On April 1, 2020, the Department of Labor (DOL) published the first regulations on the Families First Coronavirus Response Act (FFCRA). As a reminder, the FFRCA became effective on April 1 as well, and provides for Emergency Family and Medical Leave (EFMLA) and Emergency Paid Sick Leave (EPSL). Both laws apply to private employers with fewer than 500 employees, as well as some public employers.
On March 18, 2020, the Families First Coronavirus Response Act (“FFCRA”) was enacted. The statute left many questions regarding its implementation and administration unanswered. Over the past several days, the U.S. Department of Labor (the “DOL”) has been publishing questions and answers addressing some of these unanswered questions. Here is a summary of some of the key information provided by the DOL.
The COVID-19 pandemic has already caused severe disruption to many businesses across the country. Employers will be required to continue to monitor developments and adjust to changing circumstances in the coming weeks and possibly months. We provide the following recommendations for employers in dealing with the many employment-related issues that will inevitably arise.
On January 16, 2020, the Wage and Hour Division of the United States Department of Labor (“DOL”) published its final rule to revise and update its regulations regarding joint employer status. The final rule largely adopts the proposed rule the DOL published in April of 2019, which we wrote about here. The final regulations become effective March 16, 2020, and mark the first significant revision since they were enacted in 1958. Employers should take note of these new regulations because if an employee is found to be jointly employed by two employers, both employers are jointly and severally liable for all wages owed to that employee, including overtime wages.
The U.S. Department of Labor ("DOL") recently issued updated regulations which clarify what types of compensation provided by employers can properly be excluded from the regular rate for overtime computation purposes. The DOL's stated purpose in updating its regular rate regulations (which had not been significantly revised in more than 50 years) is to better reflect the 21st century workplace and to encourage employers to provide additional and innovative benefits to employees without fear that those forms of compensation might result in additional overtime obligations. The updated regulations became effective on January 15, 2020.
On November 5, the U.S. Department of Labor published a proposed rule in the Federal Register to provide some clarity for employers that seek to use the fluctuating workweek method of overtime compensation under the Fair Labor Standards Act. The proposed amendment lists each of the five requirements for using the fluctuating workweek method separately, instead of including all of the requirements in paragraph form as the current regulation does. The proposed amendment also includes additional language not currently contained in the regulation, explicitly stating that bonuses, premium payments, and other additional payments of any kind are not incompatible with the use of the fluctuating workweek method of computing overtime.
On September 27, 2019, the U.S. Department of Labor published its final regulations in the Federal Register to increase the minimum weekly salary to qualify for the Fair Labor Standards Act white collar exemptions from $455 per week ($23,660 per year) to $684 per week ($35,568 per year). These new regulations become effective on January 1, 2020.
On April 1, 2019, the Wage and Hour Division of the U.S. Department of Labor ("DOL") announced a proposed update to its joint employment regulations, which is the first significant revision to the DOL's joint employment rules since their promulgation in 1958. The proposed updates to the regulations attempt to clarify joint employer status for purposes of wage liability under the Fair Labor Standards Act ("FLSA").
On March 7, 2019, the U.S. Department of Labor issued proposed regulations that would increase the minimum weekly salary to qualify for the Fair Labor Standards Act white collar exemptions from $455 per week ($23,660 per year) to $679 per week ($35,308 per year). These new proposed regulations are intended to replace the USDOL's 2016 regulations raising the minimum weekly salary to $913 per week ($47,476 per year), which were held by the U.S. District Court for the Eastern District of Texas to be invalid approximately one week before those regulations were set to take effect.
Employers who provide sick leave and vacation leave time may also have a policy or practice of allowing employees to “sell back” accrued, unused time. Under these “buy-back” programs, the employer will, for a select time period, pay employees for their unused time, in addition to any actual work performed by the employee in that workweek. This then raises the question: do these payments for sick and vacation time have to be counted as part of the employee’s “regular rate” for purposes of computing overtime due during the workweeks in which that time is paid out to the employee?
The U.S. Department of Labor just released a new “Fact Sheet,” targeted specifically at higher education institutions and their compliance with the Fair Labor Standards Act.
On April 2, the U.S. Supreme Court held, in Encino Motorcars, LLC v. Navarro, that service advisors at automobile dealerships are exempt from the overtime requirements of the Fair Labor Standards Act. The Court was divided 5-4 on this issue, with Justice Thomas writing the opinion on behalf of the majority and Justice Ginsburg writing the opinion on behalf of the 4 dissenting Justices. The Court reversed a Ninth Circuit Court of Appeals' decision, which found that service advisors were non-exempt employees who were eligible for overtime pay.
