DOL Issues Proposed Rule Updating Regular Rate Requirements

By Kathleen J. Jennings (kjj@wimlaw.com)

Today, for the first time in more than 50 years, the U.S. Department of Labor today announced a proposed rule to clarify and update the regulations governing regular rate requirements.

Regular rate requirements define what forms of payment employers include and exclude in the “time and one-half” calculation when determining workers’ overtime rates.

Under current rules, employers are discouraged from offering more perks to their employees as those perks may be vaguely defined in calculating an employees’ regular rate of pay. The proposed rule focuses primarily on clarifying whether certain kinds of perks, benefits, or other miscellaneous items must be included in the regular rate. According to the DOL, because these regulations have not been updated in decades, the proposal would better define the regular rate for today’s workplace practices.

The Department proposes clarifications to confirm that employers may exclude the following from an employee’s regular rate of pay:

•    the cost of providing wellness programs, onsite specialist treatment, gym access and fitness classes, and employee discounts on retail goods and services;

•    payments for unused paid leave, including paid sick leave;

•    reimbursed expenses, even if not incurred “solely” for the employer’s benefit;

•    reimbursed travel expenses that do not exceed the maximum travel reimbursement under the Federal Travel Regulation System and that satisfy other regulatory requirements;

•    discretionary bonuses, by providing additional examples and clarifying that the label given a bonus does not determine whether it is discretionary;

•    benefit plans, including accident, unemployment, and legal services; and

•    tuition programs, such as reimbursement programs or repayment of educational debt.

The proposed rule also includes additional clarification about other forms of compensation, including payment for meal periods, “call back” pay, and others. The public may submit comments about this proposed rule by 11:59 pm on May 28, 2019.

Kathleen Jennings, Principal is a principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, & Stine, P.C. She defends employers in employment matters, such as sexual harassment, discrimination, Wage and Hour, OSHA, restrictive covenants, and other employment litigation and provides training and counseling to employers in employment matters. She can be contacted at kjj@wimlaw.com.

©2019 Wimberly Lawson

The materials available at this blog site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Wimberly Lawson and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

Strategies for Addressing Sexual Harassment in the Workplace; One Size Does Not Fit All

By Kathleen J. Jennings (kjj@wimlaw.com)

Today the U.S. Equal Employment Opportunity Commission (EEOC) convened an “Industry Leaders Roundtable Discussion on Harassment Prevention.” Representatives from a diverse group of industries and associations discussed challenges their members and the public face in addressing issues raised by the #MeToo movement. Participants also shared strategies they have implemented to improve workplace culture and reduce harassment.

  • Rosanna Maietta, Executive Vice President of Communications & Public Relations of the American Hotel & Lodging Association and President of the American Hotel and Lodging Educational Foundation, described the 5-Star Promise, a pledge to provide hotel employees with employee safety devices and to adopt enhanced policies, trainings and resources to improve hotel safety, including preventing and responding to sexual harassment and assault.
  • Andy Brantley, President and CEO of the College and University Professional Association for Human Resources, shared that “we cannot simply ‘train away’ harassment. Training and heightening awareness will always be important, but we must be committed to creating and sustaining workplace cultures that do not tolerate harassment in any way, shape or form.”
  • Stephanie Martz, Senior Vice President and General Counsel of the National Retail Federation, explained that “retailers recognize that training and a company culture of respect and inclusion are critical to effective prevention and compliance efforts.” She noted one challenge her organization and its members have identified is the importance of tailoring training to address the unique realities of the retail workplace.
  • Bobby Franklin, President and CEO of the National Venture Capital Association, emphasized that “harassment is interconnected with the lack of diversity and inclusiveness in our industry.” As a result, his organization surveys members to understand the scope of the harassment problem in their industry, and it has taken multiple steps to improve education by drafting model policies and a best practices guide.
  • James Banks, Jr., General Counsel of the Society for Human Resources Management, stated that his organization is providing human resource professionals with programming on workplace civility, inclusion, workplace investigations that can improve culture, and anti-harassment strategies. Mr. Banks explained that “the #MeToo movement has been a call to action for organizational leaders to assess their workplaces to ensure they have a healthy culture and live that culture in all they do.”

The Takeaway: In order for an employer to effectively deal with sexual harassment in the workplace, it must create a culture where harassment is not tolerated by anyone. Supervisor and employee training are tools that can help a company to achieve that goal, and they should be tailored to the needs of the particular industry and workforce. However, the commitment to a workplace culture that does not tolerate sexual harassment must start with upper management. And that means that sometimes upper management is going to have to make some difficult decisions if they learn that a valued manager or high performing employee has committed sexual harassment; if they take no action against that person, employees will see that the company is not willing to “put their money where their mouth is.”

Kathleen Jennings, Principal is a principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, & Stine, P.C. She defends employers in employment matters, such as sexual harassment, discrimination, Wage and Hour, OSHA, restrictive covenants, and other employment litigation and provides training and counseling to employers in employment matters. She can be contacted at kjj@wimlaw.com.

©2019 Wimberly Lawson

The materials available at this blog site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Wimberly Lawson and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.

DOL Announces Long Awaited Overtime Rule

By Kathleen J. Jennings (kjj@wimlaw.com)

Remember the proposed increase in the salary threshold for overtime eligibility that had been announced during the Obama Administration and then enjoined by a federal court in 2016? Since then, the Department of Labor has promised to issue a new rule with a new threshold that is lower than the one proposed by the Obama Administration, but higher than the existing threshold that was set in 2004.

The wait is over! Yesterday, the DOL announced a Notice of Proposed Rulemaking (NPRM) that it claims would make more than a million more American workers eligible for overtime. Under currently enforced law, employees with a salary below $455 per week ($23,660 annually) must be paid overtime if they work more than 40 hours per week. Workers making at least this salary level may be eligible for overtime based on their job duties. This new proposal would update the salary threshold using current wage data, projected to January 1, 2020. The result would boost the standard salary level from $455 to $679 per week (equivalent to $35,308 per year).

The NPRM also includes the following provisions:

  • The proposal increases the total annual compensation requirement for “highly compensated employees” (HCE) from the currently-enforced level of $100,000 to $147,414 per year.
  • A commitment to periodic review to update the salary threshold. An update would continue to require notice-and-comment rulemaking.
  • Allowing employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid annually or more frequently to satisfy up to 10 percent of the standard salary level.
  • No changes overtime protections for:
    • Police Officers
    • Fire Fighters
    • Paramedics
    • Nurses
    • Laborers including: non-management production-line employees
    • Non-management employees in maintenance, construction and similar occupations such as carpenters, electricians, mechanics, plumbers, iron workers, craftsmen, operating engineers, longshoremen, and construction workers
  • No changes to the job duties test.
  • No automatic adjustments to the salary threshold.

 

This is not a final rule. The proposed rule will be published in the Federal Register and the public will be able to submit comments during a 60 day period. For more information, please visit https://www.dol.gov/whd/overtime2019/.

Kathleen Jennings, Principal is a principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, & Stine, P.C. She defends employers in employment matters, such as sexual harassment, discrimination, Wage and Hour, OSHA, restrictive covenants, and other employment litigation and provides training and counseling to employers in employment matters. She can be contacted at kjj@wimlaw.com.

©2019 Wimberly Lawson

The materials available at this blog site are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this Web site or any of the e-mail links contained within the site do not create an attorney-client relationship between Wimberly Lawson and the user or browser. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney.