MinnesotaJudicialCenterHope is on the horizon for Minnesota restaurants! On September 20, it was announced that the Minnesota Supreme Court will hear the appeal from the novel decision, Burt v. Rackner, Inc. d/b/a Bunny’s Bar & Grill (MN App. June 27, 2016). As I wrote about on August 4, 2016, the plaintiff, Todd Burt, was terminated by Bunny’s Bar and Grill for not sharing tips with other employees. Despite not losing tips/money, the Minnesota Court of Appeals held (for the first time in 40 years) that the termination of his employment for refusing to share his tips with other employees resulted in his lost employment, and thus, he had an actionable claim to recover future lost wages under the Minnesota Fair Labor Standards Act (MnFLSA). This may not sound like a big deal, but it is – here’s why.

The MnFLSA already provides remedies when an employee is wrongfully forced to share tips – the Minnesota Human Rights Commissioner may require the employer to pay the employee the lost wages. The problem is obvious, right?  Here, the employee didn’t lose any wages – because he wouldn’t share – so he sued under this new theory that it was wrongful discharge in violation of the MnFLSA. This opens up an entirely different box of remedies – and litigation. Good for the employee.  Bad for the employer. The question is, what remedies does the MnFLSA allow, as interpreted by the courts (this is called “common law”).

In the Court of Appeals opinion, the Court held, for the first time: “Where an employer requires, as a condition of employment, that an employee consent to working rules expressly prohibited by the MFLSA, the employee is authorized by the statute to sue for damages normally associated with a wrongful-discharge cause of action.” This decision was monumental, creating a new exception to Minnesota’s at-will employment.

Not surprisingly, and a great relief to many restaurants and employers, on July 27, 2016, Bunny’s Bar & Grill, petitioned the Minnesota Supreme Court to review (and overturn, obviously) the Court of Appeals decision. Here is the issue on appeal:

Whether the MFLSA, Minn. Stat. §§ 177.24 and 177.27, creates a claim for the retaliatory discharge of an employee who refused to share gratuities, abrogating the common law of at will employment without any expression of legislative intent to do so.”

That’s fancy lawyer speak for asking the Supreme Court to decide that the Court of Appeals decision improperly interprets the MnFLSA to create an action for wrongful discharge, when the law does not itself provide such an action. Bunny’s position is that the Minnesota legislature must change the law, not the courts, which are only tasked with interpreting the law. On August 17, the Minnesota Restaurant Association (MRA) asked the Minnesota Supreme Court to allow it to file a brief in support of Bunny’s Bar & Grill petition. On September 20, the Minnesota Supreme Court announced that it would take the extraordinary step and review the Court of Appeals decision, and also allowed the MRA to file an amicus curiae brief (a brief supporting why Bunny’s is right and the Court of Appeals was wrong) in support of Bunny’s.

Keep in mind that the decision, while applicable to tips sharing, will certainly be broadly interpreted (beyond tip sharing) and used for other wage situations. Accordingly, I would not be surprised to see more employer associations or large employers ask to file a “me too” amicus curiae brief. After that, it’s the hurry up and wait game – after briefing and oral arguments, I wouldn’t expect to see a decision until Spring 2017, so we’ll just have to wait.

Native AmericanI’m proud to have graduated from the University of Tulsa College of Law, home of the Native American Law Center. Because of TU’s deep commitment to the study of of Indian law issues, I certainly developed an appreciation to this specialized practice of law and its unique history. On Thursday, September 15, Minnesota swore in its first Native American Justice to our Supreme Court – Justice Anne K. McKeig, as reported by KSTP. Justice McKeig descends from the White Earth Tribe Ojibwe.

Naturally, I knew I just had to find a way to tie in this monumental event with my wage and hour blog. Thus, I felt it appropriate to explore whether the FLSA applies to Native American tribes. There are actually two very distinct issues in that single question: (1) whether the FLSA applies to the Tribe’s business; and (2) whether the Tribe has sovereign immunity with respect to the FLSA. Thus, even if the FLSA does apply to a Tribe, it may have immunity from a private suit for violation of the FLSA, though the courts tend to blur the two together often. This is admittedly a horribly long blog…I admit I may have gotten a bit carried away. However, because of how the courts don’t distinguish the two issues well, I just couldn’t find a good way to make this a two-parter. So, here we go!

