Increased FLSA Threshold for White Collar Exemptions Takes Effect at the Start of the New Year

Employers should be aware that an amendment to the Federal Fair Labor Standards Act (FLSA) will increase the salary level threshold for the white-collar employee exemption from overtime pay commencing January 1, 2020. The white-collar exemption generally applies to executive, administrative, and professional job positions, as defined under the FLSA. A final rule was issued by the federal Department of Labor (DOL) on September 24, 2019, which increases the white-collar exemption salary level from the current level of $455.00 per week to $684.00 per week (which computes to $35,568 annually). The threshold increase is significantly lower than the increase contained in a 2016 rule ($913 per week) that never went into effect. We have previously discussed in detail here the proposed rule that ultimately led to the final rule.

Overtime on Split-Day Pay — Employer Beware

A note of caution to Minnesota-based employers — federal enforcement of the Fair Labor Standards Act (FLSA) should not be your only concern when drafting employee compensation plans; the Minnesota Department of Labor and Industry is actively auditing employers in search of those avoiding their overtime requirements under the Minnesota Fair Labor Standards Act (MFLSA). This past Wednesday, the Minnesota Supreme Court upheld a million dollar compliance order issued by the Department against an employer utilizing split-day compensation plans. The court held that an employer must pay an employee at least one and one-half time for any hours worked in excess of 48 hours in a given week (overtime hits after 48 hours under the MFLSA as opposed to 40 hours under the FLSA), regardless of how that employee was compensated prior to meeting those 48 hours. Further, the court held that an employer may not exclude time and one-half pay for work performed within the employee’s first 48 hours of work when calculating the employee’s regular rate of pay.

NLRB Strengthens Employers’ Right to Bar Non-Employee Protests

The National Labor Relations Board (NLRB or the “Board”) has yet again reversed precedent and created a new employer-friendly rule regarding non-employees engaging in leafletting on an employer’s premises. In a prior 2011 decision involving the New York New York Hotel in Las Vegas, the Board had held that employers could only prohibit leafletting by non-employees on the employer’s property when such activity would “significantly interfere” with the employer’s use of the property. This was a difficult standard for employers to meet, and, fortunately for employers, they may now have greater flexibility. 

EEOC Released FAQs on EEO-1 Reporting, Including Guidance on Reporting Non-Binary Employees

The deadline for employers with annual EEO-1 reporting requirements to submit Component 2 pay data is just over a month away. Employers must file 2017 and 2018 Component 2 compensation data by September 30, 2019.

With the deadline approaching, the Equal Employment Opportunity Commission (EEOC) has released guidance to filing employers through answers to Frequently Asked Questions. Among other issues, the EEOC addressed reporting non-binary gender employees. Previously, the EEOC required an employer to list an employee’s gender for EEO-1 reporting as male or female. The EEOC also stated that self-identification was the preferred method of identifying an employee’s sex. The EEOC, however, had not previously answered the question of how to complete the EEO-1 form related to employees who identify as non-binary.

New Compliance Tools From the Department of Labor

As part of its ongoing efforts to assist employers in understanding their responsibilities under federal employment law, the Wage and Hour Division of the U.S. Department of Labor recently added publically available presentations to its website.  The presentations cover topics under the Fair Labor Standards Act, such as wage and hour requirements, child labor requirements, and an employer’s responsibilities to provide rest breaks and proper facilities for nursing mothers.

During the past year the Department of Labor has added other content to its online materials including the Handy Reference Guide to the Fair Labor Standards Act.

The Department states that these online tools are designed to ensure a greater understanding of the federal labor laws and regulations.

Minneapolis Passes Wage Theft Ordinance, Adding Requirements Beyond State Law

The Minneapolis City Council adopted a new “Wage Theft” ordinance on August 8 that adds requirements on top of those in the new Minnesota Wage Theft law that became effective July 1. The city ordinance will be effective January 1, 2020, and will require employers to satisfy the city’s wage theft requirements for all employees who work at least 80 hours in a year within the geographical boundaries of Minneapolis, regardless of the location of the employer. Violations of the ordinance subject an employer to a variety of damages, costs, and penalties.

Do Your Employees Know When Their Commissions and Bonuses are “Earned”? Dealing with Minnesota’s New Wage Theft Statute

As we discussed in prior posts (“Minnesota’sNew Wage Theft Law: Are You Prepared?” and “Minneapolis Wants a Piece of the Wage Theft Pie”), Minnesota’s 2019 legislature passed expansive new “wage theft” protections for employees. Most of the new law’s provisions became effective July 1. The new criminal penalties for intentional wage theft are effective August 1. While the new law contains numerous significant changes to wage-related notice and recordkeeping requirements, payment of commissions and bonuses is also affected and deserves an employer’s close attention to achieve compliance without creating unnecessary burdens.

Bonuses are “earnings,” which the law dictates be paid at least every 31 days. For commissions, the new law provides that “all commissions earned by an employee” must be paid at least once every three months. Payment of commissions must be made “on a regular payday designated in advance by the employer regardless of whether the employee requests payment at longer intervals.” If commissions or bonuses are not paid within the required time from when they are earned, the Minnesota Commissioner of Labor and Industry may serve a demand for payment on behalf of the employee. If an earned bonus or commission is not paid within 10 days of the Commissioner’s demand, the MN Department of Labor and Industry may charge and collect the bonus or commission, along with a substantial penalty for each day beyond the 10-day limit.