Tag: DOL

District Court Strikes Down DOL Regulation Exempting Non-Healthcare Workers from Paid Leave

On August 3, 2020, the U.S. District Court for the Southern District of New York struck down part of a Department of Labor (“DOL”) regulation that would have prevented huge swaths of employees from taking paid leave under the Families First Coronavirus Response Act (“FFCRA”). The court’s holding has important consequences for employees who may need to take leave from work to care for themselves or others during the ongoing COVID-19 pandemic.

Congress passed the FFCRA on March 18, 2020, to provide paid leave for employees who are experiencing symptoms of COVID-19, are quarantined and cannot work because of COVID-19, or are caring for someone who is quarantined, or a child whose school or care provider is closed, because of COVID-19. In recognition of the essential role of frontline health care workers during the pandemic, however, the FFCRA permits an employer to deny an employee’s request for qualifying leave if the employee is a “health care provider or emergency responder.” The Act defines “health care provider” as “a doctor of medicine or osteopathy who is authorized to practice medicine or surgery (as appropriate)” or “any other person determined by the Secretary [of Labor] to be capable of providing health care services.” The Act also expressly authorizes DOL to “issue regulations to exclude certain health care providers and emergency responders from” from eligibility for paid leave.

DOL Expands Definition of ‘Health Care Provider’

On April 1, 2020, DOL issued a regulation implementing the FFCRA that significantly expanded the definition of “health care provider,” thereby excluding additional employees from eligibility for paid leave under the Act. The definition covered, among other employees, “anyone employed at any doctor’s office, hospital, health care center, clinic, post-secondary educational institution offering health care instruction, medical school, local health department or agency, nursing facility, retirement facility, nursing home, home health care provider, any facility that performs laboratory or medical testing, [or] pharmacy[.]” In its motion to dismiss, DOL conceded that its definition would encompass many employees who are not traditionally considered healthcare workers, such as professors, librarians, and cafeteria managers at a university with a medical school. In this sense, DOL’s new definition of “health care provider” created an exception that threatened to swallow the rule.

District Court Rejects DOL Definition

In its opinion invalidating the DOL definition, the court held that the FFCRA requires DOL to determine that a particular employee is “capable of furnishing healthcare services . . . not that [the employee’s] work is remotely related to someone else’s provision of healthcare services.” DOL’s definition, the court found, “hinges entirely on the identity of the employer, in that it applies to anyone employed at or by certain classes of employers,” as opposed to the identity of the employee, in violation of the statutory text. Administrative procedure law therefore “unambiguously foreclose[d] the [DOL’s] definition” of “health care provider.”  Finding further that DOL’s definition of “health care provider” was severable from the remainder of the regulation, the court simply invalidated that provision, restoring the definition of “health care provider” to the more limited one in the text of the statute.

The court also rejected DOL’s argument that its definition “operationalizes” the goal of “maintaining a functioning healthcare system during the pandemic.” Acknowledging that employees who “do not directly provide healthcare services to patients – for example, lab technicians or hospital administrators – may . . . be essential to the functioning of the healthcare system,” the court nevertheless held that this rationale could not supersede the “unambiguous terms” of the FFCRA, which require DOL to determine whether a particular employee can provide healthcare services.

Keeping Employees Safe 

More broadly, by enabling more employees to stay at home without sacrificing a paycheck, the court’s holding bolsters the FFCRA’s dual purpose of limiting the spread of COVID-19 while at the same time providing financial relief to American workers. The DOL regulation, on the other hand, would have forced employees to report to work despite symptoms of or exposure to COVID-19, increasing the risk of spreading the virus to others, or take leave without pay.

If you need to take leave from work because you are experiencing symptoms of or were exposed to COVID-19, or to take care of a loved one who is at home because of COVID-19, consider consulting with an employment attorney to determine whether you may be eligible for paid leave under the FFCRA.

© Katz, Marshall & Banks, LLP
ARTICLE BY Jessica L. Westerman of  Katz, Marshall & Banks, LLP
For more articles on healthcare, visit the National Law Review Health Care, Medicare, Affordable Care Act, HIPAA Legal News section.

DOL Issues Additional FFCRA Guidance as Schools Reopen

On Aug. 27, 2020, the U.S. Department of Labor (DOL) issued three new Frequently Asked Questions (FAQ) related to the reopening of schools in various formats and employee paid leave eligibility under the Families First Coronavirus Response Act (FFCRA).

The FFCRA requires employers with fewer than 500 employees to provide up to 80 hours of paid leave to employees for certain reasons related to the 2019 novel coronavirus (COVID-19) pandemic under the Emergency Paid Sick Leave Act (PSLA) and expands the Family and Medical Leave Act (FMLA) to provide employees up to 12 weeks of emergency job-protected leave to care for a child as a result of school or child care closings due to a public health emergency. The recent FAQ address caregiver leave associated with the closure of schools, which, if eligible, entitles employees to two-thirds’ pay up to $200 per day ($10,000 in aggregate).

NEW FAQ ADDRESSING SCHOOL CLOSURES

The following is an overview of DOL’s three newly issued FAQ regarding school closures:

A child attends a school operating on an alternate day basis

The DOL confirmed in FAQ #98 that an employee will be eligible for paid leave on an intermittent basis to accommodate a hybrid school schedule whereby children attend school both in-person and remotely. For purposes of the FFCRA and its implementing regulations, the school is effectively closed on days that a child cannot attend in person and leave is available on remote-learning days. The DOL cautions in its guidance that even under these circumstances, leave is only available if no other suitable person is available to care for the child.

A parent chooses remote learning when in-person instruction is available

FAQ #99 makes clear that FFCRA leave is not available to take care of a child whose school is otherwise open for in-person attendance. As a result, if a child needs care because the employee chose a virtual or remote school option, the employee is ineligible for leave. The DOL notes, however, that if the child is home due to a quarantine order or has been advised by a health care provider to self-isolate or self-quarantine, an employee may be eligible to take paid leave to care for the child.

School begins with remote learning, but shifts to in-person instruction if conditions change

FAQ #100 clarifies that leave eligibility will change as schools adopt different teaching models. Using the example of a school that starts virtually with the hope of returning to in-person teaching in the future, the DOL explains that an employee will be eligible for leave during the remote learning period for so long as the school remains closed, but eligibility will end when the school converts to in-person instruction.

ADDITIONAL FFCRA RESOURCES

Consider reviewing the following resources to learn more about the FFCRA:

Copyright © 2020 Godfrey & Kahn S.C.

ARTICLE BY Margaret R. Kurlinski and Christine McLaughlin of Godfrey & Kahn S.C. 

For more on DOL guidance, see the National Law Review Labor and Employment Legal and Regulatory Law News section.

Federal Court Strikes Down Portions of Department of Labor’s Final Rule on COVID-19 Leave, Expands Coverage

On August 3, 2020, the United States District Court for the Southern District of New York struck down portions of the DOL’s Final Rule regarding who qualifies for COVID-19 emergency paid sick leave under the Emergency Paid Sick Leave Act (“EPSLA”) and the Emergency Family and Medical Leave Expansion Act (“EFMLEA”), collectively referred to as the Families First Coronavirus Response Act (“FFCRA”).

Of particular importance to retail employers, the Court invalidated two provisions of the DOL’s Final Rule pertaining to: (1) conditioning leave on the availability of work and (2) the need to obtain employer consent prior to taking leave on an intermittent basis.

Neither the EPSLA nor the EFMLEA contains an express “work availability” requirement. The EPSLA grants paid leave to employees who are “unable to work (or telework) due to a need for leave because” of any of six COVID-19-related criteria. FFCRA § 5102(a). The EFMLEA similarly applies to employees “unable to work (or telework) due to a need for leave to care for . . . [a child] due to a public health emergency.” FFCRA § 101(a)(2)(A).  In its Final Rule, the DOL concluded that these provisions do not reach employees whose employers “do not have work” for them, reasoning a work-availability requirement is justified “because the employee would be unable to work even if he or she” did not have a qualifying condition set forth in the statute.

