Employer Law Report

Multi-state employers: Be prepared for January 1 minimum wage increases

While many employers are gearing up for the holidays, many employees across the U.S. will see an increase in minimum wage. On Jan. 1, 2020, the minimum wage will increase in numerous states and cities throughout the country that have adopted their own minimum wage laws, which provide for a higher rate than the federal minimum wage of $7.25 per hour. In areas where minimum wage laws overlap, employees are entitled to receive the highest applicable rate.

The following minimum wage increases will become effective Jan. 1, 2020:

Alaska

  • State-wide: $10.19 per hour

Arizona

  • State-wide: $12.00 per hour
  • Flagstaff, Arizona: $13.00 per hour

Arkansas

  • State-wide: $10.00 per hour

California

  • State-wide: $13.00 per hour (26 or more employees); $12.00 per hour (fewer than 26 employees)
  • Belmont, California: $15.00 per hour
  • Cupertino, California: $15.35 per hour
  • Daly City, California: $13.75 per hour
  • El Cerrito, California: $15.37 per hour
  • Los Altos, California: $15.40 per hour
  • Menlo Park, California: $15.00 per hour
  • Mountain View, California: $16.05 per hour
  • Novato, California: $13.00 per hour (100 or more employees); $13.00 per hour (26 to 99 employees); $12.00 per hour (fewer than 26 employees)
  • Oakland, California: $14.14 per hour
  • Palo Alto, California: $15.40 per hour
  • Petaluma, California: $15.00 per hour (26 or more employees); $14.00 per hour (fewer than 26 employees)
  • Redwood City, California: $15.38 per hour
  • San Diego, California: $13.00 per hour
  • San Jose, California: $15.25 per hour
  • San Mateo, California: $15.38 per hour
  • Santa Clara, California: $15.40 per hour
  • Sonoma, California: $13.50 per hour (26 or more employees); $12.50 (fewer than 26 employees)
  • South San Francisco, California: $15.00 per hour
  • Sunnyvale, California: $16.05 per hour

Colorado

  • State-wide: $12.00 per hour
  • Denver, Colorado: $12.85 per hour

Florida

  • State-wide: $8.56 per hour

Illinois

  • State-wide: $9.25 per hour

Maine

  • State-wide: $12.00 per hour
  • Portland, Maine: $12.00 per hour

Maryland

  • State-wide: $11.00 per hour

Massachusetts

  • State-wide: $12.75 per hour

Michigan

  • State-wide: $9.65 per hour

Minnesota

  • State-wide: $10.00 per hour ($500,000 or more in annual gross revenue); $8.15 per hour (less than $500,000 in annual gross revenue)
  • Paul, Minnesota: $12.50 per hour (more than 10,000 employees)

Missouri

  • State-wide: $9.45 per hour

Montana

  • State-wide: $8.65 per hour

New Jersey

  • State-wide: $11.00 per hour

New Mexico

  • State-wide: $9.00 per hour
  • Albuquerque, New Mexico: $9.35 per hour (no health and/or childcare benefits); $8.35 per hour (if employer provides health and/or childcare benefits)
  • Bernalillo County, New Mexico: $9.20 per hour (no health and/or childcare benefits); $8.20 per hour (if employer provides health and/or childcare benefits)
  • Las Cruces, New Mexico: $10.25 per hour

New York

  • New York City, New York: $15.00 per hour
  • Nassau, Suffolk, and Westchester Counties, New York: $13.00 per hour
  • New York (all other locations): $11.80 per hour

Ohio

  • State-wide: $8.70 per hour

South Dakota

  • State-wide: $9.30 per hour

Vermont

  • State-wide: $10.96 per hour

Washington

  • State-wide: $13.50 per hour
  • Seattle, Washington (more than 500 employees): $16.39 per hour
  • Seattle, Washington (500 or fewer employees): $15.75 or $13.50 (at least $2.25 per hour earned in medical benefits or tips)
  • Tacoma, Washington: $13.50 per hour

**Additional minimum wage rates may apply to specific industries (e.g., hospitality, transportation, fast food) or classes of employees (e.g., tipped employees, minors).

