FEDERAL Updates
U.S. Department of Labor Releases Wage and Hour Compliance
Who:
- Businesses using nondiscretionary bonuses
- Non-profit organizations
- Global trade organizations with paralegals
When: Effective Immediately
What: The U.S. Department of Wage and Hour Division Administrator released 3 opinion letters addressing specific scenarios to help employers comply with the Fair Labor Standards Act (FLSA).
Rounding practices when calculating employee hours worked
The first letter addressed acceptable rounding practices in the Service Contract Act (SCA) for government contractors and subcontractors. The letter used an example of payroll software that extended clocked time to 6 decimal points and then rounded the number to 2 decimals. When the decimal was less than .005, the number wasn’t rounded up, but when the decimal was .005 or greater, the number was rounded up to .01.
What does this mean?
- FLSA does apply to the SCA.
- Payroll software rounding is allowed as long as it’s a neutral practice and doesn’t fail to compensate employees appropriately.
Calculating “highly compensated employee” exemptions from overtime pay for paralegals in trade organizations
The second letter uses a case where a paralegal’s annual salary is at least $100,000 and conducts non-manual, administrative work like maintaining records, maintains the legal department’s budget, and prepares/distributes notices and reports.
Under these conditions, the paralegal qualifies for the highly compensated exemption minimum wage and overtime pay requirements. The paralegal must regularly perform at least one job duty under the administrative exemption (e.g., maintaining records) to qualify for highly compensated employee exemption.
Calculating nondiscretionary bonuses
Using a situation where employees are paid quarterly and annual bonuses under a collective bargaining agreement, the letter states that when defining overtime compensation, non-discretionary bonuses must be included as part of the employee’s complete compensation when calculating the employee’s regular pay rate.
If employers disregard including the bonus as part of computing the employees’ regular hourly rate, the employer must go back and recalculate the regular rate for each workweek in the bonus period and pay the additional overtime.
How:
- Ensure that your payroll software’s time rounding practices correctly and neutrally reflect the amount of time an employee works.
- If you employ paralegals, review their duties and determine if they qualify for the highly compensated employee exemption of the FLSA and if they should be classified non-exempt versus exempt.
- Ensure that your payroll software accounts for non-discretionary bonuses and retroactively recalculates employees’ regular pay rates during bonus periods.
Additional Resources
FLSA2019-9 Opinion Letter #1: Rounding practices for time recording
FLSA2019-8 Opinion Letter #2: Paralegal exemptions from wage and overtime requirements
FLSA2019-7 Opinion Letter #3: Non-discretionary bonuses and overtime calculations
Truck Driver Compensation, U.S. Department of Labor Releases Opinion
Who: Businesses that employ long-haul truck drivers
When: Effective Immediately
What: In an opinion letter, the U.S. Department of Labor (DOL) clarified that under the Fair Labor Standards Act non-working time is when truck drivers are relieved of all duties and sleeping in a sleeper berth. Further, if the driver isn’t “working while riding,” then they can’t be compensated; if drivers are in the sleeping berth but are on call or doing paperwork, then they should be compensated.
How:
- Review your truck driver compensation policies and procedures to ensure alignment with this new guidance.
- Educate your managers and truck drivers about the policy changes.
Additional Resources
Opinion Letter: Truck Driver Compensation Guidance
Department of Labor Press Release
EEO Releases EEO-1 Component 2 Guidance, Online Filing System Now Live
Who:
- Employers with 100+ employees
- Federal contractors with 50+ employees and $50,000+ in contracts, subcontracts, or purchase orders
When: September 30, 2019
What: To help employers submit employee pay data by September 30, 2019, the U.S. Equal Employment Opportunity Commission (EEOC) published a sample form, instructions, fact sheet, FAQs, and additional references for Component 2 pay data. Additionally, the online filing system is now live.
Employers are required to report 2017 and 2018 pay data on the revised EEO-1 form. The data will include total hours worked for all employees based on 10 categories, including race, ethnicity, and sex within 12 pay bands.
How:
- Gather your 2017 and 2018 pay data. Submit both years’ pay data along with hours worked by the September 30, 2019 deadline.
- Review pay data for any pay disparities and develop a plan to address any discrepancies that could cause further examination from the EEOC.
- Ensure your system and data is ready for the changes by reviewing your current system, and test run data pulls and reports.
