Tag: DOL

Fast-Food Restaurant CEO Tapped to Head Labor Department: What to Expect

Andrew Puzder DOL Department of LaborPresident-elect Donald Trump has announced his intention to nominate Andrew Puzder, Chief Executive Officer of CKE Holdings, the parent company of Carl’s Jr. and Hardee’s, to head the U.S. Department of Labor.

Puzder was a lawyer in St. Louis and represented the founder of Carl’s Jr. He later became the general counsel for CKE and then its CEO. He has criticized state and local minimum wage increases, the Affordable Care Act (ACA), and government overregulation, among other things.

If Puzder is confirmed as Secretary of Labor, employers should look for the following changes.

Wage and Hour

  • Puzder is no fan of the DOL’s regulation expanding overtime protection.

  • Employers are holding their breath as the U.S. Court of Appeals for the Fifth Circuit considers an appeal by the DOL of a nationwide preliminary injunction issued by a Texas district court judge enjoining the DOL from implementing its highly publicized regulation expanding overtime coverage. Puzder’s nomination as Secretary of Labor could affect the regulation’s fate. In May 2016, the DOL issued a Final Rule more than doubling the required salary level required to satisfy the exemptions from overtime for “white collar” employees from $23,660 to $47,476. The Rule was set to become effective December 1, 2016. On November 22, 2016, however, days before the effective date, a Texas district court judge issued a nationwide preliminary injunction, blocking the regulation. The DOL filed an appeal, asking for expedited briefing, and the Fifth Circuit granted that request, requiring all briefing to be completed by January 31, 2017, just days after inauguration, with oral argument to be scheduled quickly after briefing is completed.

  • Whether the DOL under a Trump Administration would support the overtime Rule is unclear. However, Puzder has been an open critic of the overtime regulation. Writing in Forbes Magazine in May 2016, after the DOL published the final regulation, Puzder stated the regulation would not help workers, and “will simply add to the extensive regulatory maze the Obama Administration has imposed on employers, forcing many to offset increased labor expense by cutting costs elsewhere.” In practice, he said, “this means reduced opportunities, bonuses, benefits, perks and promotions.”

  • Fearing the DOL under Trump might abandon the appeal, and citing Puzder’s writings on the overtime rule specifically, the Texas AFL-CIO has filed a motion with the district court to intervene as a defendant and defend the Rule even if the DOL back out. Puzder’s criticisms of the regulation, and a Republican-controlled Congress, could mean one of Secretary of Labor Thomas Perez’s signature regulations, for which the DOL worked for over two years developing, may be at an end. The new Congress could simply pass legislation that would invalidate the rule and present it to Trump, regardless of the outcome of the Fifth Circuit appeal.

  • Puzder also has been a critic of large increases to the minimum wage.

Employee Benefits

  • Puzder has criticized the ACA repeatedly as another government mandate that has caused labor cost increases and led to job cuts. The DOL, along with the Department of Health and Human Services (HHS) and Internal Revenue Service (IRS), is responsible for the majority of the regulations issued under the ACA. With Puzder heading the DOL, Trump will have an ally and partner in dismantling the ACA.

  • Puzder’s anti-regulation perspective likely will mean strong opposition to the DOL’s fiduciary rule, which expands the scope of who acts as a fiduciary and has significantly affected the financial services industry. Currently slated to go into effect in April 2017, the fiduciary rule will be at the top of the Secretary’s list of priorities.

  • Generally, Puzder’s favoring of market forces, as opposed to government regulation or mandated benefits, signals a penchant toward steering the DOL in ways that favor competition between employers for talent based on compensation and benefit packages. Appointments of the assistant Secretary of Labor of the Employee Benefits Security Administration (EBSA) and members of the ERISA Advisory Council also are eagerly anticipated as they are key in the direction of rulemaking and enforcement of ERISA and other employee benefit initiatives.

Federal Contracts (Office of Federal Contract Compliance Programs)

  • A new, more business-friendly Director of Office of Federal Contract Compliance Programs (OFCCP) likely will be focused on the regulatory burdens on mid-size and small businesses. This should shape an agenda of deregulation that may roll back regulations, including those governing paid sick leave, minimum wage, pay transparency, sex discrimination, and lesbian, gay, bisexual, and transgender (LGBT) discrimination.

