September 2017 HR Regulatory Updates

by Jill Schaefer on August 30, 2017


Reminder: Employers Required to Use New I-9 Form by 9/18/2017
Have you downloaded the new I-9 Employment Eligibility Verification Form and started using it? If not, take a minute to get started. All U.S. employers must use the new form by September 18.

If you’re curious what changed, read our August 2017 HR Regulatory Updates.


OSHA Electronic Reporting Suspended Due to Security Breach
Early last month, the Occupational Safety and Health Administration (OSHA) launched its Injury Tracking Application website so that employers can electronically submit injury and illness records (300 Logs, 301 Forms, and 300A Forms). Relatively soon after the site went live, it was temporarily shut down due to a security threat.

The U.S. Computer Emergency Readiness Team, part of the Department of Homeland Security, informed OSHA that user information was potentially compromised.

The site appears to be live again, but OSHA hasn’t officially announced this. Employers must electronically submit injury/illness information by December 1, 2017.


New Online OSHA Whistleblower Complaint Form
The Occupational Safety and Health Administration (OSHA) has revised its online whistleblower complaint form. The intent of this is to give workers another way to file retaliation complaints.

What’s New?

  • Easier-to-follow format complete with upfront questions so people will better understand their legal rights.
  • Pop-up boxes with information about other agencies so that individuals who indicate they are associated with a protected activity can seek help accordingly.
  • Available in English and Spanish.

In addition to the updated form, workers can file retaliation complaints by fax; mail; or in-person. They can also call 1-800-321-6742 or contact an OSHA regional or area office.


ERISA Fiduciary Rule Delayed
The Employee Retirement Income Security Act (ERISA) went into effect June 9, 2017. However, because it didn’t have much regulatory power behind it, enforcement was postponed until January 1, 2018. Now, it’s looking like certain fiduciary rules may be further delayed.

The Investment Company Institute (ICI), a prominent trade group opposed to ERISA, petitioned the Department of Labor (DOL) to delay parts of the rule from going in to effect until 2020.

ICI asked the DOL to finalize changes to the rule and relevant exemptions by January 1, 2019, but for the changes not to take effect until at least January 1, 2020.

Why the delay?
ICI reasons that delay in the enforcement timeline would give Labor Secretary Alexander Acosta time to properly coordinate fiduciary rule making with Securities and Exchange Commission Chair Jay Clayton.

Other equally prominent organizations, such as the AARP, want the rules to go into effect in the originally intended. They say that any more delays will water down the effectiveness of the law.

The DOL’s second public comment period on the law ended August 7, 2017. However, as of this publication, the DOL has not announced whether it will officially delay rule enforcement past 2018.

For now…
Advisers to retirement investors are considered fiduciaries and must comply with “impartial conduct standards.” They must provide advice that’s in investors’ best interest, charge no more than a reasonable compensation and not make misleading statements. They can still recommend proprietary products and they can still get variable commissions.

Advisors are permitted to sell fixed indexed annuities, associated with large commissions, so long as they justify and document why this investment is in clients’ best interest.




Compensation History Inquiries Banned
Earlier this summer, Delaware Governor John Carney signed H.B. 1 into law. It bans employers from asking job applicants about salary history. It goes into effect in December 2017.

Under this law, Delaware employers:

  • Can’t seek applicants’ pay history before making employment offers.
  • Are prohibited from asking job applicants or their current or former employers about wage/salary information.
  • Cannot engage in salary-based screening of job applicants, where prior compensation must satisfy certain minimum or maximum criteria in order to be considered for a position.
  • May discuss and negotiate salary expectations, so long as no one asks for applicants’ compensation history.
  • Can confirm job applicants’ salary history, but only after an employment offer has been made, compensation terms were specified, and the applicant accepted them.

Your Action Items
Take the time over the next few months to review your hiring practices and ensure that they comply with H.B. 1. You’ll also need to train current employees who are normally  involved in the hiring process on what they can and cannot do under the new law.


New Hampshire

Tip Pooling Addressed in Wage & Hour Law
Effective September 3, 2017, New Hampshire’s SB 37 law amended RSA 279:26-b to address the practice of tip pooling. A tip pool is a fund that all employee tips are fed into, which is then divided up among a group of employees.

Under this law, employees who receive tips in New Hampshire may pool their tips and share them with coworkers who don’t get tips. For example, hosts and kitchen staff would be able to participate in a tip pool.

