DOL Files Brief in Overtime Rule Appeal Seeking to Reaffirm Its Authority to Establish an Exempt Salary Level Test

On June 30, 2017, the U.S. Department of Labor (DOL) filed a brief with the federal Fifth Circuit Court of Appeals in support of its appeal of a lower court ruling that enjoined implementation of its 2016 overtime rule under the Fair Labor Standards Act (FLSA). Had the rule gone into effect when scheduled on December 1, 2016, it would have raised the minimum salary threshold for white collar exempt employees from $455 per week to $913 per week. Under the new Trump administration, the DOL informed the appellate court that it plans to revise the overtime rule that was issued during the Obama administration; however, it will not do so until the Fifth Circuit Court of Appeals confirms that it has the right to set an exempt salary threshold. 

DOL Officially Changing Course on Persuader and Overtime Rules

Just days after withdrawing some of its guidance on joint employer and independent contractor issues, the U.S. Department of Labor (DOL) indicated it will soon reconsider the much maligned “Persuader Rule” and white-collar Overtime Rule that were both enjoined last fall. The DOL wants to rescind the Persuader Rule and plans to seek additional public comment on the white-collar salary thresholds set forth in the Overtime Rules.

As a reminder, the Persuader Rule would have required employers to publicly disclose when they use consultants (including lawyers) to obtain labor relations advice and services for the purpose of persuading employees regarding union organizing. The consultants/lawyers would also have been required to file reports containing details about their advice and the payments received for such advice. Previously, such reports were only required when a consultant providing advice had direct contact with employees. On June 12, 2017, the Federal Register published the DOL's proposal to rescind the Persuader Rule in order to consider “the potential effects of the Rule on attorneys and employers seeking legal assistance” and “the impact of shifting priorities and resource constraints.” Comments on this proposal are due by August 11, 2017.

The Unpopularity of the Proposed EEOC and OFCCP Merger

The Trump administration’s proposed budget for the upcoming federal fiscal year contains a streamlining proposal that is evoking strong opposition from both employer and employee groups. Namely, the administration has proposed merging the federal Equal Employment Opportunity Commission (EEOC) and the Office of Federal Contract Compliance Programs (OFCCP).

Employers and employee rights groups are rarely on the same side of regulatory matters, but in this case, there is almost unanimous opposition to the proposed agency merger. Presumably, the Trump administration believes an EEOC and OFCCP merger is a plausible streamlining approach, because both organizations focus on enforcing federal laws focused on employment discrimination. Employee groups, however, worry that a merger will result in decreased enforcement efforts due to a lack of adequate agency funding, staff, and resources. The Trump administration’s merger proposal provides for the EEOC to absorb the OFCCP with no new financial resources to address merger logistics.

Department of Labor Withdraws Guidance on Joint Employer and Independent Contractor Liability

The U.S. Department of Labor (DOL) has withdrawn two informal regulatory interpretations, issued in 2015 and 2016, on the subjects of joint employer and independent contractor liability of employers. (See our previous blog posts about the related risks for employers, available here.)

The DOL’s announcement this week appears to signal a major course reversal in the wage and hour arena, particularly from 2016 when its Wage & Hour Division had made joint employment “a major focus.” This is likely true even though the DOL said, in announcing the withdrawal: “Removal of the two administrator interpretations does not change the legal responsibilities of employers under the Fair Labor Standards Act . . . as reflected in the Department’s long-standing regulations and case law.”

Minnesota Governor Vetoes Uniform Labor Standards Bill

As expected, Minnesota Governor Mark Dayton has vetoed legislation passed by the Minnesota legislature that would have preempted local government’s ability to enact laws that set wage, vacation, or sick time requirements, or other employment benefit levels higher than those set by state-wide law. The vetoed legislation (the Uniform Labor Standards bill) was passed by the Minnesota state legislature late last month and was perceived, to a great degree, as a response to the enactment of Minneapolis and St. Paul city ordinances creating mandatory sick leave benefits for employees. Although it is difficult to predict with certainty, at this time a possible override of Governor Dayton’s veto appears unlikely.

In Honor of Memorial Day, a USERRA Primer

Memorial Day signals the beginning of summer. Here in Minnesota, lake-goers open their cabins and put out their docks, and families gather for backyard cookouts. For many, Memorial Day has special meaning as we remember those who died in military service in our country’s armed forces. In honor of Memorial Day, we take a look at USERRA and other laws that afford legal protections to service members, veterans, and their families.

The Uniformed Services Employment and Reemployment Rights Act (USERRA) is a federal law that provides reemployment rights to persons who must be absent from their jobs because of “service in the uniformed services.” The U.S. Department of Labor has created a handy pocket guide that summarizes the USERRA’s protections and the respective obligations of employers and employees.

FTC Advises Simplicity for Background Check Disclosure and Authorization Form

On April 28, 2017, the Federal Trade Commission (FTC) published a post on its business blog advising employers to keep it simple when it comes to employment background check disclosure and authorization forms. While the blog post is not legally binding, it provides some useful guidance on how to comply with federal background check requirements.

Employment background checks done by an outside vendor for a fee are considered “consumer reports” under the federal Fair Credit Reporting Act (FCRA). Pursuant to FCRA, employers are required to make a specific written disclosure to prospective and current employees and obtain their written authorization before obtaining a background check for employment purposes. Against the backdrop of a growing number of lawsuits around what the FCRA statute provides that disclosure and authorization forms may contain, the FTC’s blog post clarifies that the disclosure and authorization may be in a single document as long as clear and understandable wording is used. The FTC also advises keeping the form simple, however, and excluding extraneous information. The following are examples of what the FTC blog post states should not be in a combined disclosure and authorization form: