Quick Hits

• The Supreme Court declined to hear former NLRB member Gwynne Wilcox’s challenge regarding the president’s authority to remove NLRB members, effectively ending her case for reinstatement.
• This decision leaves in place a D.C. Circuit decision holding that the president’s power to remove NLRB members could not be restricted by Congress.
• The decision aligns with Trump v. Slaughter, in which the Court upheld the president’s authority to remove a Federal Trade Commission member without cause. It is now clear that the Slaughter decision extends to NLRB members.

Discussion

The Supreme Court denied the petition for a writ of certiorari in Wilcox v. Trump, without explanation, as is customary. The denial puts an end to Wilcox’s legal challenge seeking reinstatement. In light of its decision in Trump v. Slaughter, the high court saw no need to examine the language of the National Labor Relations Act (NLRA) limiting removal for “neglect of duty or malfeasance in office.” Such congressionally imposed restrictions were held in Slaughter to violate the United States Constitution’s separation of powers.

The denial leaves in place a decision by the U.S. Court of Appeals for the District of Columbia Circuit holding that “Congress cannot restrict the President’s ability to remove” an NLRB member since the agency “wield[s] substantial executive power.” Prior to that ruling, the Supreme Court had stayed an earlier D.C. Circuit ruling in Wilcox’s favor and had declined to grant her earlier petition for a writ of certiorari.

As noted, the petition followed the Supreme Court’s June 2026 decision in Slaughter, which held that the statutory for-cause removal provision for Federal Trade Commission (FTC) members violated the Constitution’s separation of powers because it infringed the power of the executive branch. That decision, which overturned the 1935 precedent in Humphrey’s Executor, reasoned that “for-cause” removal protections for officers of federal agencies wielding significant executive power violated the separation of powers enshrined in the Constitution.

Wilcox, who was nominated by former president Joe Biden in 2021, argued that the NLRB is distinct from the FTC and “unique among independent federal agencies” in that the five-member Board acts as an independent court of appellate-like judges. She argued that “the Board’s removal protections ensure its legitimacy as a neutral arbiter of labor disputes.”

Wilcox and former Merit Systems Protection Board (MSPB) member Cathy Harris had filed legal challenges following their sudden removals by President Trump in 2025, shortly after he took office for his second nonconsecutive term. The Supreme Court declined to hear Harris’s case in June 2026.

Key Takeaways

Wilcox’s case had raised questions about whether the NLRA’s for-cause removal protections restricted the president’s ability to remove NLRB members. The denial of Wilcox’s petition preserves the current composition of the NLRB, which has a 3–1 Republican majority. The denial also avoids serious questions regarding her potential reinstatement after more than a year and how that would impact the legitimacy of Board decisions issued during her time out of office.

Moreover, the Wilcox decision reinforces a central teaching of Slaughter—that so-called “independent agencies” are not actually “independent.” To the contrary, they are directly accountable to the chief executive.

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

• On October 14, 2026, the U.S. District Court for the District of Maryland denied a preliminary injunction sought by five organizations whose members include government contractors, leaving Executive Order (EO) 14398 in effect while the case proceeds.
• The court found the groups were unlikely to succeed on their First Amendment and Fifth Amendment claims because the EO defines the prohibited activities as “disparate treatment based on race or ethnicity,” which is intentional discrimination that federal law already prohibits.
• The court read the EO narrowly, applying only to work performed under covered contracts, and noted that enforcement against lawful DEI-related speech or programs could be challenged as applied.

Judge Adam B. Abelson issued the ruling in National Association of Diversity Officers in Higher Education v. Trump. Three of the plaintiff organizations represent higher education employees; the other two are trade associations of construction contractors. They sought to block executive order (EO) 14398, titled “Addressing DEI Discrimination by Federal Contractors,” and an April 17, 2026, FAR Council memorandum implementing it.

EO 14398 and the FAR Memo

EO 14398, issued March 26, 2026, directs executive departments and agencies to include in contracts and subcontracts, within thirty days, a clause stating that the contractor “will not engage in any racially discriminatory DEI activities,” defined as “disparate treatment based on race or ethnicity” in recruitment, employment, contracting, program participation, or allocation of resources. Noncompliance may lead to contract cancellation, termination, or suspension and ineligibility for future government contracts, and the EO directs the U.S. attorney general to consider False Claims Act (FCA) actions against violators.

The FAR Council’s April 17, 2026, memorandum (FAR Memo) requires agencies to modify existing contracts by July 24, 2026, and includes model contract language identical to the EO’s. The government later agreed not to initiate FCA enforcement related to the EO or FAR Memo until August 7, 2026.

The groups submitted member declarations describing concerns about lost work, canceled contracts, and chilled speech. They claimed the EO is overbroad, discriminates based on content, and imposes unconstitutional conditions, in violation of the First Amendment of the U.S. Constitution; is unconstitutionally vague, in violation of the Fifth Amendment of the U.S. Constitution; and exceeds the president’s authority in its FCA enforcement provision. They also claimed the FAR Memo violates the Administrative Procedure Act (APA).

First Amendment Overbreadth

The court relied on the U.S. Court of Appeals for the Fourth Circuit’s February 2026 decision in an earlier NADOHE lawsuit (NADOHE I), which upheld a 2025 requirement that contractors certify compliance with federal antidiscrimination laws, “which the First Amendment doesn’t confer a right to violate.” EO 14398 does not expressly reference those laws, but the court found it requires compliance with them “impliedly,” because “disparate treatment” has a settled legal meaning: intentional discrimination.

Had the EO simply barred “racially discriminatory DEI activities,” it “may very well have run afoul of the First Amendment,” the court said, because that phrase “is far from self-explanatory.” (Emphasis added).But the clause incorporates the EO’s definition, which limits it to “disparate treatment based on race or ethnicity.”

The court also found that the EO does not reach the groups’ principal examples, such as studying diseases with “disparate negative health outcomes for particular races” or teaching, researching, or publishing on DEI topics, because those activities do not, “without something more, treat anyone less favorably than others because of race or ethnicity.”