Additional Resources
EEOC Component 2 Support Materials
Component 2 EEO-1 Pay Data Online Filing System
EEOC Notice of Component 2 Reinstatement
Expansion of Preventive-care Benefits Under High-deductible Health Plans (HDHPs)
Who: Employers offering health insurance options or HDHPs
When: Effective Immediately
What: The U.S. Treasury Department and the U.S. Internal Revenue Service (IRS) expanded the chronic conditions that qualify for preventive-care benefits under HDHPs, expanding health savings accounts (HSAs) and prescription medication coverage.
Employees must be enrolled in an HDHP to contribute to an HSA. Health plans are HDHPs if they provide benefits for preventive care before the deductible (least $1,350 for singles or $2,700 for families) is met, although the IRS doesn’t require HDHPs to have a deductible for preventive care.
The IRS’s expanded list of preventive-care benefits:
Employers now have the option to cover some or all of the above list as well as the option to apply normal copays or coinsurance.
How:
- If you don’t currently offer an HDHP, review your current offerings, and determine if an HDHP is beneficial to your organization and employees.
- Review your current HDHP and other plan coverages to determine if or how you’re currently covering the expanded list of preventive-care items.
Additional Resources
IRS Notice 2019-45
Foreign Workers Must Provide Social Media Information in Visa Applications
Who: Businesses that employ foreign national workers
When: Effective Immediately
What: All visa applicants must complete forms DS-160 (nonimmigrant) or DS-260 (immigrant) outlining all of the social media platforms they have used in the last 5 years, their usernames, current email, and phone numbers as well as all email and phone numbers used in the last 5 years.
Social media platforms include Facebook, Flickr, Google Plus, Instagram, LinkedIn, Myspace, Pinterest, Reddit, Tumblr, Twitter, Vine and YouTube, Douban, Qzone, Sina Weibo, Tencent Weibo, and Youku, and Vkonttakte.
How:
If you employ foreign national workers, be advised that there are now additional forms your employees will need to fill out during their application process, and inform them of the new process.
Additional Resource
U.S. Department of State Consular Electronic Application Center
STATE Updates
Alabama Bans Wage Discrimination
Who: Alabama employers
When: Effective September 1, 2019
What:
Alabama’s first pay equity law, called the Clarke-Figures Equal Pay Act (CFEPA), largely aligns with the federal Equal Pay Act but also includes sex and race as a protected class.
Employers may not pay an employee a lower wage rate based on their race or sex. Wage differences may be differential based on seniority, merit, earnings measured by quantity or quality, or other factors beyond sex or race.
Employers can’t refuse to interview, hire, promote, or employ applicants if the individual refuses to provide their salary history. Employers may inquire about salary history. The Act also provides employees with 2 years from the date of the supposed violation to file a lawsuit.
How:
- Ensure that your compensation practices mirror the approved wage differences.
- Review your compensation practice to ensure there’s no potential sex or race discrimination.
- Use a conservative approach; advise your hiring managers to avoid salary history questions during the hiring process.
Additional Resource
HB 225
Colorado Ban the Box Enacted
Who: Colorado private employers with 11+ employees
When: September 1, 2019
What:
As a way to improve employment opportunities among prior criminal offenders, Colorado has enacted the Chance to Compete Act. There are 3 components to the new law. Beginning September 1, 2019, employers may not:
- Publish advertisements with language saying candidates with a criminal history should not apply
- Include language on job applications that state candidates with a criminal history should not apply
- Ask or require applicants to disclose any criminal history on job applications
Criminal history is any record of “arrests, charges, pleas, or convictions for any misdemeanor or felony at the federal, state, or local level.” The law does not prohibit employers from considering publicly available criminal records. The law also includes exceptions if employers are required by law to conduct criminal history checks. If employers violate the new law, penalty fines will be sent depending on the number of violations. The violation penalties are:
- First instance: A warning will be provided, or order for compliance within 30 days.
- Second instance: A 30-day compliance order and a monetary fine not to exceed $1,000.
- Third+ instance: A 30-day compliance order and a monetary fine not to exceed $2,500.
How:
Review and edit your job application forms and advertisements.
Review your interview process and inform your hiring managers about the law’s requirements.