Does the Federal Fair Labor Standards Act (FLSA) Apply to a Tribe’s Business?

Maybe.  If you were to Google that question, you’ll see a 9th Circuit Court of Appeals case from 2009 (Solis v. Matheson) flood your screen with various degrees of interpretation of the opinion. The 9th Circuit decided that the FLSA does apply to a “retail business located on an Indian reservation and owned by Indian tribal members”. However, this is not super helpful to us here in the Midwest, for several reasons. First, we (MN, AR, IA, MO, SD, ND, NE) are in the 8th Circuit Court of Appeals. We don’t have to follow the 9th Circuit interpretations of the law (for those of you unaware, that includes the state of California and is often 180 degrees different from many other circuits on the same issue). The 8th Circuit only defers to the precedent set by the U.S. Supreme Court, though it certainly can – and will – analyze and rely upon other courts. Thus, as I am always saying, you have to dig deeper (and then dig some more).

For example, in Costello v. Seminole Tribe of Florida (2010), the Middle District of Florida, Tampa Division, held that the FLSA does apply to a Tribe, but doesn’t expressly abrogate its sovereign immunity (the second question). Thus, the Court noted that the Tribe retains immunity absent an effective waiver. In Reich v. Great Lakes Indian Fish and Wildlife Commission (1993), the 7th Circuit Court of Appeals held that Tribal policemen are exempt from the FLSA, but that may not be the case with other employees of Indian agencies (hinting that policemen are different from employees who are engaged in a commercial or service character versus government character). Accordingly, this is not a simple question to answer.

Has The Tribe Waived Its Sovereign Immunity As to the FLSA?

As happened with a prevailing wage case I handled several years ago, a Tribe can actually chose to follow a federal or state law, removing all doubt as to whether sovereign immunity applies. Accordingly, the first thing to do, would be to determine whether your Tribe has indeed waived sovereign immunity as to a FLSA-based claim in its constitution, general administrative policies and procedures, handbook (for example, does it use words like “exempt” and “non-exempt” and/or reference state and/or federal wage and hour laws, or does it have its own wage and hour ordinances?), or other contract. For example, in 2007, the Tribal Court of the Little Traverse Bands of Odawa Indians (LTBB) held in Harrington v. The Little Traverse Bay Bands of Odawa Indians, that the members of the LTBB could have voted for such inclusive waiver of rights in the LTBB Constitution, but did not do so. In Mitchell v. Pequette, (2008), the employee argued to the Leech Lake Band of Ojibwe Tribal Court that the General Administrative Policies and Procedures state the Band “may apply” the FLSA “when applicable”. However, the Tribal Court held that it is permissive rather than mandatory (“shall”), and thus, did not serve to waive its sovereign immunity.

What Have the Federal Courts Ruled on this Issue?

If no waiver is clear, then you’d look to common law (how the courts interpret the law). Continue Reading Are Native American Tribes Subject to the Fair Labor Standards Act?

Small employerWith all the press about the December 1, 2017 overtime changes, I’ve spoken to a few small employers recently that didn’t even consider the fact that the federal Fair Labor Standards Act may not apply to their business. So, I wanted to take a step back and explain how this works. First, I should caveat this by stating that any employer can certainly chose to pay more than is required by law, so you can’t ever err by paying an employee as if the FLSA does apply (unlike if you fail to pay and it does apply – that is bad). But I know for some small businesses, the overtime requirement of 40 (FLSA) or 48 (MnFLSA) hours can make a huge difference. As for the cute small employer-like kid in the picture? Just couldn’t help myself…pun intended.

Is Your Business Covered By the FLSA?