In rejecting the DOL’s interpretation, the Court stated that “the agency’s barebones explanation for the work-availability requirement is patently deficient,” given that the DOL’s interpretation “considerably narrow[s] the statute’s potential scope.”  Under the Court’s interpretation, employees are entitled to protected leave under either the EPSLA or EFMLEA if they satisfy the express statutory conditions, regardless of whether they are scheduled to work during the requested leave period.

The Court also rejected part of the DOL’s interpretation that employees are not permitted to take the protected leave on an intermittent basis unless they obtain their employer’s consent.  As an initial matter, the Court upheld the DOL’s interpretation that employees cannot take intermittent leave in certain situations in which there is a higher risk that the employee will spread COVID-19 to other employees (i.e., when the employees: are subject to government quarantine or isolation order related to COVID-19; have been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19; are experiencing symptoms of COVID-19 and are taking leave to obtain a medical diagnosis; are taking care of an individual who either is subject to a quarantine or isolation order related to COVID-19 or has been advised by a healthcare provider to self-quarantine due to concerns related to COVID-19).

In those circumstances, the Court agreed that a restriction on intermittent leave “advances Congress’s public-health objectives by preventing employees who may be infected or contagious from returning intermittently to a worksite where they could transmit the virus.”  Therefore, in those situations, employees are only permitted to take the protected leave in a block of time (i.e., a certain number of days/weeks), not on an intermittent basis.  As a result, the Court upheld the DOL’s restriction on intermittent leave “insofar as it bans intermittent leave based on qualifying conditions that implicate an employee’s risk of viral transmission.”

The Court, however, rejected the requirement that employees obtain their employer’s consent before taking intermittent leave in other circumstances (i.e., when an employee takes leave solely to care for the employee’s son or daughter whose school or place of care is closed).  In doing so, the Court ruled that the DOL failed to provide a coherent justification for requiring the employer’s consent, particularly in situations in which the risk of viral transmission is low.  The Court’s opinion brings the EPSLA and EFMLEA in line with the existing FMLA, which does not require employer consent.

It is unclear if the DOL will challenge the Court’s decision or revise its Final Rule to bring it in compliance with the Court’s opinion.  Regardless, the Court’s decision takes effect immediately and retail employers should be mindful of this ruling and revisit their COVID-19 leave policies.

Copyright © 2020, Hunton Andrews Kurth LLP. All Rights Reserved.

DOL Publishes Additional FAQs, Making Clear That Employees on Furlough or Layoff Are Not Eligible for FFCRA Paid Sick Leave or Expanded FMLA

The Department of Labor issued additional FAQs on Thursday March 26. They now offer 37 FAQs on how the paid sick leave and expanded FMLA leave under the Families First Coronavirus Response Act will apply. The leave obligations begin April 1, 2020.

As more and more employers are required to shutdown due to state orders or layoff employees due to business concerns, a frequently asked question is whether the employees impacted by these closures and layoffs will still be eligible for paid sick leave and paid FMLA leave under the FFCRA. According to the FAQs issued by the DOL, they will not:

24. If my employer closes my worksite on or after April 1, 2020 (the effective date of the FFCRA), but before I go out on leave, can I still get paid sick leave and/or expanded family and medical leave?

No. If your employer closes after the FFCRA’s effective date (even if you requested leave prior to the closure), you will not get paid sick leave or expanded family and medical leave but you may be eligible for unemployment insurance benefits. This is true whether your employer closes your worksite for lack of business or because it was required to close pursuant to a Federal, State or local directive. You should contact your State workforce agency or State unemployment insurance office for specific questions about your eligibility.

***

26. If my employer is open, but furloughs me on or after April 1, 2020 (the effective date of the FFCRA), can I receive paid sick leave or expanded family and medical leave?