  • Employee participation in tip pooling is voluntary. They can’t be coerced into it.
  • A portion of the tip pool can be shared with employees, regardless of job category, who provided service to customers.
  • Game operators are prohibited from receiving distributions from an employee tip pool. 


New Jersey

Expanded Protections for U.S. Armed Forces Members & Veterans
The recently amended New Jersey Law Against Discrimination (NJLAD) prohibits all forms of discrimination against Armed Forces members and veterans.


  • Ensures the same level of protection for military personnel as all other protected classes.
  • Forbids discrimination in employment, housing, lending practices, public accommodations, and more.
  • For state construction contracting, contractors and subcontractors must now guarantee equal employment opportunity to all veterans, regardless of when they served.



Changes to Non-Compete Agreements
The Nevada state legislature recently updated regulations on non-compete agreements. They have now specified how employers should draft their provisions and forbid employers from restricting former employees from providing services to clients.

According to Lexology, a non-compete agreement in Nevada must now:

  • Be supported by “valuable consideration”
  • Not impose any restraint that is greater than required to protect the employer
  • Not impose any undue hardship on employees
  • Impose appropriate restrictions in relation to the valuable consideration
  • Cannot restrict a former employee from providing services to a client if:
    • The former employee did not solicit the client
    • The client voluntarily chose to seek services from the former employee
    • The former employee otherwise complies with the limitations in the non-compete agreement
  • If an employee’s termination is due to the employer’s reduction of force, reorganization, or similar restructuring, a non-compete agreement can only be enforced while the employer is paying the employee, including severance pay

Action Items
If you haven’t already, review all of your non-compete agreements immediately to ensure compliance with the new law. Be careful to avoid overbroad language and unreasonable restrictions.


New York

Get Ready for the Paid Family Leave Benefits Law
Beginning January 1, 2018, all employers with 1+ employees (who have worked a minimum of 30 consecutive days) are required to provide New York Paid Family Leave (PFL). This state-specific leave law allows employees to take 8 weeks of leave in 2018 and up to 12 weeks by 2021. Not only will employers be required to provide time off, but they will also be responsible to administer PFL through their disability policy (or self-insurance) and collecting employee contributions through payroll deductions.

Employees may request PFL for only three specific situations:

  1. To provide physical or psychological care to their family members due to family member’s serious health condition;
  2. To bond with newborn children during the first year of the child’s life, or, the first year after the placement of an adopted child or foster care placement
  3. For any qualifying reason as provided for under the federal Family and Medical Leave Act arising from the employees’ spouse, domestic partner, child, or parent being on active military duty, or, alternatively, being notified of an impending call or order to active military duty.

Key items to remember:

  • Effective January 1, 2018
  • PFL will be administered through employer’s disability policy (or through self-insurance)
  • Contributions can begin July 1, 2017 at a rate of 0.126% of employee’s weekly wage up to a maximum of $1.63 per week
  • Eligible employees worked a minimum of
    • 26 consecutive weeks (regularly scheduled 20+ hours per week)
    • 175 days (regularly scheduled less than 20 hours per week)
  • Time off and pay as follows:
    • January 1, 2018: 8 weeks paid at 50% of the employee’s average weekly wage or 50% of the state average weekly wage, whichever is less;
    • January 1, 2019: 10 weeks paid at 55% of the employee’s average weekly wage or 55% of the state average weekly wage, whichever is less;
    • January 1, 2020: 10 weeks paid at 60% of the employee’s average weekly wage or 60% of the state average weekly wage, whichever is less; and
    • January 1, 2021: 12 weeks paid at 67% of the employee’s average weekly wage or 67% of the state average weekly wage, whichever is less.
  • PFL is different than FMLA
  • Employees MAY NOT request PFL for their own serious health condition
  • Employers must maintain employees’ existing health insurance benefits for the duration of PFL
  • Employees are entitled to reinstatement upon their return to work

Be sure to review your current leave policies (family, medical, personal, etc.), benefit claim procedures, existing and future employment agreements, and, if applicable, collective bargaining agreements to ensure full compliance.


New York City (NY)

New Fair Chance Act Rules Now in Effect
According to Sterling Talent Solutions’ 2017 Background Screening Trends & Best Practices Report, 48% of employers that conduct pre-employment background checks still ask applicants about their criminal history on applications. In states and cities, where “ban the box” laws have been implemented, this is a major compliance issue.

If you have locations or employees located in New York City, familiarize yourself with employer duties under the Fair Chance Act, commonly known as “ban the box.” KPA’s August 2017 HR Regulatory Updates also explored this topic. Scroll down to the New York City (NY) section and read “Ban the Box” Rules Take Effect August 5, 2017.



