Just one month after the U.S. District Court for the Eastern District of Texas shut down a Fair Pay and Safe Workplaces final rule, the District Court has enjoined the implementation of the Department of Labor’s (DOL) final rule updating its Fair Labor Standard Act (FLSA) exemptions. Had these gone into effect, they would have had a significant impact on government contractors’ labor costs.
In 2014, President Obama directed DOL to update and modernize its overtime regulations to be consistent with the intent of the FLSA. The FLSA provides for minimum wage and overtime pay protections for those covered by the Act. Exempted employees generally fall into the executive, administrative and professional (EAP) categories, and DOL has used the following three tests to determine whether an exemption applied: salary basis test, salary level test and duties test. “Exempt” employees are not eligible for overtime pay (time and a half) for hours worked over 40 in a work week.
Bass, Berry & Sims attorney Tim Garrett discussed a case pending before the U.S. Court of Appeals for the Eighth Circuit relating to a striking employee’s termination for yelling racist comments at replacement workers. Although the employee’s firing was upheld by an arbitrator, an administrative law judge (ALJ) did not defer to that ruling and ordered the company to reinstate the employee, citing protection for the striker’s conduct under the National Labor Relations Act (NLRA). The National Labor Relations Board agreed with the ALJ, and the company has appealed to the Eighth Circuit.
The full article, “After NLRB Gives Job Back To Worker Fired For Racism On Picket Line, Appeal Follows,” was published by Forbes on November 30, 2016, and is available online.
In an article published by Government Executive, Bass, Berry & Sims attorneys Richard Arnholt and Michael Moschel provided insight on the state of the Fair Pay, Safe Workplaces rule following a preliminary injunction issued by a Texas district judge in October blocking parts of the rule. Michael believes that Fair Pay, Safe Workplaces is going to be one of the executive orders President-elect Trump will do away with, considering Trump promised to wipe out job-killing regulations. Michael and Richard argue that the president and agencies went around Congress in a quest for efficiency and cost savings, but provided no reliable data to prove the need for the rule, while forcing contractors to provide detailed reporting on non-final decisions and determinations of alleged labor law violations that could end up denying them a contract without due process. Continue Reading
In a ruling announced yesterday, a federal judge in Texas has halted nationwide the effectiveness of the new salary level required to be paid by employers to those employees who are exempt from overtime. This alert will discuss briefly the ruling, its impact, and what employers should do in response. Continue Reading
Bass, Berry & Sims attorney Tim Garrett provided insight for an article outlining the case brought by 21 states challenging the Department of Labor (DOL) related to the new overtime regulations set to take effect December 1, 2016. Although the challenge is under review, Tim still is advising “that employers continue to plan to comply with the new rule effective Dec. 1, unless the court does impose a nationwide injunction. The risks of failing to comply are simply too great and can lead to immediate legal exposure.” Continue Reading
A case currently under consideration in the Eighth Circuit Court of Appeals deserves watching. The case will determine whether the National Labor Relations Act (NLRA) protects a picketing employee’s right to hurl racist insults at replacement workers, so long as no threat is involved. The case is Cooper Tire & Rubber Company v. NLRB, Case No. 16-2721. The facts show an intriguing – and some would argue sad – sacrifice by the current Labor Board of race relations at the altar of protecting striking workers’ and their “impulsive behavior.” Continue Reading
The Equal Employment Opportunity Commission (EEOC) recently revealed its Strategic Enforcement Plan for 2017-2021. Of course, this Plan was developed before the election of Donald Trump as President. Thus, the information contained in the Plan could soon become moot, or at the very least, stale. However, seeing what the EEOC recently noted as high priority areas is instructive. Whether the Plan will be dramatically or only slightly revised remains to be seen. Continue Reading
To help stabilize the individual insurance market, Section 1341 of the Affordable Care Act introduced the Transitional Reinsurance Program (TRP), which includes the collection of a TRP fee from “contributing entities” for 2014, 2015 and 2016 to fund the program. The reporting for 2016 (the final year that the TRP fee is applicable) is due by November 15, 2016.
Who has to pay the fee?
“Contributing entities” are required to pay the TRP fee to the U.S. Department of Health and Human Services (HHS). Generally, “contributing entities” include health insurers and self-funded group health plans providing major medical coverage. The IRS has confirmed that the TRP fee is deductible as an ordinary and necessary business expense. Continue Reading
Human Resources (HR) personnel are now specifically under the scrutiny of the antitrust enforcement agencies. The Department of Justice (DOJ) and Federal Trade Commission (FTC) are typically known for enforcing antitrust laws against price-fixers and bid-riggers. Recently they announced a new set of targets: anti-competitive agreements between employers related to hiring and compensation. For the first time, these agencies have warned HR personnel and their employers they may be criminally prosecuted for agreeing with other companies to fix employee pay (wage-fixing agreements) or not to recruit each other’s employees (no-poaching agreements). Criminal violations of the antitrust laws are felonies and threaten substantial fines and jail time.
Bass, Berry & Sims attorney Tim Garrett provided insight on the impact that hospitals may encounter as a result of the Department of Labor’s (DOL) new overtime pay rule, set to take effect December 1, 2016. The new rule will more than double the salary level for those employees classified as exempt from overtime pay from the current level of $23,660 to the new level of $47,476, or $913 per week. As Tim points out, “[a] major challenge for hospitals will be cost containment.” The new rule could make it difficult for hospitals to anticipate the new labor costs.
The full article, “New Overtime Rules Could Upend Pay Structures,” was published by Hospitals & Health Networks on October 25, 2016, and is available online.