  • A shift in how OFCCP approaches its auditing function also may come from a new leader. For example, a move away from the OFCCP’s current Active Case Enforcement system to one closer to that used by the George W. Bush administration (Active Case Management) would bring more efficient, high-level compliance reviews in most instances, with deeper dives reserved for the few audits with major indicators of potential discrimination.

  • There also may be a change in OFCCP enforcement priorities. OFCCP likely will not look to push boundaries, create new law through litigation, or publicly shame employers. We can expect a shift in the OFCCP’s push to address the gender pay gap and it may step back from comparable worth theories of pay discrimination. Finally, such programs as the Class Member Locator, the online registry of employers that OFCCP had cited for a discrimination violation, likely will disappear.

Immigration

  • As the CEO of CKE, Puzder brings a unique perspective on the role of foreign-born workers in U.S. businesses. Puzder has stated frequently that immigrants play a vital role in growing U.S. businesses, spurring innovation and creating jobs. Puzder will be an important and potentially moderating voice related to immigrant and nonimmigrant work visas.

Labor

  • The nomination of Puzder and the recent deal to keep an Indiana facility from closing to retain more U.S. jobs signal both Trump’s and nominee Puzder’s focus on ensuring that labor relations fits within a broader economic picture.

  • Puzder believes, as does Trump, that free enterprise will result in job growth. It is likely that the new Secretary of Labor will seek to remove burdensome regulations and be more business-friendly. For example, we anticipate changes to the DOL’s efforts to expand the definition of joint employer status, which the National Labor Relations Board (NLRB) also has expanded under the Obama Administration. Consistent with this approach, Trump (immediately after his inauguration) may repeal many of President Barack Obama’s executive orders, including (among others) Executive Order 13658 (Establishing a Minimum Wage for Contractors), Executive Order 13673 (Fair Pay and Safe Workplaces), and Executive Order 13502 (Use of Project Labor Agreements for Federal Construction Projects).

Workplace Safety and Health

  • Puzder currently heads a company that is not heavily regulated by the Occupational Safety and Health Administration (OSHA). He has stated, however, that new regulation may not be the best way to effect policy change and that view could trickle down to OSHA and the Mine Safety and Health Administration.

Non-Competes and Protection Against Unfair Competition

  • Puzder would be unlikely to latch onto the assault against non-compete agreements advanced by the Treasury Department in its March report and by the White House in its May report and October “state call to action.” Given his business background, Puzder would understand the utility of non-compete agreements, even with respect to low-wage earners, because they serve to protect the employer’s investment in training such workers.

Disability, Leave and Health Management

  • Puzder may be more willing to reduce or eliminate the burdens associated with the paid sick leave executive order that is scheduled to go into effect for new contracts after January 1, 2017. The Executive Order currently makes it very difficult for businesses to identify when paid sick leave accrues (pushing many employers to provide more than required), makes it difficult to coordinate with state and local paid sick leave laws, and makes it easier for employees to abuse the system and use the benefit to thwart any attendance policy. Businesses that operate in multiple states likely would welcome some form of federal measure that simplifies paid sick leave benefit administration, aligns federal, state, and local benefits, and provides an ERISA-type preemption.

  • Under Puzder, the DOL likely will be more business-minded with respect to issues under the Family and Medical Leave Act (FMLA) and the Americans with Disabilities Act (ADA). This would result in the administration taking less aggressive stances (including in terms of litigation) on these laws and fewer attempts to expand the coverage of these statutes.

ARTICLE BY General Employment Litigation Practice Group Jackson Lewis

Jackson Lewis P.C. © 2016

Adjusting Wage Rates? Be Mindful of State Notice Requirements

wage ratesEven employers who were opposed to the new overtime regulations are in a quandary after the District Court for the Eastern District of Texas enjoined the Department of Labor from implementing new salary thresholds for the FLSA’s “white collar” exemptions.

Will the injunction become permanent?  Will it be upheld by the Fifth Circuit?

Will the Department of Labor continue to defend the case when the Trump Administration is in place?

What does the rationale behind the District Court’s injunction (that the language of the FLSA suggests exempt status should be determined based only on an employee’s duties) mean for the $455-per-week salary threshold in the “old” regulations?

Whether employers can reverse salary increases that already have been implemented or announced is an issue that should be approached carefully.

For example, employers should be aware that state law may specify the amount of notice that an employer must provide to an employee before changing his or her pay.