There are two ways that an employee (as defined by the FLSA) may fall under the purview of the FLSA – working for a covered enterprise OR individual coverage. In other words, an entire business can meet the requirements for having to pay pursuant to the FLSA, or the business may not meet the requirements but a single employee does, and thus the business must pay that employee pursuant to the FLSA. A business meets the “covered enterprise” test if it has 2 or more employees and meets one of the following:

“(A) (i) has employees engaged in commerce or in the production of goods for commerce, or that has employees handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce by any person; and

(ii) is an enterprise whose annual gross volume of sales made or business done is not less than $500,000 (exclusive of excise taxes at the retail level that are separately stated)”

In addition, hospitals and businesses providing medical or nursing care for residents and various types of schools are covered – regardless of whether they are for profit or not for profit. Finally, public agencies are covered enterprises.

Is Your Employee(s) Covered Individually By the FLSA?

If a business does not meet any of the above, an employee working for that business may still be entitled to the FLSA’s protections if the employee’s work regularly engages them in interstate commerce or the production of goods for interstate commerce (even if their job is not the actual production of goods, but related to the process such as a secretary or janitor). General examples are those who work in communications or transportation; regularly use mail/telephone/fax for interstate communication or keep records of interstate transactions; handle, ship, receive goods from another state; cross state lines for work. However, you should not rely on this alone – many of the key terms are further defined, and courts tend to interpret such coverage broadly (in favor of coverage).

The go-to case in the 8th Circuit is Reich v. Stewart (1997), whereby the Court held that the test of such coverage is “whether the work is so directly and vitally related to the functioning of an instrumentality or facility of interstate commerce as to be, in practical effect, a part of it, rather than isolated, local activity”.  In Reich, since the employees were making pallets that were sold across state lines, they were covered  by the FLSA, even though the business had less than $500,000 in gross sales. Also, domestic service workers (nannies, cooks, chauffeurs, housekeepers, day workers) are covered if the cash wages from an employer are at least $2,000 (the threshold determined by the Social Security Administration each year) or the work more than 8 hours a week for one or more employers.

What Does the Minnesota Fair Labor Standards Act Require If the FLSA Does Not Apply?

If the FLSA does not apply, the Minnesota Fair Labor Standards Act may apply to your business. Under the MnFLSA, covered employees are entitled to overtime (1.5x) after 48 hours worked in a workweek (unlike 40 hours under the FLSA). The 48 threshold is based on actual hours worked and so it does not count paid time off, holiday pay, or vacation/sick leave. However, as with the FLSA, certain employees are exempt from the state law. In general, employees typically exempt are certain agricultural workers, seasonal day camp staff, outside sales persons (over 80% sales outside), elected officials, volunteers for nonprofits, taxicab driver, nanny, seasonal recreation such as skiing), and a few more – you can find them at Minn. Stat. 177.23 under the definition of “Employee”.

Also, keep in mind that if the FLSA applies, the MnFLSA may likely still also apply – so that the stricter of the two would need to be followed. Sometimes Minnesota does not allow exemptions from overtime requirements that the FLSA does. Accordingly, because you are a Minnesota employer, you must also look to Minnesota law to be sure an FLSA-exempt employee is also exempt under Minnesota’s FLSA. So, while it may take a bit of work to make the determination whether the FLSA applies to your business or an employee, I know for smaller, local employers, it sure may be worth it – and it can be done!

St PaulAs predicted in my earlier post, on September 7, 2016, St. Paul joined Minneapolis in unanimously approving a sick and safe leave ordinance – with a very big difference. Unlike Minneapolis, the St. Paul ordinance mandates paid leave be provided by all sizes of employers. For purposes of the St. Paul Ordinance, an “employer” is a person or entity that employs 1 or more employees – even if that person is part-time or a temporary employee. As of July 1, 2017, employees working in the city for a large employer “shall” be provided paid time off for sick leave, safe leave, and…snow days.

What Does the St. Paul Sick and Safe Time Ordinance Require?

The St. Paul Ordinance is effective July 1, 2017 for large employers (those with 24 or more employees), and January 1, 2018 for smaller employers. Similar to Minneapolis, employees working in St. Paul will accrue sick and safe time leave at the rate of 1 hour for every 30 worked, up to an annual cap of 48 hours (either calendar or fiscal year). Employees must be allowed to use sick and safe time after 90 calendar days of employment. Employers must permit an employee to carry over at least 80 hours of accrued but unused sick and safe time into the following year.