Additional Resource
Maine Bans Salary History
Who: Maine employers
When: September 17, 2019
What:
The Maine Human Rights Act prohibits employers from asking job candidates about their salary history until a job and compensation offer has been negotiated and given to the candidate. The Act also forbids employers from stopping employees from disclosing their own or other employees’ salaries.
Once the job and compensation offer is made, employers may seek the candidate’s or employee’s compensation history. Employers may confirm compensation if the candidate or employee voluntarily discloses their salary history, without prompting.
Violators may see penalty fines between $100-500 for each violation.
How:
- Review your hiring processes and remove any mention of salary history.
- Inform your hiring managers about the law’s requirements and adjust your hiring practices accordingly.
Additional Resource
Maine Veterans Allowed Time Away from Work for VA Medical Appointments
Who: Maine employers with veteran employees
When: September 19, 2019
What:
Employers with 10+ employees are required to provide time away from work to attend appointments at the U.S. Department of Veterans Affairs medical facilities. If paid leave is available, the veteran must be allowed to use paid time off (PTO) for the absence. If the veteran doesn’t have PTO, the employer must allow the individual to take unpaid leave.
The use of PTO and unpaid leave is the same for employers with fewer than 10 employees. The exception for these types of employers is that the veteran should provide two weeks or “reasonable notice” of the appointment.
How:
- Inform your veteran employees and their supervisors of the new allowances.
- Review and update your employee policies and procedures accordingly.
Additional Resources
Maine Pregnant Workers Rights Amended
Who: Maine employers
When: Sources show conflicting dates: September 18, 2019, or September 19, 2019
What:
The Act to Protect Pregnant Workers extends protections to keep pregnant employees safe and for employers to provide them with reasonable accommodations while they work. Maine employers are required to provide reasonable accommodation to employees with a “pregnancy-related condition,” including pregnancy, childbirth, or related medical conditions, and breastfeeding. Accommodations include more frequent or longer breaks, temporary work schedule modifications, seating or equipment, temporary relief of lifting requirements, temporary transfer to less strenuous or hazardous work, and provisions for breastfeeding.
How:
- Review and update your pregnancy policies, procedures, and accommodations and ensure all managers are trained on the changes.
- Examples of reasonable accommodations that you may need to include more frequent or longer breaks, time off to recover from childbirth, acquiring or modifying equipment, proper seating, etc.
Additional Resource
Maine Unemployment Compensation Prohibited from Marijuana-Related Termination
Who: Maine employers
When: September 17, 2019
What:
Similar to alcohol and illegal drugs regulations, employees who are terminated because they were under the influence of marijuana while working or when reporting to work may not apply for unemployment benefits. The exception to this stipulation is the medical use of marijuana, as outlined in Title 22, chapter 558-C.
How:
- Review and update your unemployment policies and procedures as well as your employee handbook.
- Inform all staff about the new law and the changes made to the policies and procedures.
Additional Resource
Maine Anti-discrimination Law and Restriction of Non-compete Agreements
Who: Maine employers
When: September 18, 2019
What:
Two separate laws related to anti-discrimination and non-compete agreements passed the Maine legislature and signed by Governor Janet Mills:
Clarifications to the Maine Human Rights Act: This Act prohibits unlawful discrimination of employment, housing, public accommodation, credit, and education opportunity now includes gender identity. The law defines gender identity as “the gender-related identity, appearance, mannerisms or other gender-related characteristics of an individual, regardless of the individual’s assigned sex at birth.” The law states that businesses may label public restrooms to protect transgender people. Single-occupancy toilets shouldn’t be labeled for one specific sex. Lastly, a leave of absence can be considered a reasonable accommodation for a disability claim.
Non-compete Agreements in Maine: Employers can’t enter into or renew non-compete agreements with employees who earn at or below 400% of the federal poverty level (a varied level that depends on household size, for 2019 the amount is $43,430 for a household of 8). Additionally, employers must disclose any non-compete agreement requirements before an employment offer and provide a copy of the non-compete agreement at least 3 business days before a signature is required. Non-compete agreement terms mustn’t take effect for 1 year after employment or 6 months from the date of the signed agreement. The law also prohibits restrictive employment agreements, easing restrictions to actions like employee poaching. Violations could face fines of $5,000 or more.
How:
- Review your anti-discrimination policies and ensure they are updated to include gender identity.
