HR Generalists tasked with the EEO-1 report can celebrate.  On August 29, 2017, the White House’s Office of Management and Budget sent a memo to EEOC Acting Chair Victoria Lipnic, stating that it is reviewing the September 29, 2016 pay data collection revisions to the existing EEO-1, and while it does so, the pay data collection will be stayed. In other words, the new data requirement (aimed at determining equal pay issues) is on hold but employers need to be sure to continue to collect the normal data as usual, by March 2018.

In its memo, the OMB noted that the EEOC released data file specifications for employers to use in submitting EEO-1 data that were not contained in the Federal Register notice, and thus, could not obtain public comments: “As a result, the public did not receive an opportunity to provide comment on the method of data submission to EEOC.” Accordingly, “OMB has also decided to stay immediately the effectiveness of the revised aspects of the EEO-1 form for good cause, as we believe that continued collection of this information is contrary to the standards of the PRA (Paperwork Reduction Act). Among other things, OMB is concerned that some aspects of the revised collection of information lack practical utility, are unnecessarily burdensome, and do not adequately address privacy and confidentiality issues.”

In short, employers may continue using the previously approved EEO-1 form to comply with FY2017 reporting requirements!

 

 

It’s been a month since the City of Minneapolis Sick and Safe Time Ordinance has gone into effect (July 1, 2017), and thus, employers based in Minneapolis with workers in Minneapolis should have already modified their existing paid time off (PTO) policy, or created a new sick and safe time policy. The most frequent question I’ve been getting recently is regarding whether an employer must comply if they are not located in Minneapolis, or if they are located in Minneapolis, but employees do not work in Minneapolis. The confusion is quite understandable, as the answer is not found in the ordinance, but the result of a temporary injunction issued in a Hennepin County District Court case (Minnesota Chamber of Commerce et al v. City of Minneapolis, Court File No. 27-cv-16-15051).

The City of Minneapolis is currently not enforcing its ordinance against employers who are not physically located in Minneapolis, or employers who are located in Minneapolis but whose employees do not physically work in Minneapolis. The City of Minneapolis Sick and Safe Time Ordinance is currently only being enforced against Minneapolis-based employers with employees performing more than 80 hours of work a year in the city limits of Minneapolis (which does not include pass-thru drivers). However, keep in mind that this is only a temporary pause in enforcement. On January 26, 2017, the City appealed the decision to the Minnesota Court of Appeals, and has noted in the rules that, “Once a final order has been issued through the court process, the City may amend these rules to provide additional guidance.”

Oral arguments were heard on July 11, 2017.  Accordingly, as I find myself saying way too much these days, we wait.  Employers not located in Minneapolis but with workers in Minneapolis not wanting to wait have two options: (1) continue business as usual;  or (2) amend your PTO or vacation policy to meet the ordinance requirements, even though they are not being enforced. Recall you may always offer employees more than they are entitled to, just not less.

On July 26, 2017, the Department of Labor asked the public for comments concerning revisions to the overtime rules.  Only a week later, the DOL has received over 12,000 comments. However, it appears a move is underway whereby individuals are cutting and pasting the same statement literally thousands of times. It appears an individual posted the 70th comment on July  31, 2017 (WHD-2017-0002-2990), stating that President Ford set the salary threshold in 1975 at what would be $58,000 today, and thus, the DOL should keep the $47,476 in tact (or greater). From what I can tell, the remainder 11,930 submissions so far have simply cut and pasted this comment. This makes it incredibly difficult to find and review different positions and share them here. Perhaps the DOL could institute an “Agree” or “Disagree” feature in the future?

 

The United States Department of Labor officially published its Request for Information (RFI 1235-AA20); Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees, today. In doing so, the DOL expressly acknowledged many employer’s concerns that the previously-set salary threshold of $913 per week was too high, it inappropriately excluded too many workers from the exemption who otherwise would pass the standard duties test, and it adversely impacted low-wage regions and industries. Accordingly, the RFI is intended to gather additional data regarding how the December 1, 2016 regulations affected employers and employees, and how the regulations could better be updated moving forward.

The RFI can be found at regulations.gov, where comments may be electronically submitted with a single click. Given the pending litigation in the District of Texas and the 5th Circuit Court of Appeals, the DOL is merely asking for public comment at this time, versus publishing a formal Notice of Proposed Rulemaking. The DOL acknowledges that the RFI is issued consistent with President Trump’s February 24, 2017 Executive Order 13777, “Enforcing the Regulatory Reform Agenda” which tasks federal agencies to identify regulations for repeal, replacement, or modification which meet certain requirements, such as hindering job growth.

