Speaker 1: This is Bloomberg Law with June Grosso from Bloomberg Radio.
Speaker 1: What I'm really concerned about though, is could we legally
Speaker 1: retrieve our embryos.
Speaker 2: There's mostly concern, there's worry, there's some anger.
Speaker 3: This is Bloomberg Law with June Grosso from Bloomberg Radio.
Speaker 2: What I'm really concerned about though, is could we legally
Speaker 2: retrieve our embryos. There's mostly concern, there's worry, there's some
Speaker 2: anger as patients and physicians want to be able to
Speaker 2: make these decisions together, collaboratively and not have these decisions
Speaker 2: made for us and without our input.
Speaker 4: Doctors and IVF patients are caught up in a mixture
Speaker 4: of emotions and a lot of confusion after the Alibamma
Speaker 4: Supreme Court's unprecedented decision that frozen embryos are children. The
Speaker 4: decision means doctors like Mamy MacLean could now face criminal
Speaker 4: charges or punitive damages if they discard unused frozen embryos,
Speaker 4: which is a normal part of the iv process.
Speaker 2: This ruling is so incomplete, and it leaves those of
Speaker 2: us who are sitting face to face with patients just
Speaker 2: with the inability to comment on what is safe and
Speaker 2: what is legal for them Right.
Speaker 4: Now, Alabama's largest hospital and several fertility clinics are pausing
Speaker 4: in vitro fertilization treatments because of legal concerns, and patients
Speaker 4: like Matt Clary and his wife are in limbo. They'd
Speaker 4: plan to go through another round of IVF this summer,
Speaker 4: but are now unsure whether it will be available.
Speaker 1: Nobody has the answers of how do you navigate this?
Speaker 4: Joining me is healthcare attorney Harry Nelson of Nelson Hardiman Harry.
Speaker 4: The Alabama Supreme Court is the first court to rule
Speaker 4: so that frozen embryos are children, citing anti abortion language
Speaker 4: in Alabama's constitution. But the facts of this case are
Speaker 4: rather odd.
Speaker 5: It appears that this decision was the result of a
Speaker 5: very calculated case. The case involved two families who had
Speaker 5: had children through a fertility center and had additional embryos
Speaker 5: stored at the center. Those embryos were destroyed in a
Speaker 5: bizarre incident where another patient apparently walked into an unauthorized area,
Speaker 5: opened a freezer, pulled out the storage container with the embryos.
Speaker 5: The suffered immediate freezer burn and dropped the container, resulting
Speaker 5: in the destruction, and so it doesn't seem obvious at
Speaker 5: least to me that the natural response of someone who
Speaker 5: had hoped to use an embryo for a future in
Speaker 5: vitro fertilization would be, you know, to sue for wrongful
Speaker 5: death of a minor. Right, yea, certainly people would be aggrieved.
Speaker 5: But it certainly seems there's a calculated decision to bring
Speaker 5: a case under this law. Law and challenged the destruction
Speaker 5: to use this incident to test whether the loss of
Speaker 5: an embryo in this manner could somehow be considered the
Speaker 5: same as the death of a child. So that was
Speaker 5: the legal theory they went forward on, and they lost
Speaker 5: in the lower court, And then the Alabama Supreme Court
Speaker 5: surprised most people by agreeing with the theory that the
Speaker 5: parent who lost these embryos alleged, or that their lawyer's alleged,
Speaker 5: which was that the accidental destruction of the embryos in
Speaker 5: an embryo lab, I mean, a fertility center was the
Speaker 5: legal equivalent of killing their children, that an embryo being
Speaker 5: stored in this lab a fertilized embryo, which, according to
Speaker 5: the testimony, was an equivalent of a few days old
Speaker 5: into the pregnancy process, but less than a week that
Speaker 5: that was the same as a fully born child who
Speaker 5: had been killed. You know, it's an extreme position and
Speaker 5: it raises all kinds of troubling implications for anybody who
Speaker 5: is involved at all in the process of extracting, storing,
Speaker 5: implanting embryos, handling them in any way. The simple meaning
Speaker 5: of this case is that you are potentially, if anything
Speaker 5: happens to these embryos, you are effectively committing the equivalent
Speaker 5: of a homicide or a manslaughter of a child.
Speaker 4: The common practice with a patient undergoing IVF, multiple embryos
Speaker 4: are created right so that the patient can try again
Speaker 4: if an attempt at pregnancy fail. So what kind of
Speaker 4: problem does a decision like this create, right?
Speaker 5: You know, it's a difficult procedure in which there's no
Speaker 5: certainty that a single embryo will implant. In fact, if
Speaker 5: you go back just twenty years ago, prior to the
Speaker 5: octomom case, it was common practice for many fertility doctors
Speaker 5: to implant the significantly larger numbers of embryos to see
Speaker 5: which ones would succeed. And it's still a common practice
Speaker 5: to implant smaller numbers of multiple embryos, which is one
Speaker 5: of the reasons we see a lot more twins resulting
Speaker 5: from IVF. The problem now is that, based on the case,
Speaker 5: the handling of those embryos is effectively the handling of
Speaker 5: live children. I don't know, between the age of one
Speaker 5: day old newborn to seventeen year olds. Those embryos have
Speaker 5: the same legal status as those children. And these are
Speaker 5: embryos that are in the hands of labs, doctors, hospitals,
Speaker 5: surgery centers, and really a world of new questions of
Speaker 5: what their responsibilities are, Like what happens if the power
Speaker 5: goes off and there's a destruction that way, What happens
Speaker 5: if they aren't used and they're simply sitting there is
Speaker 5: there any consequence if they're no longer usable, What happens
Speaker 5: if there's a dispute between the parents? What is their status?
