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.
As we prepare to celebrate Independence Day, Minneapolis workers are celebrating the July 1, 2017 Minneapolis Sick and Safe Time ordinance that is now in effect. I’ve written about this before, but as July 1 has rolled around, I wanted to remind Minneapolis employers to be sure your policies and procedures are compliant now. If your business “resides” in Minneapolis and you have 6 or more employees, be sure to provide at least 1 hour of paid sick leave (or PTO, etc. that can be used for the same mandated reasons) for every 30 hours worked (unpaid if less than 6 employees). As an update, the Minnesota Chamber of Commerce’s case is still on appeal before the Minnesota Court of Appeals and thus, the temporary injunction is still in effect for non-Minneapolis employers with workers in Minneapolis. This means, the City is not enforcing this ordinance with respect to non-Minneapolis based employers.
On May 30, 2017, Minnesota Governor Mark Dayton announced that he vetoed “Chapter 2, Senate File 3”, the Uniform State Labor Standards bill (aka, the “Preemption Act”). In doing so, Governor Dayton (correctly) explained that the bill would “preempt local governments’ ability to set wage and benefit levels higher than state law.” Indeed, one of the intentions of the bill was to relieve multi-location employers of the administrative (and other) burdens associated with local ordinances with various requirements concerning leave policies.
Governor Dayton opined that this is not the role of state government, and that local officials, elected by communities, should be able to “retain the right” to set higher wage and benefit levels for their residents. He did not address how this affects non-resident workers in a community. Governor Dayton further noted that state government “does not always know what works best for every community, and may lag behind when improvements are needed.” As an alternative, Governor Dayton stated that the legislature should have instead proposed to increase Minnesota’s minimum wage and statewide sick and safe time.
What does this mean for multi-location Minnesota employers? For now, status quo – employers must continue to ensure compliance in each location for which it is doing business. If there are conflicts between two ordinances, or an employee works in multiple locations and the business is headquartered in another, be sure the proper benefits and wage rates are used!
As I wrote about earlier, the Overtime Bank of America does not exist! Private employers may not allow compensatory (or “comp”) time, in lieu of overtime. If a non-exempt (hourly) employee works 48 hours in a workweek, and wants to carry the 8 hours of overtime into the next workweek to get paid while taking Friday off, he or she cannot do it – unlike government employees. Even if the employee begs, an employer simply cannot do it. Again, an employee cannot waive his or her own FLSA rights (here, the right to overtime pay – not comp time).
The Working Families Flexibility Act of 2017, H.R. 1180, seeks to amend the Fair Labor Standards Act, 29 U.S.C. 207 to change the disparity between government and private employees. The Act would allow private employers to provide employees the choice of being paid overtime or getting comp time. Such comp time could be used for any reason, such as caring for a sick child or school appointments, or an employee could chose to be paid overtime instead. Employees would be permitted to use comp time “within a reasonable period after making the request if the use of the compensatory time does not unduly disrupt the operations of the employer”.
Under this Act, employers would not be able to force employees to take comp time in lieu of overtime. Further, an employee must have worked 1,000 in a period of continuous employment with the employer during the preceding 12 months, and there must be a written or otherwise verifiable statement that the employee and employer agree to such comp time before it accrues. An employee would be able to accrue up to 160 hours of comp time each year, with any unused paid out at the end of the year (or employment). However, an employer, with 30 days’ notice, could chose to pay the employee overtime for unused comp time in excess of 80 hours. Similarly, an employee could withdraw his or her agreement to comp time at any time, and must then be paid for such time within 30 days. Notably, comp time, when paid out, is paid at the “regular rate earned by such employee when the compensatory time was accrued; or (ii) the regular rate earned by such employee at the time such employee received payment of such compensation, whichever is higher”. In other words – not time and a half…as currently drafted.
On May 2, 2017, the Act was approved by the U.S. House of Representatives, and the Trump Administration issued a Statement of Administration Policy stating that, if presented President Trump in its current form, his advisors would recommend he sign the bill into law. The current text can be found here. What’s next? The bill was received in the Senate on May 3, 2017. It will be introduced in the Senate, go through Committee, get on the schedule to be considered and put to a vote.
After almost 8 hours of debate, on March 2, 2017, the Minnesota House passed a new bill, the Uniform State Labor Standards Act 76-53, also known as the “preemption” bill (because the idea is to preempt – overrule – numerous local laws with a single state law). As I mentioned in my earlier post, this bill seeks to prohibit cities from adopting ordinances which requires employers to pay employees a higher wage than state minimum wage; mandating paid or unpaid leave; mandating certain scheduling of work time; and providing other certain benefits. The purpose of the bill is to address the concerns of multi-location employers, and the administrative hassles with not only complying with various states’ laws, but local ordinances as well.