We will continue to provide updates on future increases.

Employers should review their parental leave policies in wake of parental leave class action settlement

With multiple avenues for expanding a family and a plethora of different family models, employers would be wise to re-consider their parental leave policies to suit the needs of the modern family.

In May, a large multi-national corporation settled a class action lawsuit regarding its parental leave policy for $5 million. As written, the employer’s policy gave its employees who were primary care-givers 16 weeks of paid leave, and gave its employees who were non-primary care-givers only 2 weeks of paid leave. According to the lawsuit, the employer had an unwritten policy that made it almost impossible for men to qualify as a primary caregiver unless the birth mother was unable to care for the baby because she was medically incapable or because she was back at work. Such a policy, even if unwritten, could violate federal and state laws that prohibit employers from making employment decisions on the basis of sex. Continue Reading

NLRB invites businesses to provide feedback on when an employee’s offensive comments should lose the protection of federal labor law

The National Labor Relations Board (NLRB or Board) invited interested parties to submit feedback about when an employee’s offensive or inappropriate workplace comments should lose the protection of the National Labor Relations Act (NLRA). Specifically, the NLRB is inviting employers and other parties to submit briefing about whether it should reconsider its standards for determining whether Section 7 of the NLRA protects employees who make “profane outbursts and offensive statements of a racial or sexual nature…during the course of otherwise protected activity.” By way of background, Section 7 of the NLRA gives employees the right to engage in “concerted activities for the purpose of collective bargaining or other mutual aid or protection.” That can include raising work-related disputes or complaints. This right extends to all non-management employees, not just those represented by a union. But what if the employee raising specomplaints uses obscene or otherwise offensive language directed at a supervisor? In some NLRB cases, employee outbursts that have included offensive language have been shielded from punishment by the employer because the language was considered a part of protected speech. Continue Reading

Sixth Circuit: Employer can’t enforce shorter contractual statute of limitations period to bar Title VII action

A federal lawsuit alleging discrimination under Title VII must be filed within ninety days after the EEOC has completed its handling of the related discrimination charge and issued its Notice of Right To Sue. Some employers attempt to shorten the time for filing discrimination charges by getting employee or applicants to sign agreements to that effect. On Sept. 25, 2019, in Logan v. MGM Grand Detroit Casino, the 6th Circuit Court of Appeals ruled that efforts to shorten the statute of limitations for Title VII cases are not enforceable.

The Circuit Court overturned a district court decision that found that Barbrie Logan’s sex discrimination lawsuit could not proceed because it was barred by a six-month statute of limitations to which she agreed when she applied for employment with MGM. In overturning the lower court’s decision, the 6th Circuit stated,

“The limitation period of Title VII is part of an elaborate pre-suit process that must be followed before any litigation may commence. Contractual alteration of this process abrogates substantive rights and contravenes Congress’s uniform nationwide legal regime for Title VII lawsuits.”

Two hundred and sixteen days after resigning her employment with MGM on Dec. 4, 2014, Ms. Logan filed an EEOC charge alleging that she was constructively discharged due to sex discrimination in violation of Title VII. The EEOC issued a right to sue notice in November 2015 and she filed suit in federal district court on Feb. 17, 2016—440 days after resigning. MGM filed a motion for summary judgment, arguing that both the EEOC charge and her subsequent federal lawsuit were barred by the contractual 6 month statute of limitations. A magistrate judge of the district court agreed and issued a report recommending that summary judgment be entered in MGM’s favor. The district judge adopted the magistrate’s recommendation and entered judgment for MGM.

After a detailed discussion of the Title VII charge process and enforcement scheme, the 6th Circuit reversed. Noting that “[i]n crafting Title VII, Congress chose ‘[c]ooperation and voluntary compliance…as the preferred means’ for eradicating workplace discrimination,” the court stated that

“[a]ny alterations to the statutory limitation period necessarily risk upsetting this delicate balance, removing the incentive of employers to cooperate with the EEOC, and encouraging litigation that gives short shrift to pre-suit investigation and potential resolution of disputes through the EEOC and analog state and local agencies.”