Speaker 5: They are no longer property, they are live right. So
Speaker 5: this is a radical new legal world that we've entered
Speaker 5: with this decision.
Speaker 4: Usually the parents have the right to decide what happens
Speaker 4: to embryos that are not used.
Speaker 5: Correct until now and in every other state, embryos are
Speaker 5: effectively property. The parents have full discretion over what to
Speaker 5: do with them. Parents can decide if they don't want
Speaker 5: to pursue further privs, and there were remaining embryos, they
Speaker 5: could simply demand that they be destroyed, and they would
Speaker 5: be destroyed like any other kind of tissue in a lab, right,
Speaker 5: And it's not that they would have hero value, but
Speaker 5: they would not have the value accorded under Alabama law
Speaker 5: to a life, and they would not be facing the
Speaker 5: dire consequences of having essentially taken a life by the
Speaker 5: negligence of allowing a patient a third party to get
Speaker 5: into the facility. So all kinds of really scary implications
Speaker 5: about what this new status means.
Speaker 4: Also, can you do genetic testing on embryos?
Speaker 5: Then the question of whether you can do genetic testing
Speaker 5: or what you can do to these embryos short of
Speaker 5: destroying them is a really interesting question. There's nothing in
Speaker 5: this decision that suggests that you couldn't do genetic testing. However,
Speaker 5: any time that you have any kind of contact with,
Speaker 5: you know, embryonic tissue, you are effectively potentially taking a risk. Right,
Speaker 5: there is a risk that the extraction, even though it's
Speaker 5: often done safely. I think doctor's rul routinely tell patients,
Speaker 5: there is a chance that this will result in destruction.
Speaker 5: So I think genetic testing just became in this context,
Speaker 5: became basically off limits in Alabama because it could result
Speaker 5: in the destruction of a tissue and therefore essentially a killing.
Speaker 4: And this is a decision where the court hands down
Speaker 4: this radical decision and then just says, Okay, we're done,
Speaker 4: and the implications are left to I don't know, the
Speaker 4: medical profession, patience, the legislature who.
Speaker 5: Decides yeah, it's you know, this decision in many ways
Speaker 5: reminds me it sort of parallels the DA decision itself,
Speaker 5: which revealed Roe v. Wade in the sense that the
Speaker 5: Supreme Court said, we'reishing this proclamation that rowan too far,
Speaker 5: and we're kicking it back to the states to this
Speaker 5: and there was this almost like assumption that the problem
Speaker 5: would just sort itself out at the state level, and
Speaker 5: in fact, we've gotten a result of national chaos over
Speaker 5: the last nearly two years. And this decision does exactly
Speaker 5: the same thing in this smaller context of IVF and
Speaker 5: Alabama and embryos, because it's created a world of chaos
Speaker 5: where all these different actors parents who are considering IVF
Speaker 5: and fertility treatment, fertility doctors, hospitals, health systems, medical school
Speaker 5: training programs, storage companies. Everybody's got to make these new decisions,
Speaker 5: and there will certainly be new regulations, but there's a
Speaker 5: lot of personal decisions just to sort of avoid this
Speaker 5: whole uncertain, chaotic environment in favor of going to states
Speaker 5: where this is totally uncontroversial territory, Harry.
Speaker 4: Some doctors are saying that patients because of this could
Speaker 4: have to endure longer and more costly treatments to try
Speaker 4: to achieve a pregnancy if they're only allowed to create
Speaker 4: one embryo per cycle, and one cycle of IVF now
Speaker 4: calls about fifteen to twenty five thousand dollars. Tell us
Speaker 4: a little about the process.
Speaker 5: The process, if you speak to any woman who's had it,
Speaker 5: or couples that have gone through it, is it's quite
Speaker 5: an intensive process to prepare for it, for the extraction
Speaker 5: of the eggs, and then essentially the fertilization of the
Speaker 5: sperm and egg happened in the lab, and then once
Speaker 5: there's confirmed fertilization and just a little bit of growth
Speaker 5: of the embryo, it is then implanted. And you know,
Speaker 5: there's a question of whether the women's uterusm will accept
Speaker 5: the tissue and whether it will attach appropriately, and then
Speaker 5: there continue to be questions and a risk of unsuccessful
Speaker 5: implantation or miscarriage is a very significant risk. This is
Speaker 5: an amazing miracle of reproductive health technology that's a dance fertility,
Speaker 5: and in recent decades that's made this a possibility. But
Speaker 5: I'd personally know multiple couples that have had to go
Speaker 5: through round after round of this procedure, and that was
Speaker 5: with implanting multiple embryos just to get to success full pregnancy.
Speaker 5: And so basically this has eliminated the possibility of more
Speaker 5: than one embryo being implanted, and it means that the
Speaker 5: odds of each treatment of each IVF attempt are now reduced.
Speaker 5: If you do it in Alabama, where you certainly can't
Speaker 5: do more than one embryo, and it's become higher risk.
Speaker 5: I suppose most fertility doctors would probably do two and
Speaker 5: allow for the possibility of twins if that's acceptable to
Speaker 5: the mother. But you're really still really narrowing the chances
Speaker 5: of a successful implantation and a successful pregnancy delivered to terms.