Accrued but unused sick and safe time does not need to be paid out at termination. Employees must be able to use the leave in the same increment of time consistent with current payroll practices and existing employer policies (but no more than 4 hours). They must be compensated at the same hourly rate with the same benefits (except they are not entitled to lost tips or commissions and compensation is only required for the hours the employee was scheduled to work).

Who Is An “Employer” and “Employee” Under the Ordinance?

The Ordinance defines these terms with specificity, but here it is in a nutshell:

  • An “Employer” is a non-government person/entity employing one (1) or more employees.
  • An “Employee” is any individual employed by an Employer (including temps and part-time) that performs work for the Employer within St. Paul for at least 80 hours in a year.  An Employee is not an independent contractor.
  • Family Members” are children (step, adopted, foster, adult); spouse; sibling; parent (step and in-laws); grandparents; grandchildren; guardian (ward, or member of household); registered domestic partner; and “any individual related by blood or affinity whose close association with the employee is the equivalent of a family relationship”

Unlike Minneapolis’ ordinance, this Ordinance does not specifically allow employers operating under a collective bargaining agreement to develop alternate means of meeting the goals of the Ordinance. In fact, the St. Paul ordinance sates that, “Nothing in this chapter shall be construed as diminishing the obligation of an employer to comply with any contract, collective bargaining agreement, employment benefit plan, or other agreement providing more generous sick and safe time to an employee than required herein.”

Construction Company Opt-Out

Also like Minneapolis, construction companies may opt-out of this Ordinance if the employees are paid at least the Minnesota prevailing wage (Minn. Stat. 177.42) or the rates set forth in a registered apprenticeship agreement. Such employers shall be deemed in compliance for those employees who receive either prevailing wage rate or the apprenticeship rate – regardless of whether the employees are working on a private or public project.

What If An Employer Already Offers Paid Time Off?

Employers may certainly have more generous sick and safe time policies – but no lesser. Employers do not need to offer additional paid time off to employees if they already offer the same amount of PTO to employees that “may be used for the same purposes and under the same conditions.” In other words, the PTO policy must meet these minimum standards of accrual, use, recordkeeping, notices, etc.

Further, the Ordinance does not prohibit employers from having policies allowing donation of this paid leave to other employees – so an employee may accrue the time but not “use” it, instead “donating” it to another (seems to me that this goes against the whole purpose of the ordinance for the benefit of that employee). Employers may also advance sick and safe leave to an employee prior to accrual.

What Can Accrued Sick and Safe Time Be Used For?

Like Minneapolis, after 90 calendar days of employment, an employee may use sick and safe time for:

  • Mental or physical illness, injury, or health condition (theirs or family members).
  • Medical diagnosis, care, or treatment of a mental or physical illness, injury or health condition (theirs or family member).
  • Preventative medical or heath care (theirs or family member).
  • Absence due to domestic abuse, sexual assault, or stalking (so long as the absence is to seek related medical attention, victim services, counseling, relocation or legal action).
  • Closure of the employer’s business by a public official due to public health emergency or an infectious or hazardous situation.
  • Accommodation of need to care for child whose school or daycare has been closed by a public official due to public health or emergency situation.
  • Accommodation for need to care for family member whose school or place of care has been closed due to inclement weather, loss of power, loss of heating, loss of water, or other unexpected closure.

Unlike Minneapolis, the St. Paul ordinance does not carve out that a health care provider may only use sick and safe time when the provider has been scheduled to work (this does not include when the provider calls in and requests a shift within 24 hours or for on-call shifts – unless asked to remain on the premises during the on-call shifts).

What Can Employers Require of Employees?

The St. Paul ordinance requires an employee to do far less to obtain this new benefit.  Whereas a Minneapolis employer may require an employee to provide up to 7 days’ advance notice of foreseeable leave (such as doctor appointments) if the employee intends to use sick and safe time leave and notice of the need to use such leave “as soon as practicable” when it is unforeseeable (such as domestic violence), St. Paul only states that:

Earned sick and safe time shall be provided upon the request of an employee.”

