment to their workforce.

Ogletree Deakins’ Toronto office will continue to monitor developments and will post updates on the Canada, Cross-Border, and Leaves of Absence blogs as additional information becomes available.

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Quick Hits

• A growing number of states have passed laws allowing citizens to have guns in locked cars in employer parking lots and preventing employers from firing or disciplining employees who do so.
• Private businesses, such as shops, movie theaters, and gyms, may post signs indicating guns are not allowed inside.
• Many state laws include an exception allowing employers and property owners to ban guns on the premises of government buildings, courts, schools, polling places, correctional institutions, businesses involved in national defense, other places prohibited pursuant to any federal law or contract, and/or in company-owned or company-leased vehicles.

In recent years, court rulings and new state laws have narrowed the legal capacity employers may have to ban guns in parking lots next to workplaces. The changes include the following:

• On June 25, 2026, the Supreme Court of the United States overturned a Hawaii law that prohibited firearms on private property open to the public without the consent of the property owner. In Wolford v. Lopez, the Court ruled that the state law violated residents’ rights under the Second and Fourteenth Amendments of the U.S. Constitution.
• Effective July 1, 2026, Virginia prohibits guns in unattended vehicles unless the gun is locked in a container, such as the glove compartment or center console. Property owners can prohibit weapons on private property, including parking lots.
• Florida’s First District Court of Appeal recently ruled the state’s open carry ban is unconstitutional. Employers in Florida can display clear notices stating that firearms are prohibited on their premises, but they cannot ban legally owned firearms locked inside vehicles in parking lots or retaliate against employees for lawfully possessing them.
• On January 20, 2026, the Fourth Circuit Court of Appeals held that Maryland’s law barring guns on private property open to the public was unconstitutional. However, it upheld Maryland’s prohibitions against guns in government buildings, mass transit, school grounds, state parks and forests, museums, healthcare facilities, stadiums, racetracks, amusement parks, and casinos. 
• Effective January 1, 2025, New Hampshire permits workers to keep guns and ammunition in a locked car on their employer’s property. Covered employers may not discharge or discipline an employee for storing a gun or ammunition in a locked car.
• In Florida, North Dakota, and West Virginia, employers are prohibited from asking employees about whether they have a gun in a locked vehicle parked on the employer’s property. A search to ascertain the presence of a firearm within a private vehicle may only be conducted by on-duty law enforcement personnel as provided by state law.

Next Steps

There is no federal statute regulating guns in the workplace or employer parking lots. Under the federal Occupational Safety and Health (OSH) Act, employers have a general duty to provide a safe and hazard-free workplace, including taking reasonable steps to prevent workplace violence.

The Supreme Court opinion in Wolford v. Lopez is likely to have an impact on other states with gun restrictions similar to Hawaii’s. In the meantime, employers are not legally obligated to permit employees or customers to carry guns inside the workplace. Depending on the state, and whether a specific exception applies, they may be required to allow guns in a locked car in a parking lot that employees and customers use. The recent changes to the law may make it difficult for multistate employers to maintain a consistent policy on firearms in parking lots across all locations.

Ogletree Deakins’ Workplace Violence Prevention Practice Group will continue to monitor developments and will post updates on the Employee Engagement, Florida, Hawaii, Maryland, Multistate Compliance, New Hampshire, North Dakota, State Developments, Virginia, West Virginia, and Workplace Violence Prevention blogs as additional information becomes available.

In addition, the Ogletree Deakins Client Portal provides subscribers with timely updates on state Weapons in the Workplace laws. Premium-level subscribers have access to comprehensive law summaries 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.

Frank D. Davis is a shareholder in Ogletree Deakins’ Dallas office.

