Wage and Hour, Individual and Collective Actions

When:  Thursday, September 14, 2017    8:00 a.m. – 4:30 p.m.

Where:  New York Hilton Midtown, 1335 Avenue of the Americas, New York, NY 10019

Epstein Becker Green’s Annual Workforce Management Briefing will focus on the latest developments in labor and employment law, including:

  • Immigration
  • Global Executive Compensation
  • Artificial Intelligence
  • Internal Cyber Threats
  • Pay Equity
  • People Analytics in Hiring
  • Gig Economy
  • Wage and Hour
  • Paid and Unpaid Leave
  • Trade Secret Misappropriation
  • Ethics

We will start the day with two morning Plenary Sessions. The first session is kicked off with Philip A. Miscimarra, Chairman of the National Labor Relations Board (NLRB).

We are thrilled to welcome back speakers from the U.S. Chamber of Commerce.  Marc Freedman and Katie Mahoney will speak on the latest policy developments in Washington, D.C., that impact employers nationwide during the second plenary session.

Morning and afternoon breakout workshop sessions are being led by attorneys at Epstein Becker Green – including some contributors to this blog! Commissioner of the Equal Employment Opportunity Commission, Chai R. Feldblum, will be making remarks in the afternoon before attendees break into their afternoon workshops. We are also looking forward to hearing from our keynote speaker, Bret Baier, Chief Political Anchor of FOX News Channel and Anchor of Special Report with Bret Baier

View the full briefing agenda and workshop descriptions here.

Visit the briefing website for more information and to register, and contact Sylwia Faszczewska or Elizabeth Gannon with questions.  Seating is limited.

A New Year and a New Administration: Five Employment, Labor & Workforce Management Issues That Employers Should MonitorIn the new issue of Take 5, our colleagues examine five employment, labor, and workforce management issues that will continue to be reviewed and remain top of mind for employers under the Trump administration:

 Read the full Take 5 online or download the PDF.  Also, keep track of developments with Epstein Becker Green’s new microsite, The New Administration: Insights and Strategies.

Our colleagues Judah L. Rosenblatt, Jeffrey H. Ruzal, and Susan Gross Sholinsky, at Epstein Becker Green, have a post on the Hospitality Labor and Employment Law Blog that will be of interest to many of our readers in the financial services industry: “Where Federal Expectations Are Low Governor Cuomo Introduces Employee Protective Mandates in New York.”

Following is an excerpt:

Earlier this week New York Governor Andrew D. Cuomo (D) signed two executive orders and announced a series of legislative proposals specifically aimed at eliminating the wage gap in gender, among other workers and strengthening equal pay protection in New York State. The Governor’s actions are seen by many as an alternative to employer-focused federal policies anticipated once President-elect Donald J. Trump (R) takes office. …

According to the Governor’s Press Release, the Governor will seek to amend State law to hold the top 10 members of out-of-state limited liability companies (“LLC”) personally financially liable for unsatisfied judgments for unpaid wages. This law already exists with respect to in-state and out-of-state corporations, as well as in-state LLCs. The Governor is also seeking to empower the Labor Commissioner to pursue judgments against the top 10 owners of any corporations or domestic or foreign LLCs for wage liabilities on behalf of workers with unpaid wage claims. …

Read the full post here.

Our colleague Jeffrey H. Ruzal, Senior Counsel at Epstein Becker Green, has a post on the Wage & Hour Defense Blog that will be of interest to many of our readers in the financial services industry: “Decision Enjoining Federal Overtime Rule Changes Will Not Affect Proposed Increases Under New York State’s Overtime Laws.”

Following is an excerpt:

As we recently reported on our Wage & Hour Defense Blog, on November 22, 2016, a federal judge in the Eastern District of Texas issued a nationwide preliminary injunction enjoining the U.S. Department of Labor from implementing its new overtime exemption rule that would have more than doubled the current salary threshold for the executive, administrative, and professional exemptions and was scheduled to take effect on December 1, 2016. To the extent employers have not already increased exempt employees’ salaries or converted them to non-exempt positions, the injunction will, at the very least, appear to allow many employers to postpone those changes—but likely not in the case of employees who work in New York State.

On October 19, 2016, the New York State Department of Labor (“NYSDOL”) announced proposed amendments to the state’s minimum wage orders (“Proposed Amendments”) to increase the salary basis threshold for executive and administrative employees under the state’s wage and hour laws (New York does not impose a minimum salary threshold for exempt “professional” employees).  The current salary threshold for the administrative and executive exemptions under New York law is $675 per week ($35,100 annually) throughout the state.  The NYSDOL has proposed the following increases to New York’s salary threshold for the executive and administrative exemptions …

Read the full post here.