Like Minneapolis, St. Paul employers may require “reasonable” documentation that the leave is covered for absences of 3 or more days. For all leave, “when possible, the request shall include the expected duration of the absence.” Further, “An employer may require an employee to comply with the employer’s usual and customary notice and procedural requirements for absences or for requesting leave, provided that such requirements do not interfere with the purposes for which the leave is needed.” In other words… “sick and safe time shall be provided upon the request of an employee”.

Notices Required at Workplace, Employee Handbook & Upon Request

Employers must post a notice that addresses the following: “Employees are entitled to earned sick and safe time; the amount of earned sick and safe time and the terms of its use guaranteed under this chapter; that retaliation against employees who request or use earned sick and safe time is prohibited; and that each employee has the right to file a complaint or bring a civil action if earned sick and safe time as required by this section is denied by the employer or the employee is retaliated against for requesting or taking earned sick and safe time.” The St. Paul Department of Human Rights and Equal Economic Opportunity (HREEO) will be creating a model notice for employers to use, which must be displayed in a “conspicuous and accessible place”.

Further, if you have an employee handbook – which I strongly advocate every employer should – the notice must be included in the handbook. Also, upon request, the employee must be provided their then-current hours of sick and safe leave he or she has earned, and how much has been used. This may be provided on a pay stub or other online system for employees to access their own information.

Recordkeeping, Confidentiality & No Retaliation

Employers must keep records of hours worked and sick and safe time taken for 3 years. HREEO may have access to the records to monitor compliance, as well as the employee. Similar to Minneapolis, if an employee is transferred to a location outside of St. Paul by the same employer, and the employer doesn’t have sick and safe leave outside the city, the employer has to keep the employee’s accrued time on the books for 3 years. If that employee returns to work in the city within 3 years, the employee is entitled to all previously accrued time not used. Thus, employers that have employees perform work in Minneapolis and St. Paul should consider providing this leave outside of the city so that there is only one bucket of paid leave for all work, wherever performed.

Further, if an employee is terminated but thereafter returns to the same employer within ninety (90) days, his or her sick and safe leave must be reinstated and the employee may use it at the commencement of reemployment (no 90 day wait). In the case of mergers and acquisitions of businesses where the employees remain, the employees accrued time remains intact (no 90 day wait).

Not surprising, any health or medical information collected as a result of the employee’s use of sick and safe time must be treated as confidential.  As with any laws providing employee rights, retaliation for any employee actions under this Ordinance must be prohibited.

What Happens If An Employer Violates the Ordinance?

Any person may report a suspected violation. The HREEO Director may decide to investigate and/or pursue a violation. Note, the “relief and administrative fines” are different than Minneapolis (and the procedure a little less clear at this point):

  • Reinstatement and back pay.
  • For the first violation – payment to the employee of the time unlawfully withheld x2 or $250, whichever is greater, as liquidated damages.
  • For a second violation against the same employee – an additional  fine payable to the City of St. Paul, up to $1,000.
  • For a third violation against the same employee – ad additional penalty of up to $1,000 to the employee, or an amount equal to 10% of the total amount of unpaid wages, whichever is greater.
  • Administrative penalty of up to $1,000 payable to the employee for each violation.
  • Administrative fine of up to $1,000.

An employee, former employee or employer may appeal any violation of this Ordinance within 21 days from the determination. Following the appeal process, the violation determination becomes final. If an employer does not comply the City of St. Paul may initiate a civil action in Court against the employer and, upon prevailing, “shall be entitled to such legal or equitable relief as may be appropriate to remedy the violation.” Further, an employee does have a private right of action to sue the employer directly in district court if retaliated against for exercising rights under the Ordinance.

What’s Next?

The HREEO has to create the notice for employers.  It’s expected that the HREEO will also adopt guidelines and regulations for its implementation. As to the bigger picture, as predicted in my blog about Minneapolis’ ordinance, I suspect Duluth will be next as on July 18, 2016, the Duluth City Council approved a resolution establishing an earned sick and safe time taskforce.

