October 2019 HR Updates

on October 4, 2019

Every month we cover timely federal and state legislative and regulatory employment updates. Check out what you need to know and gain compliance tips to help you stay on top of HR the right way. Click on the federal topics or state names below to catch up on the latest news.

Federal Updates

State Updates

FEDERAL Updates

Take ERISA at Face Value

Who: Employers with voluntary retirement and health plans

When: Effective Immediately

What:

A decision from the Court of Appeals for the Seventh Circuit upheld the idea that court systems read the Employee Retirement Income Security Act (ERISA) of 1974 at face value.

The Court of Appeals ruled on a case where multi-employer pension fund trustees waited too long to recover defaulted withdrawal liability payments. The employer defaulted on payments in 2008, 2009, 2011, 2013, and 2015; each time, the trustees filed suit but voluntarily dismissed their case after the employer agreed to resume payments. During the last suit in 2018, the employer moved to drop the lawsuit on the basis that the six-year statute of limitations begun in 2008 had expired in 2014. The district court and Court of Appeals sided with the employer.

The language in ERISA doesn’t cover the deceleration of withdrawal liability provisions, which occurred when the trustees voluntarily dropped their cases.

How:

Work with legal counsel to ensure that your retirement and health plan policies and procedures meet ERISA’s requirements.

 

Department of Labor Confirms FMLA Runs at the Same Time as Paid Leave

Who: Covered Employers

When: Effective Immediately

What:

In an updated letter, the U.S. Department of Labor reinforced a prior opinion letter from March 2019 that employers can’t delay designating FMLA-qualifying leave as FMLA leave.

Additionally, it states that when employees communicate a leave of absence that qualifies for FMLA, neither the employee nor employer can decline using FMLA to cover the leave, even if a collective bargaining agreement (CBA) states otherwise. This clarification extends to employer policies that encourage employees to take paid leave instead of FMLA; the employer must still apply FMLA to the qualifying leave.

How:

Review FMLA qualifying leave policies with your managers and remind them that the regulation states any qualifying leave must be designated as FMLA, regardless of whether the manager, employee, or CBA says otherwise.

Additional Resource

Department of Labor Opinion Letter FMLA2019-3-A

 

Department of Labor Clarifies Health Savings Account Employer Contributions are Not Considered Earnings

Who: Covered employers who contribute to employee health savings accounts (HSAs)

When: Effective Immediately

What:

The Wage and Hour Division of the U.S. Department of Labor issued a new opinion letter regarding the Consumer Credit Protection Act (CCPA). Responding to a question about whether employer contributions to health savings accounts can be considered an earning under the CCPA, the DOL asserts that it can’t.

The DOL states that HSA contributions are much like bank deposits, meaning they are beyond the point that the employer can withhold the money. Since the CCPA doesn’t apply to employee bank accounts, the same is true for HSAs.

When an HSA contribution has yet to be paid and is still within the employer’s passion, it might be subject to CCPA’s limits on garnishment. Employers need to determine if their contributions count as “earnings,” which the CCPA defines as “compensation paid or payable for personal services.” The DOL compares those payments for employee’s services to wages, salaries, and bonuses.

How:

  • Review your HSA contribution procedures and your earnings reporting to determine your compliance.
  • Seek legal consult to ensure whether your earnings reporting is compliant with the DOL’s opinion letter or if you need to adjust your reporting accordingly.

Additional Resource

Department of Labor Opinion Letter CCPA2019-1

Department of Labor Expands Overtime Qualification, New Cutoff is $35,568

Who: All Employers

When: January 1, 2020

What:

The Department of Labor (DOL) amended the Fair Labor Standards Act and expanded the number of Americans who can qualify for overtime pay. The details of the new rule include:

  • Raising the salary cutoff from $455/week ($23,660/year) to $684/week ($35,568/year). Individuals who make less than $684/week and meet certain job duties must be paid 1.5 times the employee’s regular hourly rate when they have worked more than 40 hours in the workweek.
  • Raising the salary cutoff for highly compensated exempt employees from $100,000/year to $107,432/year.
  • If paid annually or more often, non-discretionary bonuses and incentive payments, including commissions, may be used to satisfy up to 10% of the standard salary. This new rule doesn’t apply to highly compensated employees.
  • Executive, administrative, and professional white-collar exemptions must minimally earn the salary threshold and perform certain duties. Job duties or job titles don’t exclusively determine exemption, but there are tasks for each category that may qualify the employee for exempt status:
    • Executive exemption: Managing the organization or a department of the organization, overseeing the work of at least 2 employees, and have the authority to hire and fire.
    • Administrative exemption: Office work directly related to business operations and the use of discretion and judgment in important decisions made for the company.
  • Professional exemption: Work that requires knowledge of a field of science or specialized study and instruction, e.g., engineer, physician, systems analyst, or programmer. Highly compensated employees are exempt if their duties include any of the specified reduced duties for an executive, administration, or professional exemption.