Foster Parent Rights
KPA’s compliance partner, FordHarrison, provided the following update.

The Texas Labor Code added Section 21.0595, which now makes it an unlawful employment practice for employers to have a leave policy which allows an employee to take personal leave to care for or otherwise assist a sick biological or adopted child but does not provide that same leave for a foster child. The statute does not require an employer to provide such leave, but if such a leave policy exists it must also apply to foster parents. Texas employers should review their leave policies to make sure they do not specifically exclude foster children or list only biological or adopted children as covered.


Uniform Trade Secrets Act Amendments
KPA’s compliance partner, FordHarrison, provided the following update.

In May 2017, the Texas Legislature passed changes to the Texas Uniform Trade Secrets Act (TUTSA), thereby aligning it with both federal and many states’ laws. These amendments largely codified already existing law and apply to cases filed on or after September 1, 2017.

These amendments come on the cusp of two defining events: the first being Congress’s enactment of the Defend Trade Secrets Act (DTSA); and second, the Texas Supreme Court’s decision in In re M-I LLC, 505 S.W. 3d 569 (Tex. 2016).

Substantive changes to the TUTSA:

  • Defining the phrase “willful and malicious misappropriation” – TUTSA has almost always provided for an award of exemplary damages and attorneys’ fees for conduct a jury finds to be “willful and malicious misappropriation” on the defendant’s behalf. Though these damages were always available under the statute, the statute did not define “willful and malicious misappropriation,” therefore creating confusion about what constitutes conduct sufficient to result in exemplary damages. Under the amendment, the phrase means “intentional misappropriation resulting from the conscious disregard of the rights of the owner of the trade secret.” H.B. 1995, Section 1(7) (“‘Willful and malicious misappropriation’ means intentional misappropriation resulting from the conscious disregard of the rights of the owner of the trade secret.”).
  • Expanded definition of the term “Trade Secret” – Under the amendment, trade secret now means all forms of information including “business, scientific, technical, economic, or engineering information…whether tangible or intangible and whether or how stored, compiled, memorialized physically, electronically, graphically, photographically, or in writing.” This change brings the TUTSA more in line with the DTSA, which specifically lists these items in the statute.
  • Codification of the Texas Supreme Court’s Seven Factor Balancing Test – The Act codifies the Texas Supreme Court’s decision in In re M-I LLC, 505 S.W. 3d 569 (Tex. 2016), wherein the Court developed a balancing test designed to weigh the right of a party to participate in proceedings brought against him against the trade secret owner’s right to protect the confidentiality of the trade secret. The amendment presumes that parties who have been sued for misappropriation should be permitted to participate and hear the evidence against them, and should only be excluded subject to the court’s consideration of:
    1. the value of the owner’s alleged trade secret;
    2. the degree of competitive harm an owner would suffer from the dissemination of the owner’s alleged trade secret to the other party;
    3. whether the owner is alleging that the other party is already in possession of the alleged trade secret;
    4. whether a party’s representative acts as a competitive decision maker;
    5. the degree to which a party’s defense would be impaired by limiting that party’s access to the alleged trade secret;
    6. whether a party or a party’s defense would be impaired by limiting that party’s access to the alleged trade secret;
    7. the stage of the action.


No Texting & Driving
Every day in the U.S., 9 people die and 1,000 people are injured because of distracted driving according to the Centers for Disease Control and Prevention (CDC). Sending or reading a text while driving is considered especially dangerous because it takes drivers’ eyes off of the road for 5 seconds or more — enough time to cover the length of a football field.

Earlier this summer, Texas Governor Greg Abbott signed a law that bans texting while driving anywhere in the state of Texas. The law went into effect on September 1, 2017.

  • The law forbids drivers from “reading, writing, or sending electronic messages” via a “wireless communication device.”
  • Violators face a $25–99 fine. Penalties could be up to $200 for repeat offenders.
  • Talking on cell phones is permitted if drivers use hands-free technology that requires only briefly touching the phone or a vehicle’s screen to begin or end a call.
  • Drivers can’t seek emergency help, report illegal activity or communicate with a dispatcher while their vehicle is in motion.
  • If a texting driver causes an accident that results in the death or serious bodily injury of another person, they can be charged with a Class A misdemeanor punishable by up to a $4,000 fine and a one-year jail sentence.
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Jill SchaeferSeptember 2017 HR Regulatory Updates