Dee Anna D. Hays is a shareholder in Ogletree Deakins’ Tampa 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

• In Gorobets v. Jaguar Land Rover North America, LLC, the Supreme Court of California held that a 998 offer can present two alternatives if the options are clearly stated and at least one option is sufficiently certain to permit accurate valuation at the time the offer is made.
• The court held that a valid alternative-choice 998 offer must clearly delineate the specific terms for each choice, specify that only one option may be selected, and communicate how to accept the offer.
• Although this case involved a car-lease dispute, the same legal principles apply to 998 offers in employment-related disputes.

California’s Code of Civil Procedure Section 998 encourages parties to resolve lawsuits early by attaching financial penalties to parties that reject a reasonable settlement offer. The settlement offer must be presented at least ten days before a trial or arbitration begins, and the recipient has thirty days (or until the start of trial) to accept it. If a plaintiff rejects a defendant’s 998 offer and loses or prevails for less than the offer after trial, that plaintiff cannot recover post-offer costs and may be required to pay the defendant’s post-offer costs. If a defendant rejects a plaintiff’s 998 offer, and the final judgment is more favorable to the plaintiff than the 998 offer, the defendant may be forced to pay the plaintiff’s post-offer costs. 

Background on the Case

Vadim Gorobets leased a car and later sued the manufacturer, Jaguar Land Rover, alleging defects in nearly every major vehicle system. He brought claims for breach of warranty and breach of the duty to return the vehicle from service without defects within thirty days.

On October 15, 2020, Jaguar Land Rover served a section 998 offer with two choices.The first was a lump-sum payment of $85,000 in exchange for the vehicle’s return with clear title. The second choice proposed that Jaguar Land Rover would reimburse Gorobets for expenses he incurred, including transportation charges, manufacturer-installed options, loan interest, rental charges, sales tax, license fees, registration fees, incidental or consequential damages, and any amount owed on the auto loan.

Gorobets rejected both choices. A jury awarded him $76,155.27 in damages.Both parties then moved to recover costs and to strike or tax the other’s cost claims. Gorobets sought $76,118 in general costs and $543,413 in attorney fees. Jaguar Land Rover argued Gorobets forfeited post-offer costs because he rejected a valid 998 offer and failed to obtain a more favorable result at trial. Gorobets countered that the 998 offer was invalid because its terms lacked sufficient specificity to permit accurate valuation.

The trial court ruled that the 998 offer was valid. It awarded Jaguar Land Rover post-offer costs and denied Gorobets’s request for post-offer attorneys’ fees. Gorobets appealed. The appellate court held that 998 offers may not present multiple alternatives, and that the only valid offer was the lump-sum offer.

Supreme Court of California Ruling

In affirming the trial court’s award, the Supreme Court of California rejected the Court of Appeal’s conclusion that alternative-choice offers are inherently uncertain. The higher court further held that “a 998 offer can be valid so long as the offer is structured so that it clearly presents the alternatives available to the offeree, and at least one of the two independent sets of terms is sufficiently certain to permit an accurate valuation at the time the offer is made.”    

Permitting alternative choices “increases the likelihood of an early settlement by providing the parties with the flexibility to explore multiple avenues toward resolution at once, rather than forcing them into a more time-consuming process that requires them to make and evaluate offers one at a time,” the court stated. “Alternative-choice offers allow the parties to communicate and explore those preferences more rapidly and efficiently, potentially shortening the path to common ground.”

Explaining steps in the legal analysis, the court stated, “When asked to determine the validity of an alternative-choice 998 offer on a motion for cost-shifting, the trial court first determines whether the offer is structured to make the provided sets of terms clear and the manner of selection between them evident. In this regard, the 998 offer must delineate the specific terms attributable to each choice presented and provide that the offeree must affirmatively choose one or the other set of terms by way of acceptance.”

“Once it determines that the alternative-choice 998 offer is sufficiently clear in structure, the trial court then considers whether either set of terms is sufficiently certain to permit valuation at the time the offer was made and whether that value of at least one valid alternative is higher than judgment or award ultimately achieved,” the court continued. The party seeking cost-shifting bears the burden of proving validity.