Speaker 5: So it's very likely that women will have to do
Speaker 5: this more. And that also is compounded by the fact that,
Speaker 5: in addition to being difficult and emotionally stressful, it's extremely
Speaker 5: expensive and very few people have the resources to repeat
Speaker 5: this process over and over again without significant financial backing.
Speaker 4: As we said, the ruling is only valid in Alabama,
Speaker 4: but at least eleven states have broadly defined personhood is
Speaker 4: beginning at fertilization in their state laws. So can we
Speaker 4: expect the anti abortion movement to start pushing decisions like
Speaker 4: this in other states?
Speaker 1: Yeah?
Speaker 5: Absolutely. I think that the logic of the decision here
Speaker 5: is something that the right to life movement is supportive of,
Speaker 5: which is sort of treating embryos with more sanctity in
Speaker 5: all of these states and eliminating practices that have bothered
Speaker 5: them for a long time. Right, Like I said, we
Speaker 5: already in the last fifteen years, certain practices in fertility
Speaker 5: have already gone away under pressure, including the practice of
Speaker 5: implanting multiple embryos and then doing a reduction to remove
Speaker 5: embryos to get to the right number. It would not
Speaker 5: be surprising to be the law in all of these states,
Speaker 5: and it is a logical implication of saying that life
Speaker 5: begins at conception. I mean it would require some different
Speaker 5: articulation that would potentially devalue what's occurring at conception or
Speaker 5: immediately after to say otherwise. So I think this position
Speaker 5: is going to be supported by the pro life community,
Speaker 5: and I think the rest of us are going to
Speaker 5: have to figure out how to deal with it.
Speaker 4: Would you say this is a new chapter in the
Speaker 4: continuing fight over women's reproductive rights.
Speaker 5: Yeah, I do think this is in the sense of
Speaker 5: new chapter. I don't think people should be surprised, right,
Speaker 5: I think that we've seen the implications already pose the
Speaker 5: repeal of Roe v. Wade with regard to not just abortion,
Speaker 5: but with regards to miscarriage treatment and seeing it extended
Speaker 5: into fertility. This is something that was absolutely predicted right
Speaker 5: after the repeal, not surprising. People should not be surprised
Speaker 5: to see contraception be the next battlefield. And these questions
Speaker 5: all are really going to push at what most of
Speaker 5: us have accepted as the traditional you know, right round reproduction,
Speaker 5: reproductive health access that women had, and that all of
Speaker 5: us that none of it should surprise anybody who was
Speaker 5: thinking through the implications when this repeal happened, and there
Speaker 5: were sure to.
Speaker 4: Be more ripple effects of the Supreme Court overturning Row.
Speaker 4: Thanks so much, Harry. That's Harry Nelson of Nelson Hardiman.
Speaker 4: I'm June Grasso, and you're listening to Bloomberg Day. Between
Speaker 4: now and November, the American people are going to know
Speaker 4: that the only reason the border is not secure is
Speaker 4: Donald Trump and as maga Republican friends. And it seems
Speaker 4: like President Joe Biden is trying to keep that promise
Speaker 4: of showing up Trump and Republicans who killed the biparties
Speaker 4: in border deal by making some changes of his own.
Speaker 4: The Biden administration is considering taking unilateral executive action using
Speaker 4: provisions of federal immigration law repeatedly tapped by former President
Speaker 4: Donald Trump, to enact a crackdown at the southern border.
Speaker 4: According to Bloomberg's sources, the administration has been exploring options
Speaker 4: that Biden could deploy on his own without congressional approval,
Speaker 4: but it's far from clear that the measures could withstand
Speaker 4: almost certain court challenges. Here to tell us about them
Speaker 4: is Leon Fresco, a partner at Holland and Knight. He
Speaker 4: was the former head of the Office of Civil Immigration
Speaker 4: Litigation in the Obama administration. So Leon tell us what
Speaker 4: measures Biden is considering.
Speaker 1: President Biden is considering a number of options, which some
Speaker 1: of them have been tried in the past and some
Speaker 1: have been rejected in the past because of questions about
Speaker 1: their legality. But let me take you through them. So
Speaker 1: the most important in terms of impact would be trying
Speaker 1: to take what is normally known as the travel ban statues,
Speaker 1: which is INA Section to twelve F, and actually saying
Speaker 1: that it can be used to remove people whose bodies
Speaker 1: have already entered the United States without letting them apply
Speaker 1: for asylum. Trump tried this, and the reason it didn't
Speaker 1: work is because the two twelve F travel ban statues
Speaker 1: uses this very interesting word in the immigration law, entry
Speaker 1: into the United States. But the problem is, under millions
Speaker 1: of cases that exist in immigration law, and you know,
Speaker 1: all the way up to the Supreme Court, this word
Speaker 1: entry means preventing the actual body from answering the United States.
Speaker 1: But once you've entered, then what's needed is a deportation.
Speaker 1: And so what the travel band statue prevents is an entry.
Speaker 1: But the entry here has already occurred, and so the
Speaker 1: question is, can you use this travel band statute deport
Speaker 1: someone without going through the normal deportation process, and that's
Speaker 1: going to be ultimately a question for the courts. But
Speaker 1: most likely is that's not going to be allowed because
Speaker 1: that wasn't allowed under the Trump administration. Even though that
Speaker 1: specific question didn't work its way all the way up
Speaker 1: to the Supreme Court. That is one of the things
Speaker 1: that they're discussing. The question is how likely it will
Speaker 1: be to succeed. It Just that's number one.
