Court Case on CA’s Day of Rest…Finally Rested

California has long had a day of rest requirement.  In fact it has existed long before overtime and minimum wage. It guarantees an employee “one day’s rest therefrom in seven”.  But  which employees and what exactly is one day in seven?  This was really never litigated before the current case of Mendoza v. Nordstrom in which the ruling was just handed down on May 8th.  Rather than my trying to explain the entire court case in a blog, I will, instead, urge you to read the recap of the case as presented by Sheppart Mullin Richter & Hampton’s Brian S. Fong for the Mondaq News Update Service. It is an in-depth look at the ruling and the impact on employers.

 

Don’t wait for blog posts to find out the latest in payroll news.  Subscribe to Payroll 24/7 today.

 

 

Is Charity Work Hours Worked?

Got a great blog post yesterday from Bill Pokorny, with Wage & Hour Insights concerning paying employees for charity work.  During this time of the year this question comes up a lot for payroll professionals. In his June 7th blog he has given a clear and concise answer on when charity work could be considered hours worked.  Check out his blog today.

Wage Theft Conversation Takes Off with Uber

Wage theft is getting a lot of attention lately. In my May 30th blog I discussed an EPI report that went into detail concerning wage theft in the United States.  But is wage theft even more rampant than that report indicated? A recent article in the New York Times concerns how Uber is just discovering they have been miscalculating the commissions paid their drivers and are getting ready to pay tens of millions in back payments. But a driver’s advocacy group in New York is indicating that the company is also making its drivers swallow the per cab ride tax burden imposed by New York.  This practice, according to the New York Taxi Workers Alliance amounts to wage theft. It all boils down to how the contracts are interpreted and only the courts will decide in the end.  But it is food for thought.  Are major corporations guilty of wage theft as a matter of business practice? This is a disturbing questions that must be answered.

What do you think?  Is wage theft a serious problem in the U.S.?  Take our poll or leave a comment.

Is Private Sector Comp Time Finally Here? And Is It a Good Idea in the First Place?

This week the House of Representatives passed The Working Families Flexibility Act of 2017, H. R. 1180. The purpose of this bill is to amend The Fair Labor Standards Act of 1938 to allow employees to receive compensatory time off instead of payment for overtime worked for employees working in the private sector. It sponsors say that this gives employees in the private sector the same flexibility that employees in the public sector have enjoyed for a number of years. In essence, being able to choose between being paid for overtime or getting time off at a later date. I have not yet made a decision on this bill as to whether or not I support it. It has good points but it also has a lot of flaws.

First the good points:

  • the bill does require that the employee agree to, in writing, receive comp time instead of being paid for the overtime worked. If the employee would prefer to be paid over time then they have to be paid overtime, at least in theory.
  • The bill also requires that the employee be given opportunity to take the comp time when requested, as long as it does not interfere with business operations.
  • The bill does require that the employee be cashed out upon termination, voluntary or involuntary, or at the end of a 12 month period. This in theory prevents overtime from never being paid.
  • The bill permits an employee to opt out after agreeing in writing to be paid compensatory time and does not permit compensatory time to be as a condition of employment.
  • The bill does not allow new employees to be forced to take compensatory time instead of overtime. The employee must work at least 1000 hours for the employer before they can agree to be pay compensatory time.
  • The bill sunsets after five years and requires after two years that the GAO submit a report outlining whether or not there were complaints alleging violation of the rules made to the Secretary of Labor or the Department of Labor. It requires an accounting of any unpaid wages, damages, penalties, injunctive relief, or any other remedies that were obtained or sought by the Secretary Of Labor.

However there are flaws:

