I can’t tell you how many times I’ve been asked in the last few weeks:  is there any chance the new overtime rule will go away or at least be postponed to sometime after December 1?  Well, apparently the answer is…

YES!  Yes.  Yes.  The answer — much to my surprise — is YES, the overtime change is NOT happening December 1.

A federal court in Texas just entered a nationwide injunction, enjoining the Department of Labor’s Final Rule, which was set to make sweeping changes to the white collar exemptions beginning December 1.  Yes, nationwide.  Injunction.  December 1 change, done.  Gone.  If you want to read the opinion, click Nevada v DOL Injunction.

So what does this mean for employers?  For employees?  It means there is no change happening December 1.  For now, the salary level remains at $455/week, or $23,660/year.  Will it happen someday?  Who knows.  The likelihood of it happening under a Republican White House, Senate, and House is, in my opinion, quite slim (at least in its current form).  Once we have had a chance to digest the decision and its effects, we will be back with more information.

I’m not sure what to say right now other than WOW.

The moment we have all been waiting for (dreading?) has arrived — the Department of Labor issued its “Overtime” Final Rule.  The details are available on the DOL’s website, with the “official” Final Rule to be published in the Federal Regulations tomorrow.

As anyone who follows HR or employment law knows, this Final Rule has been highly anticipated — not to mention hotly debated — due to what is essentially a complete overhaul of the salary basis portion of executive, administrative, and professional overtime exemptions.  We now know:

  • The new minimum salary basis is $913/week or $47,476/annually.
  • The highly compensated employee salary basis jumps to $134,004/annually.
  • The salary basis will be “automatically” updated every three years, beginning January 1, 2020.
  • Employers may now use nondiscretionary bonuses and incentive payments, including commissions, to satisfy up to 10 percent of the salary basis.
  • Perhaps most importantly, the effective date of the Final Rule is December 1, 2016.

To me, what stands out the most is the effective date — it gives employers much more time to adopt the new regulations than most people anticipated (some suspected it would be as few as 30 days).  So, that’s good news for the thousands of employers who will be impacted by these changes.  Also notable? The DOL did not make any changes to the duties test for any of the exemptions.

Once we have a chance to fully digest the Final Rule, we will be back with additional updates.   In the meantime, check out the DOL’s Questions and Answers section and Fact Sheet for additional information.  You can also comment on this post or email me directly if you have questions.  Stay tuned!

Uber_app_icon - wikimedia commonsRonald Reagan famously once said: “The nine most terrifying words in the English language are ‘I’m from the government and I’m here to help.'”

On January 13, 2015, the State of Florida entered into an agreement with the U.S. Department of Labor (“DOL”) with the goal of preventing the misclassification of employees as independent contractors. It is part of DOL’s “Misclassification Initiative.” Nationally, this initiative has meant a significant increase in the number of investigations undertaken by DOL, and Florida employers can expect greater scrutiny in light of the agreement with DOL.

How’s the initiative going so far? Two very recent cases caught my attention. Just a few days ago FedEx settled with the DOL by agreeing to pay $227 million to delivery drivers in California that were classified as independent contractors. FedEx will bounce back – aren’t drones going to be delivering packages soon anyway?

Continue Reading Yikes…Uber Drivers are Employees, Not Independent Contractors?

U.S. Department of Labor (DOL) announced today that it has awarded more than $183 million in grants to industries in 28 states that rely on the H-1B visa program for skilled workers. The grants will be used to provide education, training and job placement assistance aimed at helping American workers fill jobs in high-growth fields in which employers are currently using the H-1B nonimmigrant visa program to hire foreign workers. This is the second round of funding in connection with Solicitation for Grant Applications (SGA) DOL published last year in the Federal Register. In the first round of funding last October, DOL awarded more than $159 million to 36 grantees. Between the two rounds of grants, more than $163 million has been designated to provide on-the-job training for U.S. workers in fields such as information technology, advanced manufacturing and health care. The original SGA announced funding of $240 million to be awarded through two rounds of funding. However, about $100 million more than anticipated has been awarded as a result of additional H-1B visa fees collected. The DOL press release includes a complete list of grantees, including their locations, award amounts and targeted industries.

The Department of Labor announced yesterday in a press release that it has launched its first application for smartphones — a timesheet app to "help employees independently track the hours they work and determine the wages they are owed."  Yes, that’s right.  The DOL created an iPhone app that allows employees to track their hours and calculate the amount of wages/overtime to which they may be entitled.

As you can imagine, this news was lighting up the blog-o-sphere all day, with just about every employment law blogger I follow chiming in on the issue.  Molly DiBianca at the Delaware Employment Law Blog wrote this post, which has screenshots and a good explanation of how the app works.  Perhaps my favorite quote comes from Jon Hyman at the Ohio Employer’s Law Blog.  In his post, Jon warns: 

I cannot overstate the significance of this story.  The DOL is getting more and more aggressive in its willingness to help employees prosecute wage and hour violations.  If you do not know whether your wage and hour practices pass muster under the [FLSA], you are sitting on a bomb waiting to detonate.  And, the DOL continues to provide employees with the match to light the fuse.

Jon hit the nail on the head.  As you’ve heard us say many times before, FLSA wage/overtime claims are everywhere.  This is especially true here in the Middle District, where we have one of the highest rate of FLSA filings in the country.  This latest announcement from the DOL serves as a reminder — and huge red warning flag — to employers that these wage/overtime cases aren’t going away anytime soon.

What should you do?  Check, double check, then check again all of your classification decisions and time-keeping methods.  If you don’t have employees signing off on their timecards, start NOW.  While this new DOL app may give employees another method of keeping track of their time, it is not the end-all, be-all of time-keeping.  The stronger the employer’s records the better, and having your employees sign off on their time records may help discredit whatever records employees create in the DOL app. 

I thought this might be of interest to our many small business clients:

The U.S. Department of Labor is offering a free webcast on retirement savings options for small businesses and plan providers this Wednesday, February 23.  Check out the press release here.

The webcast, which takes place from 2:00 p.m. to 4:00 p.m. EST, will focus on retirement savings options ranging from simplified employee pensions (SEPs) and savings incentive match plans to the more complex 401(k) plan.  The DOL hopes the webcast will provide practical information to help participants understand and compare plan options, and provide tips to help small businesses start and operate these plans.

Interested?  Register online at http://www.dol.gov/ebsa.  You can also find additional information on retirement plan solutions on the Employee Benefits Security Administration’s website.

The Department of Labor recently issued updated COBRA model notices to assist employers in complying with the recently enacted Temporary Extension Act of 2010 ("TEA").  The DOL website has the following model notices available:

The website contains helpful information on each model notice so employers can determine which notices to send and each notice must be sent.  Employers should take care to ensure they are sending out the appropriate updated notices as required by the TEA