Content Discrimination, Unconstitutional Conditions, and Vagueness

For the same reasons, the court rejected the content discrimination and unconstitutional conditions claims, concluding that the groups “lack a protectable First Amendment interest in speech that is prohibited by” the EO “because they lack an interest in speech that is prohibited by federal antidiscrimination law.”

On vagueness, the court held that the clause applies only to work performed under the contract containing it. Enforcement based on conduct or speech outside the contract “may well be unconstitutional retaliation,” the court said, and should be addressed through as-applied challenges.

FAR Memo

The court declined to stay or enjoin the FAR Memo because its requirements are “substantially identical to the requirements imposed by” the EO, and the groups did not show irreparable harm from any provision “distinct” from the contract clause itself. The court did not decide the group’s other APA claims.

Next Steps

The ruling lets the government continue inserting the EO 14398 clause in new and existing contracts, and contractors that agree to it may face FCA exposure if the government believes they are not complying.

However, the court read the EO narrowly. It reaches only intentional discrimination based on race or ethnicity, and only work performed under a federal contract. Enforcement against DEI-related speech or programs that do not involve disparate treatment would be “unauthorized by” the EO and “could very well violate the First Amendment,” the court said. The government also conceded that medical research on diseases that disproportionately affect one race is not barred, and that a contract “could not be terminated” for “talking about historical examples of racial disparities.”

The ruling is unlikely to be the final word on EO 14398. A coalition of nineteen states and the District of Columbia has filed a separate lawsuit, Maryland v. Hegseth, also pending in Maryland federal court, alleging that agency actions implementing EO 14398 exceed statutory authority and violate the APA. Contractors may wish to track agency requests for contract modifications and monitor developments in these challenges.

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 Construction, Diversity, Equity, and Inclusion Compliance, Government Contracting and Compliance, Higher Education, 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

• New Jersey Senate Bill S4685 prohibits law enforcement officers, first responders, CDL drivers, or persons who operate heavy equipment from engaging in the recreational use of cannabis.
• If enacted as proposed, the bill would allow employers to take adverse action against such employees or applicants who use cannabis recreationally, and to conduct random drug tests to enforce compliance.
• S4685 remains pending before the New Jersey Legislature. If enacted, the bill would take effect immediately.

Background

On February 22, 2021, New Jersey’s then-governor, Phil Murphy, signed into law the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (CREAMMA), legalizing the recreational use of marijuana for adults age twenty-one and older. CREAMMA prohibits employers from requiring an employee to abstain from recreational cannabis usage while off duty. Nevertheless, employers may still require employees to undergo a drug test based on a reasonable suspicion of an employee’s use of cannabis, upon finding observable signs of intoxication, after a work-related accident, for pre-employment or regular screening, and randomly for safety-sensitive positions.

The Proposed Changes

The proposed bill would both supplement and amend CREAMMA and related laws to prohibit any law enforcement officer, first responder, CDL driver, or employee who operates heavy equipment from using cannabis at any time during the course of their employment, whether on or off duty or otherwise engaged in work responsibilities. Thus, the proposed bill seeks to carve out from CREAMMA’s protections employees engaged in safety-sensitive positions as follows.

Who is covered:

• Law enforcement officers: permanent, full-time members of state, county, and municipal agencies;
• First responders: a law enforcement officer; paid firefighter; paid member of a duly incorporated first aid, emergency, ambulance, or rescue squad association; paid emergency medical technician; paid paramedic; or paid 9-1-1 first responder dispatcher;
• CDL drivers: a person who has been issued a commercial driver’s license and is employed to drive a commercial motor vehicle; and
• Operators of heavy equipment: machinery weighing 5,000 pounds or more, or a vehicle that requires a CDL.

Additionally, the proposed bill would allow employers of such employees to ensure compliance by (1) discharging or taking any punitive action against the employee for engaging in the use of cannabis; (2) conducting random drug tests using scientifically reliable objective testing methods (e.g. testing of blood, urine, or saliva); and (3) refusing to hire a prospective employee for these positions due to their use of cannabis.

According to the proposed bill, evidence of a covered employee’s prohibited use of cannabis could be established simply by the presence of cannabinoid metabolites in the employee’s bodily fluid, even if the same resulted from engaging in otherwise legal, recreational use outside of work.

S4685’s ban applies to cannabis use “as otherwise permitted under the recreational use statute.” The Jake Honig Compassionate Use Medical Cannabis Act, passed in 2019, separately protects registered medical cannabis patients. It is unclear whether the proposed bill applies to employees who are registered medical cannabis patients pursuant to the Honig Act.

Next Steps

The proposed bill has been introduced and remains under consideration.

Employers in New Jersey that employ law enforcement officers, first responders, CDL drivers, or operators of heavy equipment may wish to identify the covered roles and review their drug testing and drug-free workplace policies.

Ogletree Deakins’ Morristown office and Drug Testing Practice Group will continue to monitor developments and will provide updates on the Drug Testing, New Jersey, and Trucking and Logistics blogs as additional information becomes available.

Additional information on state and federal marijuana laws, as well as drug testing requirements, is available on the Ogletree Deakins Client Portal. As new laws are enacted, the Client Portal will provide updates on the New Jersey Medical Marijuana Law Summary, the New Jersey Recreational Marijuana Law Summary, the New Jersey Drug Testing Marijuana Law Summary, and the New Jersey Lawful Off-Duty Conduct Law Summary. Template policies and full law summaries are available for Premium and Advanced subscribers. Snapshots and updates are available for all registered client users. For more information on the Client Portal or a Client Portal subscription, please reach out to clientportal@ogletree.com.

Michael J. Riccobono is a shareholder in Ogletree Deakins’ Morristown office.

Jessica L. Shinski, a 2026 graduate of the Seton Hall University School of Law, currently awaiting admission to the State Bar of New Jersey, contributed to this article.

