gymLate last week, the EEOC released the proposed rules on wellness programs for employers.  These long-awaited proposed rules will likely be adopted in full by this summer, after the public has 60 days to submit comments.

I talked about this in a post last fall and even in a post back in 2011.  But now, we finally have something more to go on.

It’s still early to give a full recap of the rules, particularly because they might change.  Various blogs have been summarizing some of the key points thus far.

HRMorning.com lists eight such points. It’s top two?

  1. The proposed rule clarifies that the ADA allows employers to offer incentives up to 30% of the cost of employee-only coverage to employees who participate in a wellness program and/or for achieving health outcomes.
  2. The rule also allows employers to impose penalties on employees who do not participate or achieve certain health outcomes. The maximum allowable penalty an employer can impose on employees is 30% of the total cost of employee-only coverage.

Jon Hyman describes the proposed rules as “balanced” and advocates reviewing a helpful Q&A provided by the EEOC itself.

Several months ago, the EEOC announced its intend to issue regulations interpreting whether employer wellness plans are legal or illegal medical exams under the ADA. Thankfully, last Thursday the EEOC published its proposed regulations, and its good news for employers who use these programs to keep down the cost of their group health insurance.

Eric Meyer notes several other takeaways including that no discrimination is allowed by employers:

  1. No discrimination allowed. That means, employers may not interfere with an employee’s ADA rights, or threaten, intimidate, or coerce an employee for refusing to participate in a wellness program or for failing to achieve certain health outcomes.
  2. Volunteers only. Employers cannot require employees to participate, or discipline or deny health coverage to employees who do not participate.

A Law360 article this morning notes, however, that there are still some open questions and issues from the proposed guidance:

  • Will ‘Employee-Only Coverage’ Language Stay?
  • Will the Courts and EEOC See Eye-to-Eye On Whether Employers to Use the ADA’s “Safe Harbor” Provisions?
  • What Will Happen with Wellness Programs When Considered Under Upcoming Regulations Under GINA?

For employers, the proposed rules are not the end of the discussion on wellness programs, just another step down the road. But if your company utilizes them, this is one area worth watching for developments this year.

In one of my very first posts way back in 2007, I said this:

For employment lawyers and HR professionals, it’s “old” news that overtime lawsuits are a major concern.  Business Week picks up on that trend in next week’s Cover Story entitled: “Wage Wars: Does your Boss Owe You Overtime”.

According to the article:

No one tracks precise figures, but lawyers on both sides estimate that over the last few years companies have collectively paid out more than $1 billion annually to resolve these claims, which are usually brought on behalf of large groups of employees.

Yes, you read that right. A BILLION dollars.

Since that time, the numbers of lawsuits have only increased.  Indeed, during the 2013-2014 year, a record 8126 federal wage & hour cases were filed. That is up over 436 percent since 2000.

The attorneys’ fees and the existing potential for additional damages have long been a large incentive for attorneys representing employees to bring these claims.

Heck, fellow blogger and Connecticut lawyer Richard Hayber alone lists 18 class action claims on his site for people to get involved with (you’re welcome, Rick.).

And yet, for some reason, the Connecticut General Assembly thinks that this is somehow an underrepresented area of litigation.

Why do I make that conclusion? Because last week, the Labor & Public Employee Committee approved of a bill (Raised Bill 914)  that would mandate double damages in cases of a failure to pay overtime wages unless the employer could prove that it had a “good faith belief” in its underpayment.

Let’s be clear: That good faith belief standard — which isn’t defined in the bill — would be a very high hurdle to clear.  And it would make settlement of cases much more expensive.

For that reason, the CBIA has opposed the bill stating it “discourages employers from ever being able to challenge employee wage claims, because the only possible results would be to pay double damages if wrong on the claim or pay high legal costs to be proved right.”

Whatever the legislative intention, this is yet another bill in search of a problem.  Indeed, if anything, the wage & hour lawsuit craze is booming right now.  Passage of the bill would only create additional incentives for litigation.

