The U.S. Department of Labor will today unveil new regulations effectuating significant changes to the payment of employee overtime under the federal Fair Labor Standards Act (FLSA). The new rule will raise the salary exemption threshold for overtime pay under the FLSA from its current rate of $23, 660 a year to $47,476 annually. Also raised under the new rule will be the total annual compensation level above which highly compensated white collar workers will be ineligible for overtime from the current $100,000 to $134,004 a year. The adjustments in the salary exemption thresholds will be the first since 2004 and only the third in the last four decades. The DOL estimates that the new rule will result in overtime eligibility for an additional 4.2 million additional workers nationwide.
The overtime salary exemption thresholds will be subject to automatic adjustment every three years, beginning on January 1, 2020, to raise the threshold to match the 40th percentile of full-time salaried workers in the lowest-wage Census Region. The new rule is set to go into effect on December 1, 2016.
You can view the the DOL's overview and summary of the final rule here.
Federal contractors, take notice: did you know that it is now illegal as a federal contractor to prevent your employees from discussing their compensation? The Department of Labor’s recent ruling may significantly impact your business and necessitate changes to your policies and practices. Continue reading to determine whether your business will be affected and how.
Federal contractors take notice: on Labor Day 2015, in a display of solidarity with workers and organized labor, President Barack Obama signed an executive order requiring paid sick leave for employees of federal government contractors. By some estimates, the executive order is likely to affect more than 300,000 employees of federal contractors who presently receive no paid leave benefits. The executive order, which will take effect in 2017, mandates that employees who work on federal contracts receive one hour of paid leave for every 30 hours worked. That works out to about seven days of paid leave per year for the average worker.
Predictably, the executive order, which President Obama was to have signed at a breakfast gathering of the Greater Boston Labor Council, is being applauded by organized labor groups. The executive order is the latest move by President Obama to expand entitlements and protections for federal contract workers. With other recent executive orders, he raised the minimum wage, expanded the availability of overtime for federal contract employees and expanded employee protections against discrimination to include sexual orientation and gender identity.
In a landmark decision on Thursday, the National Labor Relations Board (“NLRB” or “Board”), by a 3-2 vote, determined that its long-standing “joint-employment jurisprudence” had grown “increasingly out of step with changing economic circumstances, particularly the recent dramatic growth in contingent employment relationships, i.e., shift work, contract workers, and temporary employee relationships[,]” across the U.S.
Consider the following scenario. You are an employer to which the FMLA and ADA apply. One of your employees has been on unpaid FMLA leave due to medical conditions that have required ongoing treatment by a team of doctors. The employee has exhausted all of his sick leave and paid time off and is nearing the conclusion of the twelve weeks of unpaid FMLA leave to which he is entitled. You prepare a letter informing him that he must report back to work on the day after his leave has run out. Just before that date, however, the employee provides you with a doctor’s note stating that the employee requires additional medical testing as a part of his treatment, is unable to return to work at the present, and without the additional testing, it is unclear when the employee will be able to return to his job.
July 26, 2015 marked the twenty-fifth anniversary of The Americans with Disabilities Act (“ADA”), which created comprehensive federal protections for individuals with disabilities in all areas of public life, including the workplace, providing equal access to the same employment opportunities and benefits available to persons without disabilities. In signing the law into effect twenty-five years ago, President George H.W. Bush noted:
With today’s signing of the landmark Americans [with] Disabilities Act, every man, woman and child with a disability can now pass through once-closed doors into a bright era of equality, freedom and independence.
Workplace violence has become a growing concern for businesses across the country. In Virginia, employers of all sizes are actively considering, many for the first time, whether it would be prudent to have extra security personnel on hand and wondering whether they can be held liable for actions taken by security guards on their premises. The good news for employers in the Commonwealth is that such liability can be mitigated with the right policies in place.
Part 1 of this article can be found here.
The Fair Credit Reporting Act
Having considering the perils summarized above, an employer who still decides to use employee criminal background checks faces additional restrictions under other federal statutory provisions, namely the Fair Credit Reporting Act (“FCRA”). An employer who uses consumer reports to make employment decisions, including hiring, retention, promotion or reassignment, must comply with the FCRA. The Federal Trade Commission (“FTC”) enforces the FCRA.
Use of employment-related background checks by employers to discover information about the work history, education, criminal record and financial history of job applicants has become ubiquitous. In one recent survey of employers, 92% of those responding stated that they subjected all or some of their job candidates to criminal background checks. The reasons for increased employer reliance on criminal background checks are straightforward - to control theft and fraud and address heightened concerns about potential liability for workplace violence and negligent hiring. It is not illegal for an employer to ask questions about an applicant’s or employee’s background, or to require a background check. However, anytime an employer uses that information to make an employment decision, irrespective of how the employer has obtained the information, the employer must comply with federal anti-discrimination and credit reporting laws, and state and local restrictions.
The Department of Labor (DOL) has just released its long-awaited Notice of Proposed Rulemaking to the white collar exemption under the Fair Labor Standards Act (FLSA). The amendments, if passed, will significantly increase the minimum salary test (from $23,660 to $50,440) for hours worked over 40 in a work week. The amendments will have far-reaching impacts on many industries that will need to reclassify many currently exempt employees and corresponding wage and hour policies.