Speaker 4: Let me just stop you a minute. So in that
Speaker 4: case they would take migrants to enter the country and immediately.
Speaker 1: Deport them right Their argument would be employing I Ina
Speaker 1: too twelve f the ban on entry statutes to say
Speaker 1: that even though you've entered, we're not gonna let you
Speaker 1: answer because you've entered illegally. Entry means legal entry, and
Speaker 1: so we're banning any kind of illegal entry. And so
Speaker 1: once we find you, we're allowed to kick you out
Speaker 1: without getting asylum, without any due process of any kind.
Speaker 1: Any look to see about asylum or any trafficking or
Speaker 1: anything else. That's not going to be our concern. We're
Speaker 1: just gonna take you and move you right back into
Speaker 1: Mexico without any of that. And so the question will
Speaker 1: be does this ability that decides you give to prevent
Speaker 1: an entry work after an entry has already been made
Speaker 1: in a case where the entry made was illegal, And
Speaker 1: so that's gonna be the question that a court will
Speaker 1: have to determine.
Speaker 4: I'm sure that that definition of entry doesn't meet the
Speaker 4: Merriam Webster Dictionary definition, but legal interpretation is another thing.
Speaker 4: But it sounds like that wouldn't pass legal scrutiny when
Speaker 4: it's challenged, which it surely will be.
Speaker 1: It may also be that the Biden administration doesn't care
Speaker 1: if that gets a join because at least from their
Speaker 1: per sective, they can say, look, we tried. Do you
Speaker 1: now see that this takes Congress, Congress down back to you.
Speaker 4: The Biden administration is also discussing ways to make it
Speaker 4: harder for migrants to pass the initial screening for asylum seekers,
Speaker 4: essentially raising the standard tell us about that.
Speaker 1: The standard right now is called credible fear, And what
Speaker 1: that says under the law is do you have a
Speaker 1: significant possibility of having an asylum case that's plausible? And
Speaker 1: the issue is that there is some dicta in the court.
Speaker 1: This is not binding law, but it's pretty strong dicta
Speaker 1: that even for an asylum case, you have to show
Speaker 1: that you have a ten percent chance of being persecuted
Speaker 1: in your home country. So this credible fear standard is
Speaker 1: do you have a significant possibility of having a ten
Speaker 1: percent chance? And so if a pretty lenient standard, and
Speaker 1: so what that means is a lot of people qualified.
Speaker 1: Now if you raise the standard, many people believe Congress
Speaker 1: is the one that needs to do that, because every
Speaker 1: single time that the government has tried to raise the standard,
Speaker 1: whether they do it on paper or whether they do
Speaker 1: it verbally, they kind of give a hint in so
Speaker 1: the agents look start finding ways to deny these claims.
Speaker 1: The advocates figure it out, they sue, and they enjoy
Speaker 1: whatever new move was done, because the law is actually
Speaker 1: pretty firm that it's this specific credible fear standard that
Speaker 1: must be applied at the moment until such time as
Speaker 1: Congress changes it.
Speaker 4: All right, that makes two that seem unlikely to withstand
Speaker 4: court challenges. What else are they discussing?
Speaker 1: So then the next few possibilities are these sort of
Speaker 1: more acnee tried and truth. Always they try to do
Speaker 1: this and they never work. Resolutions like for instance, moving
Speaker 1: to a last in, first out processing to them, which
Speaker 1: what they say is, okay, let's just clear the decks
Speaker 1: of the millions of cases that we have for deportation,
Speaker 1: which is making things take many months. Let's just immediately
Speaker 1: put someone who comes tomorrow into the court so that way,
Speaker 1: at least these new cases are moving quickly and we
Speaker 1: can get them process. But what happens is that never
Speaker 1: works because the person then says, I haven't found the
Speaker 1: lawyer yet, and there's case law about getting people a
Speaker 1: chance to find the lawyer, and so you have to
Speaker 1: give them several weeks to do that. And then once
Speaker 1: you've done that, then you've already moved from this urgent
Speaker 1: processing point and we're back to square one again. So
Speaker 1: that issue of can we clear the decks and move
Speaker 1: cases quickly has unfortunately, And let's we're going to start
Speaker 1: assigning people lawyers so that then they have to make
Speaker 1: their asylum case on the spot. That would be a
Speaker 1: way you could people through the court quickly, But I
Speaker 1: don't think Congress has given enough funding to make that
Speaker 1: succeed at any grand scale, And I think people would
Speaker 1: be against that on the conservative side because they would say,
Speaker 1: why are you getting free lawyers to the foreign nationals
Speaker 1: coming illegally. But the problem is is if you don't
Speaker 1: do that, there's all the Staate well that says you
Speaker 1: have to give people a reasonable tine period to find
Speaker 1: a lawyer, which then subverts this ability to have a
Speaker 1: rocket docket essentially.
Speaker 4: And they're also considering detaining more people.
Speaker 1: The problem is they are one, you need additional congressional
Speaker 1: funding to do it, which ICE is now saying they
Speaker 1: actually can have lesson to be able to detain people.
Speaker 1: And number two, you can't detain anyone where there's a
Speaker 1: kid involved, so you couldn't detain families coming together, and
Speaker 1: you can't detain children at all, and so you would
Speaker 1: just be detaining single adults, which the government is already
Speaker 1: doing at the capacity they're doing. The problem is many
Speaker 1: many more people coming than the detention spaces that exists.