No. If your employer furloughs you because it does not have enough work or business for you, you are not entitled to then take paid sick leave or expanded family and medical leave. However, you may be eligible for unemployment insurance benefits. You should contact your State workforce agency or State unemployment insurance office for specific questions about your eligibility. For additional information, please refer to https://www.careeronestop.org/LocalHelp/service-locator.aspx.

In addition to several FAQs on the impact of layoffs and furloughs, the FAQs also address what documentation employers should request, whether the paid sick leave and paid FMLA can be used intermittently and whether other employer-offered paid leave can be used concurrently with that required by FFCRA.

Jackson Lewis P.C. © 2020

Three Takeaways from DOL’s Proposed New Overtime Rule

On Mar. 7, 2019, the U.S. Department of Labor (DOL) issued a Notice of Proposed Rulemaking (NPRM) regarding changes to the “white collar” overtime exemptions under the Fair Labor Standards Act (FLSA).

Here are three key points employers need to know:

1. The salary basis threshold would increase to $679 per week ($35,308 per year).

The DOL set this threshold by using the same methodology from the 2004 revisions, which set the salary level at $455 per week.

In 2004, $455 per week represented the 20th percentile of earnings for full-time salaried workers in the lowest-wage census region and in the retail sector. The new annual salary of $35,308 represents the DOL’s estimate for the 20th percentile standard in January 2020, when it anticipates the rule to become final. The NPRM would also permit employers to count nondiscretionary bonuses and incentive payments (including commissions) paid on an annual or more-frequent basis to satisfy up to 10 percent of the standard salary level.

With the prior rule issued under President Barack Obama, the DOL attempted to change the salary basis level from $455 to $913 per week. As we have covered in this blog, the change did not take effect because the United States District Court for the Eastern District of Texas blocked the rule from taking effect. Under President Donald Trump, the DOL ultimately stopped pursuing the rule and dropped its appeal of the Texas court’s ruling.

2. The salary basis threshold for highly compensated employees would also increase from $100,000 to $147,414 per year.

The proposed salary basis threshold represents the 90th percentile of full-time salaried workers nationally, as projected by the DOL for 2020. This was the same methodology used by the DOL for the Obama-era rule.

3. The duties tests for executive, administrative and professional employees remain unchanged.

Assuming an employer has properly classified its exempt employees, the NPRM will not change that classification, unless the employee no longer satisfies the salary basis threshold.

Given how the Obama-era rule met its demise, the NPRM is unlikely to be the final word. Stay tuned for additional developments.

 

Copyright © 2019 Godfrey & Kahn S.C.
This post was written by Rufino Gaytán of Godfrey & Kahn S.C.

DOL’s Long-Awaited Overtime Proposed Rule Announced

Recent developments on the wage and hour front will soon require employers to reexamine exemption classifications within their workforce.

On March 7, 2019, the U.S. Department of Labor (“DOL”) released its long-awaited proposed amended rule to the overtime provisions of the Fair Labor Standards Act (“FLSA”). If this proposed rule takes effect, the minimum salary threshold required for workers to qualify for the FLSA’s “white collar” exemptions (executive, administrative and professional) will be increased to $35,308 annually (or $679 per week). The current salary threshold under the FLSA’s “white collar” exemptions is $455 per week ($23,660 annually), and has not seen an increase since 2004.

The proposed rule also will increase the salary threshold for the “highly compensated employee” exemption, from the current $100,000 to $147,414 per year. Further, under the proposed rule, employers will be allowed to count certain nondiscretionary bonuses and incentive payments (including commissions) toward up to 10 percent of the new salary threshold.

By way of background, in May 2016, the DOL under President Obama issued a rule intended to increase the salary threshold to $913 per week ($47,476 annually). Other changes to the rule included an increased salary threshold for highly compensated workers from $100,000 to approximately $134,000 and a schedule for automatic increases to the salary threshold.