Key Takeaways

Section 998 offers can be a valuable strategic tool, and this case gives employers more flexibility in using the tool. It reinforces the notion that Section 998 promotes early settlements through financial incentives. Businesses looking to settle a case with a 998 offer may consider presenting alternative choices, but should be careful to state the terms clearly.

One open question remains. Because Gorobets rejected both alternatives outright, the court had no occasion to decide whether an offeror can still invoke cost-shifting based on the certain alternative, if the offeree instead accepts the uncertain one. Businesses may want to ensure both alternatives are as clear as possible to avoid this ambiguity.

Ogletree Deakins’ San Diego office will continue to monitor developments and will post updates on the California and Manufacturing blogs as additional information becomes available.

Tracie L. Childs is a shareholder in Ogletree Deakins’ San Diego office.

Katie M. Greenbaum is an associate in Ogletree Deakins’ San Diego 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

• OFCCP finalized three rules rescinding and revising federal contractors’ and subcontractors’ affirmative action obligations following the 2025 revocation of EO 11246.
• The final rules significantly modify obligations under Section 503 by rescinding disability self-identification invitations and the 7 percent utilization goal, rescinding OFCCP’s race- and sex-based regulations, and making technical amendments to the VEVRAA regulations.
• The rules have varying effective dates, which means that contractors will need to pay close attention to when the adjustments may apply to their ongoing affirmative action programs (AAPs) and other compliance matters.

OFCCP’s final rules follow President Trump’s EO 14173, issued on January 21, 2025.

‘Rescission of Executive Order 11246 Implementing Regulations’

EO 14173 revoked EO 11246, which, for more than sixty years, had established the legal framework requiring federal contractors to maintain AAPs based on race and sex. The final rule, “Rescission of Executive Order 11246 Implementing Regulations,” completes the corresponding regulatory adjustments by rescinding parts of Title 41 of the Code of Federal Regulations (CFR), chapter 60, which was promulgated under EO 11246. Specifically, the rule rescinds CFR Parts 60-1, 60-2, 60-3, 60-4, 60-20, 60-40, 60-50, and 60-999, and removes components under EO 11246 in Part 60-30. Those regulations addressed contractors’ previous obligations to develop race- and sex-based AAPs, and provided for OFCCP’s related enforcement authority.

‘Modifications to the Regulations Implementing Section 503 of the Rehabilitation Act of 1973, as Amended’

The Section 503 final rule makes significant changes, most notably rescinding the requirement that contractors affirmatively invite applicants and employees to voluntarily self-identify a current or former disability (using the CC-305 form), eliminating the 7 percent utilization goal for individuals with disabilities, and removing data collection and utilization analysis requirements. The rule also updates the basic coverage threshold from $15,000 to $20,000 to reflect recent inflationary adjustments. Despite the many rescissions, the rule retains Section 503’s core disability nondiscrimination protections, reasonable accommodation requirements, outreach assessment obligations, and AAP requirements. The U.S. Department of Labor’s (DOL) commentary notes that the disability self-identification framework conflicts with the plain text of the Americans with Disabilities Act.

‘Modifications to the Regulations Implementing the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as Amended’

The VEVRAA final rule makes technical changes to the VEVRAA regulations, removing cross-references to EO 11246 (relocating the administrative enforcement proceeding procedures from the former Part 60-30 and incorporating them directly into the VEVRAA regulations at 41 CFR Part 60-300), removes an unnecessary citation to Section 503 authority, and updates the jurisdictional coverage threshold from $150,000 to $200,000 in accordance with recent inflationary adjustments established by the Federal Acquisition Regulatory (FAR) Council.

Next Steps

These final rules change the antidiscrimination requirements applicable to federal contractors or other employers. The rules do not eliminate prohibitions on employment discrimination under Title VII of the Civil Rights Act of 1964, or elsewhere under federal, state, and local antidiscrimination statutes.