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Quick Hits

• Effective October 1, 2026, employers in Connecticut must provide written notice to workers before conducting electronic monitoring in the workplace.
• Under Substitute Senate Bill 472, which Governor Ned Lamont signed into law in June 2026, employers must provide newly hired employees with a clear written statement describing which activities are prohibited by the employer and may be monitored without giving prior written notice.
• Violating the law may result in a fine of $500 for the first offense, $1,000 for the second offense, or $3,000 for subsequent offenses.

In recent years, a growing number of employers have been using technology to track employees’ movements and actions. This includes cameras in the workplace, GPS tracking on phones and wearable devices, smart glasses, keystroke monitoring, and biometric monitoring. Some employers use these tools to pinpoint areas for cost savings and boost productivity and efficiency. Generally, employers are legally permitted to monitor employees’ activity on company-owned devices and computer servers.

The provisions included in Substitute Senate Bill 472 (Public Act No. 26-73), signed into law by the governor on June 4, 2026, require employers to give prior written notice to all employees who may be affected by electronic monitoring, listing the types of monitoring that may occur and the specific locations where monitoring may occur, such as a lobby, factory floor, retail sales floor, or inside commercial vehicles. Employers must post that information in a conspicuous, readily visible place. They also must provide each employee hired on or after October 1, 2026, with a clear written statement describing which activities are prohibited by the employer and may be monitored without giving prior written notice.

If an employer reasonably believes that an employee engages in conduct that violates the law, violates the legal rights of the employer or other employees, or creates a hostile workplace environment, and electronic monitoring may produce evidence of this misconduct, then the employer may conduct monitoring without giving prior written notice. Any information legally obtained during a criminal investigation through electronic monitoring may be used in a disciplinary proceeding against an employee.

The state law does not apply to information collection for security purposes in common areas of an employer’s premises that are held out for use by the public, or information collection that is prohibited under state or federal law.

Like other states, Connecticut previously banned electronic monitoring in restrooms, locker rooms, employee break rooms, and conversations related to union organizing or collective bargaining.

Next Steps

Employers in Connecticut may wish to update their employee handbooks and written policies on electronic monitoring in the workplace to be compliant with state and federal privacy laws. They may wish to train supervisors on the permissible types of electronic monitoring and how to properly handle video and audio evidence in workplace investigations and disciplinary proceedings.

The penalty for violating Public Act No. 26-73 is a fine of $500 for the first offense, $1,000 for the second offense, or $3,000 for subsequent offenses.

Ogletree Deakins’ Stamford office, Artificial Intelligence and Innovation Practice Group, and Cybersecurity and Privacy Practice Group will continue to monitor developments and will post updates on the Artificial Intelligence and Innovation, Connecticut, and Cybersecurity and Privacy blogs as additional information becomes available.

John G. Stretton is a shareholder in Ogletree Deakins’ Stamford 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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EEOC to Rescind Enforcement Guidance on Criminal Background Checks. The U.S. Equal Employment Opportunity Commission (EEOC) plans to rescind its “Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions under Title VII of the Civil Rights Act,” which it most recently updated in 2012. The Commission has sent the Office of Information and Regulatory Affairs (OIRA) a draft rescission of the guidance, characterized as a “final rule,” which likely means there will be no opportunity for public comment. The guidance states that an employer’s neutral criminal background check policy could have a disparate impact on protected applicants, and it strongly suggests that employers using background screens deploy a nine-factor “individualized assessment” to avoid potential liability under Title VII of the Civil Rights Act of 1964. The EEOC’s decision to rescind the guidance is consistent with the Commission’s and the administration’s deemphasis of the disparate impact theory of discrimination.

The guidance is an example of how policy debates evolve over time. In 2012, the background check guidance caused quite a stir within the business community, which expressed concern that the update potentially limited employers’ ability to protect employees and customers. Over the years, however, perspectives on the issue evolved, and the Commission came to reconsider its approach. Stephen R. Woods, Gustavo A. Suárez, Amie M. Willis, and Leah J. Shepherd have the details.

USCIS Would Prefer Not to Defer. This week, U.S. Citizenship and Immigration Services (USCIS) issued a proposed rule, titled, “Removing Deference to Prior USCIS Determinations of Eligibility.” The proposal would rescind the current regulation that requires USCIS, when processing an extension-of-stay request, to give “deference to a prior determination of the petitioner’s, applicant’s, or beneficiary’s eligibility.” USCIS argues that “the deference regulation and policy risk undermining program integrity by potentially reducing scrutiny of extension requests of nonimmigrant worker classifications, thereby potentially perpetuating erroneous prior approvals and creating an environment in which fraudulent and meritless petitions are less likely to be detected before approval.”

The proposal, which did not appear in the administration’s Unified Agenda of Federal Regulatory and Deregulatory Actions (“Regulatory Agenda”) released on July 3, 2026, is the latest iteration of a policy that has changed multiple times over recent administrations. Public comments on the proposal are due by November 13, 2026.

USCIS Finalizes Elimination of 540-Day Automatic Work Authorization Extension. On October 14, 2026, USCIS issued a final rule that officially ends the automatic extension of immigrants’ work authorizations while their work authorization renewals are pending. The change in policy had already been promulgated via an interim final rule (IFR) issued on October 30, 2025, and this week’s action adopts the rule—without changes to the IFR—permanently.

USCIS to Change Premium Processing? USCIS has sent OIRA a draft proposal, titled, “Amending the Premium Processing Timeframe.” Because the proposal did not appear in the Regulatory Agenda, no information about its contents has been made public. The Buzz expects this initial review period to last several weeks, after which USCIS will likely publicly release the proposal, potentially laying the groundwork for a lengthening of the applicable premium processing periods. The premium processing timeframes are currently fifteen, thirty, or forty-five business days.