In most states, employers merely need to give employees notice of a change in pay before the beginning of the pay period in which the new wage rate comes into effect.

But some states require impose additional requirements. The New York Department of Labor, for example, explains that if the information in an employee’s wage statement changes, “the employer must tell employees at least a week before it happens unless they issue a new paystub that carries the notice. The employer must notify an employee in writing before they reduce the employee’s wage rate. Employers in the hospitality industry must give notice every time a wage rate changes.”

Maryland (and Iowa) requires notice at least one pay period in advance.  Alaska, Maine, Missouri, North Carolina, Nevada and South Carolina have their own notice requirements.

Employers who are making changes to wage rates based on the status of the DOL’s regulations should be nimble – while also making sure that they are providing the notice required under state law.

ARTICLE BY Michael D. Thompson of Epstein Becker & Green, P.C.

©2016 Epstein Becker & Green, P.C. All rights reserved.

FLSA Salary Basis Increase Put On Hold For Entire Country – What Now?

salary basis“The Court finds the public interest is best served by an injunction.” With those words, a district court in Texas put on hold the implementation of the new rules applicable to the White Collar Exemptions under the Fair Labor Standards Act (FLSA). The rules, originally scheduled to go into effect on Dec. 1, 2016, have been indefinitely delayed for employers throughout the United States.

In granting the injunction, the court stated that the plaintiffs (various states and business groups) challenging the rule had shown a likelihood of success in their arguments that the Department of Labor (DOL) exceeded its statutory authority in issuing the rule. As a result, the court will now spend time reviewing the arguments of both parties in depth before making a final decision.

The next big date is Jan. 20, 2017, when President-elect Donald J. Trump is sworn in as president. It is not clear what a DOL under President Trump would do with the rule. Watch for hints about what could happen with the rule in the news media over the next few weeks, especially when President-elect Trump names a nominee for secretary of the DOL.

Will the judge lift the injunction and allow the rule to be implemented before Jan. 20, 2017?

The judge has already started the process for accepting arguments from both parties, and it is possible he could make a final decision before Jan. 20, 2017. That decision, however, could be appealed no matter who wins at the district court level. During an appeal, the injunction could remain in place.

Practically, what does this mean for employers?

It means you have options. In large part, an employer’s next steps depend on the message that has been delivered to employees already and systems you have in place to implement the new rule. Has the company informed those to-be-newly-non-exempt employees that they would start receiving overtime compensation as of Dec. 1? If so, then the company will need to decide whether to roll back that promise. (Note that, if you conducted an audit and determined that, based on the employee’s responsibilities they do not meet the duties test, you should nonetheless reclassify them as non-exempt to avoid potential claims in the future). Overtime for those newly non-exempt employees may not be required any longer as of Dec. 1, but a company must balance what is required by law with the human resources impact of taking that potential benefit away from employees.

ARTICLE BY Tom O’Day of Godfrey & Kahn S.C.

Copyright © 2016 Godfrey & Kahn S.C.

Stop! Texas Federal Court Enjoins New FLSA Overtime Rules

Texas DOL FLSA overtime rulesWe have written often in the past several months about the new FLSA overtime rules that were scheduled to go into effect in little more than a week, dramatically increasing the salary thresholds for “white collar” exemptions and also providing for automatic increases for those thresholds.

In our most recent piece about the important decisions employers had to make by the effective date of December 1, 2016, careful readers noticed a couple of peculiar words — “barring … a last-minute injunction.”

On November 22, 2016, a federal judge in the Eastern District of Texas entered just such an injunction, enjoining the Department of Labor from implementing the new rules on a nationwide basis.

“The court determines that the state plaintiffs have satisfied all prerequisites for a preliminary injunction,” wrote United States District Court Judge Amos Mazzant III. “The state plaintiffs have established a prima facie case that the Department’s salary level under the final rule and the automatic updating mechanism are without statutory authority.”

The state plaintiffs had argued that the Department of Labor usurped Congress’ authority in establishing new salary thresholds. Finding that the Department had overstepped its bounds, Judge Mazzant wrote, “If Congress intended the salary requirement to supplant the duties test, then Congress and not the department, should make that change.”

The injunction could leave employers in a state of limbo for weeks, months and perhaps longer as injunctions often do not resolve cases and, instead, lead to lengthy appeals. Here, though, the injunction could spell the quick death to the new rules should the Department choose not to appeal the decision in light of the impending Donald Trump presidency. We will continue to monitor this matter as it develops.

