Sometime soon, your e-mail inboxes are going to be bombarded from attorneys telling you that you need to pay attention NOW to new overtime rules by the U.S. Department of Labor.  ROFL.  

At least based on what we know now, it’s best taking a lesson from my teenagers and ignoring the messages and hype (and all the text abbreviations too.)  SMH. 

Late last week, Bloomberg news reported that the DOL is considering changing the rules regarding who is eligible to receive overtime by increasing the salary threshold from about $24,000/year to $35,000. IKR?

In plain English, employees who make less than $35,000 would have to be paid overtime on any hours worked over 40 — no matter what their duties are.   MEGO. 

If all this sounds vaguely familiar, you may recall that the Obama-era proposed rules were enjoined by a court before implementation and then we had an election.  Those proposed rules would have set the bar even higher to approximately $47,000.  RIP.

But here’s the thing – we don’t have anything yet. And when released, the proposed rules will be just that — proposed.  They are still very much subject to change.  And even then, there will likely be a significant period of time before implementation.  My guess — and it’s just that — would be late 2019 or early 2020 at the earliest.  SWAG.

For now, here’s the one thing to think about: If you have any exempt employees that are paid about $35,000 or less, keep in mind that you may need to start paying them overtime…at some point.  MEH.

But remember: Just because you are paying employees a salary does not mean you’re following the law. Employees must also have “duties” that are exempt — typically, professional, executive or administrative.  

BOL.  

Employers who want to (or need to) use independent contractors often scratch their heads at a disconnect – how do you determine who is an independent contractor?  I recall at one speaking engagement years ago, an employer who came up to me and asked: “So are you saying that there are TWO tests to determining if someone is an independent contractor?”

Yes, that’s exactly what I was saying.

The Connecticut Department of Labor and the Connecticut Department of Revenue Services (the state equivalent to the IRS) have each developed tests for determining if someone is an employee vs. an independent contractor.

And they are not the same.

I’ve looked at this before, but my colleagues at Shipman & Goodwin — who now host a terrific new little blog on tax law (www.cttaxalert.com) — have posted about it too — but this time from the perspective of tax lawyers. 

Worth your time.

In my prior post, I wondered aloud whether there were some rough waters ahead for employers.  Apple recently announced that it would not meet it’s earnings estimates in the first quarter of 2019, in part because of soft demand from China. Other companies are expected to announce some similar issues.

Honestly, I’ve had enough conversations in the last few years with HR professionals who just haven’t lived through a major downturn.

Think about this way: For anyone who joined the workforce since 2010 or so, the era of massive layoffs in the financial and automobile sectors had just passed.

But fortunately, there are still a few of us around who remember.

So here are four things to think about:

  • Performance Reviews.   Why? Because when a downturn hits, your company will need to start a selection process as to who stays and who goes.  Inevitably, you will start looking at performance reviews to see about ranking employees.  You know what you might find? They all start looking alike. Everyone is slightly above average.   While I’m not suggesting everyone convert to a forced ranking system, your performance reviews should be honest indicators of how an employee is doing. Take a look at the ones you are doing this quarter.
  • WARN.  The Workers Adjustment and Retraining Notification Act  is one of those federal laws that you might not have even heard about. But if your company has 100 or more employees, you should. It requires that 60 days notice be given in instances of a mass layoff or plant closing. Before you go down the road of layoffs, you may have obligations to notify your workers and the government of the potential for layoffs. Be sure to comply.  Here’s a brief recap.  
  • Consider a Statistical Analysis.  I know — you didn’t like math in high school. But trust me: There is an entire profession of statistical experts available to help you figure out if the proposed layoff may have a disparate impact on a protected class of workers.  How is this done? You look at the class of workers that may be impacted by the proposed reduction in force and have an analysis done to see whether your neutral criteria may not be so neutral after all. Sometimes there are explanations for the disparate impact; but sometimes, the analysis can force employers to take a second look. Regardless, this can be an important step.  Just make sure to use an attorney to help give guidance here.
  • Understand the OWBPA.  It stands for the Older Workers Benefit Protection Act and it’s part of the federal law on age discrimination.  And if you want your employees to sign separation agreements (as I think you should) when you do your layoffs, your agreements better comply with this act.  I did a recap in 2008 that still holds up today.  

Before you have a crisis on your hands, talk internally about what the reasonable expectations for 2019 are going to be. If a possible cutback to personnel is even being discussed, now is the time to get ahead of things.

January 1st is typically a time for new laws to kick in and 2019 is no exception.

For employers, the biggest change is one that I discussed way back in May with amendments to Connecticut’s Pay Equity law.

