LB4HR – July 2015
Welcome to Legal Briefs for HR, an update on employment issues sent to over 6000 individual HR professionals, in-house counsel and business owners plus HR and legal professional organizations (who have been given permission to republish content via their newsletters and websites), to help them stay in the know about employment issues. Anyone is welcome to join the email group . . . just let me know you’d like to be added to the list and you’re in! Back issues are posted at www.munckwilson.com under Media Center/Legal Briefs and you can also join the group by clicking on “Subscribe.”
A special welcome to new subscribers in the G6 Hospitality Human Resources and Legal departments, and thanks for having me speak at your annual HR Summit . . . great questions!
Here are a few items causing fireworks in the workplace on this beautiful Independence Day:
- Constitutional Law 101: SCOTUS on Same Sex Marriage – On June 26, the Supremes declared in a 5-4 decision that the U.S. Constitution supports the fundamental right to marry, regardless of gender, and that states have no lawful basis for refusing to license same-sex marriages in their own state or to refuse to recognize marriages performed in other states. Obergefell v. Hodges (U.S. 2015). Employers in states that previously recognized same-sex marriages or who already provided employee benefits to domestic partners won’t have much work to do. The rest may, so take a look at your benefit plans and policies that implicate married status (e.g., bereavement, tuition assistance) and do some updating. Qualified pension and 401(k) plans changed their definition of “spouse” to comply with the Internal Revenue Code after SCOTUS’ U.S. v. Windsor decision in 2013, but health and welfare plans probably need attention. Side note . . . this decision means the injunction imposed by a Texas court against the DOL’s enforcement of a revised definition of “spouse” for FMLA purposes is toast.
- DOL Makes Some Employers Red (Angry), White (Scared) and Blue (Sad) – After months of delay, we finally see how the Department of Labor plans to satisfy President Obama’s mandate to increase the number of folks who are eligible for overtime pay. On June 30, proposed changes to the “white collar” regulations were made public and can be found at https://www.federalregister.gov/articles/2015/07/06/2015-15464/defining-and-delimiting-the-exemptions-for-executive-administrative-professional-outside-sales-and. This is a Notice of Proposed Rulemaking, which means you now have an opportunity to comment before these changes are made final. Here are the highlights:
- Increase the minimum salary for most white collar exemptions from $23,600 to $50,440 per year (40th percentile of full-time, salaried annual earnings).
- Increase the minimum salary for the highly compensated exemption from $100,000 to $122,148 per year (90th percentile of full-time, salaried annual earnings).
- Both of these salary numbers are estimates tied to the current 40th and 90th percentile earnings; the actual number when the law takes effect may be different.
- Provide for automatic increases of these minimums to avoid lengthy gaps (the last increase was 10 years ago) and the need for new rule-making with each increase.
- There are no proposed changes to the current duties tests . . . but DOL is soliciting comment on those tests.
- In August, DOL may publish a Request for Information on the issue of compensability of time spent by nonexempt workers using electronic communications devices while off the clock.
- Ban the Ban? – The EEOC is questioning employers’ need to obtain and use criminal history info in hiring decisions and a handful of states and local jurisdictions have enacted “ban the box” legislation to defer that query until later than usual in the hiring process. Contrary to this trend, certain industries or types of jobs are subject to mandatory background checks or at least can make a very good business argument why they should do so. Into the breach steps proposed legislation called the Certainty in Enforcement Act of 2015 which, if passed, would amend Title VII to state that consideration of credit and criminal records, as mandated by law or certain professional organizations, is deemed to be both job related and a business necessity and shall not be the basis for liability under a theory of disparate impact. If you’d like to track H.R. 548, you can see full text and all the action on the bill at www.congress.gov.
- Fun With FMLA – Machinist experiences chest pain and leaves work early. He arrives at hospital just before midnight, is admitted after midnight and is discharged a few hours later, in the p.m. Upon returning to work, machinist is informed he is discharged for walking off the job. Machinist sues under FMLA and loses. Why? The regs say one of the definitions of a “serious health condition” is inpatient care involving an overnight stay, but the court said there was no overnight stay because he was admitted and discharged on the same day. Jeffrey Bonkowski v. Oberg Industries Inc. (3rd Cir. May 2015). As always, the devil is in the details.