Speaker 1: You know, maybe you can start using military bases and
Speaker 1: other things of this nature and not what can be done,
Speaker 1: but it's gonna need more funding to convince people you
Speaker 1: really are serious about detaining people.
Speaker 4: Does Biden have the resources for any of these plans
Speaker 4: to be implemented, so.
Speaker 1: For the ban, he certainly does. The the band doesn't
Speaker 1: cost anything. The question is will the court uphold the
Speaker 1: ban for the increased detention. He's gonna need additional funding
Speaker 1: from Congress for things like, you know, food for the
Speaker 1: people that are being detained, housing, transportations to move them
Speaker 1: to these detention facilities, things of nature. So all of
Speaker 1: that will be needed. The question is will Congress give
Speaker 1: them that funding or what the Biden administration could do
Speaker 1: theoretically is divert resources from other Department of Homeland Security
Speaker 1: priorities to this. But the question is how much money
Speaker 1: is they're really in the budget to divert to this
Speaker 1: that's not being used for something useful. I mean, surely
Speaker 1: there will be some programs you can divert to this,
Speaker 1: but I don't know in terms of the billions that
Speaker 1: will be needed that they're billions left diverts. So that's
Speaker 1: why you would think the Congress would need to pass
Speaker 1: the funds for that.
Speaker 4: It sounds like all of these plans might have a
Speaker 4: problem in the courts, correct.
Speaker 1: And I think that's where the question ultimately comes down to.
Speaker 1: Is the Biden administration proposing these changes to simply have
Speaker 1: them lose because it knows that they will lose, but
Speaker 1: at least they can say, look, we tried, and now
Speaker 1: isn't it obvious that Congress needs sacked. That's one option
Speaker 1: or option two. Aren't doing it to just say they
Speaker 1: did something at the end of the day. I mean,
Speaker 1: that's ultimately the question. It's not clear what the goal is.
Speaker 1: But if the goal is that they thing that there's
Speaker 1: something they can do at a moment that doesn't have
Speaker 1: some Congressional assistance, that's going to completely stem the tide
Speaker 1: of what's happening at the border. It's going to be very,
Speaker 1: very difficult to accomplish because they're going to need at
Speaker 1: least assistance from the court. Maybe they don't need assistance
Speaker 1: from Congress, but they're going to at least need assistant
Speaker 1: from the courts to do something that the courts have
Speaker 1: never permitted before.
Speaker 4: So a Bloomberg News Morning Console poll last month found
Speaker 4: that six and ten swing state voters say Biden bears
Speaker 4: at least some of the responsibility for a surgeon migrants.
Speaker 4: The border and migrants are going to be a prominent
Speaker 4: issue in the twenty twenty four elections, and you know,
Speaker 4: we've seen Democratic mayors and governors and some lawmakers asking
Speaker 4: Biden to do something about the migrant crisis. Do you
Speaker 4: think that will outweigh what we expect maybe outrage from
Speaker 4: you know, the far left and from immigration advocates.
Speaker 1: I think it will pay during the spring how intense
Speaker 1: the crossings are. If the crossings are at the three
Speaker 1: million per year rates that we've been seeing very recently,
Speaker 1: it's going to be very difficult the impact that this
Speaker 1: is going to have on cities. And this is where
Speaker 1: I think the Biden administration would at least do itself
Speaker 1: some good in terms of trying to go to the
Speaker 1: Congress and say, look, if we're going to do something,
Speaker 1: we need to at least have detention. You need to
Speaker 1: at least give us the money to do one specific
Speaker 1: thing which has detained single adults who don't have anywhere
Speaker 1: to go and are dependent on cities to house. That
Speaker 1: probably needs stand as soon as possible. Now, do they
Speaker 1: need more money to do that? Probably? I don't think
Speaker 1: there's the money now in the budget to do this
Speaker 1: on a massive scale. But I do think if Republicans
Speaker 1: were to reject that, or if Democrats or whoever were
Speaker 1: to reject that, then that would look like a very
Speaker 1: bad faith effort. I mean, you could talk about all
Speaker 1: these changes in the law that some people liked or
Speaker 1: didn't like or whatever. But if the issue is just, hey,
Speaker 1: what do you want us to do with people? If
Speaker 1: it's not to detain them while their cases processing, you
Speaker 1: tell us what you want us to do. And so
Speaker 1: that's the case. Now you can say, well, what I
Speaker 1: want you to do is do remain in Mexico. But
Speaker 1: the problem is there that infrastructure, you know, to the
Speaker 1: extent that people want to blame Joe Biden for something,
Speaker 1: was torn down completely at the beginning of the Biden administration,
Speaker 1: and then Mexico took legal measures to make it impossible
Speaker 1: in Mexico for that to ever be done again, meaning
Speaker 1: Mexico had acquiesced. Now there's Supreme Court decisions in Mexico
Speaker 1: that prohibits this, and there's laws in Mexico that prohibits this.
Speaker 1: And so what what needs to happen is that whole
Speaker 1: process that started under the Trump administration we need to
Speaker 1: be restarted where Mexico is threatened again. Hey, your days
Speaker 1: of building cars in Mexico are over. We're going to
Speaker 1: give it a fifty percent tire off if you don't
Speaker 1: help us with remain in Mexico, and then Mexico would
Speaker 1: have to change all its laws again and go back
Speaker 1: to the Supreme Courn and figure out the way where
Speaker 1: that would be allowed to be changed again and do
Speaker 1: all of that. And the point is the Biden administration
Speaker 1: needs a solution in a month. They don't need a
Speaker 1: solution in six months or a year. So that's the
Speaker 1: problem with sort of having taken down that infrastructure. If
Speaker 1: that infrastructure cannot be built so quickly, three institute remain
Speaker 1: in Mexico.