Employers Under the Microscope: Is Change on the Horizon?

When:  Tuesday, October 18, 2016    8:00 a.m. – 4:00 p.m.

Where:  New York Hilton Midtown, 1335 Avenue of the Americas, New York, NY 10019

Epstein Becker Green’s Annual Workforce Management Briefing will focus on the latest developments in labor and employment law, including:

  • Latest Developments from the NLRB
  • Attracting and Retaining a Diverse Workforce
  • ADA Website Compliance
  • Trade Secrets and Non-Competes
  • Managing and Administering Leave Policies
  • New Overtime Rules
  • Workplace Violence and Active-Shooter Situations
  • Recordings in the Workplace
  • Instilling Corporate Ethics

This year, we welcome Marc Freedman and Jim Plunkett from the U.S. Chamber of Commerce.  Marc and Jim will speak at the first plenary session on the latest developments in Washington, D.C., that impact employers nationwide.

We are also excited to have Dr. David Weil, Administrator of the U.S. Department of Labor’s Wage and Hour Division, serve as the guest speaker at the second plenary session. David will discuss the areas on which the Wage and Hour Division is focusing, including the new overtime rules.

In addition to workshop sessions led by attorneys at Epstein Becker Green – including some contributors to this blog! – we are also looking forward to hearing from our keynote speaker, Former New York City Police Commissioner William J. Bratton.

View the full briefing agenda here.

Visit the briefing website for more information and to register, and contact Sylwia Faszczewska or Elizabeth Gannon with questions.  Seating is limited.

The DOL has been steadfast in expanding worker coverage under the Fair Labor Standards Act (“FLSA”), and the financial services industry, like most, will be affected. The DOL’s initiative began on July 6, 2015, when it published a Notice of Proposed Rulemaking (“NPR”) that is expected to extend overtime protection to almost five million white-collar workers who are currently not entitled to overtime pay because they are classified as exempt. The NPR, which is expected to be finalized in July 2016, will likely more than double the salary threshold to qualify for FLSA exemption under the executive, administrative, or professional exemption, increasing it to $970 per week, or $50,440 per year. In addition, the highly compensated employee exemption, which, if satisfied, lightens the duties requirements of the executive, administrative, or professional exemptions, is expected to increase from $100,000 to $122,148. Once in place, these salary threshold requirements are expected to increase annually to adjust for inflation, which has not previously been the case.

Less than two weeks later, on July 15, 2015, the DOL issued Administrator’s Interpretation No. 2015-1 on independent contractor misclassification, promoting the now famous “tagline” that most workers are employees—and not independent contractors—who are, therefore, covered by the FLSA. To support its position, the DOL redefined its long-standing “economic realities” test, which courts rely upon when determining whether there exists an employer-employee relationship. The traditional economic realities test includes the following non-dispositive criteria: (i) the degree of control exercised by the business over the worker; (ii) the worker’s opportunity for profit or loss; (iii) the degree of skill and independent initiative required to perform the work; (iv) the permanence or duration of the working relationship; (v) the extent to which the work is an integral part of the business; and (vi) the worker’s investment in his or her own business. In this Administrator’s Interpretation, however, the DOL significantly revised this objective test by radically redefining the factors to promote “employee” status.

Not resting on its already significant initiative, on January 20, 2016, the DOL issued Administrator’s Interpretation No. 2016-1 (“new Interpretation”) concerning joint-employment liability. The new Interpretation provides that businesses that utilize employees of third-party employers may be considered joint employers of those workers and therefore covered by the FLSA. Also, the new Interpretation states that joint employment often involves a “larger and more established” employer “with a greater ability to implement policy or systemic changes to ensure compliance.” The DOL explains that investigators may hold the larger company responsible for “financial recovery” and “future compliance.” The larger companies are undoubtedly more important to the DOL as they are the deep-pocket joint employer that can be held responsible for the entire amount of back wages owed.

The new Interpretation explains that there are two types of joint employment on which the DOL will focus: horizontal and vertical relationships. Horizontal joint employment exists when an employee has employment relationships with two or more related or commonly owned businesses. In assessing horizontal joint employment, the DOL focuses on the relationship between the businesses, not the workers. The DOL explains that a horizontal joint-employment relationship may exist in situations when: (i) employers share an employee’s services, (ii) one employer acts in the interest of the other employer in relation to the employee, or (iii) one employer controls the other employer and therefore shares control of the other employer.