To the extent that employers have not already increased exempt employees’ salaries or converted them to non-exempt positions, the injunction will at the very least allow employers to postpone those changes. And, depending on the final resolution of this issue, it is possible they may never need to implement them.

The last-minute injunction puts some employers in a difficult position, though — those that already implemented changes in anticipation of the new rules or that informed employees that they will receive salary increases or will be converted to non-exempt status effective December 1, 2016.

Whether employers can reverse salary increases they have already implemented is an issue that should be addressed carefully with legal guidance.

As for those employers that informed employees of changes that would go into effect on December 1, 2016, they, too, should seek legal guidance as to how to communicate with employees that those announced changes will not go into effect at that time.

While the FLSA rules are now enjoined, employers must now be mindful not only of morale issues that might result from not providing employees with raises that were implemented or announced, but also of potential breach of contract claims.

ARTICLE BY Michael S. Kun of Epstein Becker & Green, P.C.

©2016 Epstein Becker & Green, P.C. All rights reserved.

Election 2016, Title VII and Sexual Orientation, DOL Persuader Rule: Employment Law This Week – November 21, 2016 [VIDEO]

dol persuader rule employment lawElection 2016: New Laws Impacting Employers

Our top story: Election Day brings a wave of new laws affecting employers. While all eyes were on the battle for the White House, voters in a number of states approved new legislation that will directly impact employers. Arizona and Washington will soon require paid sick leave for workers, as well as minimum wage increases. Medical marijuana is now legal in Arkansas, Florida, and North Dakota, while recreational use was approved in California, Maine, Massachusetts, and Nevada. The new laws in Arkansas and Maine explicitly prohibit employment discrimination against medical marijuana users.

Federal Court Agrees with EEOC: Title VII Covers Sexual Orientation

In another move toward sexual orientation protections in Title VII of the Civil Rights Act of 1964 (“Title VII”), the U.S. District Court for the Western District of Pennsylvania has denied a motion to dismiss a sexual orientation case brought by the U.S. Equal Employment Opportunity Commission (“EEOC”), one of several claims that the agency is pursuing across the country. The employer in this case had argued for dismissal because it claimed that Title VII’s prohibition of sex discrimination does not apply to sexual orientation discrimination. The court found that sexual orientation discrimination is a “subset of sexual stereotyping” covered by Title VII. This same issue is currently pending before the U.S. Court of Appeals in the Second and Seventh Circuits, in cases where the district courts ruled that sexual orientation discrimination is not prohibited by Title VII.

DOL’s Amended Persuader Rule Is Permanently Blocked

A federal court in Texas has permanently enjoined the U.S. Department of Labor (“DOL”) from enforcing its 2016 amended Persuader Rule, after concluding that the amended rule is unlawful. The decision applies nationwide, making permanent a preliminary injunction that the court issued in June. The rule would have required employers to report payments made to consultants, including lawyers, in connection with even indirect efforts to influence employees’ opinions on labor unions and a wide range of employment matters.

Fourth Circuit Rules That Nursing-Home Nurses Are Not “Supervisors”

The Fourth Circuit recently upheld a conclusion by the National Labor Relations Board (“NLRB”) that registered nurses and licensed practical nurses at a nursing home in South Carolina can unionize because they do not exercise enough independent judgment to be supervisors. The Fourth Circuit deferred to the NLRB’s position that employees do not exercise independent judgment because their decisions are controlled by company policies or rules. Because the nurses’ supervision mainly consisted of making sure that nursing assistants followed written rules and did not discipline assistants on their own, the nurses did not exercise independent judgement and, therefore, were not supervisors.

Tip of the Week

Lenora Billings-Harris—Diversity Strategist, an award-winning international speaker, and the author of The Diversity Advantage—is here with some advice on how to combat unconscious bias.

ARTICLE BY George Carroll Whipple, III of Epstein Becker & Green, P.C.
©2016 Epstein Becker & Green, P.C. All rights reserved.

Texas Judge Not Persuaded, Permanently Enjoins DOL’s New Reporting Rule

Stop, Rain, DOL Persuader ruleIn a major victory for the business community, Judge Sam R. Cummings of the U. S. District Court for the Northern District of Texas issued a permanent nationwide injunction blocking the Department of Labor (DOL) from enforcing its new “persuader” rule. National Federation of Independent Business, et al. v. Perez, et al., Case No. 5:16-cv-00066. The rule attempted to expand disclosure requirements by employers and their consultants (including attorneys) related to union-organizing campaigns.