There’s still a long way to go in this legislative session, but bills like these are giving employers in Connecticut a good deal of heartburn.

capitoldasAs the legislative session continues to roll around, sometimes you can get caught up in bills that have no chance of getting passed.

For example, the General Assembly — as presented structured — will never pass a bill making Connecticut a Right to Work state.

But when the Connecticut Commission on Human Rights and Opportunities makes proposals to the legislature, it’s worth taking a closer look at their proposals.  Why? Because sometimes (though not always), their proposals get adopted.

Two significant proposals, which are being being floated through the Judiciary Committee, not the Labor & Public Employee Committee are as follows:

The CHRO has also proposed language that would impact employers less than the others.

These proposals are still in their formative stages; you won’t find them in the bill record book yet or on the CBIA bill tracker site.

But it’s important for employers and their counsel to review them to understand what is being vetted.

So far, this legislative session is proving to be far busier than was first anticipated.   Stay tuned.

Yesterday on Twitter, a Connecticut legislator posted this:

State Representative Matt Lesser, be careful what you ask for. But since you asked, here’s a modest proposal that I saw recently that ought to be discussed.  It’s not perfect, but it brings up an important topic that Connecticut should talk about.

(We won’t, of course. The General Assembly hasn’t shown any interest in this.  But humor me just for a minute.)

A former colleague of mine, Michael Kun, of Epstein Becker & Green, recently advanced a proposal to amend federal wage & hour laws to bring them more in line with the way we treat other employment laws.  Namely through compromise and settlement.  Regardless of your political leanings, it’s an insightful and thoughtful post and definitely worth a read.

Michael’s advances an argument based a theory that I’ve talked about before in so-called “wage-theft” cases: That employers are typically trying to comply with a whole host of laws.

The desire of employers and their counsel to comply with the law plays out thousands of times every day, to the great benefit not just of employers, but of employees. All management-side employment lawyers worth their salt have stories about how they worked with their clients to prevent a manager from terminating an employee’s employment, or cutting an employee’s pay, by explaining the law and the potential repercussions.

But there’s a problem, according to Michael.  Federal wage & hour laws “dissuade employers from correcting wage issues.” Why?

Because, unlike other employment laws, the FLSA generally doesn’t permit employers and employees to resolve wage disputes, short of the very litigation or agency complaint that neither employers nor employees really want.

The FLSA forbids the very amicable resolutions that would benefit both employers and employees.

And it’s time to change that.

He proposes a system to resolve complaints with safeguards that are similar to those used in age discrimination cases.  I will readily acknowledge that the proposal is far from perfect, but it tackles a subject that for too long has created litigation without creating a fair escape hatch to avoid expensive litigation for employees and employers alike.

Here’s the thing, Representative Lesser, that same system exists under state law too.  Employers who discover that they may not have been following wage & hour laws have an incentivenot to disclose it because if they do, even voluntarily, the Connecticut Department of Labor can (and, in some instances, will) require penalties and interest to be paid along with it — even if reasonable people could disagree about whether such violations did, in fact occur or were intentional.

Wage & hour case also are challenging to settle in Connecticut because some lawyers representing employees can use any such voluntarily acknowledgments to prove liability and then litigate these cases for high fee awards all the while assuring their clients they should hold out for nothing less than full capitulation by the employer.

A few years back, I floated the idea of an amnesty program for employers to disclose voluntarily wage & hour violations with a Connecticut Department of Labor official.  The official appreciated the sentiment but said it would never fly because the existing legislation would need to be amended.  Maybe such a proposal could be done in conjunction with making the penalties for intentional violations stricter.

Regardless, I agree with Michael’s post that ultimately the only ones who benefit from keeping the status quo are the lawyers.  We’ll do just fine.

Yes, it’s a bit unconventional.  But Representative Lesser — you didn’t want easy proposals right?