The House Votes to Remain in D.C. On October 15, 1814, the U.S. House of Representatives voted to keep the nation’s capital in Washington, D.C. Just weeks earlier, in the midst of the War of 1812, the British Army set fire to many of the city’s public buildings, including the U.S. Treasury, the Capitol, and the White House. When Congress returned to Washington, D.C., in September 1814, it met temporarily in one of the few remaining public buildings—the U.S. Patent Office. The major topic of debate in the weeks that followed was whether to permanently move the capital to a more secure location. As with previous negotiations over the capital’s location, this debate generally divided along northern and southern lines, with legislators from northern states advocating for a move to Philadelphia or New York, and southerners arguing for remaining in the District of Columbia. Finally, on October 15, 1814, a resolution to move the capital to Philadelphia failed in the House by a vote of 74–83. Thereafter, Congress met at various locations throughout the city—including the Old Brick Capitol on the site of the current Supreme Court Building—until the Capitol was repaired.

Quick Hits

• Governor Matt Meyer signed amendments to the Delaware Personal Data Privacy Act on September 2, 2026, that further limit profiling and automated decision-making based on the personal data of job applicants, employees, and independent contractors.
• Violations of the law can result in civil penalties up to $10,000 per violation.
• The amendments will take effect on January 1, 2027.

The Delaware Personal Data Privacy Act (DPDPA) took effect on January 1, 2025. The law currently regulates people who conduct business in Delaware (or people producing products or services targeted to Delaware residents) that process personal data of at least 35,000 Delaware consumers, or process personal data of at least 10,000 Delaware consumers and derive at least 20 percent of their annual revenue by selling personal data. Beginning on January 1, 2027, those numbers will drop to 10,000 for the first category and 5,000 for the second category.

Similar to other comprehensive privacy laws across the country, personal data under the DPDPA includes any information that is “linked or reasonably linkable to an identified or identifiable individual,” but does not include deidentified data or publicly available information, and relies on the twin concepts of “controllers” and “processors.” It also requires a privacy notice.

The DPDPA does not currently apply to data collected by employers for hiring and employment purposes (although that will change somewhat starting on January 1, 2027), medical data covered by the Health Insurance Portability and Accountability Act (HIPAA), and clinical trial data, as well as a number of other exclusions for certain types of entities (e.g., those engaged in insurance, banking, and securities). Violations of DPDPA may result in civil penalties up to $10,000 per violation.

The DPDPA permits Delaware consumers to access, correct, and delete their personal data and opt out of targeted advertising, data sales, and certain profiling. The law requires a consumer’s consent before processing sensitive data, including a person’s race, national or ethnic origin, religion, sexual orientation, immigration status, genetic and biometric data, financial credentials, and precise geolocation data.

The amendments expand the definition of sensitive data to encompass mental or physical health treatment or diagnosis, neural data, and certain financial data that would allow access to a consumer’s financial account, as well as inferences made based on personal data that would reveal the same. The amendment prohibits the sale of sensitive data unless:

• the disclosure of sensitive data is “strictly necessary” to provide or maintain a product or service affirmatively requested by the consumer;
• the controller provides a “clear and conspicuous” notice of the sale of personal data before the sale;
• the controller maintains a record of the consumer’s consent for five years; and
• the record of consent is provided with any data protection assessment requested by the Delaware attorney general.

The amendments introduce a requirement for controllers to conduct impact assessments if they process the personal data of 50,000 or more Delaware consumers for processing activities that may present a “heightened risk of harm” to a consumer, which includes targeted advertising, the sale of personal data, the profiling of a consumer (where it presents a risk of unlawful discrimination, financial injury, or intrusion into privacy affairs), or the processing of sensitive data. The same applies where a processor may be profiling consumers in furtherance of automated decisions that produce legal or similarly significant effects on a consumer. Profiling includes any form of automated processing performed on personal data to evaluate, analyze, or predict factors related to demographic characteristics, personal preferences, interests, reliability, behavior, location, or movements.

Legal or similarly significant decisions are those that would result in the provision or denial of employment opportunities, insurance, healthcare services, financial services, housing, education enrollment, criminal justice, or access to essential goods or services.

An impact assessment must include the intended uses of the profiling, reasonably foreseeable risks of harm, categories of personal data processed, performance metrics and known limitations, transparency measures, and post-deployment monitoring and safeguards.

Hiring and Employment Decisions

One important aspect of the new amendments is that, while the law continues to exclude employees from the definition of “consumers,” the amendments introduce a separate category known as “residents,” who do not share all of the same rights as consumers, but which may provide a new, separate basis for regulating employers indirectly via their status as a third party that acquires personal data from a controller.

While employment-related personal data is still generally excluded, now subject to the DPDPA will be personal data processed in connection with profiling and reports, meaning written, oral, or other communication of personal data by a controller or processor, including recommendations, summaries, and automated decisions based on personal data or profiling.

The DPDPA may come into play where an employer orders a report from a vendor (acting as a controller), and such report is not a consumer report or would not be if disclosed to a third party, it is not furnished or disclosed in compliance with the Fair Credit Reporting Act (FCRA), and it is used or relied upon in connection with a decision resulting in the provision or denial of employment opportunities for a Delaware resident.

It seems that Delaware was seeking to address that gray area where employers have asked vendors (often incorporating automated decision-making tools) to source, screen, or rank job candidates, partly based on outside data assembled by the vendor, and ultimately used the information to make a decision on a candidate before ever reaching the official background check stage regulated by the FCRA.

Under the amendments, the controller is responsible for imposing contractual obligations on third parties receiving the report, including notifying the resident of any adverse action based on the report, a description of the personal data relied upon in making the adverse action, the resident’s right to obtain information from the controller, and the resident’s right to have the controller perform a human review of the adverse action. In addition, the controller must, upon request from the resident, provide within thirty days the personal data maintained about the resident, the source of the personal data used in profiling, identify all third parties that obtained a report concerning the resident within the previous twenty-four months, and the opportunity to correct any incorrect personal data.

Controllers also may not process personal data or engage in profiling in violation of state or federal laws prohibiting unlawful discrimination. Delaware considers anti-bias testing for AI tools (or lack thereof) to be relevant to any claims for such violations.