The new rule, which Judge Cummings had preliminarily enjoined prior to its effective date of July 1 of this year, would have greatly increased the reporting requirements under Section 203 of the Labor Management and Reporting Disclosure Act. That section requires employers and their labor relations consultants to disclose the terms (including financial terms) of any arrangement by which the consultant provides services that are intended to directly or indirectly persuade employees concerning their rights to organize a union or to bargain collectively with their employer.

For years, the DOL took the position that no reporting was required unless the consultant had direct contact with employees by way of in-person meetings, telephone calls, letters, or emails. Similarly, no reporting was required if the consultant’s activities were limited to providing sample materials such as speeches, postings, letters to employees, and the like that the employer was free to accept, reject, or modify.

However, the new persuader rule expanded the disclosure requirements to include indirect contact with employees by the consultant, including:

  • Directing, planning, or coordinating the efforts of managers to persuade employees

  • Providing materials such as speeches, letters, or postings that are intended to persuade employees

  • Conducting union avoidance seminars if the consultant assists the employer in developing anti-union strategies

  • Developing personnel policies intended to persuade employees in the exercise of their organizational or collective bargaining rights.

The attorneys general for 10 states as well as various business groups challenged the new rule as infringing on employers’ First Amendment rights and conflicting with the attorney-client privilege. Judge Cummings agreed that the rule is unlawful and should be set aside. Presently, it is unknown if DOL intends to appeal Judge Cummings’ order.

ARTICLE BY Henry W. Sledz Jr. of Schiff Hardin LLP

© 2016 Schiff Hardin LLP

Non-Competes Call to Action, Transgender Bathrooms, Texas Court Blocks Blacklisting Rule: Employment Law This Week November 7, 2016 [VIDEO]

White House Issues Call to Action on Non-Competes

Our top story: The White House issues a call to action. The administration is calling on states to combat what it describes as the “gross overuse of non-compete clauses today.” The statement recommends legislation banning non-competes for certain categories of workers and prohibiting courts from narrowing overly broad agreements. New York Attorney General Eric Schneiderman answered the call immediately, announcing that he would introduce relevant legislation in 2017.

“President Obama’s call to action encouraged states to take action to do three things. One, to ban non-competes for certain types of employees, such as low-wage earners; two, to increase transparency in the way that employers communicated with employees about non-competes; and three, to incentivize employers to write non-competes that are enforceable. … It used to be that non-competes were subject to scrutiny in the courtroom, but now we’re seeing that scrutiny also in the media and in the political arena. … With scrutiny of non-competes occurring in additional fora, it’s important for employers to review their non-competes, both to make sure that they are enforceable and to make sure that they’re administered to appropriate levels of employees.”

High Court Will Hear Transgender Bathroom Case

The Supreme Court will examine the definition of “sex discrimination.” The High Court has agreed to hear a case involving a transgender student and his use of the boys’ bathroom at school. The legal issue at the center of the case is the interpretation of regulations implementing Title IX, which bans sex discrimination in schools. The Department of Education has put out guidance interpreting “sex discrimination” to include claims based on gender identity, and the Fourth Circuit deferred to that interpretation in this case. This case could have implications for other laws that prohibit sex discrimination, including Title VII of the Civil Rights Act.

Texas Court Blocks Fair Pay and Safe Workplaces Regulations

Federal contractors get a reprieve from the “blacklisting” rule. A Texas federal court issued a temporary nationwide injunction on portions of the Fair Pay and Safe Workplaces rule. The executive order includes controversial disclosure requirements for government contractors and restrictions on arbitration. The district court ruled that the prohibition on certain arbitration agreements conflicted with the Federal Arbitration Act, and the reporting requirements could allow contractors to be disqualified from obtaining contracts without due process.

New York City Council Passes First Freelancer Wage Protection Law

The New York City Council has passed the nation’s first legislation bolstering protections for freelancers. The “Freelance Isn’t Free” Act, which passed unanimously, implements penalties for employers who do not pay freelance workers within 30 days of services rendered. In addition, the Act requires a written contract for freelance work worth $800 or more. The contract must include an itemized accounting of the work to be performed and the rate of pay. Mayor Bill de Blasio is expected to sign the bill.

