9. Litigation and Class Action Risks What to Know: The US litigation climate is far more aggressive than Japan’s. Wage/hour and discrimination claims are most common. Class actions – where one or a small group of employees seek to recover damages on behalf of hundreds or thousands of similarly situated workers – are the costliest and can quickly lead to million-dollar liability. Example: The California restaurant case shows how small errors in meal/rest breaks and payroll records can balloon into a class action with major settlement costs. Action Item: Invest in HR compliance systems, work closely with legal counsel, and consider employment practices liability insurance (EPLI) to mitigate risk. 10. Privacy and Data Rules in Employment What to Know: Data privacy rules are notoriously fragmented around the US, with no federal requirement but dozens of strict state laws that all add their own differences and nuances. And to make matters worse, some states (like California and Colorado) are amending their data privacy laws to also regulate HR data, creating compliance traps for unwary employers. Example: The California Consumer Privacy Act (CCPA) is the nation’s strictest law that requires employers to disclose HR data practices, catching many foreign companies off guard. Action Item: Create a written employee data privacy policy tailored to the states where you operate, and train staff on proper data use and storage. Conclusion We will continue to monitor developments related to US workplace law and offer updates as necessary, so make sure you are subscribed to Fisher Phillips’ Insight System to track the most up-to-date information. Please contact your Fisher Phillips attorney, the authors of this Insight, or any attorney in our International Practice Group or in our Tokyo office with any questions.
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