On June 10, 2022, the U.S. Department of Labor (DOL) Wage and Hour Division (WHD) submitted a notice of proposed changes to its wage information collection form, WD-10, that it uses to determine prevailing wages. The WHD is also proposing a new optional form, WD-10A, which it will use before sending out the actual survey, in order to identify potential respondents who worked in the construction industry.

In other words, the new form will allow contractors to voluntarily report subcontractors with whom they’ve worked, so that the WHD can also send subcontractors the survey. This should ideally reach more non-union contractors, and thus, the rates should more closely reflect actual prevailing wages (versus union wages). Contractors have until August 10, 2022 to submit comments on the proposed notice. A summary of the changes can be found here. As always, the more non-union contractors that actually fill out and complete the survey, the better the chance that the set prevailing wage will reflect actual market (prevailing) rates.

If you are a home health care provider (personal care attendants, community first service and support workers), the Minnesota Department of Labor & Industry (MNDOLI) has created a new webpage for information related to employment practices in your industry. This includes a general video on:

  • Overtime (follow federal (40+ hrs/wk) and state law (48+ hrs/wk) at 1.5 times the regular rate) *Note – this is where I see the majority of violations – (and investigations) – make sure you are properly paying overtime – if you are paying a “bonus” for additional hours worked, I’d highly encourage you to have that pay practice reviewed asap.
  • Minimum wage requirements
  • Travel time
  • Rest periods (less than 20 minutes paid)
  • Payment of all hours worked (regardless of reimbursements)
  • Discipline for working unauthorized overtime (but paying it)
  • On-site work/rest time (sleep time – Minn. 177.23, sub.11 and Minn. Rule 5200.0121 and federal law)
  • Regular payments, timely payments and final pay law

Employers should be careful to remember that this guidance is ONLY for Minnesota state law. If federal law applies to your business and is more beneficial for the employee, then federal law applies.

Minnesota employees who are eligible for Frontline Worker Pay will be able to apply at https://frontlinepay.mn.gov starting tomorrow, June 8, 2022. That means that Minnesota employers who are in the frontline industry sector (see my previous post), must provide notice by June 23, 2022.  

MNDOLI has drafted the employer notice in several languages, which you can download here. The notice must be given to each employee and/or placed where all other notices (such as your minimum wage poster) are posted. For many employers this is a breakroom, kitchen or job trailer. If you chose to provide notice to each employee, I would also recommend posting it as well, to be sure nobody is missed and/or loses the notice.

A detailed list of the industry sectors (and now with examples) can be found here.

 

The Minnesota Department of Labor & Industry is indicating that the frontline worker pay application period will be open from June 8 to July 22, 2022.  Within 15 days – June 23, 2022, employers in the applicable sectors (see my previous post) will need to post the notice.  The notice will be available at frontlinepay.mn.gov when the application dates are finalized.  There are also a few webinars today at 1 pm and Friday, June 3 at 3:30, and an outreach toolkit (this is NOT the employer notice). That’s all I know, folks!

As promised, I’m sharing what I know.  As of now, the Minnesota Department of Labor & Industry (MNDOLI) is indicating that their goal is to launch the frontline worker pay application mid-June (at which time the 45 day application period will begin).  MNDOLI anticipates payments will be made late summer or early fall.

It’s been quiet around here (from a wage and hour standpoint) in Minnesota! I’ve had very little to blog about – no more! Governor Tim Walz recently signed a bill, Frontline Worker Payments, which will provide a payment to frontline workers up to $1,500. While the actual process is not yet up and running, once the Minnesota Department of Labor & Industry (MNDOLI) finalizes the online application system, and opens the application period, employers will have 15 days to notify all current workers that may be eligible for the payment. MNDOLI is preparing a form to be used (stay tuned). Employees will then have 45 days to apply. Once the application period closes, there will be a 15 day period for applicants to contest the decision. Once that timeframe is closed, the available money will be split equally upon the eligible applicants, in an amount not to exceed $1,500 per individual.

What are the frontline business sectors? 

  • Manufacturing
  • Long-term and home care, health care, vocational rehabilitation
  • Emergency responders
  • Child care, schools
  • Food service (including production, processing, preparation, sale and delivery)
  • Retail (including sales, fulfillment, distribution and delivery)
  • Temporary shelters and hotels
  • Building services, including maintenance, janitorial and security
  • Ground and air transportation services, public transit

Which employees are eligible within the frontline sector?

  • Must have worked at least 120 hours between March 15, 2020 and June 30, 2021 AND unable to telework AND worked in close proximity to others (not in your household).
  • Must have an annual income of less than $185,000 for married taxpayers filing jointly, or $85,000 for all others if the occupation does not have COVID-19 patient care responsibilities.
  • Must have an annual income of less than $350,000 for married taxpayers filing jointly, or $175,000 for all others if the occupation had direct COVID-19 patient responsibilities.
  • Must not have received unemployment for more than 20 weeks on a cumulative basis between March 15, 2020 and June 26, 2021.

So, for now this is just a heads-up. I’ll certainly post more as the process develops. Again, employers will only have 15 days to provide notice to employees, so you’ll want to be sure to keep your eyes out!

Today, March 11, 2022, the U.S. Department of Labor (DOL) announced its notice of proposed rulemaking (NPRM) that seeks to update the Davis-Bacon and Related Acts (DBA). This NPRM is the first major revision to the DBA in over 40 years.