  • first the premise that public sector employees “enjoy” the privilege of compensatory time in lieu of overtime. Public sector employees did not come under the FLSA until 1985 when it was mandated by a court decision. Private-sector employees have been under the FLSA since 1938. The only reason the comp time in lieu of overtime was permitted is because it was written into many cities, counties and states requirements because they were spending public money. It was never something that was negotiated or requested by the employees themselves.
  • Many studies in the United States show that employees tend not to take all of the vacation they are due because they can’t get the time off from their employers. So my question is if they can’t get time off to take vacation that has been given them how will they be able to take off using compensatory time? Especially when the bill does not state that they must be given the comp time when requested but only if it does not interfere with business operations. And how many of us have not been able to take our vacation because our boss says I can’t give you the time off right now.
  • If not able to take the time off due to business operations then what’s the purpose of having comp time except to delay paying the employee overtime that was rightfully do. I understand that taking time off does affect business operations and if I’m requesting vacation I can understand that my boss can say not at this time. Because in essence vacation is not something that I actually worked for, but a benefit my boss is offering me. But compensatory time off is not the same as vacation although this bill seems to treat it that way. This is money that I’ve already worked for and am already due. It is not a benefit that my boss gets to allow me to take at his or her convenience.
  • My biggest problem with this bill is the fact that even though it says that the GAO will present a study on whether or not there were violations the fact is that the Labor Department collects hundreds of millions of dollars each year for violation of simple minimum wage and overtime rules. These rules have been in effect since 1938 and yet employers still violate them on a regular basis. Is this just adding one more area that employees will have to sue their employers through the DOL to get their money? Especially lower paid or minimum wage employees. Is this one more thing the employee will have to be aware of and make sure they are being paid properly?

Compensatory time off bills have passed the house many times in the past but have never gone past the Senate, usually dying in committee. But these are not normal times so we will have to wait and see.

 

What do you think? Take our poll. Are you for or against The Working Families Flexibility Act of 2017? 

Comma Placement Matters, Especially in Wage Hour Law

As many of us who use Facebook know, the grammar police are constantly posting memes about the proper use of commas. Recently the placing of a comma came into play which cause one employer to have to pay back wages for overtime. The U.S. Court of Appeals for the First Circuit has overturned a federal district court opinion and ruled that dairy company delivery drivers are eligible to receive overtime under Maine’s overtime laws. At issue was Maine Rev. State. Ann. §664(3)(F), which provides an exemption from overtime for those involved in the “canning, processing, preserving, freezing, drying, marketing, storing, packing for shipment or distribution” of perishable food. The drivers did not dispute that they handled perishable foods, but said that they do not engage in “packing” them, and therefore are eligible to receive overtime. The employer argued that the above provision actually refers to two distinct exempt activities (“packing for shipment,” and ”distribution”), and therefore the exemption from overtime applies to the drivers. The appellate court sided with the drivers. It said that the exemption would have applied to the drivers if the statute had read “packing for shipment, or distribution” rather than “packing for shipment or distribution.” Since the drivers did not pack items for either shipment or distribution, their activities did not come under the statutory exemption [O’Connor v. Oakhurst Dairy, CA1, Dkt. No. 16-1901, 3/13/17].

So watch out for where the commas are placed if you want to avoid penalties!

Get the latest news on overtime rules by subscribing to Payroll 24/7 today!

We Have A New Secretary of Labor

The Senate confirmed Alexander Acosta as the 27th Secretary of Labor yesterday.  The swearing in ceremony was conducted this morning by Vice President Mike Pence.  I sent a tweet over to the new Secretary this morning wishing him well in his new job protecting the American worker. Now we need to wait and see where the new Secretary will take the DOL.  There are quite a few outstanding issues, including the delay on the changes to who is entitled to overtime, left from the Obama Administration that the new Secretary will have to deal with.  So will Mr. Acosta be a good Secretary of Labor?  Only time will tell us that.

 

Keep up to date with the latest ruling from the new Secretary of Labor and the DOL by subscribing to Payroll 24/7 today!

State vs. Cities: The Wage Hour Fight Continues

Localities such as cities or counties have been enacting their own wage and hour requirements for quite a few years now.  Dozens of cities in California and New Jersey have their own sick leave laws as well as higher than state minimum wages.  New Mexico has local minimum wages as does Washington.  But it seems the state legislators are starting to fight back.  With the assistance of groups such as the American Legislative Exchange Council (ALEC) model bills (draft legislation that legislators may customize and introduce) have passed in several states.  The latest states to pass such legislation are Arkansas and Iowa.  These bill basically forbid the local governments from passing any type of law relating to minimum wage, living minimum rates, employment leave or benefits, hiring practices or any condition of employment that is more generous than the federal or state law.  Whether cities will fight back in the courts, or if they even can, remains to be seen. Miami Beach recently tried to establish its own minimum wage despite Florida having passed its own version of the ALEC legislation.  The court struck down the Miami Beach ordinance. So the fight continues.  Payroll professionals need to monitor local minimum wage and sick leave ordinances to ensure compliance but remember these ordinances can be fleeting if the state has passed the ALEC-style legislation.

Get all the latest on local minimum wage laws by subscribing to Payroll 24/7 new alert service. News you need as payroll professionals when you need it.