The new law prohibits employers from asking a job applicant his or her wage and salary history. But the prohibition does not apply in two situations:

  • if the prospective employee voluntarily discloses his or her wage and salary history, or;
  • to any actions taken by an employer, employment agency, or its employees or agents under a federal or state law that specifically authorizes the disclosure or verification of salary history for employment purposes.

While salary may not be inquired, the law DOES allow an employer to ask about the other elements of a prospective employee’s compensation structure (e.g., stock options), but the employer may not ask about their value.

The bill has a two year statute of limitations. Employers can be found liable for compensatory damages, attorney’s fees and costs, punitive damages, and any legal and equitable relief the court deems just and proper.  (This bill amends Conn. Gen. Stat. Sec. 31-40z if you’re looking for the pinpoint legal citations.)

Note that this ban on inquiries also applies to applications or other recruiting forms too. So, if your application asks for prior salary history, it’s time to eliminate that.  Employers should inform manager and other employees who conduct interviews about this requirement as well.

 

Today, Massachusetts started retail sales of marijuana at two locations. Perhaps no location is closer to the population centers of Connecticut than Northampton — just 30 miles up the road from Enfield.  It’s the first store east of the Mississippi River.

And lest you think that this is a Massachusetts-only affair, you need only watch the news reports from today to understand that there are plenty of Connecticut residents lining up seeking to avoid the restrictions in place in the Constitution State.   And Governor-Elect Lamont has indicated he’s in favor of it. 

This is going to cause headaches and some choices for employers in Connecticut.

Small amounts of marijuana have been de-criminalized in Connecticut but recreational use and possession is still prohibited. Moreover, employers are still free to discipline employees for recreational use on the job or even off.

But Connecticut has, for several years now, permitted medical marijuana users (who have registered with the state) to have some limited job protections.  On-the-job marijuana use can still be prohibited as well as showing up under the influence.

The City of Waterbury recently announced a policy that testing positive for any amount of marijuana may subject employees to discipline.  As a news article notes, that policy is likely to be challenged in arbitration and the courts.  

So what can a private employer do when it drug tests employees in Connecticut and the results show up as “positive” for marijuana? Well, employers are going to first want to know if the employee is a medical marijuana patient, in which case further inquiries may be needed.  Otherwise, the employer may have the ability to still discipline or terminate that employee’s employment.

Beyond the “Can We Fire…” question, the newer question is going to be “Should We Fire….”

With legal sales just miles away from employers here, the line as to what should be permitted or not gets, if you permit the pun, hazier and hazier.  No doubt, some employers are going to try to draw lines in the sand and say that any drug use is not permitted — particularly if there are additional legal obligations that they need to follow. But some others may have a more permissive attitude and treat marijuana use as they do alcohol use — it’s fine so long as it doesn’t impact work and so long as it isn’t done at work.

The start of retail sales in Massachusetts is not the end of the story here; Connecticut may very well start to reconsider its own laws now that one New England state has taken the plunge. Regardless, employers should continue to talk with their counsel to navigate this ever-changing area of law.

Back in 2010, I wrote a simple blog post about how organ donors were protected under Connecticut’s FMLA law.  In it, I recount how my father — 25 years prior at that time — donated a kidney to his brother (my uncle).  At the time, I noted that both were well.  

On Sunday, October 28, 2018, my uncle passed away after a short illness.   Dr. Allen Schwartz was retired as the Deputy Director of Policy and Enterprise solutions at NYS Office for People with Developmental Disabilities and recently served as a Senior Policy and Research Analyst at Westchester Institute for Human Development. He leaves behind his wonderful wife, Andrea, and two adult children.  Allen was blessed to contribute so much to society in the 33 years since that organ transplant and he will be sorely missed. 

In honor of Allen, I’m reprinting the blog post below.  Become an organ donor today.  

FROM THE ARCHIVES – September 2010

25 years ago nearly to the day, my father donated one of his kidneys to his brother.

What have you done today? Have you done everything you could? Could you have done better?

They may seem like unfair questions after the first sentence.

But tonight is the start of Yom Kippur – a Day of Atonement in the Jewish religion and one of the holiest days of the year.  And as part of the services tonight and tomorrow, Jews around the world will be asking tough questions of themselves all with the goal of being a better person next year.

And so, to honor my father and his heroism and provide education and insights in the employment law context in the way I know best, today’s post is all about organ donation and what employers need to know.  My goal is to begin a discussion this important issue in Connecticut.