The three final rules have different effective dates, so contractors should pay close attention to when the adjustments apply to their specific ongoing AAP cycles and other compliance matters. Contractors may wish to review their antidiscrimination policies to ensure continued compliance with Title VII and other federal, state, and local antidiscrimination laws. They may further wish to audit any prior activities that were previously driven solely by compliance with rescinded provisions of EO 11246, Section 503, or VEVRAA, and assess how changes can be legally implemented or updated to meet broader business purposes.

For more information on the DOL’s three final rules published by OFCCP, please join us for a webinar, “OFCCP’s Three Final Rules: A Reset for Federal Contractors,” on Wednesday, August 26, 2026, from 2:00 p.m. to 3:00 p.m. EDT. The speakers will address which federal contractor requirements remain in effect and how to guide compliance efforts related to continuing obligations under Title VII, state and local laws, and relevant executive orders. Register here.

Ogletree Deakins’ 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, 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

• In a precedential decision, the Third Circuit held that the FCA’s anti-retaliation provisions protect employees from retaliation for their efforts to stop fraud against the government, but those efforts must be related to an alleged FCA violation.
• The court distinguished the legal standard applicable to claims under the FCA’s anti-retaliation provisions and the FCA’s qui tam provisions.
• The court held that claims of retaliation under the FCA must demonstrate both a subjective belief of fraud by the employee and an objectively reasonable belief of such conduct.
• The court found that concerns about regulatory violations alone, such as FDA compliance, were not enough to plead a FCA anti-retaliation claim under the FCA’s “other efforts” prong.

Background

In a precedential decision in Lisenby v. Olympus Corp. of the Americas, No. 25-1480, the Third Circuit held that Congress’s 2009–2010 FCA amendments protect whistleblowing employees who make “other efforts” to stop violations of the FCA only “when they are motivated by an objectively reasonable belief that the employer has submitted, or will submit, false or fraudulent claims for payment to the federal government.”

The holding comes in a case brought by a former employee of a Japanese-owned company that sells medical devices to the U.S. government (notably, the U.S. Department of Veterans Affairs (VA)), who alleged that his job was eliminated after he raised concerns regarding potential U.S. Food and Drug Administration (FDA) regulatory violations.

The Third Circuit affirmed the lower court’s dismissal of a lawsuit claiming unlawful retaliation in violation of the FCA and state law, finding that the employee’s complaint lacked allegations supported by an “objectively reasonable belief that the employer ha[d] submitted, or [would] submit, false or fraudulent claims for payment to the federal government.”

No Heightened Pleading Requirements

The Third Circuit held that FCA retaliation claims are not subject to the heightened standard for pleading fraud under Federal Rule of Civil Procedure 9(b), which requires plaintiffs to allege fraud “with particularity.” The court noted that while FCA qui tam claims are subject to this heightened pleading standard because they allege false or fraudulent payments, “[r]etaliation claims under the FCA do not … involve allegations of fraud.” Accordingly, “an FCA retaliation claim need only satisfy Rule 8(a)’s notice pleading standard,” the Third Circuit stated.

‘Other Efforts’ Must Be Connected to FCA Violations

The FCA protects employees from retaliation for “lawful acts done … in furtherance of” either “an action [under the FCA]” or “other efforts to stop [one] or more violations of [the FCA].” The Third Circuit explained that it had not previously addressed the “other efforts” prong and set forth two central holdings with regard to what constitutes “other efforts.”

First, the court concluded that “a plaintiff’s actions must be connected to a violation of the FCA,” meaning that the “plaintiff’s conduct must be related to the submission of a false or fraudulent claim to the federal government for payment or approval.”