3 countdownAs the Minnesota State Fair is here with everything “on a stick”, and the Renaissance Festival is back to jousting…it is signaling the end of summer, and beginning of a new school year – or in our case – a new FLSA year. The December 1, 2016 deadline is just three months away; similar to school, it’ll be here before you know it. What can (and should) employers being doing now to prepare?  Get your house in order…you only get one take on this!

Be sure all your positions have job descriptions. This is good not only to analyze the exemption status, but also if a reasonable accommodation is requested in the future. Without such, an employee has more room to argue what the essential functions are (“I never have to lift more than 30 pounds!” Or, “I never have to work weekends!”). Also, if there are discipline issues, it is helpful to support what their job duties are (of course, it should always include something along the lines of “and any and all other duties as assigned” – and don’t forget the at-will language: “nothing in this job description changes the at-will nature of your employment”). Simply, job descriptions are essential to ensure everyone is on the same page for expectations.

Be sure your employee handbook is up to date. Some employers will detail what positions are paid overtime in their employee handbook (or policies), others will define “full time” or “exempt” and the like. You don’t want to be caught with discrepancies. For example, your handbook may define a “non-exempt” employee as an “hourly” employee.  Yet, I  know you know, that a non-exempt employee may be a salaried employee, and still receive overtime. I have seen handbook definitions such as this create much confusion in the past.  Save yourself the headache and review/update your handbook!

Be sure your employees are properly classified. Easier said than done, right?! Well, all too true (if it were easy, nobody would read my blog and I wouldn’t have the wage and hour practice that I do!). You’ll want to pull all your job descriptions for each position (perfect time to create them if they don’t exist); the list of employees (the DOL looks at exemptions by individual – not position); their salary/hourly rate; how they are currently classified; any commissions/bonus structure; how many employees they supervise (if any); for sales folks, you’ll want the approximate percentage of tine spent on outside/inside sales; an organizational chart (handy to see supervisors of two or more); and any special qualifications (such as professional licenses, etc.) or other unique circumstances about their position. This basic information is a good start on your wage and hour audit / analysis.

As it will take much longer than you’d think to pull it altogether, I would highly suggest employers start doing this now. Also, as a great majority will likely find at least one employee could be classified differently, you’ll want time to address how to make that change prior to December 1. Finally, if you think you may have issues, it is not a bad idea to have legal counsel be a part of the audit process (including how to handle potential misclassifications). I know it is not fun to pay attorneys’ fees before an issue arises (going to the dentist is arguably more enjoyable, I suppose), but I can almost guarantee defending a wage and hour lawsuit will be exponentially more expensive, time consuming, and interrupting to your business. In any event, as noted above, employers are only going to get one take on this…the filming stops in only 3 months, so get your house in order now!

Farm exemptionGiven the revised FLSA white-collar exemption regulations, and the associated December 1, 2016 hoop-la about the new $47,476 threshold, it is easy to get tunnel vision with those exemptions. If an employee doesn’t fit in them, they must be paid minimum wage and overtime, right? Not necessarily! Since they are often typical to a specific industry, I don’t even often think of them unless a client fits the mold. So, that is why I thought I would blog about the other, often forgotten exemptions. Yes, there are many other exemptions from either minimum wage, overtime, or both.  I won’t write about any one of these in detail, but certainly gives me ideas for future blogs (teaser!). Here they are:

  • Commissioned sales employees (must be retail or service establishment [these two terms are VERY specific and have their own exemptions] and more than half of income is commissions and average 1.5 times minimum wage)
  • Computer professionals (must make at least $27.63 per hour)
  • Drivers, driver’s helpers, loaders and mechanics employed by a motor carrier with duties affecting safety of operation of vehicles in interstate or foreign commerce (this gets sticky)
  • Farm workers on small farms (no more than 500 “man-days” (at least 1 hour of work in a day) of labor in any 3 month period during the previous calendar year)
  • Salesmen, partsmen and mechanics at automobile dealerships (this is actually under a lot of interpretations these days so be careful – ex.-  a mechanic shop may not be treated the same as a automobile dealership – even if related to the dealership)
  • Seasonal and recreational establishments
  • The DOL provides a list of others who are exempt from overtime (OT), minimum wage (MW) or child labor laws (CL) – while I try not to regurgitate material already available on the internet, this is too handy to not share:
    • Aircraft salespeople – OT
    • Airline employees – OT
    • Amusement/recreational employees in national parks/forests/Wildlife Refuge System – OT
    • Babysitters on a casual basis – MW & OT
    • Boat salespeople – OT
    • Buyers of agricultural products – OT
    • Companions for the elderly – MW & OT
    • Country elevator workers (rural) – OT
    • Workers with disabilities – MW
    • Domestic employees who live-in – OT
    • Farm implement salespeople – OT
    • Federal criminal investigators – MW & OT
    • Firefighters working in small (less than 5 firefighters) public fire departments – OT
    • Fishing – MW & OT
    • Forestry employees of small (less than 9 employees) firms – OT
    • Fruit & vegetable transportation employees – OT
    • Homeworkers making wreaths – MW, OT & CL
    • Houseparents in non-profit educational institutions- OT
    • Livestock auction workers – OT
    • Local delivery drivers and driver’s helpers – OT
    • Lumber operations employees of small (less than 9 employees) firms – OT
    • Motion picture theater employees – OT
    • Newspaper delivery – MW, OT & CL
    • Newspaper employees of limited circulation newspapers – MW & OT
    • Police officers working in small (less than 5 officers) public police departments – OT
    • Radio station employees in small markets – OT
    • Railroad employees – OT
    • Seamen on American vessels – OT
    • Seamen on other than American vessels – MW & OT
    • Sugar processing employees – OT
    • Switchboard operators – MW & OT
    • Taxicab drivers – OT
    • Television station employees in small markets – OT
    • Truck and trailer salespeople – OT
    • Youth employed as actors or performers – CL
    • Youth employed by their parents – CL

Also, keep in mind that these are federal FLSA exemptions. Minnesota state law may provide for more protection for employees and thus, the employee may be entitled to overtime (after 48 hours) and/or minimum wage, and/or not be allowed to work as a child in certain positions.

For example, while the FLSA exempts an automobile dealership salesperson, parts person or mechanic, Minnesota state law only allows the exemption if the individual is “paid on a commission or incentive basis” (otherwise the laws read exactly the same). So, you can see how 7 short words can change an entire scope of an exemption between federal and state law. This is why I get heartburn when Minnesota employers determine an exemption by Google search alone! Accordingly, if you think one of the above may apply, I would highly encourage you to dig deeper to be sure you know how the federal, state and courts are interpreting the exemption that you think may fit. And as I often say, if it seems too good to be true, it probably is.

FBAThe National Labor & Employment Law Section is proud to sponsor its third-annual
Minneapolis seminar, “Employment Law in a Nutshell.” This seminar is being cosponsored by the Younger Lawyers Division (YLD), the Law Students Division (LSD), and the Minnesota Chapter of the FBA. The seminar is a live, half-day CLE and will take place on the afternoon of Wednesday, August 31, 2016 at the University of St. Thomas School of Law in Minneapolis (Room 321), 1000 Lasalle Ave., Minneapolis, MN 55403.

The event will focus on the basics of labor and employment law, featuring three hour-long presentations: Continue Reading Join Me for the Employment Law in a Nutshell CLE – St. Thomas August 31st!

VoteIn a huge turn of events, on August 22, 2016, Hennepin County District Court Judge Susan M. Robiner resurrected the $15 minimum wage ballot question for the City of Minneapolis to put on the November 8, 2016 ballot. The case, brought by individuals related to 15 Now MN, is styled Vasseur et al. v. City of Minneapolis et al., Court File No. 27-CV-16-11794, (Minn. Fourth Judicial District, Aug. 22, 2016), and the decision can be found here. The ballot question, drafted by the City of Minneapolis Attorney, will be as follows:

“Proposal to Amend the Minneapolis City Charter to require a $15 Minimum Wage for Employees Working in Minneapolis.