Next Steps

Delaware’s privacy law amendments arrived as an increasing number of states are adopting and refining their comprehensive data privacy laws. Delaware employers may still process the personal data of job applicants and employees, but may want to review how they use AI tools in recruiting, hiring, performance reviews, discipline, and termination decisions, and take adequate steps to ensure compliance with the new amendments to the privacy law before January 1, 2027.

Ogletree Deakins’ Artificial Intelligence and Innovation Practice Group and Cybersecurity and Privacy Practice Group will continue to monitor developments and will post updates on the Artificial Intelligence and Innovation, Cybersecurity and Privacy, and Delaware blogs as additional information becomes available.

Harris S. Freier is a shareholder in Ogletree Deakins’ Morristown office.

Elizabeth R. Lash is senior counsel in Ogletree Deakins’ New York City 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

• A Massachusetts federal judge enforced Fresenius’s noncompete agreement against a former supply chain executive who accepted employment with Vantive, a direct competitor, finding that the agreement adequately identified his employer and was properly executed.
• The court held that the restrictions were no broader than necessary under the Massachusetts Noncompetition Agreement Act because the executive had access to confidential companywide information and competitive strategies, and the restrictions applied only to duties substantially similar to those he performed for Fresenius.
• Finding that Fresenius was likely to succeed on its breach of contract claim and faced irreparable harm from the executive’s potential use of confidential information, the court barred him from working for Vantive until July 2027.

In Fresenius USA Manufacturing, Inc. v. Micah Much, the company sought to enforce certain noncompetition provisions in its “Employee Confidentiality, Assignment and Protective Covenants Agreements” that it entered into with the defendant during his employment (and in exchange for which the defendant was given significant compensation). The agreements specifically prohibited the defendant from “working for or in furtherance of any ‘Competing Business’ within the ‘Restricted Area’ under circumstances where his ‘duties, services, and/or responsibilities are the same as or substantially similar to any of the duties and responsibilities’ performed for Fresenius” in the twelve months immediately following the termination of his employment with Fresenius.

The defendant worked for Fresenius from September of 2022 to July of 2026 as its vice president of Supply Chain Americas. In connection with his position at Fresenius, the defendant was responsible for overseeing supply chain management, among other things, for one of Fresenius’s divisions. He was involved in discussions regarding confidential information with other executives, as well as confidential strategic initiatives in furtherance of Fresenius’s business. Then, in May of 2026, the defendant interviewed with Vantive, a company that Fresenius described as its direct competitor. He began working as Vantive’s executive vice president and chief supply chain officer in late July 2026 and was responsible for overseeing Vantive’s global logistics and supply chain operations. Importantly, Fresenius also alleged in its filings that the defendant attended a meeting in which the business discussed potential strategies for competing with Vantive.

In early August 2026, Fresenius filed a petition for a preliminary injunction, arguing that the defendant breached the agreements by providing services to Vantive in connection with his new position. In his objection, the defendant argued the noncompetition provisions were unenforceable, since the name of his specific employer, Fresenius USA Manufacturing, was not stated in the agreements. Instead, he argued, only “Fresenius Medical Care Holdings, Inc.” appeared in the agreements. The defendant further argued that his employer did not sign the agreements.

The court rejected the defendant’s arguments and held the agreements were enforceable under the MNAA. First, the court explained that the agreements defined “the Employer” as “a subsidiary of Fresenius Medical Care Holdings, Inc.” Since the defendant was only employed by one subsidiary, this definition sufficiently identified the defendant’s “specific employer rather than the broader … parent company.” The court also held that the agreements were signed by individuals “[o]n behalf of the Employer,” who had the requisite authority to sign on behalf of Fresenius.

To be enforceable, the MNAA also requires noncompete provisions to be “no broader than necessary to protect … legitimate business interests of the employer.” In rejecting the defendant’s argument that the agreements were overly broad since they referenced the entire company’s confidential information and competitors instead of limiting it to the subsidiary that employed the defendant, the Fresenius court held that the agreements were not any broader than necessary. In so holding, the court reasoned that, because the defendant had knowledge of confidential information and trade secrets across the business, including strategies for competing with the defendant’s new employer, the restrictions were not broader than necessary. Moreover, the court noted that the restrictions were limited to the duties and responsibilities that the defendant actually performed.

The court next evaluated whether Fresenius demonstrated a likelihood of success on the merits with respect to its breach of contract claim. The defendant argued it had not, asserting his job duties at Vantive were “materially different” than the ones he fulfilled at Fresenius since he would only have “some responsibility for logistics functions,” with the majority of his focus being on “driving continuity, strategy, and excellence across Vantive’s supply chain functions.” In the court’s view, Fresenius demonstrated a likelihood of success, finding the defendant’s work for Vantive to be “substantially similar to at least some of the duties and responsibilities he had with Fresenius in the past two years.” Fresenius also demonstrated that it would suffer irreparable harm without an injunction, since the defendant had access to “several executive meetings discussing … plans for improving its supply chain … and at least one meeting discussing Fresenius’s strategies about competing with Vantive.” According to the court, it was logical to conclude that the defendant would “use his knowledge of [Fresenius]’s supply chain and strategies to the benefit of his former employer’s direct competitor.” The court ordered the defendant to cease his work at Vantive until July 2027.

Ogletree Deakins’ Boston office will continue to monitor developments and will post updates on the Healthcare, Massachusetts, and Unfair Competition and Trade Secrets blogs as additional information becomes available.

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Quick Hits

• On October 6, 2026, Washington DOSH proposed updates to construction PPE rules to align with federal OSHA requirements, including requiring employers to ensure PPE properly fits each affected employee.
• The proposal also includes minor clarifications and housekeeping revisions, with public hearings in November 2026, comments due November 23, 2026, and intended adoption on March 2, 2027.

DOSH’s primary purpose for this proposed rulemaking is to bring Washington’s construction PPE requirements in line with the federal construction PPE requirements, which were updated by the federal Occupational Safety and Health Administration (OSHA) and took effect January 2025.