Speaker 4: Okay, thanks so much, Leon. We'll see what Biden decides
Speaker 4: to do if anything. That's Leon Fresco, a partner at
Speaker 4: Holland and Knight. I'm June Gross. When you're listening to Bloomberg.
Speaker 4: Some of the biggest names in corporate America have kicked
Speaker 4: off the year with large layoffs. Companies announced plans to
Speaker 4: cut eighty two thousand, three hundred and seven positions last month,
Speaker 4: up one hundred and thirty six percent from December and
Speaker 4: the second most of any in January since the aftermath
Speaker 4: of the financial crisis. That's according to Challenger, Gray and Christmas.
Speaker 4: So how should companies and executives prepare for large scale layoffs?
Speaker 4: While following employment laws and avoiding litigation. Here to tell
Speaker 4: us is Rebecca Bernhardt, a partner at Dorsey and Whitney.
Speaker 4: Let's start with a big one tell us about the
Speaker 4: WARN Act.
Speaker 3: So the WARN Act, which actually stands for the Worker
Speaker 3: Adjustment and Retraining Notification Act, believe it or not, is
Speaker 3: basically a law on the federal level that applies to
Speaker 3: employers with more than one hundred employees if they are
Speaker 3: going to be doing what's called a mass layoff or
Speaker 3: a plant closure. And then there's of course statutory and
Speaker 3: regulatory definitions of what those terms means. But in a nutshell,
Speaker 3: if you have more than one hundred employees and you're
Speaker 3: going to lay off at least fifty in one single location,
Speaker 3: then the WARN Act is triggered, which is you're giving
Speaker 3: notice not just to the employees, although that's a huge
Speaker 3: component and that's what most people think about it, but
Speaker 3: you're also giving notice to a variety of guys government agencies.
Speaker 3: The original philosophy there was that those government agencies would
Speaker 3: rally and get the unemployment people on standby, and get
Speaker 3: any workforce training resources that they have on standby and
Speaker 3: that kind of thing. So once that applies. It means
Speaker 3: you have to give sixty days advance notice both to
Speaker 3: the group of employees who are affected their union and
Speaker 3: to this variety of state authorities, starting with like the
Speaker 3: mayor of the local community and then the Department of
Speaker 3: Labor is representative in that area that kind of thing.
Speaker 6: Do the government officials that you have to give notice
Speaker 6: to are they able to do anything?
Speaker 3: In theory, they don't do anything other than rally their
Speaker 3: own resources. They don't actually engage with the employer to
Speaker 3: negotiate over who's being laid off or what's being done
Speaker 3: with for example, severance packages or anything like that. The
Speaker 3: reason I mentioned that is because there are a couple
Speaker 3: exceptions to the Warnan Act in terms of when you
Speaker 3: can give notice, and a lot of companies like to
Speaker 3: rely on these exceptions. But I say it's, you know,
Speaker 3: you should be cautious because the unforeseen circumstances or the
Speaker 3: faltering business exceptions, and the unforeseen circumstances was a big
Speaker 3: one during the pandemic. Of course, they still require you
Speaker 3: to give notice, and they definitely require you to give
Speaker 3: notice to government. It's just that you might not have
Speaker 3: to give sixty day notice. You have to give notice
Speaker 3: as soon as possible, and so a lot of employers
Speaker 3: will say, oh, we're a fultering company, or they were
Speaker 3: unforeseen circumstances, and so they'll lay the people off that
Speaker 3: same day with no notice, and then they forget to
Speaker 3: give the government their notice because they think we're not
Speaker 3: following them one Act sixty day notes requirement, and then
Speaker 3: they're in trouble with the government for not issuing those
Speaker 3: government notices, and that involves fine.
Speaker 6: I mean, often you hear about layoffs. You know, they're
Speaker 6: laying off this many people, and they're laying them off
Speaker 6: right then they don't give you know, two months notice
Speaker 6: to the employee. Is that they're looking at an exception?
Speaker 3: It could be, and it certainly was fairly common in
Speaker 3: again in the pandemic. Now, I mean, I obviously can't
Speaker 3: speak to every individual circumstance, and it's possible that they're
Speaker 3: looking exceptions, but a lot of companies do what I
Speaker 3: call pre pay the penalty. So if you fail on
Speaker 3: the employees side, the penalty or the remedy, if you will,
Speaker 3: would be that the employee is entitled to basically their
Speaker 3: salary and continued benefits for the period in which the
Speaker 3: note was deficient. So in your example, if I'm told
Speaker 3: today that I'm being laid off, i didn't get my
Speaker 3: sixties day notice, so I'm entitled to sixty days of
Speaker 3: pay and benefits. And so a lot of times employers
Speaker 3: will say, sorry, Rebecca, we're laying you off today. Here's
Speaker 3: a severance package that includes at least sixty days notice
Speaker 3: and at least sixty days of all your continued benefits.
Speaker 3: Sign this release, and they're hoping basically that that will
Speaker 3: satisfy their obligations. As a relief to the individual employees.
Speaker 3: They don't want to give the notice, so they just
Speaker 3: essentially prepay the damages of the potential litigation if it ensues.
Speaker 6: What happens if you have union members in your workforce?