- Ensure proper labeling of single-use public restrooms.
- If you use noncompete agreements, review and update the agreement and the organizational policies for entering into agreements.
- Inform your hiring managers about the update noncompete agreement details.
Additional Resources
LD 1701: Clarifying the Maine Human Rights Act
LD 733: An Act to Promote Keeping Workers in Maine
Massachusetts Publishes Final Paid Family and Medical Leave Regulatory Language
Who: All Massachusetts employers
When: Notice distribution by September 30, 2019
What:
The Massachusetts Department of Family and Medical Leave released the final regulatory language for implementing the Paid Family and Medical Leave Law (PFML).
PFML notices must be provided to each covered employee by or before September 30, 2019.
How:
- Display the Massachusetts PFML poster by September 30, 2019.
- Distribute notices to employees, obtain written acknowledgment of the notice (or refusal to acknowledge), and keep an internal record of its distribution.
- If you already notified employees, distribute updated rate sheets. You don’t need another written acknowledgment (or refusal), but you do need to keep an internal distribution record.
- Employers with a paid leave benefit can apply for an annual exemption. If you do not plan on applying for an exemption or your exemption application is denied then you must begin contributing on October 1, 2019.
Additional Resources
PFML Workplace Posters and Written Notices
New Hampshire Passes Non-compete Agreement Law
Who: New Hampshire employers
When: Effective September 8, 2019
What: Employers may not enter into non-compete agreements with low-wage employees who make an hourly rate less or equal to 200% of the federal minimum wage (currently $7.25). Employers must provide job candidates with non-compete agreements before or with job offers.
How:
If you use non-compete agreements, review and update the agreement and the organizational policies for entering into agreements.
Inform your hiring managers about the updated non-compete agreement details.
Additional Resource
New Jersey Passes Employment Protections for Medical Marijuana
Who: New Jersey employers
When: Effective Immediately
What:
The Compassionate Use of Medical Marijuana Act (CUMMA) prohibits employers from taking negative action against employees and job applicants based on their cardholder status and use of medical marijuana. The law includes new drug-testing program guidelines:
- Employers must notify employees or job applicants of a positive test result.
- The notice must include the applicant or employee’s right to provide a medical explanation for the positive test result.
- The applicant or employee has 3 business days from the notice to provide information that explains the test result. This explanation should include a doctor’s note or proof of registration under CUMMA.
Employers can terminate an employee for medical marijuana possession during business hours or if accommodating the employee’s medical marijuana use would break federal laws, federal contracts, or federal funding.
How:
- Review your drug testing protocols and update how you respond to positive test results.
- Train HR and managers about the law’s new protections and the organization’s updated drug testing policies and procedures.
Additional Resource
New York City: Reminder To Post Sexual Harassment Training Notice
Who: New York City employers with 15+ employees, including supervisors, managers, interns, independent contractors, seasonal, or part-time employees who work 80+ hours per year or for 90 days
When: September 6, 2019
What:
Starting September 6, 2019, employers must post the English and Spanish versions of the Sexual Harassment Act Notice. Employers must also provide the Stop Sexual Harassment Act Factsheet to new employees at the time of hire or include the information in the employee handbook.
New York City requires all employees to complete the sexual harassment training and acknowledge participation by December 31, 2019; New York State mandates that the training be completed by October 9, 2019. We cover further details about the training requirements here.
How:
- Starting September 6, 2019, post the Sexual Harassment Act Notice in a visible, highly trafficked area.
- Begin distributing the Factsheet to new employees. Review your employee handbook and determine if it should be updated with the Factsheet’s information.
- Train all employees and record their participation before October 9, 2019, with an employee signed acknowledgment.
- Complete the sexual harassment training annually and keep records of participation for at least 3 years.
Additional Resources
Anti-Sexual Harassment Training Read First
Anti-Sexual Harassment Training Module
NYC Human Rights Stop Sexual Harassment Act Fact Sheet and Posters
New York: Second State to Ban Workplace Hair Discrimination
Who: New York employers, any company with New York employees
When: Effective Immediately
What: Amending the New York Human Rights Law, the new law broadens the definition of race to include traits linked to race that include, but aren’t limited to, “hair texture and protective hairstyles.” The latter term includes braids, locks, and twists.
This law falls in line with prior guidance from New York City and ensures that employer policies related to tidiness do not limit African American employees.