Pizza workers may be covered.

This week, one of Connecticut’s own, Representative Rosa DeLauro introduced the “Schedules That Work Act” bill in Congress.  It would ostensibly help part-time workers secure stable schedules.

It would, among other things “ensure employees get two weeks notice about their work schedules, as well as extra pay to compensate for last minute changes”, as summed up by The New York Times.

I’m not going to spend time detailing all the nuances of the bill because, well, it has virtually no chance at all of getting passed in the gridlock that is Washington, D.C.  (If you want further details, the National Women’s Law Center has a good one here.)

One of the bill’s proposals, however, would establish a “reporting time pay requirement” which would entitle certain restaurant and retail workers to a minimum of four hours of pay even if the employer wanted to send them home early during a shift.

But what’s been missing in the discussion so far in the discussion is that Connecticut has long since had rules in place in the restaurant and mercantile industries that mandate something similar.  I first covered these rules back in 2011.

The problem for employers is that you won’t find those rules in the law itself.  Instead, you will find them in certain “wage orders” issued by the Connecticut Department of Labor. Thankfully, those orders are now available online.  (The mercantile trade order is here and the restaurant order is here.)

Both orders were updated in the last few months to take into account the minimum wage increases too.

(Speaking of minimum wage for a moment, did you check out Funny or Die’s Mary Poppins “quitting” because of her pay? Very well done.)

For restaurant workers, a two hour minimum rule (in 31-62-E1 (b)) applies, unless notice is given the day before and applies to the minimum rate, not the regular work rate.

An employee regularly reporting for work, unless given adequate notice the day before to the contrary, or any employee called for work in any day shall be assured a minimum of two hours’ earnings at not less than the minimum rate if the employee is able and willing to work for that length of time. If the employee is either unwilling or unable to work the number of hours necessary to insure the two-hour guarantee, a statement signed by the employee in support of this situation must be on file as a part of the employer’s records.

For mercantile workers, a four hour minimum rule (in 31-62-D2 (d)) applies, and its phrased slightly differently. Those employees get their “regular rate”.

An employee, who by request or permission of the employer, reports for duty on any day whether or not assigned to actual work shall be compensated for a minimum of four hours earnings at his regular rate. In instances of regularly scheduled employment of less than four hours as mutually agreed in writing between employer and employee, and approved by the Labor Department, this provision may be waived provided the minimum daily pay in every instance shall be at least twice the applicable minimum hourly rate.

What’s the practical application of this rule? Suppose you’re a retail store and have an employee who’s shift that day is from 1 p.m. to 9 p.m.  At 3 p.m., you realize that you have more than enough workers to cover the shift and send the employee home “early”.  Under Connecticut’s rule, that employee is entitled to a minimum of four hours of pay, even though they only “worked” for two.

And one more thing: For restaurant workers, the order also provides that on the 7th consecutive day at work , the employee is entitled to pay at time and a half.

So, ignore the headlines for the time being. Instead, use this summer to catch up on the rules that you may not have known about.

The Connecticut General Assembly is back at work so it’s time to take a quick peek to see what’s percolating.

2013 Legislative Session Begins

The Connecticut Business and Industry Association highlighted the “captive audience” bill as bill that is resurfacing, even though the Attorney General has previously raised doubts about the constitutionality of it.  The bill would restrict communications by the employer in general workplace meetings.  The CBIA highlighted the bill’s flaws:

The proposal usually shuts down much of what an employer can talk about with their employees in regular workplace meetings. For example, the last captive audience proposal restricted “political” discussions—with “politics” so broadly defined that almost any topic would have been considered off-limits. This would include issues critical to the effective management and operation of a business.

And under the threat of severe legal and financial penalties, an employer’s ability to communicate—particularly in opposition to the potential unionization of the workforce–would be effectively silenced.

Before this flawed concept goes any further, lawmakers should heed the attorney general’s warnings.

