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Fair Labor Standards Act
Nationwide Injunction Imposed Against New FLSA Rules

It looks like Christmas has come early for employers all around the country.  On November 22, 2016, a federal judge from Texas issued a nationwide preliminary injunction prohibiting the U.S. Department of Labor from enforcing its new rules regarding the executive, administrative, and professional (“EAP”) exemptions under the Fair Labor Standards Act.

Hooray!

hooray

For all those employers who were going to be converted to non-exempt status solely because of the increased salary threshold, those employees can remain exempt.  For those employees who were set to receive a pay increase due to the new FLSA rules, employers will need to make the tough decision on whether they will still increase employees’ salaries.  Some factors to consider are whether the pay increases have already been implemented or announced, the potential impact on morale, and the company’s budget.

To view a copy of the court’s decision, please click on the following link:  FLSA Rules Preliminary Injunction.

 
Two Lawsuits and Several Bills Challenging the DOL’s New FLSA Rules

UPDATE:  OMG!  Contrary to very-widely-held speculation, a federal district court actually did issue a preliminary injunction against the new FLSA rules!  And, the injunction applies nationwide!  Click here for further details:  Nationwide Injunction Imposed Against New FLSA Rules

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This has been a busy couple of weeks for the U.S. Department of Labor’s (“DOL”) new FLSA rules.  First, two lawsuits have been filed in a Texas federal court to seek an order preventing the DOL from enforcing its new overtimes rules.  In addition, a House bill - HR 6094 – is making its way through Congress to postpone implementation of the new FLSA rules for six months.  The new rules are currently set to take effect on December 1, 2016, which is just about two months away.

lawsuit

The first lawsuit was filed by 21 states and argues that the DOL overstepped its authority by raising the salary level for the FLSA’s Executive, Administrative and Professional exemptions (“EAP exemptions”).  The lawsuit argues that, instead of raising the salary level, the DOL should have reexamined the duties of the EAP exemptions.  In addition, the 21 states also challenged the automatic increases that are set to increase every three years “without regard for current economic conditions or the effect on public and private resources.”  Finally, the lawsuit posits that new DOL’s rules violate the Tenth Amendment because employment budgetary matters such as the pay requirements of state employees are subject to state sovereignty.

The second lawsuit was filed by a coalition of business groups, including the National Federal of Independent Businesses (“NFIB”) and several Chambers of Commerce.  This lawsuit argues that setting new salary threshold at an exceedingly high level and scheduling automatic increases both violate the Administrative Procedure Act.

(Both lawsuits have been assigned to Judge Amos Mazzant, who was appointed to the bench by President Barack Obama.  So, that’s not exactly great news…)

Finally, there are several bills pending in Congress that seek either (1) a delay of the new rules or (2) a phase-in of the increased salary threshold over several years.  Specifically, HR 6094 and S. 3462 both seek a six-month delay of the effective date of the new rules and HR 5813 and S. 3464 seek to phase-in the increases over several years.

Recently, the U.S. House of Representatives just voted 241-177 in favor of passing HR 6094.  The bill will now go to the U.S. Senate for consideration.  However, President Obama has previously threatened to veto the measure if it is passed and the Office of Management and Budget issued a statement that “strongly opposes” the bill.

Therefore, despite all these legal challenges to the new FLSA rules, employers should plan to implement whatever changes they deem necessary by the December 1, 2016 effective date.

 
Two New Workplace Poster Requirements

In case you missed it, as of August 1, 2016, there are two new (or more accurately, revised) posters that employers must post in the workplace.

ICYMI

First, every employer who has employees that are subject to the FLSA (that’s most of you) must post a revised version of the FLSA poster in the workplace.  The poster must be posted in a conspicuous place as to permit employees to readily read it.  Four versions of the new poster can be obtained on the DOL’s website:

Second, employers who are covered by the Employee Polygraph Protection Act (that’s also most of you) must also post a revised version of the Employee Polygraph Protection Act poster in the workplace.  This poster must also be posted in a prominent and concpicuosu lace in every establishment of the employer where it can be readily observed yb employees and applicants for employment.  There are two versions of this poster available:

These new posting requirements are the result of an increase in fines under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015.  

 
FAQ: Hepatitis A and the Workplace

Hawaii is currently experiencing a major outbreak of Hepatitis A.  At last count, nearly 140 individuals in Hawaii have been infected with the Hepatitis A virus (“HAV”).   As a result, many Hawaii employers are left with a myriad of questions about the rights of employers and employees with regards to HAV in the workplace.

Many People Thinking of Questions

Examples of questions raised by employers regarding Hepatitis A include the following:

  • What is Hepatitis A?
  • How long is a person with Hepatitis A contagious?
  • Who should get tested for Hepatitis A?
  • Is there a vaccine that can prevent Hepatitis A infection?

In addition, workplace-specific questions have included the following:

  • Does the Department of Health (“DOH”) require employees in certain fields of work, such as food service or healthcare, to obtain Hepatitis A vaccinations prior to working?
  • How does a food service employer know if an employee has been found to have been infected with Hepatitis A?
  • How does a food service employer know which employees are a “contact” that needs to obtain a negative IgM test before resuming work?
  • Can an employer require employees to get vaccinated?  If so, can the employer limit this requirement only to certain job classifications?
  • Is the employer required to pay for Hepatitis A vaccinations?
  • Is time spent getting a Hepatitis A vaccination compensable under wage and hour laws?
  • Is there anything else an employer can do to help prevent the spread of Hepatitis A?
  • If an employee informs his employer that he has tested positive for Hepatitis A, what if anything can the employer tell its employees?
  • If an employee informs his employer that he has consumed food from a business that has an infected employee, what can the employer do?
  • Where can I read more information about Hepatitis A?

In response to the multitude of questions that employers have been asking the past few weeks, the Hawaii Employers Council (“HEC”) has prepared a FAQ on HAV and the workplace.  The FAQ can be accessed on HEC’s website here:  HEC Issues FAQ for Hepatitis A and Workplace Issues.

For any questions that have not been answered in the FAQ, please feel free to contact me

 
Hawaii Minimum Wage Now $8.50 Per Hour

Happy New Years everybody and welcome back to work!  This is just a quick reminder that the Hawaii minimum wage increased by 75 cents on January 1, 2016, which makes the new minimum wage in Hawaii $8.50 per hour.  The tip credit is still just 75 cents per hour (assuming the tipped employee earns at least $7.00 per hour in tipped income and wages).

Minimum+wage+increase.mgn (1)

In addition, the minimum wage is also scheduled to increase twice more in the next two years.  Beginning January 1, 2017, the minimum wage will be $9.25 per hour and on January 1, 2018 it will increase to $10.10 per hour.

For further discussion on the Hawaii minimum wage or tip credit, you can read a helpful guide issued by the Hawaii Department of Labor and Industrial Relations back in 2014:  DLIR Wage and Hour Notice.