The bill would not prohibit local governments from setting their own employees’ wages, benefits, etc., or mandating the same when a private employer works on a local government project (contract) or receives local government funds and subsidies. Today, March 6, 2017, the House bill was received by the Minnesota Senate and was introduced and first read. The companion bill to the House’s HF600 is SF580. What’s next? Well, according to KSTP, Governor Mark Dayton is apparently not a supporter of this bill in its current form, so unless changes are made, he has indicated he’s like to veto it. So, this could all be much ado about nothing.
Good news for employers doing business in Minneapolis, but not located in Minneapolis…as the result of a lawsuit brought by the Minneapolis Chamber of Commerce and others, a Hennepin County judge has temporarily enjoined Minneapolis from enforcing its Sick and Safe Leave Ordinance against employers not residing in Minneapolis, until the hearing on the merits. What does this mean? For employers not located in the City of Minneapolis, you do not need to modify your paid time off just yet. As I wrote about earlier, the ordinance is set to go into effect on July 1, 2017, (though it won’t be meaningfully enforced for a year) and, as written, would affect all employers, wherever located (such as trucking companies driving through Minneapolis). This Order puts a hold on it’s reach…for now.
However, as I noted earlier, other Minnesota cities are following suit. On February 14, 2017, a Duluth task force, called the “Earned Safe and Sick Time Task Force” has started its series of 8 public meetings to debate a similar ordinance. As a result of the various city leave ordinances taking effect (Minneapolis, St. Paul and perhaps Duluth), a bill has been introduced, the Uniform State Labor Standards Act, HF600, which would prohibit cities from: adopting ordinances which requires employers to pay employees a higher wage than state minimum wage; mandating paid or unpaid leave; mandating certain scheduling of work time; and providing other certain benefits (unrelated to its own city government workers). The bill certainly has a long way to go, but it recognizes the concerns of multi-location employers and the administrative nightmare with not only complying with various states’ laws, but local ordinances as well.
As a result of President Obama’s White House Summit on Worker Voice, on October 28, 2016, the U.S. Department of Labor’s Wage and Hour Blog announced its new beta website – Worker.gov. This website is, according to the DOL, designed to provide “easy-to-access” solutions for employees who need answers “fast”. The DOL admits that “Even the best government websites can be difficult to navigate” – true, true. That being said, it makes it only about 4 clicks for a worker to file a claim electronically.
In short, the website, which is in beta and therefore undergoing constant changes, is designed to provide employees with an easy way to determine whether their rights are being violated, then provides them with a simple click to file a claim against an employer. Partnering with the NLRB, EEOC, and DOJ, the DOL wants the website to provide “critical information” to employees about their rights, who may not know whether they have a “FLSA” or “FMLA” problem, but an “unfairness-on-the job problem”. Employees answer a “few simple questions” and voila! The website will supposedly provide the relevant information, expanding in the weeks and months to come, and “learning” from the workers that use it about what kind of information is being sought – and the site will supposedly begin to feature that information prominently for similar workers.
The beta site provides a drop down, under which five job titles are currently available – day laborer; office worker; nail salon worker; restaurant worker; and construction worker. From there, it takes to you a “Tell Us what happened. We can help.” screen with several options such as – “You have the right to be treated equally.”, “You have the right to engage with others to improve wages and working conditions”, “You have the right to a safe and healthy work environment”, and “You have the right to be paid.” From there, the employee can chose what happened (i.e. suggestions – all are in the negative – such as “I was not paid for work I performed”) , and then be taken to a “File a Claim” screen.
What does this mean for employers? I have to believe we will see an increase in filed complaints, as that is the whole purpose of the website – to make it easy for employees to complain about unfair work treatment – and provide a simple click to do so.
The Minnesota Chamber of Commerce, along with several other employer groups such as TwinWest Chamber of Commerce, filed a lawsuit today in Hennepin County challenging the City of Minneapolis’ new Sick & Safe Leave Ordinance – as recently amended. The press release summarizing the action can be found here. In short, they argue that the ordinance conflicts with Minnesota state law, namely, that it is “unworkable” and “unlawful”, and that employers need statewide workplace regulations that are consistent. If you want to read the memorandum in support of the temporary injunction, you can find it on KSTP’s website here. What’s next? The parties will get a hearing date, the judge will likely take it under advisement, and issue an order either temporarily enjoining the City of Minneapolis from enforcing the ordinance, or disallowing such injunction. I would not be surprised to see a similar action filed in St. Paul, challenging its newly enacted sick and safe leave ordinance, modeled after the City of Minneapolis’ ordinance. Stay tuned!