The Labor & Public Employee Committee at the legislature maintains a bill record bill that lists potential bills up for consideration.  As the session progresses, this list gets more refined.

Among the early “Proposed Senate Bills” under consideration:

  • Proposed Senate Bill 56, which would increase minimum wage by 75 cents in January 2014 and another 75 cents in January 2015;
  • Bills that would either eliminate or expand paid sick leave (Proposed Senate Bills 179 and 198);
  • Proposed Senate Bill 159, which would “prevent current or potential employers from requesting or requiring that employees or potential employees provide passwords to their personal accounts as a condition of their employment.”

On the House side, a few “Proposed House Bills” are starting to surface too including:

The next meeting of the Committee is set for January 29th, where these concepts — and others, including teaching about the history of the labor movement — will be discussed.  No public hearings have yet been posted publicly.

At a Sentencing Commssion hearing last week, former state lawmaker Ernie Newton — who was convicted in 2006 on corruption charges — urged commission members to address hiring discrimination against ex-felons, reports CT News Junkie.  There is no indication yet that they will do so, but his comments raised some eyebrows in the press.

Newton’s comments aren’t the first time, though, that the issue of hiring discrimination against felons has surfaced as a legislative proposal.  Back in 2010, the legislature overrode Governor Rell’s veto of a bill that restricts the use of background checks for state job applicants. 

Despite that, private employers are still free to make hiring decisions based on a criminal conviction. 

The topic is not going away any time soon.  In April, the EEOC released new guidance that suggested that employers use arrest and criminal records in their decision-making process with care.  The agency suggested that under some circumstances, there may a violation of Title VII if used improperly. 

With the state budget again dominating discussions, it is unclear yet whether the General Assembly has any desire to take up legislation on this topic any time soon.  The “long’ year begins on January 9, 2013 and runs to June 5, 2013.

Sometime last summer, Connecticut attorney Karen Lee Torre sparked a few fires with her suggestion to eliminate the Connecticut Commission on Human Rights and Opportunities — the organization charged with, among other duties, investigating and remedying discrimination in the workplace.  (You can find my prior posts on the exchange here, here and here.

The crux of Attorney Torre’s arguments at the time was as follows:

CHRO was and remains crippled by internal race politics with staffers suing each other and maintaining demographic battle lines. It is Afro-centric, politically correct to a grievous fault and brazenly hostile to the civil rights of white males. It is time to dissolve it or at least gut it with a budget that reflects its worth.

This month, the Connecticut Lawyer published an opinion piece written by my colleague, Joshua Hawks-Ladds, in which he suggests another radical change in the CHRO but for different reasons. You can download the article here

First, he highlights what he believes needs fixing at the CHRO:

Unfortunately, the Commission has become an underfunded, understaffed and perpetually backlogged bureaucracy. Along with many valid discrimination complaints, the Commission’s offices are clogged with specious claims that the Commission is required to investigate. This means that the bona fide discrimination claims against landlords and employers get lost in the morass. Some of the valid claims are removed from the CHRO and litigated in the state and federal courts. However, the many of the claims (over 2,000 are filed each year) languish for years in the agency’s offices. The system is unfair to claimants with bona fide claims, as well as employers and landlords with bona fide defenses.

As a result, he proposes a fix:

a complete overhaul of the Commission’s procedures to mirror the state Department of Labor’s Unemployment Compensation system, with one exception: if either party does not agree with an appeal referee’s decision relating to a charge of discrimination, then that party may appeal that decision, de novo, to the superior court.

It’s a new approach to an old problem.  He acknowledges up front that his proposal is likely to be met with opposition from some. But with many people (on both sides of cases) unhappy with the status quo, the time may be right to at least consider something new. 

An advisory committee charged with making recommendations about changes to the CHRO has been in the works for many many months now.  It’ll be interesting to see what changes they propose to an agency that continues to draw criticism.