The most significant proposed change to Washington’s existing construction PPE rule would require employers to “ensure that [the PPE] properly fits each affected employee.” Washington’s existing construction PPE rule does not include a requirement that the employer ensure that the PPE fits the affected employees. As the proposed rulemaking describes, federal OSHA similarly revised the federal construction PPE requirement in January 2025 to require employers to ensure that PPE properly fits each affected employee.

Notably, the proposed rule does not provide any definition or guidelines for what it means for PPE to “properly” fit an employee. Similarly, the federal OSHA rule upon which the proposed rulemaking is based also does not define the term “properly fits.”

There are also some smaller proposed changes to the rule, including revising the language of the rule so that it states expressly that employers are responsible for providing certain PPE. Other small “housekeeping” changes are also proposed, including formatting changes and the correction of typographical errors.

DOSH will hold two public virtual and telephonic hearings on the proposed rulemaking on November 10, 2026, and November 16, 2026, and the public is invited to submit comments on the proposed rulemaking until November 23, 2026. DOSH’s date of intended adoption for the revised rule is March 2, 2027.

Ogletree Deakins’ Seattle office and Workplace Safety and Health Practice Group will continue to monitor developments and provide updates on the Construction, Washington, and Workplace Safety and Health blogs as additional information becomes available.

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Probably not. The clause’s flow-down requirement contains an exception for subcontracts where the place of “delivery or performance” is outside the United States.

Because the exception is written in the disjunctive (i.e., “expressed by mutually exclusive alternatives joined by or”), a subcontract performed outside the United States may qualify for the exception even when the finished goods are delivered in the United States. That relatively straightforward example, however, raises harder questions for global supply chains in which manufacturing, assembly, installation, services, and delivery occur in multiple countries.

Quick Hits

• FAR 52.222-90, “Addressing DEI Discrimination by Federal Contractors,” flows down to subcontracts at any tier, including subcontracts for commercial products and commercial services, subject to an exception where the place of “delivery or performance” is outside the United States.
• The use of “or” is significant. A foreign manufacturer that performs a supply subcontract entirely at an overseas facility may fall within the exception even if the finished goods are shipped FOB destination to a U.S. location.
• The more difficult questions arise when subcontract performance occurs partly inside and partly outside the United States. FAR 52.222-90 does not expressly address how the geographic exception applies to mixed-location performance.

Applying any FAR flow-down clause begins with identifying which lower-tier relationships are subcontracts. As we discussed in a prior article on the DEI clause, the FAR defines “subcontractor” broadly to include “any supplier, distributor, vendor, or firm that furnishes supplies or services to or for a prime contractor or another subcontractor” (FAR 44.001), although the line between a subcontractor and a vendor is not always bright. FAR 52.222-90 adds a second threshold question: even when a supplier is a subcontractor, does the geographic exception to the flow-down requirement apply?

That question is particularly important for commercial companies with global supply chains. A product may be manufactured overseas, transported to the United States, installed by personnel in another country, or pass through multiple affiliates before reaching the government. The text of FAR 52.222-90 suggests that contractors should examine both where delivery occurs and where the subcontract is performed before deciding whether the clause must be flowed down.

The Clause and Its Flow-Down Provision

FAR 52.222-90 implements EO 14398 and appears in the Revolutionary FAR Overhaul (RFO) version of FAR Part 52 posted on Acquisition.gov, which the FAR Council intends to finalize through notice-and-comment rulemaking. Contracting officers insert the clause in solicitations and contracts valued over the micro-purchase threshold, including those for commercial products and commercial services, subject to the clause’s geographic limitation. The clause is also listed among the clauses that flow down to commercial subcontracts under FAR 52.244-6.

Paragraph (c) of FAR 52.222-90 requires contractors to include the substance of the clause in subcontracts at any tier, including those for commercial products and commercial services, “except those where the place of delivery or performance is outside the United States.” The wording of the exception matters. The clause does not require both delivery and performance to occur outside the United States. Instead, it uses the disjunctive “or.” Under the ordinary reading of that language, a subcontract should fall within the exception if either its place of delivery or its place of performance is outside the United States.

The resulting compliance determination can be important. As we discussed in a prior article, FAR 52.222-90 requires prime contractors to report certain “known or reasonably knowable” subcontractor conduct that may violate the clause, states that compliance is material to the government’s payment decisions for purposes of the False Claims Act, and is paired with new causes for suspension and debarment. Contractors, therefore, have reason to determine carefully which subcontracts actually fall within the clause’s flow-down requirement.

Place of Performance and Foreign-Manufactured Goods

For a straightforward supply subcontract, identifying the place of performance may be relatively simple. The FAR treats “deliveries or performance” as a schedule term specifying the time, place, and method of delivery or performance (FAR 15.209-1), and its “place of performance” provisions (FAR 52.215-6 and 52.214-14) ask offerors to identify the street address of any plant or facility used in performing the contract.

For a supply contract, performance generally occurs where the goods are manufactured, assembled, or otherwise produced. A foreign manufacturer that makes a commercial product entirely at its own plant overseas therefore has a strong basis for concluding that the subcontract is performed outside the United States.

The fact that the finished product is ultimately delivered to the United States should not, standing alone, change that conclusion. Consider a German manufacturer that produces a commercial product entirely at its German facility and ships the product FOB destination to its customer’s warehouse in Virginia. Under FAR transportation terminology, the contractual place of delivery may be Virginia. But the place of performance remains Germany. Because FAR 52.222-90 excepts subcontracts where the place of “delivery or performance” is outside the United States, the foreign place of performance should be sufficient to bring the subcontract within the exception.

This reading is also significant because other FAR clauses use different language when the drafters intend any U.S. performance to trigger a requirement. For example, FAR 52.222-55 addresses subcontracts “performed in whole or in part in the United States,” while FAR 52.203-14 uses the formulation “performed entirely outside the United States.” FAR 52.222-90 uses neither formulation. Instead, it asks whether the “place of delivery or performance is outside the United States.”

Those textual differences become important when a subcontract does not have a single, easily identifiable place of performance.