Speaker 6: What should employers do?
Speaker 3: Well, this is a great question because the first thing
Speaker 3: you should do is pull out your collective bargaining agreement,
Speaker 3: your contract with the union, because there might be language
Speaker 3: in there, and you don't want to be in a
Speaker 3: position of not following what you've already agreed upon with
Speaker 3: the union, which you could have agreed upon decades ago. Right,
Speaker 3: a lot of union relationships are decades old and current
Speaker 3: managers don't remember all of the well i'll call boiler
Speaker 3: plate that's in a collective barning agreement because they never
Speaker 3: have to use it. Right, But generally speaking, if there's
Speaker 3: language in the collective barging agreement that says you have
Speaker 3: to bargain with the union before you implement layoffs, then
Speaker 3: that's what you have to do.
Speaker 1: Right.
Speaker 3: You have to sit down. You have to say we're
Speaker 3: in trouble, we need to reduce our workforce, and we're
Speaker 3: here to talk to you about what your ideas are
Speaker 3: for that. Right, most general labor law says that unless
Speaker 3: there is the scifick language like that, you don't have
Speaker 3: to bargain with the union what i'll call in advance
Speaker 3: over the decision. But you do have to bargain over
Speaker 3: what's called the effects, and that's called effects bargaining. And
Speaker 3: so you have to say to the union, we are
Speaker 3: going to lay people off. We're going to lay you know,
Speaker 3: one hundred people off from these two plants, and we're
Speaker 3: here to bargain with you over you know, the effects
Speaker 3: of that layoff. And generally speaking, that's you know, as
Speaker 3: you would expect severance, But sometimes unions want contributions depend
Speaker 3: funds over money, and sometimes they might want retraining money,
Speaker 3: you know, to help their employees get jobs somewhere else.
Speaker 3: So you know, that's the theory. They have the right
Speaker 3: to sort of decide what kind of sefarence they want. Now,
Speaker 3: it's possible that the contract itself already contains some severance language.
Speaker 3: It's usually contains seniority clauses, which give you some guide
Speaker 3: of if you are laying people off, here's the order
Speaker 3: in which you have to do it. Those kinds of
Speaker 3: things have to be followed, or else you're going to
Speaker 3: get in trouble with kind of union mitigation. So you
Speaker 3: want to follow anything that's already in the contract, and
Speaker 3: then you want to sit down and bargain or anything
Speaker 3: that hasn't been decided about the layoff process.
Speaker 6: If there is no language in the contract in the
Speaker 6: union contract, do unions have any power to stop a layoff.
Speaker 3: So, of course the current and LRB is very employee friendly,
Speaker 3: and so you know, it is unclear how cases might
Speaker 3: have evolved, but in general, the case law that's kind
Speaker 3: of Supreme Court made that has bubbled up and it's
Speaker 3: pretty old. It's you know, cases from the seventies and eighties.
Speaker 3: It says basically what I just said, which is you
Speaker 3: don't get to you don't get to bargain over the
Speaker 3: decision of whether or author's playoffs. But that doesn't mean
Speaker 3: that a union can't try. Right, a union could say,
Speaker 3: we understand you want to do layoffs, we'd like to
Speaker 3: talk to you because we have an alternative suggestion. We'd
Speaker 3: rather go to part time schedules, or we'd rather, you know,
Speaker 3: move some work from point A to point B. They
Speaker 3: are certainly free to request negotiation. They of course have
Speaker 3: all of the economic tools that they would have in
Speaker 3: any bargaining situation, which, as we understand them, are strikes.
Speaker 3: Of course, that would be ironic to go on a
Speaker 3: strike regarding a layoff, but that is, you know, the
Speaker 3: biggest weapon that a union has is to sort of
Speaker 3: put that economic pressure. I think that the Uniana workers
Speaker 3: what I'll call rolling job actions that happened, you know,
Speaker 3: a couple of months ago. Those were an interesting creative strategy,
Speaker 3: and you can see how that would work in a
Speaker 3: layoff pressure campaign. Right, if I want to lay off,
Speaker 3: if I want to you know, close my plants and
Speaker 3: you know, Detroit, Michigan, my workers in you know, Mary
Speaker 3: in Indiana might say, oh, well we're going to we're
Speaker 3: going to strike, and it's like, no, no, no, I like
Speaker 3: that plan. I want that plan to be operational, right,
Speaker 3: and that and that might put pressure on me as
Speaker 3: the employer to sit down with the union to figure
Speaker 3: out what we're going to do about Detroit.
Speaker 6: So now there's always a question of, you know Title
Speaker 6: seven antidiscrimination laws, what are the concerns that employers have
Speaker 6: to think about there?
Speaker 3: That is the biggest kind of area I think employer
Speaker 3: side and employment lawyers are kind of engaged to deal with.
Speaker 3: It's the selection who.
Speaker 1: Right.
Speaker 3: In the union context, we've got what I said already,
Speaker 3: we've got this kind of seniority concept that helps you
Speaker 3: select and that kind of insulates employer in that world.
Speaker 3: But in the non union environment, it's really up to
Speaker 3: the employer to decide who I'm picking, right, and human
Speaker 3: nature is going to be such that I want to
Speaker 3: pick the people I think are the worst performers, or
Speaker 3: I want to pick the people that I don't like.
Speaker 3: I'm a human being, I have emotions, and so of
Speaker 3: course anytime you're making those kinds of decisions, you want
Speaker 3: to make sure that you can defend those on objective
Speaker 3: criteria and not subjective criteria, because subjective criteria would make
Speaker 3: it easier for the affected employees to proceed with discrimination suits.