Vertical joint employment exists when a worker provides services to one company while being formally employed by a third party, such as a labor supplier. To determine whether joint employment exists, the DOL analyzes whether an employee of one business, the labor supplier, is economically dependent on another business that utilizes the labor supplier’s employee.

In light of the DOL’s ongoing initiative to increase coverage under the FLSA, businesses should carefully consider their relationships with independent contractors and their labor supply workforce. Businesses should closely monitor their relationships with independent contractors and be disciplined in limiting their engagement with contractors to discrete projects of a finite duration. In addition, businesses should avoid using contractors as headcount replacement. Doing so places firms at risk for claims by individuals that they were misclassified and entitled to pay and benefits.

With respect to using a labor supplier’s employees, businesses should effectively “partner” with the labor supplier. As part of any services agreement, labor suppliers should explicitly represent that they are treating their workers as employees, and not as independent contractors. Businesses should also have the right to review the labor supplier’s employment records for the workers it supplies to confirm FLSA compliance. In addition, financial services firms may want to pay careful attention to the contracts between them and the labor suppliers, confirming that such contracts contain: (i) appropriate forum and choice of law provisions, (ii) representations regarding wage and hour and other legal practices, and (iii) an explicit indemnification by the labor supplier for any liability arising from a joint-employment relationship.

A version of this article originally appeared in the Take 5 newsletter “Five Employment Law Compliance Topics of Interest to Financial Services Industry Employers.”

With the release of President Obama’s budget for the DOL on February 9, 2016, the Office of Federal Contract Compliance Programs (“OFCCP”) announced two top enforcement priorities for 2016. First, the OFCCP will continue to identify and address systemic pay discrimination in its efforts to reduce the gender and race-based pay gap.  Second, the OFCCP will establish regional centers staffed with “highly skilled and specialized compliance officers” to conduct “large, complex compliance evaluations” in specific industries, including the financial services industry.

When President Obama signed the Lilly Ledbetter Fair Pay Act after taking office seven years ago, he made clear his commitment to equal pay for equal work. Since then, the OFCCP has taken steps to fulfill that commitment. With the release of the OFCCP’s 2017 budget, government contractors can count on larger, more complex and thorough compliance investigations specifically aimed at rooting out unlawful pay discrimination. Financial services companies are in an industry specifically targeted by the OFCCP and should expect more audits and greater scrutiny of their compensation practices. The OFCCP’s scrutiny of companies within its jurisdiction at a minimum will include requiring a company to produce compensation data on each U.S.-based employee located at the audited facility, identify factors used to determine employee compensation, and submit policies and documentation concerning the company’s compensation practices.

The OFCCP has jurisdiction pursuant Executive Order 11246 over any financial services company that (i) holds a single government contract or subcontract in excess of $10,000; (ii) holds government contracts or subcontracts that combined are in excess of $10,000 in any 12-month period; (iii) holds government bills of lading; (iv) is a depository of federal funds in any amount; or (v) is a financial institution that is an issuing and paying agent for U.S. savings bonds and notes. Those with contracts in excess of $50,000 are required to maintain written affirmative action programs. The thresholds are higher under the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act.

Often overlooked, financial institutions with federal share and deposit insurance, whether with the Federal Deposit Insurance Corporation (“FDIC”) or the National Credit Union Association (“NCUA”), are  considered contractors subject to OFCCP jurisdiction. Although the FDIC and NCUA do not use government-appropriated funds, and are not subject to the Federal Acquisition Regulation, the OFCCP maintains that they are contracting government agencies for affirmative action purposes, and by definition, government contracts include contracts for nonpersonal services, including insurance services.

In another recent development, the OFCCP final rule implementing President Obama’s Executive Order 13665 (“Final Rule”) went into effect January 11, 2016. The Final Rule extends pay transparency protections to all employees and applicants. The Final Rule prohibits contractors subject to the Executive Order, when entering into a new or modified contract on or after that date, from discriminating against any employee or applicant for employment for inquiring about, discussing, or disclosing his or her compensation, or the compensation of another employee or applicant. Although the National Labor Relations Act provides similar protections, it does not extend the protections to supervisors, managers, agricultural workers, and employees of rail and air carriers. Under the Final Rule, however, those employees are protected. Contractors are required to notify employees and applicants of their rights by including the Pay Transparency Nondiscrimination Provision prepared by the OFCCP in their employee manual or handbook and either electronically posting the provision on contractor’s career web page or posting a copy in conspicuous places at their facilities.