FOB Terms Still Matter, but They Do Not End the Analysis

Although an overseas place of performance may independently satisfy the exception, delivery remains relevant because FAR 52.222-90 expressly identifies it as a separate geographic consideration.

The FAR does not define “place of delivery” specifically for purposes of FAR 52.222-90, but it does define how delivery terms work. FAR 2.101 defines “FOB” (or “F.o.b.”) as a term used in conjunction with a physical point to determine responsibility and the basis for payment of freight charges and, unless otherwise agreed, the point where title for goods passes to the buyer or consignee.

Under “F.o.b. origin,” the seller or consignor places the goods on the conveyance, and the buyer or consignee generally assumes responsibility for transportation and risk of loss. Under “F.o.b. destination,” the seller or consignor delivers the goods at the specified destination and generally remains responsible for transportation and risk of loss until the goods reach that point.

FAR Subpart 47.3 also recognizes delivery terms tailored to international shipments, including “F.o.b. vessel, port of shipment” and “F.o.b. inland point, country of importation.” The FAR expressly contemplates that supplies originating outside the contiguous United States may be acquired on either an “F.o.b. origin” or “F.o.b. destination” basis (FAR 47.304-4).

Those rules can help identify the place of delivery, but they should not be used to collapse the two parts of the FAR 52.222-90 exception into a single delivery test. If a foreign manufacturer produces goods entirely overseas and ships them “F.o.b. destination” to the United States, the U.S. delivery point does not eliminate the fact that performance occurred outside the United States. Conversely, a U.S. manufacturer that produces goods domestically but contractually delivers them at an overseas destination may have an argument that the foreign place of delivery itself satisfies the exception.

The result is that contractors likely will want to analyze delivery and performance independently rather than stopping the analysis after identifying a U.S. nexus.

The Harder Question: Performance in More Than One Country

The more difficult cases arise when a subcontract involves performance both inside and outside the United States.

Consider a foreign manufacturer that builds specialized equipment at its facility in France and ships the equipment to a U.S. contractor. The manufacturer then sends technicians to the United States to install, test, and commission the equipment. The subcontract plainly involves substantial performance outside the United States, but it also involves performance in the United States.

FAR 52.222-90 does not expressly state how its exception applies to that situation. It does not say that the exception is limited to subcontracts “performed entirely outside the United States.” Nor does it state that the clause applies whenever a subcontract is performed “in whole or in part” in the United States. The absence of either formulation leaves room for questions about how to identify “the place of performance” when there is more than one place.

Similar issues can arise when a product is manufactured overseas but customized or assembled in the United States, when testing occurs at facilities in multiple countries, or when a foreign supplier provides both products and services under the same subcontract. A contractor’s foreign affiliate may purchase goods abroad and transfer them to a U.S. entity, and FAR 52.244-6 provides that “subcontract” includes certain transfers of commercial products between divisions, subsidiaries, or affiliates at any tier. In each case, identifying a single “place of performance” may be considerably more difficult than it is for a finished commercial product manufactured entirely at one overseas facility.

Implications for Flow-Down Compliance

For companies subject to FAR 52.222-90, the geographic exception is ultimately a supply-chain and flow-down compliance issue. But the exception may be broader than contractors initially assume.

A U.S. destination does not necessarily mean that a foreign supplier must receive the clause. When a commercial product is manufactured entirely outside the United States, the overseas place of performance provides a substantial basis for applying the exception even if the supplier delivers the finished product to a U.S. location. Likewise, a foreign place of delivery may independently be relevant even where some performance occurs domestically.

The harder cases are those in which the subcontract itself crosses geographic boundaries. Contractors evaluating those relationships may want to identify where the material elements of the subcontract occur, including manufacturing, assembly, customization, testing, installation, services, and contractual delivery. They also may want to document the basis for determining whether the geographic exception applies, particularly where performance occurs in multiple countries.

For foreign commercial companies supplying goods into the U.S. federal market, the practical takeaway is equally important. The mere fact that a product ultimately reaches the United States does not necessarily subject the foreign manufacturer to FAR 52.222-90. The analysis should focus on the actual places of delivery and performance under the subcontract. Contractors may want to pay close attention to the clause’s particular wording. The word “or” may do significant work in determining the reach of FAR 52.222-90, while mixed-location performance may present the more difficult compliance question.

Next Steps

Ogletree Deakins’ Diversity, Equity, and Inclusion Compliance Practice Group, Government Contracting and Reporting Practice Group, and Workforce Analytics and Compliance Practice Group will continue to monitor developments and provide updates on the Diversity, Equity, and Inclusion Compliance, Government Contracting and Reporting, 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-enabled smart glasses create workplace compliance risks by enabling discreet recording, data capture, transcription, and AI analysis in settings where traditional smartphone policies may not apply.
• Employers may want to update recording and confidentiality rules to address wearable devices while accounting for consent laws, biometric privacy, trade secrets, investigations, and third-party data handling.
• Employers may want to ensure that restrictions are narrowly tailored to comply with labor laws and to preserve processes for disability accommodations, meeting protocols, and consistent manager enforcement.

The Smartphone Isn’t the Only Compliance Problem

AI-enabled glasses look like ordinary eyewear. But depending on the model, they can take photos, record video and audio, livestream, transcribe conversations, translate speech, and send what they capture to an AI assistant for analysis—all hands-free, and often with little more than a small indicator light to signal that anything is happening.

As these devices move from novelty to mainstream, employers are fielding new questions: Can an employee wear them on the floor? In a meeting? In an investigation interview? What about a candidate who shows up to an interview wearing them? The short answer is that existing policies may not have an answer at all. Below are seven issues employers may want to address now.

Issue #1: Workplace Recording and Consent Laws

Recording laws (also known as wiretapping laws) vary by state. Federal law and most states follow a one-party consent rule: a conversation may be recorded if one participant consents—including the person doing the recording. A minority of states, including California, Florida, Illinois, Maryland, Massachusetts, Montana, New Hampshire, Pennsylvania, and Washington, generally require the consent of all parties, at least where participants have a reasonable expectation of privacy.