Second, the court held that “a plaintiff must, in good faith, have held an objectively reasonable belief that [the] employer was violating, or would violate, the FCA.” The Third Circuit explained that Congress’s addition of the “other efforts” prong in the 2009–2010 FCA amendments was intended to expand the scope of the FCA anti-retaliation provision to protect an employee’s efforts to prevent an FCA violation (or, in other words, stop it before it happens).

Regulatory Concerns Alone Are Insufficient

The Third Circuit held that the employee’s complaint failed to show that the employee reasonably believed the employer “was violating, or would soon violate, the FCA.” The court emphasized that the complaint focused on the employee’s concerns that the employer was violating FDA regulations, not on the employer’s alleged fraud on the government. Allegations that the employer was a federal contractor and had already sold allegedly non-FDA-compliant devices for use in medical procedures covered by Medicare and Medicaid were not sufficient because they suggested only that the employee was concerned with “FDA regulatory violations and the attendant risks to patient safety, not fraud committed against the government.”

Key Takeaways

The decision in Lisenby, underscores that employers may be subject to claims of unlawful retaliation by discharged employees who have allegedly attempted to stop potential fraud against the government. Notably, such claims are governed by Rule 8’s notice pleading standard, not Rule 9(b)’s heightened fraud-pleading standard.

Still, the decision emphasizes that, at least in the Third Circuit, retaliation claims under the FCA for “other efforts” are limited. The “other efforts” prong requires conduct motivated by an objectively reasonable belief that the employer submitted, or would submit, false or fraudulent claims for payment to the federal government.

Further, the court drew a sharp distinction between complaints about regulatory violations and complaints tied to false or fraudulent claims for government payment. Accordingly, the ruling suggests that in the Third Circuit an employee’s actions regarding product safety concerns or potential regulatory violations, absent an objectively reasonable connection to an FCA violation, are insufficient to trigger the FCA’s anti-retaliation protections.

Ogletree Deakins will continue to monitor developments and provide updates on the Ethics/Whistleblower, Government Contracting and Compliance, and Healthcare blogs as additional information becomes available.

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Quick Hits

• San Francisco recently amended its Fair Chance Ordinance to prohibit employers from making adverse employment decisions based on out-of-state criminal convictions or arrests for abortion, miscarriage, gender-affirming care, and drag performances.
• If an employer sends notice to a candidate or employee regarding an intent to take adverse action based upon a criminal history and the candidate or employee timely responds, the employer must send a reply within fourteen days, confirming receipt.
• The amendments increased administrative penalties and potential liquidated damages for violations.
• The legislation took effect on August 10, 2026.

Employers in San Francisco must comply with both the statewide Fair Chance Act and the San Francisco Fair Chance Ordinance.

San Francisco’s Fair Chance Ordinance already prohibited employers in San Francisco with more than five employees anywhere from inquiring about prior arrests and convictions on job applications or before presenting a conditional job offer. The Fair Chance Ordinance applies to adverse employment actions, including refusing to hire, discharging, or refusing to promote an individual. The law covers full-time, part-time, temporary, seasonal, and contingent workers, as long as they work at least eight hours per week in San Francisco.

Under the new amendments, covered employers may not consider out-of-state convictions or arrests regarding conduct that is lawful under California law and:

• has the primary aim of seeking, performing, providing, receiving, or facilitating the services by or of a physician or other medical professional to terminate a pregnancy;
• is related to actions taken by a person regarding miscarriage or seeking, performing, providing, receiving, or facilitating the services by or of a physician or other medical professional related to miscarriage;
• is conduct related to a stillbirth;
• is related to seeking, performing, providing, receiving, or facilitating medical care, support, or advocacy for the purpose of addressing disparities between any person’s gender identity and their physiology or perceived gender identity, including hormone replacement therapy, surgical procedures, and changes to a person’s name or gender marker;
• is related to using a gendered facility that corresponds with one’s gender identity and/or playing on a sports team that corresponds with one’s gender identity;
• is related to a public, artistic performance characterized by exaggerated displays of femininity or masculinity, in some instances demonstrated by wearing clothing associated with a different gender than the person’s assigned gender at birth.