The DOL is asking employers to weigh in on eleven (11) questions (summarized below):

  1. Should the DOL simply update the 2004 salary level ($455/wk) for inflation?
  2. Should multiple salary levels be created, and if so, how (size of employer, region, etc.)?
  3. Should there be different salary levels for executive, administrative and processional (as it was prior to 2004)?
  4. Should the DOL return to using the long and short test salary levels (and would the duties test need to change if so)?
  5. Does the 2016 salary threshold ($913/wk) in effect negate the duties test?  And if so, at what threshold does it not negate the duties test?
  6. What actions did employers take to prepare for the December 1, 2016 regulation (i.e., increase salaries, change hours, reduce pay, etc.)?
  7. Would it be preferable to base exemptions on duties only (no salary threshold)?
  8. Does the $913/wk threshold exclude occupations traditionally covered as exempt?
  9. Is the 10% non-discretionary bonus and incentive payment credit towards satisfying the salary threshold appropriate?
  10. Should the highly compensated thresholds have multiple levels, and if yes, how (i.e. size of employer, region, etc.)?
  11. Should the salary levels be automatically updated periodically, and if so, how/when?

The public has until September 25, 2017, to submit comments. Following the close of the comment period, employers can expect more waiting, as usual.  It appears from the RFI that the DOL will not be issuing a Notice of Proposed Rulemaking while the cases are ongoing, so as is the norm, we will continue to wait.

The United States Department of Labor announced today that, as indicated in the 5th Circuit Appeal recently, it will be publishing a new Request for Information (RFI) concerning the overtime regulations (technically, “Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees”) tomorrow. The July 26, 2017 RFI will seek public comments regarding the salary level test (recall the DOL told the 5th Circuit that it was dropping the $913/wk overtime threshold), the duties test, varying cost-of-living (i.e. the fact that one salary threshold may be inappropriate nationwide), inclusion of non-discretionary bonuses and incentive payments, highly compensated employee salary test, and automatic updating of such salary levels.

The RFI will be open for 60 days during which the public may submit comments.

Just when employers were embracing the (other) new Form I-9, the United States Customs and Immigration Services (USCIS) has once again updated Form I-9, with a new revision date of “07/17/17 N”. Employers may start to use the revised form immediately, but the revised I-9 does not need to be used exclusively until September 18, 2017. The revised I-9 can be found on the USCIS website: www.uscis.gov/i-9.

What is new and revised? A few revisions to the instructions and, more importantly, the list of acceptable employment authorization documents. Specifically, List C now allows a Consular Report of Birth Abroad (Form FS-240) as evidence.  In addition, USCIS has combined onto List C #2 all the certifications of report of birth issued by the Department of State (Form FS-545, Form DS-1350 and Form FS-240). Thus, the List C documents were renumbered (except the social security card).

Finally, the USCIS issued a revised Handbook for Employers: Guidance for Completing Form I-9 (M-247). While I’m not often “wooed” with government “guidance” documents such as this, this particular handbook is actually very helpful and useful for employers. For example, it addresses when certain documents can expire without re-verification, and when others need to be re-verified upon expiration (hint: all documents must be unexpired when first presented). However, given its content, it was extremely long; the revised handbook is indeed much easier to navigate and a great place for employers to start with I-9 questions.

The United States Department of Labor (DOL) recently announced its decision to once again issue Opinion Letters, Ruling Letters, Administrator Interpretations and Field Assistance Bulletins.  They will be published on the DOL website here, along with past opinions (pre-2009).  Interpretations by the DOL Administrator that interpret the Fair Labor Standards Act (FLSA), Davis-Bacon Act (DBA) or Walsh-Healey Public Contracts Act (PCA), are considered “official rulings”, and thus, provide employers with a good faith reliance defense when so relying. This guidance is very helpful when employers are trying to understand how to interpret the FLSA, DBA or PCA with various facts.

Often, numerous employers have the same questions of interpretation, and thus, opinion letters are very helpful when such common questions arise. The last opinion letters were published in January 2009, and withdrawn by the Obama Administration when the letters were literally not put in the mail in time before the administration changed. If you’d like to receive a notice when new rulings and interpretations come out, you can do so here.