Days before the rule was set to take effect, a Texas federal district court preliminarily enjoined the rule, and later confirmed its ruling on the basis that the new regulations placed too much emphasis on the salary requirement and would have resulted in the reclassification of substantial groups of employees who otherwise performed duties qualifying for exempt status. At the time, the DOL predicted that its rule would cover about four million workers who were presently non-exempt.

While the DOL’s newly proposed rule is set to take effect in January 2020, it is subject to a 60-day comment period and may face legal challenges from business and worker advocate groups alike. Given that some increase to the salary threshold is imminent, employers should nevertheless remain proactive and audit their exempt worker population. As we have noted in prior publications, employers have a number of options available in addressing this issue. As a first step, employers should identify all positions in their organizations that are classified as exempt but pay less than $35,308, review employees’ job descriptions for compliance under each exemption’s duties test, and determine the number of hours exempt employees are working.

 

© 2019 Vedder Price.
This post was written by Sadina Montani and Monique E. Chase of Vedder Price.
Read more labor and employment news, including updates on the DOL’s Overtime Rule, on our labor and employment page.

New Federal Overtime Rule Expected in Early 2019

It doesn’t seem that long ago that employers were busily preparing for the new overtime rule that would have doubled the minimum salary level for the “white collar” exemptions from $23,660 to nearly $48,000.  That new rule—finalized in May 2016 and set to take effect on December 1 of that year—was struck down by a Texas federal court in late November 2016.

President Trump took office in January 2017, and the DOL—with less interest in so aggressively raising wages as the predecessor administration—pushed the pause button on revisions to the overtime rule.  In public comments, however, Labor Secretary Alexander Acosta, who assumed the post in late April 2017, repeatedly indicated that he favors some increase in the minimum salary threshold for exemption, which was last raised in 2004 (and before that, in 1975).

In July 2017, the DOL began seeing public comment on a revised overtime rule, publishing a Request for Information in the Federal Register.  The comment period closed in September 2017.

In its Spring 2018 Regulatory Agenda, the Trump Administration formally announced its intention to issue a Notice of Proposed Rulemaking (NPRM) in January 2019 “to determine what the salary level for exemption of executive, administrative, and professional employees should be.”

So what should employers expect in a new overtime rule?  Likely an increase in the minimum salary for exemption to something in the low-to-mid $30,000s.  This would be consistent with Secretary Acosta’s comments on the issue, but still considerably lower than the level proposed by the Obama Administration.  It would also be significant lower than some state law minimum salaries for exemption (consider New York’s minimum for exempt executive and administrative employees, which will climb to $58,500 at the end of 2018).

Another thing we could see in a new overtime rule are more modern examples of how the various exemptions might apply in today’s workplaces.  The DOL included a number of new examples in its sweeping revisions to the overtime exemption rules in 2004.  It would make sense to revisit those examples, and to consider additional examples, given how the workplace has evolved in the last 15 years.

It’s also possible the DOL will depart from a one-size-fits-all salary minimum and propose different tests for smaller or non-profit employers.  Small businesses, non-profits, and educational institutions were among the loudest voices in opposition to the 2016 overtime rule changes, and would be among the hardest hit by any increase in the minimum salary levels.

What I don’t expect from a new overtime rule are automatic future increases (which were part of the 2016 rule) or a change from a qualitative to a quantitative (e.g., California-style) primary duties test.

I also don’t expect any new overtime rule to take effect before 2020.  Even assuming the DOL meets its expected deadline of proposing a new rule in January 2019, it will likely receive (and have to review) hundreds of thousands of public comments.  (The DOL received more than 270,000 comments in response to the proposed overtime rule that was finalized in 2016.)  In all likelihood, the DOL will give employers plenty of lead time to plan and prepare for any increases in the minimum salary for exemption.  So for employers who are not subject to more stringent state rules around exemption, it’s likely you have at least a year and a few months before you’d have to implement any changes.

 

© 2018 Proskauer Rose LLP.
This post was written by Allan Bloom of Proskauer Rose LLP
Learn more labor and employment news on the National Law Reviews Labor & Employment page.