The city government or an individual may bring a civil action for violations. The amendments increased potential liquidated damages from $500 to $1,000 for each affected employee or applicant. The administrative penalty also increased from $500 to $1,000 for each affected employee or applicant for a first violation, from $1,000 to $2,000 for a second violation, and from $2,000 to $4,000 for subsequent violations.

The new amendments added a procedural requirement if the employer intends to take adverse action based upon a conviction history. The San Francisco ordinance already required an employer to make an individualized assessment of the information, send the report to the candidate, notify the candidate of the potential adverse action (pre-adverse action letter), and give the candidate seven days to respond. (Under California state law, the amount of time for the candidate to respond differs from San Francisco’s rule and depends on how the employer sends the notice.) Now, under the new San Francisco amendment, if the candidate does timely respond, the employer must reply within fourteen days to confirm receipt and reconsider the decision in light of the candidate’s response. Further, the amendment requires employers to send any final notice of adverse action (adverse action letter) within thirty days of receiving information from the candidate. If the candidate did not provide additional information, the employer must send the adverse action letter within thirty days of sending the pre-adverse action letter.

San Francisco’s amendments reflect the many ways in which California state law differs from laws in other states. For example, California state law protects the right to access abortion and contraception, prohibits insurers and healthcare providers from denying or restricting gender-affirming care, prohibits prosecution of people based on their actions or omissions with respect to their pregnancy or pregnancy outcome, and prohibits prosecution of people based on their actions to aid or assist a pregnant person who is exercising their reproductive rights.

Next Steps

Employers in San Francisco may want to ensure compliance with both California state law and San Francisco’s amended Fair Chance Ordinance by reviewing job applications, background check procedures, and communications processes. Before declining a candidate based on criminal history, employers must conduct an individualized assessment, notify the candidate, provide a copy of the background check, give the candidate a certain amount of time to respond, and now in San Francisco, confirm receipt of any response. The employer must then reconsider based on evidence the candidate provides.

Ogletree Deakins’ Background Checks Practice Group and San Francisco office will continue to monitor developments and will post updates on the Background Checks and California blogs as more information becomes available.

California pre-adverse action letters, adverse action letters, and California and San Francisco law summaries (timing, arrests, convictions, pre-adverse action process, adverse action process) are available on the Ogletree Deakins Client Portal to Premium-level subscribers. For more information on the Client Portal or a Client Portal subscription, reach out to clientportal@ogletreedeakins.com.

Cara F. Barrick is a shareholder in Ogletree Deakins’ San Francisco office.

Joel H. Kosh is of counsel in Ogletree Deakins’ San Francisco 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

• MSHA finalized a rule (effective July 27, 2026) eliminating obsolete blacksmith shop requirements for surface areas of underground metal/nonmetal mines, requiring no compliance action from most operators.
• Several other proposals relevant to surface metal/nonmetal operators remain pending but could be finalized relatively quickly given the administration’s deregulatory priorities.
• Pending proposals, if finalized, would simplify narrow regulatory obligations without fundamentally rewriting surface metal/nonmetal compliance programs.

For metal/nonmetal surface operators, the most relevant proposals involve surface drilling, aerial tramways, trolleys, and hazard communication (HAZCOM).

MSHA proposed eliminating blacksmith shop requirements for surface areas of underground metal/nonmetal mines, explaining that the standard had become obsolete. Further, the hazards associated with these types of fabricating and forging facilities were deemed to be covered by other regulations. That proposal has now been finalized and took effect July 27, 2026. Most operators will not need to take any compliance steps. The rule simply removes an obligation already irrelevant to modern operations.

That rule was one of four July 2025 proposals MSHA moved to final rule status. The other three involve underground coal standards for flame safety lamps, diesel particulate matter emission limits, and conveyor belts.