- Noncompete Nixed – Noncompete covenants are a creature of state law and the law governing them in Oregon just became a bit of a bear. OR had already enacted a law to limit their use to exempt workers earning more than the median income for a family of four (roughly $74K, for now) and conditioning enforceability on either an employee receiving a “bona fide advancement” or providing it in writing to a new hire at least two weeks before employment begins. The law also provided a two-year limit on duration of the restriction, which has now been reduced to 18 months via amendment of the existing law. The reduced temporal limit takes effect January 1, 2016 and will apply to agreements entered into on or after that date. These limitations do not apply to other restrictive covenants, such as non-solicitation of one’s former co-workers or customers.
- Hot Stuff – The Fourth of July signals onset of the hottest part of the year, so here are your summer tips:
- California Cool – At least one state, California, mandates that outdoor workers be provided with water, rest and shade. For more info on the CA law, go to http://www.dir.ca.gov/dosh/heatillnessqa.html.
- General Duty – OSHA likes CA’s “water, rest, shade” ditty and incorporated it into its Heat Illness Prevention Program at https://www.osha.gov/SLTC/heatillness/index.html. Employers have a general duty to provide a workplace free of known harms and this can include the effects of summertime heat.
- There’s an App For That – Check out OSHA’s heat risk app at https://www.osha.gov/SLTC/heatillness/heat_index/heat_app.html. It enables supervisors to quickly determine the heat index of their location on their iPhone or Android devices.
- The Other Kind of Hot Employee – Rising temps seem like a good reason, to some, for wearing less clothing or the wrong kind of clothing to work. Revisit your dress/personal appearance policy and have a talk with those who display too much skin or appear more suited to a day at the beach rather than a day at work. Scantily clad folks may be (purposely or inadvertently) inviting the kind of attention that may lead to harassment claims and co-workers may be uncomfortable being forced to work alongside a half-naked person.
- Hot Topic – College and high school students on break are looking for work and some are willing to do it for free, just to get work experience on their resume and maybe, just maybe, impress you enough to earn a job offer for future employment. As tempting as the siren song of free labor sounds, in most cases . . . don’t! Refresh yourself on the requisites of unpaid internships by reading Fact Sheet #71 on the DOL’s website at http://www.dol.gov/whd/regs/compliance/whdfs71.htm. Plenty of employers, especially in the sports, journalism and entertainment fields, have learned this expensive lesson the hard way.
- Hot Savings – Heads up, Texans . . . your sales tax holiday for the year will be on August 7 to 9. For more info on what items are included, go to http://comptroller.texas.gov/taxinfo/taxpubs/taxholiday/d/.
- Mama Mia – Just before the Supreme Court ruled on Young v. UPS, the EEOC issued revised Enforcement Guidance on Pregnancy Discrimination and Related Issues, in what appeared to be an attempt to influence the outcome. In the end, SCOTUS did not completely side with either the EEOC or the employer but it did make clear that the employer’s reliance on a facially neutral policy (which limited light duty opportunities to those who had workplace injuries or an ADA disability) could violate the Pregnancy Discrimination Act if it posed a significant burden on pregnant workers and the employer did not have a very good reason for excluding them from those opportunities. As a next step, EEOC has revised its guidance to parrot what the Supremes said in the Young decision.
- Oh Pooh, Part Two – Last month, I wrote about two warehouse employees who prevailed in their GINA lawsuits, arising from being asked to provide DNA samples via cheek swab (to help the employer identify a mystery person who defecated repeatedly on the warehouse floor). Although the deliveryman and fork lift driver were not a match with the, uh, deposit and neither suffered an adverse employment action, they sued under GINA for the humiliation of being tested. Now comes their reward . . . the jurors awarded $2.23 million in damages, comprised of $475,000 for emotional distress and $1.75 million in punitive damages, based on the employer’s “reckless indifference” to their rights.
- FTC and Impermissible Influence – Back in December 2009, the Federal Trade Commission (FTC) revised its Guides Concerning the Use of Endorsements and Testimonials in Advertising. Part of the guide was aimed at employee bloggers and explained that they must disclose the fact that they are employed by the entity whose products or services were the subject of their social media commentary. The guides were recently updated and the “What People Are Asking” section now says that liking, pinning or sharing a link with others can be an endorsement which prompts the disclosure requirement. If the platform does not provide a way to make such a disclosure, then mum’s the word.
- Social Stop – 21 states and Guam have enacted law prohibiting employers from requiring job applicants and employees to disclose passwords or provide access to their personal social media accounts. Oregon went there, too, but now adds to it by banning employers from requiring or requesting an applicant or employee to establish or maintain a personal social media account and requiring an employee to advertise on the account. This amendment takes effect January 1, 2016.