FMLA is typically thought of in the medical context or childbirth/adoption process.  But Connecticut’s FMLA statute actually provides protection for those employees who become organ or bone marrow donors.

Donors are to be provided with the same amount of leave (16 weeks over a 2 year period) that, say, new mothers and fathers are accorded.

This is still a relatively new law — having been passed just six years ago fairly quietly.

If you’re an employer, what does this mean? Well, for one, your FMLA policies should be updated to let your employees know that they can be a living organ donor — and still have their job protected.

Employers can also update their FMLA forms to provide for organ donation is a category to check off. Many employers tend to use the Connecticut DOL’s forms (at the end of the regulations) — assuming that they are the most complete forms out there. But even those forms do not include language about being an organ donor.  (Don’t look to the US Department of Labor either; their forms just follow federal law, not state law.)

Enterprising employers might think to seek out the Connecticut DOL regulations for some guidance. But those employers would also be out of luck. Those regulations haven’t been recently updated and say nothing about how employers should handle such requests.  (Authors note: Still not updated in 2018!) Indeed, if you just read the regulations, you might even think that organ donors are not protected because language about “organ donors” isn’t even there.  (Conn. Regs. Sec. 31-51qq-7 is a perfect example.)

Perhaps a representative from the Department of Labor can take the opportunity to update their website on this category and provide additional information, in the absence of formal regulations.   Without that, organ donors may be left wondering if their jobs are protected if they choose to donate.

In the meantime, employers are on their own to take steps to educate their workforce about the protections offered under Connecticut’s FMLA for organ donation.  Employers should be sure their forms and policies are up-to-date and remove any barriers to organ donation that their employees might think exist.

Credit should be extended to the many employers that have done a lot in this area, including some local companies (Aetna and Bank of America).  The Workplace Partnership for Life initiative is truly a win-win campaign in which everyone can play a significant role in recruiting potential organ, tissue, marrow, and blood donors. Thousands of U.S. corporations, organizations, and associations are working to create a “donation friendly America” by joining the Workplace Partnership for Life.

(And, of course, if you haven’t become an organ donor, do it today.  You can download the form from the DMV off their website and mail it in. Or when you renew your license, you can become a donor then.  The DMV has a FAQ about the process on their website as well.)

And what of my father and his brother? They’re both living healthy and productive lives.  And we continue to celebrate many holidays together.

If through this post and actions by employers, we can ensure that another family has that same benefit, I think we can say that today was at least a pretty good day and we did what we could. Think about the simple changes that your workplace can make today.

In the last few months, I’ve had some inquiries from employers asking about resources for layoffs.

Yawn.

Everyone remembers the layoffs of the recession, right?

Actually no, as it turns out.

In the ten years since the last great round of layoffs, there is a big group of new managers, directors, human resource personnel, lawyers etc that have joined the workforce.  And, as it turns out, they really DON’T remember the layoffs.  Unemployment is low. “Why would I need to worry about a Reduction in Force?

The stock market’s drop yesterday should remind all of us that good times aren’t always going to last.

What’s ironic about this is that back in 2008 — when the unemployment rate was skyrocketing — programs about reductions in force were just taking off and I noted the same concerns about whether employers were sufficiently aware of the issues.

History may repeat itself. Back then, I highlighted a few items that employers had to think about:

  • The WARN Act – If you’re doing a mass layoff, you need to notice affected workers in advance and provide notices to local and state officials.
  • Separation Agreements – If you want employees to sign a separation agreement (and you probably should), you need to give employees who are terminated in a layoff 45 days to consider an agreement and provide additional background information about the layoff itself.
  • Disparate Impact Analysis – With computers, checking your layoff data to ensure that it doesn’t have a disproportionate impact on protected groups (or, if it does, a legitimate business reason why it might) remains important.

Much of this remains valuable advice today.  And for employers who don’t remember this, now would be a good time to start your refresher courses.

Layoffs may not be right around the corner. But employers that are looking ahead in their business plans for 2019, would be wise to ensure that their staff are aware of the obligations that attach if the economy turns cold.

Lawyers love their cocktail chatter. And at a recent bar event, an interesting hypothetical came up among lawyers:

Suppose an employee is trying to get pregnant and is thinking about infertility treatments.  She’s considering time off for rest, and perhaps even for some in vitro fertilization (IVF) appointments. Perhaps even the doctor has said that the employee needs “light duty” work during certain days.   Maybe things are a little more hazy; suppose the employee just says that they are undergoing infertility treatment and needs some time off.

Is the employer obligated to provide such an accommodation?

The answers aren’t entirely clear.