What Is Still Pending

Several other proposals remain pending but would matter to surface metal/nonmetal operators if finalized.

MSHA proposed rescinding certain drilling requirements—including drill equipment maintenance and pre-drilling inspections—on the grounds that those obligations are already covered in Part 56.

Currently, operators must inspect drilling areas before work begins and maintain drill equipment in safe operating condition under specific regulatory provisions. If finalized, those standalone requirements would be eliminated, though the underlying safety obligations would remain under other Part 56 standards.

The agency also proposed removing duplicative aerial tramway provisions and eliminating trolley-related standards, which it described as legacy requirements for transportation systems displaced by modern haulage practices.

A hazard communication proposal would allow operators to provide miners electronic access to HAZCOM materials at no cost. Under current rules, operators must maintain paper copies of safety datasheets and other HAZCOM materials at the mine site. The proposed change would let operators satisfy that obligation through electronic access, reducing paper-based compliance burdens while preserving miners’ access to chemical hazard information.

Based on the administration’s stated deregulatory priorities, final action on these proposals could come relatively quickly.

Where the Pushback Is

Since the initial comment periods closed, the public rulemaking record has shown a mixed response.

Several narrow proposals drew limited opposition, and MSHA has already finalized the blacksmith shop rule and several coal-specific measures.

Other proposals have drawn more scrutiny, especially those that would limit district manager authority over mine plans and training requirements.

The concerns raised in public comments center on whether removing MSHA district manager discretion could weaken site-specific safety oversight—particularly in situations where local conditions warrant additional protective measures beyond the baseline regulatory requirements. Those issues are more relevant to underground coal, but they signal where the industry is watching.

What to Watch

For metal/nonmetal operators, the deregulatory package is moving—but unevenly.

The drilling, aerial tramway, trolley, and HAZCOM proposals remain ones to watch. If finalized as proposed, those rules would not create a wholesale rewrite of surface metal/nonmetal compliance obligations. But they could simplify several narrow standards and give operators more flexibility in how they maintain records and provide required safety information.

In the meantime, operators do not need to change their compliance programs based on pending proposals. However, while operators continue to follow the current standards, they may want to monitor the Federal Register for final rule announcements so they can be prepared to update policies and training once the new rules take effect.

Given the pace of the administration’s deregulatory agenda, operators should not be surprised if final action on several of these proposals comes sooner rather than later.

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

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A version of this article was previously published in Pit & Quarry magazine.

Quick Hits

• Employers that wish to pursue an EPIP rather than participate in the FAMLI state plan must file a DOI between September 1 and November 15, 2026, in order to be exempt from making contributions to the state plan during the 2027 calendar year seeding period.
• The DOI process requires employer registration through the FAMLI Portal, a consultation with and attestation from a licensed insurance agent, and completion of an online DOI form with submission of the attestation through the portal.
• A DOI is not the same as an EPIP application; even if a DOI is accepted, the employer must still file a separate EPIP application no later than October 1, 2027, for implementation of a private plan at the time benefits commence in January 2028.
• While the process for filing a DOI is not yet fully detailed on the FAMLI website, Ogletree Deakins has obtained clarification from the Maryland FAMLI Division regarding how it will actually work. Here is a step-by-step breakdown of the process as we currently know it.

Step 1: Registering for a FAMLI Employer Account

The employer must register for a FAMLI account through the FAMLI Portal. Registration is now open.

The employer must identify an individual employee to act as its authorized officer. A third-party administrator (TPA) cannot be used for this purpose. The registration process requires the authorized officer to first register with the federal government website, Login.gov, which provides identity verification for individuals that can then be used with various federal and state agencies. The Login.gov registration requires the authorized officer to provide certain personal information, including proof of legal identity. This has been a source of concern for some employers, but it is a mandatory part of the process.