I’ll provide a more comprehensive blog soon of how this is going to affect employers (I’ve got to read the over 400 pages), but here’s what the DOL is highlighting in the changes (all of which result in increased prevailing wages):

  1. Prevailing wage rates will increase, to “keep up with actual wages”.
  2. Return to pre-1983 definition of “prevailing wage”.
  3. Wage determinations will be periodically updated (note, some states’ little DBA already do this).
  4. Allows contracting agency to adopt state or local wage determinations.
  5. Will allow for supplemental rates for key job classifications when there is no survey data.
  6. Regulatory language will be updated to reflect modern construction practices.
  7. “Strengthen worker protections and enforcement, including debarment and anti-retaliation.

Also, employers should keep in mind that this is not law yet, it is just a NPRM, which is the first step the DOL must take to attempt to change the regulations.

From time-to-time, I meet (read: they got in trouble or were about to) a new client from out of state that has an issue in Minnesota arise – not because of any willful or intentional wrongdoing, but just because they don’t realize some unique aspects of Minnesota law.  So, for those non-Minnesota based Minnesota employers, here’s my top 10 FYI’s for you:

  1. Any severance and release needs to have a 15 day rescission and waiver period under the Minnesota Human Rights Act (this is in addition to a 7 day period for ADEA claims). Accordingly, you’re unlikely to see a Minnesota settlement agreement that pays an employee before the 14 day rescission period runs (i.e. we pay on the 16th day).
  2. Employees who are terminated may ask for a copy of their personnel record/file – this is a defined term in Minnesota.  Employers have 7 business days to provide it.  See my earlier blog here.
  3. Terminated employees may also ask for a statement of reasons for their termination. Employers have 10 business days to provide. I blogged about this as well here – this is more than just a request – likely an attorney is in the background.
  4. Terminated employees who demand their final pay in writing are entitled to it within 24 hours of written demand.  Again – here’s my blog on that…typically I suggest just having the check ready to hand over at the termination meeting.
  5. We do not have a tip credit! ‘Nuff said. Oh, and don’t force shared tips either… not okay.
  6. Employers cannot deduct wages for property damage, lost or stolen property, etc. without written authorization from the employee after the fact.  True story.  Don’t do it. Here’s the law and yep, my blog post.
  7. Minnesota recognizes overtime after 48 hours (not 40).  Minnesota does not recognize the computer exemption. Smart computer people would need to fall under one of the other exemptions (administrative, executive or professional) in order to be paid a salary without overtime.
  8. Minnesota does not require paid meal or rest  breaks.  Employees do get “sufficient time to eat a meal” every 8 hours – which is presumably at least 20 minutes – generally 30 paid, and time to use the bathroom every 4 hours. Here are the rules on that.
  9. We have a Wage Theft Act requiring employers to provide a lot of information on a sheet of paper about the terms of employment – even at-will – which you don’t want to mess with; this includes requirements as to what needs to be on a paycheck stub. MNDOLI’s guidance on this may be an easier read than the statue.
  10. We have sick and safe leave.  Check local ordinances to be sure you are following those (i.e. Minneapolis, St. Paul, Duluth) if you have employees working there. This could include snow days, dontcha know!

I hope the above helps our non-domestic employers to navigate our waters a bit better. See what I did there?! Land of 10,000 lakes?

They say money makes the world go round…  As end-of-year reviews are coming up and it may be close to merit increase time, I wanted to send out a friendly remember that Minnesota’s state minimum wage rates increase January 1, 2022:

  • Large employers (over $500k) = $10.33
  • Small employers (under $500k) = $8.42
  • Training wage = $8.42

St. Paul’s minimum wage increases next occur July 1, 2022 ($15/hr for macro businesses >10,001 employees; $13.50 for large; $12 for small; and $10.75 for micro).

Minneapolis’ minimum wage increases next occur July 1, 2022 ($15 for large  businesses >100 employees; $13.50 for small)

On August 11, 2021, the Minnesota Supreme Court held that it is for a jury to decide. In Hagen v. Steven Scott Management, Inc., (yes, this is the same case I just wrote about for rent credits being wages), the plaintiff argued that all of her on-call time should be compensable because it was part of her “duties of employment”. The hours-worked rule (Minn. R. 5200.0120) generally provides that an employee who cannot use their time “effectively for the employee’s own purposes is working while on call”. However, Minnesota courts have not yet addressed the distinction (as in federal law) of, “being able to use one’s time effectively or not, while working on call”.

In this case, the employee had to carry an employer-provided cell phone, stay within a 20 minute radius of the apartment complex (her worksite), and could not drink alcohol.  Further, certain activities such as grocery shopping would be occasionally interrupted from tenants seeking assistance, and her family all lived 30-45 minutes away so she could not visit them. The Court held that whether the mere act of being on-call was considered a duty of her employment was complicated because her job description lists, “working on an on-call basis,” as an essential duty. Ultimately, the Court held that reasonable persons could reach a different conclusion as to whether her on-call restrictions allowed her to use her time effectively for her own purpose – and thus, a jury must decide.

So what does this mean in the real world? Minnesota courts are not blindly following federal law (District of Minnesota) in determining whether on-call time is compensable under the MFLSA (compared to the FLSA). Further, the Court has stated that a jury must decide when on-call time is compensable (i.e. can the employee use the time effectively for their own use or not). This is an issue for employers as a claim for unpaid on-call time will almost certainly survive a motion for summary judgment – taking such questions to trial. As you can imagine, this increases the cost to litigate. Thus, employers should be careful to draft job descriptions and on-call policies (if employees are not paid to wait) to make it clear how they are – or are not – restricted during an on-call shift. For example, consider response times, prohibitions of activities during that time, and what they are required to do or not do. The more restrictions, the more the employee can argue they are duties of employment and thus, compensable. Check your handbook policies, job descriptions, and offer letters for on-call language and ensure it is accurate and the employee is properly compensated depending on how effectively they can use their on-call time for personal matters.