How:

  • Begin reviewing employee pay information, job descriptions, and job duties to identify exempt employees who are earning below the new cut off.
  • Compare the cost of increasing employee salaries above the new threshold against the cost of nonexempt employees receiving overtime pay.
  • Determine what the financial impact will be on your organization and what changes you need to make.
  • Communicate and train affected employees about reclassifying their job, or any changes made to their salary, job, or job description, regarding reclassifying their job. Explain exempt and non-exempt employees and how this classification affects them.

Additional Resources

Department of Labor Overtime Final Rule

Wage and House Division Fact Sheet on Final Rule

Final Rule FAQs

 

EEOC Component 2 Data Collection Stops After 2019; 2017 and 2018 Data Still Needed

Who: Employers with 100+ employees, including federal contractors

Please note that Component 1 data is still required for employers with 100+ employees, including federal contractors with 50+ employees, and a federal government contract of $50,000+.

When: Effective Immediately

What: The portal to submit 2017 and 2018 data will remain open until the Equal Employment Opportunity Commission (EEOC) has received enough data. Moving into next year, the EEOC will not be collecting EEO-1 Component 2 data as part of future EEO-1 reports. The agency determined the employer burden is too high to be useful data.

The 2017 and 2018 Component 2 data submitted by the September 30 deadline included pay information broken down by job, race, sex, and ethnicity. The agency still requires employers to submit Component 1 information.

How:

Submit your 2017 and 2018 data.

Work with legal counsel to review your pay practices to avoid any possible future scrutiny.

Additional Resource

EEOC Portal

EEOC 6570-01P

 

NLRB Seeks Comments on Explicit Language Protections

Who: All employers

When: Comments due November 4, 2019

What:

The National Labor Review Board (NLRB) is seeking comment on whether to reevaluate a previous ruling on employees’ use of explicit language during union and other protected activities. There is concern among the majority of the NLRB about the use of profanity, racial slurs, sexual language, and other outbursts during protected activities.

How:

People interested in submitting a comment have been asked to address any of the below:

  • When should profane or explicit language lose NLRB protection? What are the specific cases?
  • What is the limit that employees should be given to use explicit language during a protected activity?
  • Should the NLRB take into account workplace norms when making decisions about explicit language? Additionally, should employer policies be included in those decisions too?
  • Should prior rules be modified, eliminated, or kept in place?
  • Should the NLRB take into consideration non-discriminatory laws like Title VII?

Comments should be filed with the board on or before November 4, 2019, through the e-File service.

Additional Resources

NLRB Case 14-CA-197985

NLRB Invitation to File Briefs

 

STATE Regulatory Updates

Massachusetts Clarifies Paid Family and Medical Leave for Independent Contractors

Who: Employers who hire 1099-MISC workers

When: Effective Immediately

What:

The Massachusetts Department of Paid Family and Medical Leave updated guidance on when businesses should count 1099-MISC workers as part of their workforce. 1099-MISC workers who live and work in Massachusetts as an “individual entity” and can’t be defined as an independent contractor should be included in the company’s workforce numbers.

There are 3 factors that the employer must determine the independent contractor meets:

  • The contractor has freedom in the control of their services and performance
  • Services are conducted outside of the company’s place of business and business hours.
  • The contractor independently participates in the same business area as the service they’re providing the company

How:

  • Review your 1099-MISC workers to make sure they’re correctly classified and counted.
  • If 1099-MISC workers meet the 3 requirements, companies don’t have to contribute to their paid family and medical leave, include them in the workforce headcount, or provide quarterly reports on their earnings.

Additional Resource

Employer’s Guide to Paid Family and Medical Leave

 

Final Piece of New Jersey Wage Theft Act Goes Into Effect November 2019

Who: New Jersey employers

When: November 1, 2019

What:

Although the majority of the New Jersey Wage Theft Act has already gone into effect, the Act included a new crime that will take effect in November. Called “pattern of wage nonpayment,” the new crime is when a person is convicted at least twice of a violation of Criminal Justice Code provisions, or wage and hour laws. A “pattern of wage nonpayment” is classified as a third-degree crime and doesn’t merge with other lesser convictions.

How:

Review and update your payroll, timekeeping, and wage and hour classification policies and procedures to identify risks and minimize any possible delays in payment. Be sure to update and maintain your records based on this assessment.