Tip of the Week

Brian Chevlin, Senior Vice President and General Counsel for Pernod Ricard USA, is here with some advice on how to build a committed legal team through a culture of appreciation.

ARTICLE BY

George Carroll Whipple, III
Epstein Becker & Green, P.C.
©2016 Epstein Becker & Green, P.C. All rights reserved.

Down to the Wire: DOL’s “Blacklisting Rule” Enjoined

blacklisting ruleA federal judge in Texas has blocked implementation of major portions of the U.S. Department of Labor’s (DOL) Fair Pay and Safe Workplaces rule, the so-called “blacklisting” rule.

Judge Marcia A. Crone of the U.S. District Court for the Eastern District of Texas entered a nationwide preliminary injunction order on Oct. 24 blocking the Oct. 25 implementation date of the DOL rule, along with a related Obama Executive Order, the Federal Acquisitions Regulations (“FAR”) Rule and the DOL’s Guidance regarding the FAR Rule.

Had they gone into effect, the new rules would have imposed significant and stringent reporting and disclosure requirements on contractors bidding on federal projects. Moreover, those disclosures of non-final and non-adjudicated “violations” could have been used to bar contractors from federal projects.

Judge Crone determined that the plaintiffs in this action, the Associated Builders and Contractors of Southeast Texas, had a likelihood of success on the merits of establishing that the new regulations exceeded the authority of the president, the FAR Council and the DOL; were otherwise preempted by other federal labor laws; violated the First Amendment rights of federal contractors through compelled speech; violated contractors’ due process rights; are arbitrary and capricious; and violated the Federal Arbitration Act.

The opinion focuses in large part on the disclosure requirements contained in the president’s Executive Order, the DOL Guidance and the FAR Rule, which Judge Crone found to be “drastic new requirements” which are “a substantial departure from and a significant expansion of prior reporting rules.”

The disclosure requirements, among other things, would require contractors to report all “violations” of 14 separate federal labor and employment statutes; disclosures could then be used to disqualify bidders on federal projects. Judge Crone’s opinion finds fault with the Executive Order, Rule and Guidance for broadly defining “violations” to include non-final decisions or administrative determinations, which have not been preceded by a hearing or made subject to judicial review. Moreover, the “violations” to be reported are not confined to performance of past government contracts.

Judge Crone determined that “[i]n the present case, the Executive Order, FAR Rule, and DOL Guidance arrogate to contracting agencies the authority to require contractors to report for public disclosure mere allegations of labor law violations, and then to disqualify or require contractors to enter into premature labor compliance agreements based on their alleged violations of such laws in order to obtain or retain federal contracts. By these actions, the Executive Branch appears to have departed from Congress’s explicit instructions dictating how violations of the labor law statutes are to be addressed.”

Judge Crone also enjoined enforcement of the portion of the Executive Order and the Rule that provided that contractors and subcontractors who enter into contracts for non-commercial items of more than $1 million must agree not to enter into any mandatory, pre-dispute arbitration agreements with their employees or independent contractors on any matter arising under Title VII, as well as any tort related to or arising out of sexual assault or harassment.

Left standing by Judge Crone is the portion of the Executive Order requiring that all covered contractors inform their employees in each paycheck of the number of hours worked, overtime calculations (for non-exempt employees), rates of pay, gross pay, additions or deductions from pay, and whether they have been classified as independent contractors. That requirement in the Executive Order has an effective date of January 1, 2017.

ARTICLE BY Gerald F. Lutkus of Barnes & Thornburg LLP

© 2016 BARNES & THORNBURG LLP

Lawsuits Against Overtime Rule, Voluntary Wellness Program, ADA: Employment Law This Week – October 3, 2016 [VIDEO]

Employment, DOL, Overtime RuleStates, Businesses File Lawsuits Against Overtime Rule

Our top story: The U.S. Department of Labor (DOL) is facing a fight over its new overtime rule. Effective December 1, the new overtime rule will raise the minimum salary threshold required for white-collar exemptions under the Fair Labor Standards Act to $913 per week, more than doubling the current threshold. But Texas and Nevada are leading 21 states in a lawsuit challenging the DOL’s updated rule, and more than 50 business groups, including the National Retail Federation and the U.S. Chamber of Commerce, have brought a separate challenge. At the same time, the U.S. House of Representatives voted to delay the effective date of the new regulation by six months. These challenges are based on concerns that the new salary threshold would mean a big increase in costs for employers and oversteps the DOL’s authority. Kristopher Reichardt, from Epstein Becker Green, has more.