Keep Rollin’ Rollin’ Rollin’: DOL Reissues 17 Opinion Letters That Had Been Withdrawn Under the Obama Administration

In late June 2017, the United States Department of Labor (DOL) announced it would be reinstating Opinion Letters issued by its Wage and Hour Division, which was a practice that had ceased back in 2010. This announcement is significant from both the procedural and substantive basis. From 2010 to July 2017, Opinion Letters were replaced by Administrator Interpretations, which set forth a more general interpretation of the law and regulations as they pertained to a particular industry or set of employees. Opinion Letters, on the other hand, are official written opinions that set forth how wage and hour laws apply in very specific circumstances as presented to the DOL Wage and Hour Division via specific employer questions asking for a formal opinion to guide the employer as to how to proceed. In other words, employers submit questions based on their specific factual circumstances and policies and the DOL issues a written opinion as to the legality of the employer’s policies.

With Opinion Letters back, businesses have been waiting to see what the DOL would do with them. In the first week of 2018, the DOL answered that question by re-instating 17 Opinion Letters that were issued in January 2009 but withdrawn during the Obama administration. The DOL also reissued over a dozen advisory Opinion Letters that had been published during former President Bush’s administration, but were also later rescinded.

Because Opinion Letters answer specific business questions related to wage and hour issues in various business segments, the 17 reinstated Opinion Letters and the dozen plus reissued advisory Opinion Letters may provide businesses specific and tailored guidance on various wage/hour issues under the Fair Labor Standards Act (FLSA).

The reinstated letters cover a wide variety of topics including, appropriate inclusions in an employee’s regular pay rate, types of employment that qualify for the FLSA’s minimum wage and overtime exemptions, and how ambulance service workers’ “on-call” time should be treated for purposes of “hours worked” under the FLSA. Here is the full list of reinstated Opinion Letters (all dated January 5, 2018) and links:

Number

Letter Subject

FLSA2018-1

Construction supervisors employed by homebuilders and section 13(a)(1)

FLSA2018-2

Plumbing sales/service technicians and section 7(i)

FLSA2018-3

Helicopter pilots and section 13(a)(1)

FLSA2018-4

Commercial construction project superintendents and section 13(a)(1)

FLSA2018-5

Regular rate calculation for fire fighters and alarm operators

FLSA2018-6

Coaches and the teacher exemption under section 13(a)(1)

FLSA2018-7

Salary deductions for full-day absences based on hours missed and section 13(a)(1) salary basis

FLSA2018-8

Client service managers and section 13(a)(1)

FLSA2018-9

Year-end non-discretionary bonus and section 7(e)

FLSA2018-10

Residential construction project supervisor and section 13(a)(1)

FLSA2018-11

Job bonuses and section 7(e)

FLSA2018-12

Consultants, clinical coordinators, coordinators, and business development managers under section 13(a)(1)

FLSA2018-13

Fraud/theft analysts and agents under section 13(a)(1)

FLSA2018-14

Calculation of salary deductions and section 13(a)(1) salary basis

FLSA2018-15

Product demonstration coordinators and section 13(a)(1)

FLSA2018-16

Volunteer fire company contracting for paid EMTs – joint employment and volunteer status

FLSA2018-17

Construction supervisors employed by homebuilders and section 13(a)(1)

As demonstrated by the list above, there are a number of broad topics covered, i.e., Section 13(a)(1) of the FLSA, which exempts employees employed in a bona fide administrative function, and a number of extremely narrow ones, e.g., those dealing with helicopter pilots, coaches, construction supervisors employed by homebuilders.

Here is a summary of some of the noteworthy findings in the reinstated Opinion Letters:

Bonus Compensation

The DOL reviewed the issue of whether certain bonuses (or other payments) should be included in an employee’s regular rate of pay under the FLSA. See FLSA2018-5, FLSA2018-9, and FLSA2018-11.