Smart glasses make inadvertent violations easy. An employee in a one-party consent state who joins a video call with colleagues in an all-party consent state may trigger the stricter rule without realizing it. For multistate employers, a single, uniform recording rule may not map neatly onto every location—or every meeting.

Traditional recording policies compound the problem. Many were drafted with phones and handheld recorders in mind and refer to “cameras” or “recording devices” in ways that may not obviously reach a pair of glasses. If the policy does not clearly (either specifically or broadly) cover the device, enforcement becomes an argument rather than an expectation.

Issue #2: Trade Secrets and Confidential Information

Trade secret protection depends, in part, on an employer’s reasonable efforts to keep information secret. A device that can passively capture everything in a wearer’s line of sight tests those efforts. Risk areas include:

• Manufacturing environments, where proprietary processes, equipment configurations, and formulas are visible on the floor.
• Customer information, including data displayed on screens or discussed on calls.
• HR investigations, where witness identities and allegations are highly sensitive.
• Internal business discussions, such as strategy sessions, pricing, and deal planning.
• Attorney-client communications, where a recording—particularly one routed to a third-party AI platform—could raise questions about confidentiality and potential waiver of privilege.

Uploading captured material to a cloud-based service adds another layer: once information leaves the employer’s systems, control over it may be lost.

Issue #3: Privacy and Biometric Data

Smart glasses do not just capture images; they can capture faces and voices. If captured data is processed using facial recognition or voiceprint technology, biometric privacy statutes may come into play. Illinois’s Biometric Information Privacy Act (BIPA), with its private right of action, is the most prominent example, while Texas, Washington, and a growing number of comprehensive state privacy laws also regulate biometric data.

The privacy implications extend beyond employees. Customers, patients, visitors, and vendors may be recorded without knowing it—raising concerns in health care, retail, financial services, and any setting where third-party privacy is expected. And when captured information is fed into outside tools, employers may have limited visibility into how that data is stored, analyzed, or used.

Issue #4: The NLRA Complicates Blanket Prohibitions

The instinctive response—ban the glasses—carries its own risk. Section 7 of the National Labor Relations Act (NLRA) protects employees’ right to engage in protected, concerted activity for mutual aid or protection, whether or not they are unionized. The National Labor Relations Board (NLRB) has long recognized that recording can, in some circumstances, be part of protected activity, such as documenting unsafe conditions or capturing evidence of disparate treatment.

Under the Board’s 2023 decision in Stericycle, Inc., a work rule that could reasonably be interpreted to chill Section 7 activity is presumptively unlawful unless the employer shows the rule advances a legitimate and substantial business interest that cannot be achieved with a more narrowly tailored rule. The Board’s composition and priorities shift politically, and Stericycle may be revisited, but employers may want to draft with the current standard in mind.

The practical lesson: employers may want to tie restrictions to specific, articulated interests—confidentiality, safety, privacy, privilege—and to specific locations or activities, rather than prohibiting all recording everywhere.

Issue #5: ADA Accommodation Considerations

Smart glasses are not just consumer gadgets; for some employees, they may function as assistive technology. Real-time transcription and captioning may help employees who have hearing-related conditions. Object recognition, text reading, and scene description may assist employees with vision-related conditions. Prompts and reminders may support employees with certain cognitive or neurological conditions.

A request to use smart glasses as an accommodation should trigger the interactive process under the Americans with Disabilities Act (ADA) and analogous state laws. A blanket ban does not relieve an employer of that obligation. Employers may consider whether the device can be used with recording or AI features limited, in designated areas, or with other safeguards—or whether an alternative accommodation would be effective.

Issue #6: Interviews, Investigations, and HR Meetings

Some of the most sensitive moments in the employment relationship happen in a conference room. Smart glasses raises distinct questions in each:

• Candidate interviews. A candidate may use smart glasses to record the interview—or to receive real-time coaching or answers—raising both consent and assessment-integrity concerns.
• Workplace investigations. Undisclosed recordings can compromise witness confidentiality, chill candor, and complicate the investigative record.
• Discipline and termination meetings. A recording made without the employer’s knowledge may surface later as evidence in litigation or an agency charge.

Practical protocols may include asking at the start of every interview or meeting whether any device is recording, documenting the response, reminding participants of applicable policies, and offering an alternative—such as a written summary—where appropriate. HR professionals may also want to be trained to recognize the devices, since they may look like ordinary prescription glasses.

Issue #7: Policy Drafting Considerations

For most employers, the fix is not a new policy but an updated one. Suggested action items may include:

• Reviewing recording-device policies. This includes identifying gaps created by wearable technology.
• Defining covered devices broadly.
• Focusing on function—capturing audio, images, or video, or transmitting data—rather than form.
• Expressly including wearables and AI devices.
• Naming smart glasses and similar technology to remove ambiguity.
• Addressing confidentiality and safety rationales.
• Articulating the business interests behind each restriction and where it applies.
• Preserving NLRA rights. This would include clear savings language and avoiding overbroad prohibitions.
• Leaving room for ADA accommodations.
• Providing a path for employees to request exceptions through the interactive process.
• Training managers on enforcement.
• Helping supervisors recognize the devices and applying the policy consistently and lawfully.

Practical Takeaway

The question is no longer whether employees will bring AI-enabled eyewear into the workplace. The question is whether employers’ policies were written for a smartphone era and are prepared for a wearable-AI era.

Many employers already have recording policies. Few were designed for glasses that can passively record, transcribe, and analyze the workplace. Because this technology sits at the intersection of privacy, labor relations, accommodations, investigations, trade secrets, and AI governance, a measured, cross-functional review now may prevent a far more complicated conversation later.

Ogletree Deakins’ Artificial Intelligence and Innovation Practice Group and Cybersecurity and Privacy Practice Group will continue to monitor developments and will post updates on the Artificial Intelligence and Innovation, Cybersecurity and Privacy, and Employment Law blogs as additional information becomes available.

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