“This was obviously a coordinated effort to attack the new overtime regulations on multiple fronts. Both suits take slightly different paths to achieve the same objective. . . . The Eastern District of Texas, a conservative jurisdiction, is somewhat known for moving its docket along quickly, which is important to any challenge, since the new rules take effect in just two months, despite some congressional attempts to delay the rule until June 1 of next year. . . . Employers should absolutely continue to prepare for the overtime rule going into effect on December 1. It’s unlikely that these lawsuits would delay or stop these rules. Employers should expect that they will go into effect.”

Court Finds That Voluntary Wellness Program Does Not Violate the ADA

An employer’s voluntary wellness program survives an Equal Employment Opportunity Commission (EEOC) challenge. A lighting manufacturer in Wisconsin requires an anonymous health risk assessment in order to participate in its health plan. The EEOC filed suit against the company, claiming that the program violated restrictions in the Americans with Disabilities Act (ADA). The district court found that the program did not violate the ADA. But perhaps more importantly, the court deferred to the EEOC’s regulation stating that wellness programs are not covered by the ADA’s “safe harbor” and can violate the ADA if the exams are not voluntary.

Truthful Statements Protected Under NLRA, Even if Disparaging

Technically truthful statements are protected under the National Labor Relations Act (NLRA), even if they’re disparaging. A group of DirecTV technicians were fired after appearing on a local news station discussing a new company pay incentive. The incentive was tied to convincing customers to let DirecTV use landlines to track viewing habits. A split D.C. Circuit affirmed a National Labor Relations Board ruling in favor of the employees, finding that the technicians’ comments were based in truth and thus fell under the protection of the NLRA. Therefore, the company must reinstate the technicians.

Tip of the Week

To celebrate Global Diversity Awareness Month, we’re bringing you a diversity-focused “Tip of the Week” each episode in October. With us this week is William A. Keyes, IV, President of the Institute for Responsible Citizenship, with some advice on growing a diverse culture by demanding excellence.

“One of the things I notice is that the brightest young African-American men are often ignored when it comes to great opportunities. Now, you probably find that surprising, but that’s been my observation. . . . So, my argument is that for a top-tier company that is saying that it’s committed to attracting top talent of color, if you’re going to do that, you should really commit to it, state that commitment, and settle for nothing less. Having done that, you really take care of your retention problems, because you bring in people who are really talented. You set a high bar for them, high standards for achievement that you expect for them to meet, they do so. Not only do you retain them, but you create a culture that is attractive to other people who also want to pursue excellence.

ARTICLE BY George Carroll Whipple, III of Epstein Becker & Green, P.C.

©2016 Epstein Becker & Green, P.C. All rights reserved.

Final Rules Released for Federal Contractor Paid Sick Leave and New EEO-1 Report

EEOC EEO-1 reportThursday was a busy day, with the announcement of two long-awaited final rules from the EEOC and the US Department of Labor (“DOL”). The EEOC released the final version of the revised EEO-1 form, and the DOL released the final paid sick leave rule for federal contractors. (And, as we reported yesterday, the US House of Representatives also passed a bill earlier this week that would delay implementation of the Department of Labor’s new overtime rule.)

EEO-1 Pay Data Rule

Following a revised proposal in July, the EEOC has announced the final revised version of the EEO-1 form, which will require employers to report employee pay data beginning with the 2017 report. The 2017 report will be the first to include the new information. The deadline to file the 2017 report is March 31, 2018, giving employers six additional months to prepare their report. The report for 2016 (which is not affected by this new rule) is still due today, September 30, 2016.

Paid Sick Leave

Not to be left out, the DOL also announced the final regulation on paid sick leave for federal contractors. The rule was first announced in President Obama’s September 2015 executive order and proposed rules were announced in February 2016. The final rule will go into effect for new solicitations issued on or after January 1, 2017, and will require employers to provide one hour of paid sick leave for every 30 hours of work, up to a total of 56 hours of paid sick leave per year. The rule will apply to employees of covered federal contractors who work “on” or “in connection with” a covered government contract.

ARTICLE BY Christina A. Pate of Squire Patton Boggs (US) LLP

© Copyright 2016 Squire Patton Boggs (US) LLP