With Login.gov identity verification, along with the employer’s employer identification number (EIN) and contact information, the authorized officer may then register for an employer FAMLI account. Once registered, the authorized officer may grant access to other employees or a TPA who will actually manage parts or the whole of the FAMLI process for the employer (i.e., filing reports, remitting contribution payments, and managing employee leave claims).

Step 2: Consulting With a Licensed Insurance Agent

The employer will need to meet with a licensed insurance agent of its choice, who will walk through a specified agenda of information about FAMLI and private plan requirements. The consultation agenda covers fifteen required items, including escrow requirements, contribution rules, consequences if a private plan is not approved, and quarterly reporting obligations. Following the meeting, the agent will sign a Proof of Private Plan Consultation form, attesting that they have reviewed the agenda with the employer.

This consultation is required even if the employer intends to self-insure rather than purchase a commercial plan. Not all insurance agents will be fully versed in FAMLI, so employers should engage an agent who has at least a working understanding of the program.

Step 3: Uploading the Signed Form and Completing the DOI Online

Once the insurance agent consultation is complete, the employer will upload the signed “Proof of Private Plan Consultation” form through its FAMLI account and complete the DOI online. Note that this functionality is not yet available on the FAMLI Portal.

According to information provided to Ogletree from the FAMLI Division, the DOI itself will be a series of checkboxes that closely mirror the insurance agent consultation form, with two additional questions:

• whether the employer intends to use a commercial plan or self-insure; and
• approximately how many employees will be covered by the plan.

Step 4: Receiving DOI Acceptance Notification

The authorized officer will be notified by email within fifteen days if the DOI has been accepted.

Step 5:Collecting Contributions and Escrow Holding

If the DOI is accepted, the employer will begin collecting contributions starting January 1, 2027, but will not remit them to the state. Instead, the employer must hold the funds in an escrow account, pending submission and approval of an EPIP application.

Notably, if a private plan is not approved by the FAMLI Division before January 1, 2028, the employer will be required to remit to the state an amount equal to all unpaid employer and employee contributions (which should be the same as the funds in the escrow account), plus any interest and penalties for late payment.

Step 6: Filing the EPIP Application

The employer will need to file an EPIP application beginning in late summer 2027, but no later than October 1, 2027. It is critical to understand that the DOI is not the same as an EPIP application. Even if a DOI is accepted, the employer must still separately apply for EPIP approval.

The FAMLI Division will make the EPIP application forms available in the summer of 2027. All DOIs expire December 31, 2027. Failure to submit a private plan application by the October 1, 2027, deadline is grounds for termination of the DOI by the FAMLI Division.

Key Takeaways

The DOI process offers employers a meaningful opportunity to opt out of the state plan during the seeding period, but it requires careful planning and timely action. Employers should consider taking the following steps:

• identifying and preparing an authorized officer, including completing Login.gov identity verification;
• registering immediately through the FAMLI Portal if they have not already done so;
• consulting with a knowledgeable insurance agent well in advance of the November 15, 2026, deadline;
• submitting the DOI and agent consultation form no later than November 15, 2026;
• preparing for escrow obligations beginning January 1, 2027; and
• calendaring the October 1, 2027, EPIP application deadline as a critical follow-up to DOI acceptance.

Ogletree Deakins will provide more information about the EPIP application process once additional details are available from the FAMLI Division. The FAMLI Division has also set up a help center for employers. Employers may reach the FAMLI Customer Care Contact Center at (410) 525-4010 or paid.leave@maryland.gov, Monday through Friday, 8:00 a.m. to 4:00 p.m. ET.

The firm’s Baltimore office and Leaves of Absence/Reasonable Accommodation Practice Group will continue to monitor developments and will provide updates on the Leaves of Absence and Maryland blogs as additional information becomes available.

In addition, the Ogletree Deakins Client Portal provides subscribers with timely updates on state family and medical leave laws, including Maryland’s FAMLI program. Premium-level subscribers have access to comprehensive Law Summaries and updated policies; 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.

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