In this way, according to the court, Title VII claims are distinguishable from claims of discrimination brought under 42 U.S.C. Section 1981 and claims brought pursuant to ERISA (regarding which the 6th Circuit previously has endorsed shorter contractual statutes of limitations.)

How does this affect those in Ohio?

In Ohio, employees challenging an adverse employment decision as having been based on their protected status under Ohio Chapter 4112 (similar in most respects to the protected statuses found in Title VII) have the option to file a lawsuit directly in the court of common pleas rather than a charge with the Ohio Civil Rights Commission. Therefore, when an employee chooses to forego the charge filing process with the OCRC to enforce his or her rights, Ohio employers should argue for enforcement of a shorter contractual statute of limitations because the Logan court’s analysis would no longer be applicable. As we previously reported, federal courts in Ohio already have upheld employers’ rights to enforce contractual statutes of limitations in employment actions that did not raise claims under Title VII.

DOL increases salary threshold for white collar exemptions to $35,568

After more than 15 years, the U.S. Department of Labor (DOL) is updating the overtime regulations under the Fair Labor Standards Act (FLSA). The FLSA entitles most employees to minimum wage and overtime pay for all hours worked over 40 in a workweek. However, employees who meet the salary threshold and the relevant duties test qualify for the executive, administrative, professional exemption (white collar exemption), and are not entitled to overtime pay. On Sept.24, 2019, the DOL issued a news release announcing its final rule regarding overtime regulations.

Effective Jan. 1, 2020, the new salary threshold for white collar exemptions will increase to $684 per week, which is the equivalent of $35,568 per year for a full-time employee. Currently, the salary level is set at $455 per week ($23,660 annually for a full-time employee).

In addition to the increased salary threshold, the final rule:

  • Raises the annual compensation level for “highly compensated employees” to $107,432 per year, up from the currently-enforced $100,000 amount
  • Allows employers to include nondiscretionary bonuses and incentive pay (including commissions) paid at least annually to account for up to 10 percent of the salary threshold
  • Revises the special salary levels for employees in U.S. territories and the motion picture industry

According to the DOL, these changes will mean 1.3 million additional American workers are eligible for overtime pay under the FLSA. The DOL notes that the “increases to the salary thresholds are long overdue in light of wage and salary growth since 2004.”

A previous rule issued under the Obama Administration in 2016 was blocked by a federal judge before the rule could go into effect. The 2016 rule was more expansive than the 2019 final rule announced on Sept. 24, 2019.

Takeaways

For full-time employees with salaries below $35,568, employers will need to consider whether to implement salary increases to ensure the salary threshold for white collar exemptions is met or to convert those employees to non-exempt status. Conversion would require those employees to track their hours and make them eligible for overtime pay. This is also a good time for employers to review job descriptions to ensure they accurately reflect the work performed and to ensure those duties still qualify under one of the white collar exemptions for exempt employees.

NLRB sides with Kroger’s action to remove union representatives from company property

On Sept. 6, 2019, the National Labor Relations Board (NLRB) granted a significant win to employers, ruling that businesses can lawfully limit the rights of nonemployee union supporters to access company property that is otherwise open to the public. In a 3-1 decision, the Board ruled that Kroger did not violate the National Labor Relations Act (NLRA) when it removed nonemployee union supporters from the parking lot of a Kroger store. The decision overruled a 2016 ruling by an NLRB administrative judge that Kroger had illegally barred two nonemployee representatives of the United Food and Commercial Workers Union from petitioning customers in the parking lot of a store in Portsmouth Virginia. The nonemployee union representatives were there to solicit customer support for the union’s protest over a decision to close the store and relocate employees to a different location 25 miles away.

The administrative law judge who initially heard the case ruled in favor of the union, noting that the grocery store’s managers had previously allowed several charitable entities to distribute literature and sell goods outside the store’s entrance. Applying Sandusky Mall Co., 329 NLRB 618 (1999), the administrative law judge held that Kroger violated the NLRA and discriminated against the union by regularly granting access to company property to civic, charitable and promotional activities by nonemployees while prohibiting nonemployee union representatives from petitioning on company property. Continue Reading

Misclassifying employees as “independent contractors” does not violate NLRA

The decision to classify a worker as an independent contractor, rather than as an employee, carries significant legal implications. Misclassifying employees as independent contractors can result in employer liability for unpaid payroll taxes, unpaid unemployment and workers’ compensation premiums, and responsibility for failure to provide the various rights afforded under employment laws to employees but not to independent contractors. A careful approach, including legal advice, is always wise in evaluating whether a worker can properly be classified as an independent contractor. However, the National Labor Relations Board (NLRB) has taken one element of risk out of the decision.

