Posts Tagged ‘Department of Labor’

Labor Dept. OT Rule Due for Makeover

It doesn’t come as any great shock that President Trump’s Department of Labor is recalling the overtime rule for second look.

The U.S. Department of Labor yesterday announced plans to undertake new rulemaking with regard to overtime.

On July 26, 2017, the Department of Labor published a Request for Information (RFI) regarding the Overtime Final Rule, which was published on May 23, 2016, asking for public input on what changes the Department should propose. That comment period has ended and the Department is reviewing those submissions.

On August 31, 2017, U.S. District Court Judge Amos Mazzant granted summary judgment against the Department of Labor in consolidated cases challenging the Overtime Final Rule. The court held that the Final Rule’s salary level exceeded the Department’s authority, and concluded that the Final Rule is invalid.

On October 30, 2017, the Department of Justice, on behalf of the Department of Labor, filed a notice to appeal this decision to the U.S. Court of Appeals for the Fifth Circuit. Once this appeal is docketed, the Department of Justice will file a motion with the Fifth Circuit to hold the appeal in abeyance while the Department of Labor undertakes further rulemaking to determine what the salary level should be.

Here’s a post I did on the rule when it was proposed.

Advertisements

Overtime Rule on Standby Pending OMB Review

Looks like the U.S. Labor Department’s overtime rule is on thin ice.

The DOL yesterday sent a Request for Information related to the overtime rule to the Office of Management and Budget for its review. When published, the RFI offers the opportunity for the public to comment.

The rule, which increases the threshhold income for qualifying for overtime to $47,476, was to have gone into effect on December first of last year.

But there’s a new sheriff in town–President Trump, aided and abetted by his Labor Secretary Alexander Acosta, neither of whom have expressed much sympathy for the rule.

The rule focuses primarily on updating the salary and compensation levels needed for Executive, Administrative and Professional workers to be exempt. Specifically, the Final Rule:

  1. Sets the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South ($913 per week; $47,476 annually for a full-year worker);
  2. Sets the total annual compensation requirement for highly compensated employees (HCE) subject to a minimal duties test to the annual equivalent of the 90th percentile of full-time salaried workers nationally ($134,004); and
  3. Establishes a mechanism for automatically updating the salary and compensation levels every three years to maintain the levels at the above percentiles and to ensure that they continue to provide useful and effective tests for exemption.

Additionally, the Final Rule amends the salary basis test to allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new standard salary level.

The initial increases to the standard salary level (from $455 to $913 per week) and HCE total annual compensation requirement (from $100,000 to $134,004 per year) were to be effective on December 1, 2016. Future automatic updates to those thresholds will occur every three years, beginning on January 1, 2020.

For my prior posts on the overtime rule, start here.

DOL: Enterpise Car Rental Subsidiary Barred Blacks From Management Trainee Jobs

An Enterprise car rental subsidiary isn’t playing fair when it comes to entree-level management trainee jobs, according to a lawsuit filed by the U.S. Department of Labor.

The DOL alleges that  Enterprise RAC Company of Baltimore, LLC, a subsidiary of one of the world’s largest vehicle rental companies and a federal contractor, is discriminating against African-American applicants pursuing those jobs.

A review by DOL’s Office of Federal Contract Compliance Programs determined that African-American and white applicants were not treated equally, and that African-American applicants were substantially more likely to be rejected at the initial screening stage and after the first interview.

That discriminatory hiring continues to this day, the lawsuit charges.

As a federal contractor, Enterprise is prohibited from discriminating in employment because of race, color, religion, sex, sexual orientation, gender identity, national origin, disability or status as a protected veteran.

Here’s the DOL’s announcement of the lawsuit.

$1 Million Grant to Study Paid Leave Programs

Is the spending of $1 million to study paid leave programs in the U.S. a wise expenditure?

The U.S. Department of Labor thinks so, announcing that $1 million will be available to research and analyze how paid-leave programs can be developed and implemented across the country.

The announcement coincided with a roundtable discussion at DOL’s Washington, D.C. headquartersThe event will include leaders from Nestlé, Spotify, Patagonia and other businesses to examine the growing momentum behind paid family and medical leave across the U.S.

Up to six competitive grants will be available under this program.

Here’s the DOL announcement of this funding opportunity.

Obama Takes Aim at Contractor Pay Practices

Federal contractors could be forgiven for thinking they’re being picked on by the U.S. government.  President Obama today signed two documents putting those contractors’ pay practices under further scrutiny.

One–an executive order–prohibits contractors from retaliating against their employees because they discuss their pay with each other.

The other, a presidential memorandum, requires the Department of Labor to adopt rules requiring contractors to submit pay data to the department, broken down by race and gender.

Both moves are designed to highlight the Obama administration’s push for equal pay for women, who continue to earn about 77 cents on the dollar for every dollar a man makes.

And since Obama doesn’t have the constitutional authority to command the private sector to close the pay gap, he instead pressures contractors to get with the program.

It’s the latest in a string of executive orders to call attention to labor issues. Previously, Obama hit contractors up by raising their minimum wage to $10.10 an hour, and he’s also ordered DOL Secretary Thomas Perez to re-examine the regulations governing overtime under the Fair Labor Standards Act, to limit the number of employees who are denied overtime for working more than a 40 hour workweek.

Obama Order Targets FLSA Exemption

Employers won’t be able to make as wide use of the “white collar” exemption to deny overtime pay to their employees, a process that President Obama intends to jump-start tomorrow with the issuance of an executive memorandum.

According to published reports, Obama will instruct the U.S. Department of Labor to issue stricter rules on overtime. The Fair Labor Standards Act requires most employees be paid time and a half for working more than 40 hours a week.

However, the FLSA has an exemption for workers employed as bona fide executive, administrative, professional and outside sales employees. There are a lot of hoops an employer has to jump through to show that the affected employees really are in one of these categories–but they all have in common either the performance of management duties or tasks involving specialized knowledge.

The White House is concerned that employers are abusing the exemption by folding in workers, such as convenience store managers, fast food shift supervisors and office workers, who may be expected to work 50 or 60 hours a week without overtime, and that their hourly pay rate may actually be less than the $7.25 an hour minimum wage.

The action is the latest example of Obama’s stated intention to use his executive authority to enact policies that Congress won’t consider.

But expect pushback from congressional Republicans.

The fact is, though, this exemption has been on the FLSA books for decades and is in need of revisiting–so maybe Obama’s unilateral move will finally spur Congress to take a serious look at the exemption.

Wage Hour, FMLA, Worker Misclassification Priority Items in DOL’s 2015 Budget Request

Federal budgets are wish lists of what additional monies agencies would like to pursue their most important goals.  They’re unlikely to get all the sought-after increases, but the request does reveal where the agency sees its priorities.

For the U.S. Department of Labor, three areas of continuing interest where substantial additional sums are sought in the 2015 budget are enforcement of wage and hour laws, the Family and Medical Leave Act, and misclassification of workers as independent contractors.

The first two of these items are under the purview of the Wage and Hour Division, which said it is seeking an additional $41 million for wage and hour law enforcement and protection of leave rights under the FMLA.

To combat worker misclassification, DOL wants an additional $14 million. According to the DOL’s announcement, such misclassification deprives the affected individuals “of benefits and protections to which they are legally and entitled  and disadvantages employers who comply with the law.”

And the Office of Federal Contract Compliance Programs, which enforces nondiscrimination requirements in federal contracts, is requesting an additional $107 million to “strengthen efforts to eliminate pay discrimination affecting women.”

Read more on these and other budgetary requests by DOL.