Shall the Minneapolis City Charter be amended to require all employees working within the geographic boundaries of the City of Minneapolis to be paid a $15 minimum wage by their employers, regardless of the employers’ geographic location, to be phased in starting at $10.00 as of August 1, 2017 and increasing to $15 by the year 2020 for employers with 500 or more employees and by the year 2022 for employers with fewer than 500 employees and increasing thereafter based upon the non-seasonally adjusted consumer price index as published by the U.S. Department of Labor, such charter provisions to be enforced by the City of Minneapolis and permitting private civil actions in a court of law?”

How Did We Get Here?

As you may recall, because my blog is just so memorable…on July 28, 2016, I wrote about Vote for 15 MN’s petition to the City of Minneapolis to amend its Charter to require a $15 minimum wage by 2020 for large employers, and 2022 for small employers.  Accordingly, if you want to read all about the implications of the proposed amendment you can find it that post (in other words, I won’t regurgitate it in this post though it is all applicable again).  However, later that day, the City of Minneapolis Attorney publicly filed a memorandum declaring that the proposed Charter was inappropriate for a ballot referendum, as I wrote about here. That has now been undone.

Judge Robiner’s opinion summarized her legal analysis supporting the ballot question thus:

  • “No Minnesota case law supports the City’s claim that general welfare legislation may only be proposed through initiative and referendum;
  • No Minnesota case law supports the City’s claim that ‘all local municipal functions’ means only ‘the form, structure, and functioning of the municipal government’;
  • Minnesota cases have allowed district courts to enjoin elections only where the proposed charger amendment was unconstitutional or conflicted with state law neither of which are even argued by the City; and,
  • For a court to enjoin a ballot initiative based on its content when that proposal has garnered the proper number of signatures and proceeded properly could reasonably be seen as overreaching its specific role under Minn. Stat. § 204B.44 and its general role in a government that respects separation of powers.”

What’s Next?  

Well, the Court ordered the City of Minneapolis to prepare a ballot for the November 8, 2016 election that includes the Vote for 15 MN proposed amendment. In order to pass, at least 51% of voters must vote in favor of the amendment.  If that happens, the first wage increase will be August 1, 2017. It appears 15 Now MN has set up a National Day of Action for $15/hour on September 12, and will start knocking on doors on September 17. However, the City may also appeal Judge Robiner’s Order to the Minnesota Court of Appeals. Since I was dead wrong on how this would turn out in my first post, I’m not even going to make a prediction on this third post!  Stay tuned…

minwage_posterWith the August 1, 2016 increase in Minnesota’s minimum wage, employers should be sure to replace your Minnesota minimum wage poster – which is a required posting. You can download it for free here.  If you have one of those 21-in-1 or whatever posters, you can certainly just tape this on top of the old – no need to buy a completely new poster. However…there are two more to go.

On the Federal front, the FLSA minimum wage poster has also changed effective August 1 (and thus must be posted) – that poster can be downloaded for free here. Finally, the Employee Polygraph Protection Act poster must be updated – that can be found here.

interview-1018333_1920Minnesota employers with a location in Massachusetts should take note that Massachusetts passed a new Pay Equity Act yesterday, which, among other things, makes it unlawful to ask applicants about their salary history effective January 1, 2018. Specifically, the Pay Equity Act provides:

“(c) It shall be an unlawful practice for an employer to:

(1) require, as a condition of employment, that an employee refrain from inquiring about, discussing or disclosing information about either the employee’s own wages, including benefits or other compensation, or about any other employee’s wages;

(2) screen job applicants based on their wage, including benefits or other compensation or salary histories, including by requiring that an applicant’s prior wages, including benefits or other compensation or salary history satisfy minimum or maximum criteria; or request or require as a condition of being interviewed, or as a condition of continuing to be considered for an offer of employment, that an applicant disclose prior wages or salary history;

(3) seek the salary history of any prospective employee from any current or former employer; provided, however, that a prospective employee may provide written authorization to a prospective employer to confirm prior wages, including benefits or other compensation or salary history only after any offer of employment with compensation has been made to the prospective employee…”

I won’t go much beyond that, as this won’t apply to many Minnesota employers,  but if it does apply to your business, you can find the full text here. I would not be surprised if we see something like this down the pipeline here in Minnesota in the future.