Speaker 3: You know, you might say that you pick the people
Speaker 3: with the lost review scores, but it just happens that
Speaker 3: you picked all of the you know, the people of color,
Speaker 3: and we think that you know, your statement that it
Speaker 3: was the lowest performance scores is actually pretext and you
Speaker 3: were just trying to get rid of the people of
Speaker 3: color in the plant. And so the selection of who
Speaker 3: gets picked for the layoffs would trigger any of the
Speaker 3: protective statuses under the state or federal laws Title seven
Speaker 3: as you noted, but the Age Discrimination Act, and then
Speaker 3: any local laws that mirror those, and then of course
Speaker 3: disability to so layoffs.
Speaker 6: I've seen people laid off and then they get something
Speaker 6: from the company. Here's who we laid off. So we
Speaker 6: laid off twenty people above the age of fifty, and
Speaker 6: then we kept twenty people above the age of fifty.
Speaker 6: I mean, do they try to balance it out that way?
Speaker 3: So that is an obligation to provide what that's called
Speaker 3: a disclosure statement under the relations for the Age Discrimination
Speaker 3: Acts amendment of the Older Workers Benefit Protection Act. So
Speaker 3: the Older Worker Benefit Protection Act amended the Age Discrimination
Speaker 3: Act and said, if you're going to lay people off
Speaker 3: and you're going to give them a release of claims
Speaker 3: to sign in connection with the seference package and it's
Speaker 3: a group, you know, termination, you need to give them
Speaker 3: information about everybody who was laid off and their ages.
Speaker 3: You can do it by job title. You're not going
Speaker 3: to do it by name. And that way those older
Speaker 3: people can take it to a journey if they wish,
Speaker 3: and there's an easy way to visually say are they
Speaker 3: really picking on all the old people? And if you
Speaker 3: know your history just came out of the movement in
Speaker 3: the eighties, which of course is where the Warnact came
Speaker 3: out of too. There was a lot of plant closures
Speaker 3: in the eighties and a lot of companies just picked
Speaker 3: all the older workers because they were the more expensive.
Speaker 3: It saved the money on their pensions, and all these
Speaker 3: folks got laid off and then they didn't realize they
Speaker 3: were losing their pensions in the process. So the WARN
Speaker 3: Act came up to sort of help on that end,
Speaker 3: and then the Older Worker Benefit Protection Act was kind
Speaker 3: of a sort of individual right roomy neal amendments to
Speaker 3: help people get more information about who's being selected and
Speaker 3: who's not to decide is there really an age discrimination?
Speaker 3: So interestingly enough, you had mentioned Title seven before that
Speaker 3: doesn't require that same kind of disclosure on whether it's
Speaker 3: men versus women, or Lutherans versus Catholics, so you know,
Speaker 3: or all the other protective statuses, you know, white versus
Speaker 3: non white, and so employers do, I think, try to
Speaker 3: do that assessment and that analysis across the board, but
Speaker 3: they only have to actually share those numbers with the
Speaker 3: affected employees visa the age, and I do think they
Speaker 3: try to balance it out. If employers bringing lawyers like
Speaker 3: me into the mix, and we look at that statement
Speaker 3: before it gets you know, finalized, we think, geez, it
Speaker 3: looks like you've got sixty people being laid off and
Speaker 3: fifty five of them are old, Right, how are you
Speaker 3: picking your people?
Speaker 1: Right?
Speaker 3: That looks pretty permisitious, And we would work on sort
Speaker 3: of the selection criteria and say, you know, are you
Speaker 3: sure that these are the right sixty people?
Speaker 6: Are there any general rules you would give employers when
Speaker 6: they're thinking about layoffs?
Speaker 3: Yeah, I think that all of these different anti excrimination
Speaker 3: laws and warning requirements are counterintuitive to the way people
Speaker 3: tend to make their actual business decisions. And so I've
Speaker 3: just encourage people to try to slow down and contact council,
Speaker 3: either in house counsel if you got it, or external
Speaker 3: employment council, just to help reframe the decision making. You know,
Speaker 3: no one wants to question your business. No lawyer, no
Speaker 3: good lawyers should question your legitimate business needs to take
Speaker 3: the steps you need to take. But by slowing down
Speaker 3: and sort of helping think about what does the law
Speaker 3: say you have to think about, I think you can
Speaker 3: still make the business decisions you need, but you can
Speaker 3: sort of be aware of the legal framework that might
Speaker 3: constrain some of those business decisions or require you to
Speaker 3: think about, you know, a selection criteria. It's more objective,
Speaker 3: for example, and the after effects and costs. Right, if
Speaker 3: we don't give notice, what are the caught risks of
Speaker 3: being sued for notice pay in the first place? And
Speaker 3: so is it actually cheaper to give that notice and
Speaker 3: let those people work? You know, that kind of thing A.
Speaker 4: Love for employers to think about. Thanks so much, Rebecca.
Speaker 4: That's Rebecca Bernhardt of Dorsey and Whitney and that's it
Speaker 4: for this edition of the Bloomberg Law Podcast. Remember you
Speaker 4: can always get the latest legal news by subscribing and
Speaker 4: listening to the show on Apple Podcasts, Spotify, and at
Speaker 4: Bloomberg dot com, slash podcast, slash Law. I'm June Grosso,
Speaker 4: and this is Bloomberg