Finally, on January 29, 2016, the U.S. Equal Employment Opportunity Commission (“EEOC”) proposed revisions to the Employer Information Report (“EEO-1 report”). As proposed, contractors and employers with 100 or more employees would have to submit pay data on their workforce when filing their EEO-1 report. In addition to disclosing the number of employees working in each EEO-1 job category by gender and race/ethnicity, contractors and employers would be required to provide pay data on each employee’s W-2 earnings, along with the total hours worked by the employee. The pay data and hours worked would be submitted in the aggregate showing the total number of employees, and the total number of hours of employees, by gender and race/ethnicity within each EEO-1 job category slotted into 12 pay bands. Each pay band provides a range of compensation received by employees and is used to distinguish different levels of compensation. For example, employees earning from $49,920 to $62,919 would fall within Pay Band 6, while employees earning $208,000 or more would fall within Pay Band 12.

The new EEO-1 report would allow the EEOC and OFCCP to use the employer pay data to “assess complaints of discrimination, focus investigations, and identify employers with existing pay disparities that might warrant further investigation.” Specifically, the pay bands would allow the EEOC and OFCCP to compute within-job category variation, across-job-category variation, and overall variation, looking at W-2 pay distribution within an establishment, and comparing the establishment’s data to aggregate industry data, which would support their ability to detect potential discrimination. While the proposed revisions are now subject to comments and possible changes, going forward, it is clear that the OFCCP, in partnership with the EEOC, will be stepping up its efforts during compliance reviews, specifically scrutinizing contractors’ compensation, in an attempt to root out pay discrimination and close the earnings gap.

A version of this article originally appeared in the Take 5 newsletter “Five Employment Law Compliance Topics of Interest to Financial Services Industry Employers.”

 

Employment Law This Week – Epstein Becker Green’s new video program – features an interview with attorney John Fullerton, a founding contributor to this blog.

Mr. Fullerton discusses the lack of clarity on what constitutes a whistleblower. Marketing firm Neo@Ogilvy has decided not to appeal to the U.S. Supreme Court in a case that would have tested the definition of a whistleblower under the Dodd-Frank Act. At issue is whether an employee can be eligible for anti-retaliation protection under the Dodd-Frank Act even if he or she does not provide information of corporate wrongdoing directly to the SEC. The U.S. Court of Appeals for the Fifth Circuit says “no,” but the Second Circuit disagrees.

Click below to view the episode and also see our earlier post “2nd Circuit Expands Dodd-Frank Anti-Retaliation Protection to Cover Internal Whistleblowing.”

Wage & Hour Guide for Employers AppWe’d like to share some news with financial services industry employers: Epstein Becker Green has released a new version of its Wage & Hour Guide for Employers app, available without charge for Apple, Android, and BlackBerry devices.

Following is from our colleague Michael Kun, co-creator of the app and leader of our Wage and Hour group:

We have just updated the app, and the update is a significant one.

While the app originally included summaries of federal wage-hour laws and those for several states and the District of Columbia, the app now includes wage-hour summaries for all 50 states, as well as D.C. and Puerto Rico.

Now, more than ever, we can say that the app truly makes nationwide wage-hour information available in seconds. At a time when wage-hour litigation and agency investigations are at an all-time high, we believe the app offers an invaluable resource for employers, human resources personnel, and in-house counsel.

Key features of the updated app include:

  • New summaries of wage and hour laws and regulations are included, including 53 jurisdictions (federal, all 50 states, the District of Columbia, and Puerto Rico)
  • Available without charge for iPhoneiPad, Android, and BlackBerry devices
  • Direct feeds of EBG’s Wage & Hour Defense Blog and @ebglaw on Twitter
  • Easy sharing of content via email and social media
  • Rich media library of publications from EBG’s Wage and Hour practice
  • Expanded directory of EBG’s Wage and Hour attorneys

If you haven’t done so already, we hope you will download the free app soon.  To do so, you can use these links for iPhoneiPad, Android, and BlackBerry.

My colleagues Michael S. Kun and Jeffrey H. Ruzal at Epstein Becker Green wrote a Wage and Hour Defense blog post that will be of interest to all financial services employers: “Proposed DOL Rule To Make More White Collar Employees Eligible For Overtime Pay.”Clock

Following is an excerpt:

More than a year after its efforts were first announced, the U.S. Department of Labor (“DOL”) has finally announced its proposed new rule pertaining to overtime. And that rule, if implemented, will result in a great many “white collar” employees previously treated as exempt becoming eligible for overtime pay for work performed beyond 40 hours in a workweek – or receiving salary increases in order that their exempt status will continue.

Read the full original post here.