Additional Resource

Senate No. 1790

 

New Jersey Clarifies Stance on Hairstyle Discrimination

Who: New Jersey employers

When: Effective Immediately

What:

The New Jersey Division on Civil Rights dispensed guidance on the New Jersey Law Against Discrimination’s (LAD) ban on race-based discrimination. The guidance states the LAD includes banning discrimination based on hairstyles, including those styles associated with race.

The guidance states that the calling out of any hairstyle in an employer’s policy qualifies as evidence of unequal treatment and violates the LAD. Employers should also be careful of policies that appear to be neutral if they are unfairly applied to people of different races. An employer can’t enforce policies that discriminate against hairstyles by claiming the organization has a “corporate image.”

How:

  • Review your appearance policies and ensure they are neutral.
  • Consider whether your appearance policies and procedures related to an employee or job candidate’s hair could be considered discriminatory. This consideration might need to be reviewed on a case by case basis.

Additional Resource

Guidance on Race Discrimination Based on Hairstyle

 

New York State Expands Domestic Violence Victim Protections

Who: New York state employers

When: November 18, 2019

What:

Governor Andrew Cuomo amended the New York State Human Rights Law to expand the definition of “victim of domestic violence” and to expand protections. The new definition aligns with the state’s Domestic Violence Prevention Act and adds victims of domestic violence as a protected class.

Employers must make reasonable accommodation for victims of domestic violence who are absent from work for:

  • Medical attention related to domestic violence injuries
  • Services from a domestic violence shelter, program, crisis center
  • Psychological counseling, including for a child victim of domestic violence
  • Legal services or participation in legal proceedings related to domestic violence.

If there is an undue hardship to the employer to meet accommodations, employers are exempt. Undue hardship is determined by the size of the organization, the organization’s services. Employees may be required to use paid time off as accommodation.

Employees must give their employer a reasonable amount of notice before a leave of absence. If reasonable notice isn’t possible, the employer may request certification for the need for absence.

How:

  • Review and update your policies related to leaves of absence and ensure they are compliant with the new accommodations.
  • Train managers and supervisors about domestic violence and reasonable accommodations.

Additional Resource

NY A5618/S1040

 

Oklahoma Permitless Gun Carry Bill Goes Into Effect November 1, 2019

Who: Oklahoma employers

When: November 1, 2019

What:

Beginning in November, the majority of Oklahoma residents will be able to carry unlicensed concealed or unconcealed firearms. People excluded from the law are individuals convicted of crimes and who are in the country illegally. Firearms will be banned from public buildings, schools, professional sporting events, casinos, and bars.

This law eliminates the current requirement that individuals must apply for a license to carry a firearm.

Private property owners with businesses open to the public may decide to allow or ban concealed or openly carried firearms on their premises. Owners that choose to ban firearms must display a poster stating, “Carrying a Firearm on the Premises is Prohibited.”

How:

  • Review your workplace violence policies and procedures and determine as a whole whether a ban on guns in the workplace is appropriate for your organization.
  • Notices or posters are required in the state if a business chooses to ban firearms from the public premises, check with your legal counsel on how best to proceed.

Additional Resource

HB 2597

 

Oklahoma Expands Marijuana Smoking Law to Include Vaping Ban

Who: Oklahoma employers

When: November 1, 2019

What:

Oklahoma’s law that banned smoking marijuana in the workplace has expanded the definition of smoking to include smoking tobacco or marijuana, or vaping marijuana.

A related law about medical marijuana was amended to prohibit employers from discriminating against licensed medical marijuana users unless the business might lose money or licensing benefits under federal law.

How:

Review and update your smoking policies to ensure they are compliant with the amendment.

Additional Resource

HB2601

 

Oklahoma’s Protection from Workplace Harassment and Violence Act Takes Effect November

Who: Oklahoma employers

When: November 1, 2019

What:

Oklahoma’s new Protection from Workplace Harassment and Violence Act gives employers the ability to acquire temporary restraining orders on behalf of employers who have been harassed at work. It also permits employers to file an injunction prohibiting workplace harassment but keeps them immune from liability for seeking or failing to seek an injunction.

Harassment is 2 or more acts directed an individual that causes a “reasonable person emotional distress.”

How:

  • Review and update your workplace harassment policies and procedures for compliance with this new law.
  • Educate your managers about the new law and how this may impact their management practices.

Additional Resource

SB 715

 

Emily Hartman

Emily Hartman

Emily is the Client Content Specialist. She’s using the skills she learned in Washington, D.C. to breakdown technical information into news you can use.

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Emily HartmanOctober 2019 HR Updates

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