 

 

On June 30, 2017, the Department of Labor filed its reply brief with the 5th Circuit Court of Appeals.  A copy of the brief can be found here. Thus, the Texas lawsuit that has put the overtime regulations overhaul on hold nationwide, is now in the hands of the 5th Circuit.  Any question as to whether the Department of Labor would chose to withdraw the appeal has been answered in the negative. Significantly, however, the Department of Labor has withdrawn its appeal with respect to the legality of the specific $913 per week ($47,476/year) salary threshold:

“The Department has decided not to advocate for the specific salary level ($913 per week) set in the final rule at this time and intends to undertake further rulemaking to determine what the salary level should be.  Accordingly, the Department requests that this Court address only the threshold legal question of the Department’s statutory authority to set a salary level, without addressing the specific salary level set by the 2016 final rule. In light of this litigation contesting the Department’s authority to establish any salary level test, the Department has decided not to proceed immediately with issuance of a notice of proposed rulemaking to address the appropriate salary level….Instead, the Department soon will publish a request for information seeking public input on several questions that will aid in the development of a proposal.”

Accordingly, the question now is simply whether the Department of Labor has the authority to set a specific threshold or whether Congress must do so. And again, we wait.

Joining its twin city, St. Paul’s Earned Sick and Safe Time (EEST) Ordinance is now in effect. As of July 1, 2017, employers located in St. Paul with 24 or more employees must provide 1 hour of EEST for every 30 hours worked, commencing on their start date, up to 48 hours per year (or more). Of course, it can’t be this simple! A complete “how to” can be found on St. Paul’s website here.  In addition, the latest Rules can be found here, updated June 30, 2017.

On Friday, June 30, 2017, the Minneapolis City Council passed a $15 minimum wage ordinance on a vote of 11-1, amending Title 2, Chapter 40 of the Minneapolis Code of Ordinances relating to Administration: Workplace Regulations (link is to the draft ordinance). The Ordinance requires that large employers (100 or more employees) pay Minneapolis workers $15 per hour by July 1, 2022, and small employers pay $15 per hour by July 1, 2024, over a 5 and 7 year phase-in period (see table below). As with State law, employers may not take a tip credit for hospitality workers. So what does this mean?  Only time will tell, but it may be a “be careful what you wish for” situation, similar to what Maine has recently went through.  Restaurant employers in Maine saw a hit in their tips only a few weeks after that $12 minimum wage ordnance passed (even despite the fact that the higher wages didn’t yet go into effect), causing the Maine Senate and House to vote overwhelmingly in favor to repeal and restore the tip credit, which Governor LePage has indicated he will sign into law (there are a few more votes and steps in the process).

Who/What Does the Ordinance Apply To?

All employees (full-time, part-time, joint or temporary) are counted to determine size. A franchise is a large employer (no matter how many employees at a single location) if the brand has at least 10 national locations (no matter who operates the franchise). A full service restaurant in Minneapolis, with fewer than 10 national locations is a single employer. State, County, and local governments (except the City of Minneapolis) are exempt from the $15 minimum wage requirement. Notably, and ripe for debate (similar to the sick and safe leave ordinance that since has been limited to employers with an actual work location in the City), is the requirement that it applies to “all time worked within the geographic boundaries of the city”. Employees who work outside the City, but perform at least two (2) hours per week or more in Minneapolis, are covered by this ordinance.

Important for construction and other transportation industries typically passing through: “Time spent in the city solely for the purpose of travelling through the city from a point of origin outside the city to a destination outside the city, with no employment-related or commercial stops in the city, except for refueling or the employee’s personal meals or errands, is not covered by this article.” Thus, a charter bus picking up kids in Minneapolis for summer camps, but located elsewhere could be covered if that driver spends more than 2 hours in the City. A caterer from outside the City who is contracted to cater a party in the City could be covered, as could a construction company that delivers materials into the City. In short, as enacted, it seems the ordinance is going to affect a whole lot of employers located outside the City boundaries.

When Are the Wages Due?

The current tiered phase-in hourly wages are as follows:

Date Large business: five years Small business: seven years
Jan. 1, 2018 $10 No increase
July 1, 2018 $11.25 $10.25
July 1, 2019 $12.25 $11
July 1, 2020 $13.25 $11.75
July 1, 2021 $14.25 $12.50
July 1, 2022 $15 $13.50
July 1, 2023 $15 indexed to inflation $14.50
July 1, 2024 $15 indexed to inflation $15

There is a 90 day training wage for employees under the age of 20 of 85% of minimum wage.

What Happens Next?

The Minneapolis Department of Civil Rights is in charge of enforcement, though the Ordinance does allow a private right of action (employers may be sued by individuals for failing to pay the proper minimum wage). Employers must post notice of these rights, similar to the other State required notices.  As with the sick and safe leave ordinance, chances are that St. Paul and Duluth are not far behind.