How: Review your dress code/appearance policies to ensure they comply with the new law. Be sure the language is neutral and general and doesn’t call out hair textures and styles associated with racial groups.
Additional Resource
Pittsburgh, Pennsylvania Paid Sick Leave Returns
Who: Employers with employees within Pittsburgh city limits
- Excludes state/federal employees, independent contractors, construction union members covered by a collective bargaining agreement, seasonal employees who work 16 weeks or less
When: Sources are conflicting on the effective date
What: All employers within Pittsburgh, Pennsylvania, will need to provide paid sick leave benefits as follows:
- Employers with 15+ employees must provide up to 40 hours of paid sick time/year
- Employers with fewer than 15 employees must provide up to 24 hours of paid sick time/year
The sick time may be unpaid the first year after the effective date but must become paid leave the following year. Employees may use hourly sick time or in the smallest units allowed by the employer’s payroll software. They should use reasonable notification requests which can be in the form of a verbal request. Permitted purposes include:
- Employee mental or physical illness, injury, or other health condition who needs a diagnosis, care, treatment, or preventive care.
- Caring for a family member with mental or physical illness, injury, or other health condition who needs a diagnosis, care, treatment, or preventive care.
- Public health emergencies (e.g., business closures due to public health official order).
- Caring for a family member with a communicable disease, as diagnosed by a health agency or health care professional.
Employers must track employee sick time taken and retain records for 2 years. They may also require documentation, signed by a health care professional, after 3 or more consecutive sick days are taken. Employers may not retaliate against employees taking sick time or filing a complaint.
Employee notification requirements regarding these changes have not been finalized. We will continue to monitor for effective dates and any additional timing.
How:
- If you do not offer a minimum paid sick leave, review your policies and procedures, and update them accordingly.
- Notify employees of their entitlement to sick time, the amount of sick time they will accrue, and the terms of the new law and their rights to file complaints.
- Contact your payroll software company to discuss sick time accrual recordkeeping and implementation of the changes.
Additional Resources
Pennsylvania Supreme Court Ruling
San Antonio, Texas Delays Paid Sick Leave
Who: Private Employers with 5+ employees, including temporary employees or employment agencies
When: December 1, 2019
What:
Originally intended for August 1, 2019, the city of San Antonio has given employers extra time to prepare for the paid sick leave law to take effect. We originally covered the details of the new regulations in last month’s regulatory update.
Separately from San Antonio, last month’s regulatory update reported that Dallas was implementing paid sick leave, but there was a chance implementation would also be delayed. Currently, Dallas has not yet delayed their effective date of August 1, 2019, but this is also pending with the Dallas City Attorney’s Office.
How:
- Keep an eye out for possible changes but continue to prepare your business for the December 1, 2019 effective date.
- If you do not already offer paid sick leave, consult with your legal counsel, and begin to work towards the December 1, 2019 deadline.
- Contact your payroll systems and make additional preparations to accommodate for the paid sick leave accrual and tracking requirements.
- Update any relative policies or employee handbook with the new requirements.
- Inform and educate eligible employees about the changes.
Additional Resource
San Antonio Paid Sick Leave Ordinance
Washington Now Includes Obesity as a Protected Class
Who: All employers
When: Effective Immediately
What:
In the ruling Taylor v. Burlington N.R.R. Inc., the Washington Supreme Court declared obesity as part of a protected class under the Washington Law Against Discrimination (WLAD). Through extensive analysis, it further stated that medical research shows obesity to be a physical condition or disorder that may or may not occur from other underlying medical conditions and due to Washington’s 29% obese population is not considered an abnormal condition. The state’s disability discrimination law provides broader coverage than the American Disabilities Act, so employers will need to ensure HR practices accommodate this new protection.
How:
- Review and update your anti-harassment, anti-discrimination, and anti-retaliation policies to include obesity as a protected class.
- Update your training materials to reference obesity as a protected class and train anyone that is part of the hiring process to be made aware of this change.
- Review and update your reasonable accommodation practices to include obesity
Additional Resource
Washington State Supreme Court Ruling on Taylor v. Burlington N.R.R. Inc.
Emily Hartman is the Client Content Specialist at KPA. She’s using the skills she learned in Washington, D.C. to breakdown technical information into news you can use.