Let’s go through some of the laws that may be implicated:

Employment decisions related to infertility treatments implicate Title VII under limited circumstances. Because surgical impregnation is intrinsically tied to a woman’s childbearing capacity, an inference of unlawful sex discrimination may be raised if, for example, an employee is penalized for taking time off from work to undergo such a procedure.

In doing so, the EEOC has cited to a Seventh Circuit case from 2008 which also found that the employer was liable for discrimination when it terminated employee for taking time off to undergo IVF.

  • ADA – Infertility may be an impairment that may “substantially limit” the major life activity of reproduction. Why is this important? Because it may then qualify the employee under the ADA as having a “disability”.   So, in such an instance, employers should review the “reasonable accommodation” portion of the statute. And the employer may decide that a day off for IVF treatment in “reasonable” under the circumstances.
  • State Laws – Connecticut has comparable laws on the subject as well.  Thus, employers should do the same analysis for CTFMLA and comparable state anti-discrimination laws as well.

But despite this, there are some courts — including the Second Circuit — that have found that a woman suffering from infertility does not have a medical condition related to pregnancy under Title VII and the Pregnancy discrimination Act because infertility is a condition that also affects many men as well.

Employers that have employees undergoing treatment for infertility should tread carefully in this uncertain area of law.  Each set of facts should be looked at on a case-by-case basis and consider enlisting trusted legal counsel for advice.

One of the benefits of writing a blog as long as I have is that you get to track the progress of a law or legal development over a number of years.

It was back in 2012, for example, that I first provided a comprehensive summary of a new medical marijuana bill that was making it’s way through the legislature.

And I was quick to note that the law had enough questions attached to it that employers would be wise to spent a late night or two studying all of the quirks.

Now, years later, we have the first case to look deeply at the statute. And for employers, the answers are becoming clearer.

My colleague, Chris Engler, recently recapped the case in a post on my firm’s sister blog.

The plaintiff in the case had applied for a job with a health and rehabilitation facility. The plaintiff ultimately received a job offer, subject to completing a background check and a drug screen. Prior to the drug screen, the plaintiff informed the company that she was a qualifying patient who used medical marijuana to treat her PTSD. Nevertheless, when her drug screen came back positive, the company revoked the job offer on the day before she was to begin work. Based on these facts, the court granted summary judgment for the plaintiff….

In rejecting the employer’s defenses in the new decision, the court addressed various important issues regarding [the law’s] non-discrimination provision. First, the court clarified that [the law] protects both an individual’s status as a qualifying patient of medical marijuana and that individual’s actual use of medical marijuana. However, the court pointed out that employers can still discipline employees who are under the influence at work.

The case can be downloaded here.  

As more people apply for cards to use medical marijuana, employers would be wise to understand the rules of the road before rejecting job applicants who test positive for marijuana on a drug screen.

Trying to follow both state and federal wage and hour laws isn’t that hard.

But it isn’t that easy either.

Let’s say you’re a restaurant with a waitstaff.  Like most restaurants nowadays, your customers pay by credit card and you, the employer, have to pay the credit card company a percentage on each sale.

You know there are rules regarding deductions of the wages to employees. But what about tips? Can you take out the percentage of fees being charged by the credit card company on the tips?

According to the U.S. Department of Labor: Yes.

In its fact sheet, the USDOL makes it plain that such actions by an employer do not violate federal law, so long as they are limited to the fees on the tips themselves.

Where tips are charged on a credit card and the employer must pay the credit card company a percentage on each sale, the employer may pay the employee the tip, less that percentage. For example, where a credit card company charges an employer 3 percent on all sales charged to its credit service, the employer may pay the tipped employee 97 percent of the tips without violating the FLSA.

The DOL also has 2006 opinion letter bolstering its views here. Even Connecticut, in an unofficial guidance, permits the practice.

While that aspect is clear, the remaining aspects of tip pooling are still very much being debated.  According to a DOL Field Bulletin this spring, in the Conolidated Appropriations Act, 2018, the Act provided that certain other portions of DOL regulations that barred tip pooling when employers pay tipped employees at least the full FLSA minimum wage and do not claim a tip credit no long have further force or effect.

As a result, according to the DOL, “employers who pay the full FLSA minimum wage are no longer prohibited from allowing employees who are not customarily and regularly tipped—such as cooks and dishwashers—to participate in tip pools.”

And if that weren’t confusing enough, employers in Connecticut also need to comply with the Wage Order drafted by the Connecticut Department of Labor that has additional guidance on tip pooling.

Employers must continue to tread cautiously in the area of wages. Minefields continue to be ever present — and the impact of a failure to comply with the law can be costly.