In a recent case involving a transportation company, the NLRB concluded that the company had misclassified some of its drivers as independent contractors. But, the NLRB also concluded that the misclassification, standing alone, did not constitute a violation of the National Labor Relations Act (NLRA). The case is Velox Express, Inc. 15-CA-184006, 368 NLRB No. 61

The NLRB Administrative Law Judge (ALJ) who initially heard the case had concluded that the fact of misclassification violated the NLRA rules which protect the rights of employees to join unions. Independent contractors, unlike employees, do not have the right to organize. The ALJ felt that by classifying the drivers as independent contractors Velox had inherently interfered with their right to organize. On appeal the NLRB overruled the ALJ’s decision. The NLRB concluded that just the fact of misclassification does not inhibit or otherwise interfere with the rights of employees to organize.

This decision does not mean that employers can let down their guard when making classification decisions. Misclassification can still bring significant legal risk under tax law, employee benefits law, and other laws protecting employee rights. Misclassification can also indirectly lead to problems under the NLRA. In the Velox case the company had terminated one of its drivers after she complained about being misclassified. The NLRB ruled that since the driver was, in fact, an employee, she had the right under the NLRA to complain on behalf of herself and others about what she felt was a misclassification. So, although the misclassification, standing alone, was not an NLRA violation, the adverse action taken against a complaining employee was.

New York’s new discrimination law—Aberration or the start of a trend?

Employers with facilities in New York are probably aware of the significant piece of anti-discrimination legislation Gov. Cuomo signed recently. The new law:

  • expands coverage to all employers regardless of size;woman in conference room
  • expands protections against discrimination to certain non-employees;
  • increases the statute of limitations for sexual harassment claims from one to three years;
  • adds punitive damages and mandatory attorneys’ fees as potential remedies;
  • prohibits mandatory arbitration of discrimination claims;
  • adds to the notice requirements an employer must provide regarding its sexual harassment policy, including in the language identified by any employee as their primary language; and
  • places significant specific restrictions upon the use of non-disclosure agreements

While these changes are certainly significant, the more troubling aspect of the law for employers and their counsel may be its expansive definition of sexual harassment as well as its open dismissiveness of federal law. Continue Reading

Are Ohio workers’ compensation laws changing?

As we reported in June, the Ohio legislature attempted to make substantial changes to workers’ compensation laws as part of the overall budget. However, after the House and Senate could not reach an agreement on many parts of the budget, Gov. DeWine permitted the legislature additional time to reach a compromise. The actual budget submitted to and signed by the governor contained NO changes to the workers’ compensation laws. Conspicuously absent from the budget was the House’s proposal requiring any applicant for workers’ compensation benefits to disclose whether they were a citizen or not. Further, the budget did not include any provision for first responders with post traumatic stress disorder (PTSD) to obtain workers’ compensation benefits. Hence, for now, the Ohio workers’ compensation laws have not changed.

Rumors exist that legislators intend to introduce specific legislation to address these proposed changes as well as other changes. Stay tuned and we will keep you updated should the legislature introduce any new bills to change the Ohio workers’ compensation laws.

Myths, rumors and clarification on the status of the H-4 EAD

In February of this year, USCIS announced that the proposed rule to eliminate the ability of foreign nationals in H-4 status to apply for an Employment Authorization Document (EAD) was sent to the Office of Management and Budget (OMB) for final approval. Five months later, OMB has still not released the proposed rule for publication. The delay likely reflects substantive issues and is more than mere bureaucratic delay. In the meantime, the H-4 EAD is alive and well. The proposed rule must still clear several administrative hurdles before it becomes effective and can be implemented. Continue Reading

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