A year after President Obama’s executive order establishing paid sick leave for federal contractors, the DOL has finally published its final rule, Establishing Paid Sick Leave for Federal Contractors, at 29 CFR Part 13. For those of you not wanting to read all 466 pages of the Final Rule, I’ll try to summarize the good stuff below. Keep in mind that this rule is applicable to covered federal contract work (more on that below). Importantly, many of the provisions are very similar to requirements in the Minneapolis and St. Paul Sick and Safe Leave ordinances, so if you are a federal contractor doing business in those cities and this new rule applies to your business, it would be wise to craft a policy that covers all the requirements.
The rule applies to new contracts after January 1, 2017 covered by the Davis-Bacon Act, Service Contract Act, and other concessions contracts and service contracts related to federal property or lands. All contracts that fall under the executive order Establishing a Minimum Wage for Contracts are also covered. The rule does not apply to work under collective bargaining agreements that provide at least 56 hours of PTO that can be used for health-related reasons until January 2, 2020 (or the date the CBA ends if sooner). Employers may use multiemployer plans to provide leave under this Final Rule. Also the rule does not apply to contracts for the manufacturing or furnishing of materials, supplies, articles, or equipment, including those subject to the Walsh-Healey Public Contracts Act. It also does not apply to employees “performing in connection with covered contracts for less than 20 percent of their work hours in a given workweek.”
- PTO Accrual or Up Front Bucket – Employees must be able to accrue 1 hour of paid sick leave for every 30 hours worked on or in connection with a covered contract, up to 56 hours (7 days) per year (MSP and St. Paul cap at 3 days). Employees who do not need to record their time can be assumed to work 40 hours under the contract each week, or can use an estimate of hours worked (so long as reasonable and based on verifiable information). In lieu of accrual, employers may chose to provide 56 hours of PTO at the beginning of each accrual year.
- Use of PTO – Employees must be able to use it while working on or in connection with a covered federal contract for own health needs or those of a family member, or due to being a victim of domestic violations, sexual assault or stalking (or to assist a family member who is a victim). Note, there is no waiting period. Requests for PTO may be verbally or in writing (you can’t force them to put the request in writing, but after it is approved, you could ask that they follow the normal procedures to record that request such as through an online system). Denial of PTO for this purposes must be in writing with a reason why it is denied. Failure to find replacement worker is not a reason to deny.
- Carryover of PTO – Employees must be able to carryover up to 56 hours from year to year while working for the same contractor on covered contracts – and get unused PTO back if return to work within a year of leaving a job on a covered contract.
- Recordkeeping – Employers must provide the employee with their PTO availability each pay period.
- Payout of PTO – not required, but if an employer pays out PTO upon termination, and the employee later returns to the job, the employer does not need to restore unused leave.
- Proof – Employers may require a doctor’s note or other documentation supporting the need for leave of 3 days or more (be sure to follow the process provided).
In any event, given the direction of city ordinances and the spread of such sick and safe leave laws, contractors should consider revising their PTO policy (hopefully you still don’t have a separate sick leave and vacation policy) to incorporate the most employee generous of all the applicable leaves to your business, so that your PTO policy will be compliant with all the laws and ordinances your business needs to function with little further administrative burden. As always, employers should be sure not to retaliate for requesting or taking such leave, or otherwise discriminate or interfere these rights. Finally, if you can’t get enough, or want more information, the DOL has a series of information on the Final Rule that can be located here.
As I wrote about earlier this May, the City of Minneapolis has enacted a sick and safe leave (SSL) ordinance, effective July 1, 2017. However, just last Friday, September 23, 2016, after tireless work by the Minneapolis Regional Chamber’s Workforce Fairness Coalition, the Minneapolis City Council adopted several revisions to the ordinance that are helpful to employers doing work in Minneapolis. The City’s presentation regarding the amendments to the ordinance can be found here and the amended regulations here. Because I know you are overworked (which is why you are reading this and not the ordinance in the first place), here are the revisions in a nutshell:
- Defines “Regular Rate of Pay” – and importantly excludes tips, commissions, expense reimbursement; premium pay, bonuses, special occasion gifts, profit sharing payments, and retirement contributions.
- Accrual of time is in one hour increments (no fractions).
- Employers may front load SSL by providing 48 hours or more to employees following their 90 days of employment and 80 hours of SSL each year thereafter.
- SSL must be recorded recorded as normal payroll practices or policies but no less than monthly.
- SSL must be compensated at same hourly rate with same benefits as was scheduled to work when used SSL.
- No longer must track hours of employees who “occasionally” work in the City (but, there is a presumption of a violation if no records are maintained).
- Clarified that additional PTO does not need to be given for SSL if current PTO is sufficient to meet the accrual requirements for SSL and allows the use consistent with the Ordinance.
Finally, the City is working on releasing a FAQ document in October and creating a 16 member Workplace Advisory Committee, which you can apply to be on here.