Exempt Employee Deductions

The DOL reviewed the issue of whether a salary deduction is permissible when an exempt employee is absent for a full day, but does not have enough leave time in the employee’s leave bank to cover the entire absence. The DOL concluded that, “if the absence is one full day in duration, the employer may deduct one full day’s pay or less. Therefore, in answer to your first question, if an employee is absent for one or more full days, but does not have enough time in his or her leave bank to cover the entire absence, the employer may make a deduction from the employee’s pay for any portion of the full-day absences that is not accounted for by the leave bank.” SeeFLSA2018-7.

Administrative Exemption

In reviewing whether client service managers at an insurance company qualified as exempt administrative employees, the DOL focused on the “independent judgment” factor in determining that their primary duty was to use independent judgment over matters of business significance when issuing advice and, generally, without first seeking upper-level management approval.

On-Call Hours

The DOL concluded that on-call hours of ambulance service personnel are not compensable time under the FLSA for purposes of the regular rate and overtime calculations. The issue arose from an ambulance service’s unwritten policy that required on-call employees to arrive for service at the ambulance garage within five minutes of being notified. The DOL determined the five-minute requirement was “not a significant hindrance” to the employees that would require the employer to convert their on-call time to compensable hours worked. Notably, the scope was an ambulance company servicing a small city of approximately 4,000 individuals.

Takeaways:

  1. Nothing New as the DOL Returns to the Prior Opinion Letter Process. The important news is the return to the more focused, less-sweeping means to establishing DOL-interpretation policy. Otherwise the information provided in the reinstated Opinion Letters is not new; it has been available to businesses for years and, as such, most businesses with issues relevant to the topics in the reinstated Opinion Letters are likely already complying. The reinstated Opinion Letters do not take on any topics that had been severely altered during the Obama administration. We addressed this rolling-back issue in our All Things HR in a post titled “The Way We Were: The NLRB’s Time Machine Resets the Clock on Employer Work Rules and Joint Employer Status” demonstrating this is not just a NLRB mantra, it looks to be the DOL’s too.

  2. Ranging Applicability. As the ambulance-employer DOL Opinion Letter demonstrates, some of the reinstated Opinion Letters will have very limited applicability as Opinion Letters are only as good as the overlapping facts in the circumstances presented in them and the business seeking to use them as guidance. Nevertheless, while many Opinion Letters focus on specific legal issues specific to certain employers/businesses/industries, they are still valuable resources and may provide answers or guidance in many areas in wage and hour law.

  3. More Defenses Available to Businesses. Opinion Letters were and continue to be another tool businesses have in their arsenal to help ensure compliance with the FLSA, and another tool in their defense arsenal. Specifically, Section 10 of the Portal-to-Portal provides businesses an affirmative defense to all monetary liability if the business can demonstrate it acted “in good faith and in conformity with and in reliance on any written administrative regulation, order, ruling, approval, or interpretation” of the DOL Wage and Hour Division. See 29 U.S.C. § 259 and 29 C.F.R. Part 790.

In addition, Opinion Letters can be used to prove the “good faith” defense against the double liquidated damages penalty available under the FLSA, and the third-year of damages in the case of willful violations, of which the bar is extremely low. See 29 U.S.C. § 260. The availability of newly-issued Opinion Letters means that a business can request and obtain an Opinion Letter addressing a specific practice, policy, and/or factual circumstance for guidance and rely on a favorable Opinion Letter in response to a charge or lawsuit on the same issue.

  1. This is a Good Thing. This is good news for businesses because it demonstrates two things: (1) businesses will be able to have and rely on additional resources to meet their statutory and regulatory wage and hour obligations; and (2) the Trump administration seems intent on turning back the clock to a time pre-Obama administration, but not necessarily instituting new guidance or interpretations (not in the labor and employment context at least). This means that businesses are likely already familiar with what they should be doing and have been doing it.

© Copyright 2018 Dickinson Wright PLLC
For more Labor and Employment news go to the National Law Review’s Labor and Employment Page.