- Calendar This – Yours truly and a host of employment experts will be speaking at the Texas Employment Relations Symposium which is co-hosted by the Texas Association of Business and SHRM – Texas State Council on July 9 and 10 at the Hyatt Regency on the Riverwalk in San Antonio. For a copy of the agenda and info to register, go to http://www.txbiz.org/events/Employment-Relations-Symposium-360/details. Hope to see you there!
- Stated Differently – Here are some hot topics for you multi-state employers:
- Illinois (Chicago) – Effective July 1, 2015, the minimum wage for employees who work at least two hours in the city in any two-week period will be $10/hour for non-tipped workers and $5.45/hour (plus max tip credit of $3.30/hour) for tipped employees. The non-tipped rate will increase annually until it reaches $13/hour by 2019. After that, the rate will be tied to the Consumer Price Index.
- Indiana – Effective July 1, 2015, liquidated damages are no longer mandatory when an employer violates the state’s wage payment law. Under the prior version, employers were charged a penalty of 10% per day for each day the disputed wages remained unpaid. Under the new version, a court must first find the employer was not acting in good faith before the damages apply. Also effective July 1, 2015, the list of reasons for which an employer may withhold from an employee’s pay has been expanded to include [a] sale of goods or food to the employee; [b] purchase price of uniforms and equipment; [c] education or employee skills training; or [d] advances in pay, including early payment of vacation pay. These deductions remain contingent on a writing signed by both the employee and the employer, agreeing to the deduction, and the ability of the employee to revoke the authorization at any time.
- Maryland (Montgomery County) – Employers must provide paid sick leave to all employees performing work in Montgomery County effective October 1, 2016. The definitions of permissible uses of paid sick leave and the covered individuals with some relationship to the employee (whose need is a reason for the employee to take leave) are quite broad, so read closely if you are subject to this law.
- Massachusetts – Effective July 1, 2015, employers of 11+ employees must provide employees with at least one hour of paid sick time for every 30 hours worked, up to a maximum of 40 hours of paid sick time each year. Employers with less than 11 employees must provide the same amount of time off, but without pay. There is also a mandatory poster for the workplace. For more info and a copy of the poster, go to http://www.mass.gov/courts/case-legal-res/law-lib/laws-by-subj/about/employmentleave.html#Sick Leave.
- New York (New York City) – Ban the box ordinance takes effect October 27, 2015.
- Oregon – Effective July 1, 2015, OR law permits both medical and recreational marijuana use. The change in state law does not impact employers’ ability to impose policies which prohibit having any marijuana in one’s system while they are at work, or to refuse to hire an applicant or to discharge an employee who violates that policy. OR becomes the seventh state to “ban the box” for private employers, effective January 1, 2016. The law prevents employers from requiring applicants to disclose a criminal conviction prior to an initial interview. If there is no initial interview, the ban remains in place until after there is a conditional offer of employment. Also effective January 1, 1016, OR becomes the 4th state to add paid sick leave (following CA, CT and MA). Employers with 10+ employees (6+ if you are in Portland) must provide up to 40 hours of paid sick leave per year. Smaller employers must provide a comparable amount of unpaid time off to their employees.
- For the Birds – If you like being tweeted and want breaking news on employment law changes (and the occasional random cheer for K-State), follow me on Twitter. I’m at @amross.
Until next time,
Audrey E. Mross
Labor & Employment Attorney
Munck Wilson Mandala LLP
600 Banner Place
12770 Coit Road
Dallas, TX 75251
Legal Briefs for HR (“LB4HR”) is provided to alert recipients to new developments in the law and with the understanding that it is guidance and not a legal or professional opinion on specific facts or matters. For answers to your specific questions, please consult with counsel. If you wish to be added to the group or to modify your current contact information, go to www.munckwilson.com and click on Media Center and then Subscribe, or send your contact info directly to the author. If you wish to be removed from the group, reply and put “Remove” in the subject line.
If you wish to post, reprint or send LB4HR for the benefit of your organization, please contact the author for permission. Upon approval, nonprofit entities may post, reprint or send LB4HR to their members for no fee. For-profit entities may be charged a nominal fee. LB4HR is copyrighted work product and may not be posted, reprinted or sent without permission, however, individual subscribers are welcome to forward LB4HR to individuals or within their place of employment without seeking permission, so long as the author’s complete contact information is included.
Subscribers are encouraged to notify their Internet Service Provider (ISP) that firstname.lastname@example.org is a trusted source, in order to receive an uninterrupted subscription to LB4HR. Due to the size of the email group and occasional use of sensitive words, LB4HR can be perceived as spam or inappropriate email and deleted or diverted by your ISP’s filter.