Breaking Federal Developments in Labor and Employment September 2017

Salary Test for Exempt Status Invalidated

Under the prior administration the DOL had issued amendments to certain exemptions from the overtime requirements of the Fair Labor Standards Act (“FLSA”), which would have dramatically increased the number of employees eligible for overtime pay to over 4 million workers within the first year of implementation. The amendments were to be effective on December 1, 2016, however their implementation was stayed by a federal judge last November, as reported in our November 2016 Client Alert.

The new regulations were to essentially double the salary threshold for employees who would be exempt from overtime payments, assuming they met one of the three exemptions, from $455 per week or $23,660 per year, to $913 per week or $47,476 per year. Under these regulations, even if employees performed duties that would otherwise indicate they were exempt from overtime, if they made less than $47,476 per year, their employers would have to pay them overtime regardless of their duties. Just last week, a federal judge in Texas invalidated the new regulations, and specifically found that, while a salary test was permissible, the minimum threshold of over 47K per year was too high, and in fact obviated the need for any other duties based analysis, which has always been at the heart of the executive, administrative, or professional exemptions.

Employer Tip

For the time being, employers can feel comfortable relying on the duties test to determine eligibility for overtime, however, the DOL has indicated that it is still looking at the minimum salary threshold, and employers should expect that threshold to increase from the current number of $23,660. Employers would be well advised to take a look at their currently classified exempt employees making between 24-35K per year to determine whether such employees truly meet the duties test, and whether such employees are being paid at appropriate levels.

EEO-1 Salary Reporting Requirements Blocked

The new EEO-1 forms with reporting information for 2017 were to have included salary information in addition to the usual reporting requirements. The EEOC was presumably intending to use such information to target companies for Equal Pay investigations and complaints. Reporting is still due using the EEO-1 forms in March 2018, but the OMB has just announced that the forms are not going to require the reporting of salary information by gender and other protected characteristics, so employers have a reprieve with respect to federal reporting requirements.

Employer Tip

Employers should be mindful that the state and federal equal pay laws are still applicable, and it is always a good idea to do a self-audit of comparative pay data based on gender, race, and other protected characteristics in order to ensure compliance with such laws. Please also refer back to our April 2017 Client Alert with respect to NY pay equity laws and the salary history ban that goes into effect next month for NY employers.

New I-9 Form in Effect September 18, 2017

Employers should be aware that a new I-9 form is going into effect on September 18th. The link to the new form can be found here.

This post was written by David I. Rosen of Sills Cummis & Gross P.C. © Copyright 2017

Sign of Future Changes? DOL Proposes 18-Month Extension of Transition Period for Compliance With ERISA “Fiduciary Investment Advice” Rule

On August 9, the US Department of Labor (DOL) announced in a court filing that it has proposed an 18-month extension of the full implementation of the Best Interest Contract Exemption (the “BIC Exemption”) under the ERISA fiduciary investment advice rule. The Proposed Extension would also apply to the Principal Transaction Exemption and Prohibited Transaction Exemption 84-24 (together with the BIC Exemption, the “Exemptions”). In April of this year, the DOL extended the effective date of the Rule until June 9 and limited the requirements of the Exemptions to only require compliance with the “impartial conduct standards” (ICS) through December 31 (the “Transition Period”). If the Proposed Extension is approved, full compliance with the Exemptions will not be required until July 1, 2019.

As described in our earlier advisory, “Compliance With the ERISA Fiduciary Advice Rule for Private Investment Fund Managers and Sponsors and Managed Account Advisers: Beginning June 9, 2017,” compliance with the ICS generally requires that an investment advice fiduciary (1) act in the “best interest” of plan participants and IRA owners; (2) receive no more than “reasonable compensation” (as defined under ERISA and the Internal Revenue Code); and (3) make no materially misleading statements about recommended transactions, fees, compensation and conflicts of interest.

The Proposed Extension was submitted to the Office of Management and Budget (OMB) in the form of an amendment to each of the Exemptions.

This post was written by Henry Bregstein Wendy E. Cohen David Y. Dickstein Jack P. Governale Christian B. Hennion and Gary W. Howell of Katten Muchin Rosenman LLP
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