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Entries in overtime wages (7)

Wednesday
May032017

Working Families Flexibility Act Means Little to California Employers

Lawyer for EmployerEmployment Defense

 

by Nicole Kamm

818.907.3235

 

 

The House of Representatives just passed U.S. H.R. 1180, a bill that could potentially give certain businesses and their employees more flexibility in federal overtime compensation. The Working Families Flexibility Act (WFFA) would allow employers to award workers compensatory (“comp”) time off, in place of overtime premium pay for hours worked over 40 in a week.

Federal and State Overtime RulesUnder this bill, employers may choose to offer this option, and employees may decide if they would rather receive regular overtime pay or take compensatory time off at a later date. This “banked” comp time may be cashed out at a later date should the employee decide s/he would prefer to have monetary compensation rather than the time.

From an employer perspective, this could result in significant savings in operational costs, though it could be more challenging in the administrative sense. But for employers with staff in California, this bill would have little practical effect.

What Does H.R. 1180 Mean for California Employers?

First, there’s no word on whether or not the WFFA will pass the Senate. In the past, similar bills often cleared the House only to be killed on the Senate floor. (A more business-friendly political administration may mean greater possible success this time around, however.)

Second, and more importantly, state laws are clear regarding California overtime requirements. California employers are mandated to pay overtime at time-and-a half or double-time, depending on how many hours/days are worked.

CA overtime requirements are as follows:

  • All hours worked in excess of 8 hours in a workday or 40 hours in a workweek are paid at the rate of one and one-half times the regular rate of pay.

  • The first eight hours worked on the seventh consecutive day of work in the workweek are paid at the rate of one and one-half times the regular rate of pay.

  • Hours worked in excess of 12 in any one workday and hours worked in excess of 8 on the seventh consecutive day of the workweek are compensated at a rate of two times the regular rate of pay.

Employers should ensure they have clear, written policies regarding overtime compensation. For example, all employees should be aware (preferably via an Employee Handbook outlining company policy) that:

  • Overtime hours must be approved in advance by supervisors.

  • Unauthorized overtime will be paid, but could result in discipline or even termination.
  • Hours worked on weekends do no automatically count as overtime.

  • Sick, vacation, holiday or other paid time off cannot be used to calculate overtime compensation (unless your “company” is the Los Angeles Fire Department!). 

Nicole Kamm is an Employment Defense Attorney

 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

 

Tuesday
Sep202016

Employers' Legislative Update: Governor Brown Signs New Bills

Wage and Hour Defense Attorney

 

by Sue M. Bendavid & Tal Burnovski Yeyni

 

Tis the season for new laws in California and not all of it brings good tidings and cheer for employers.

Recently, Governor Jerry Brown signed several state Assembly and Senate Bills affecting those who employ domestic staff; agricultural workers; teachers; etc. Most companies with employees (or individuals with domestic staff) in California will be affected.

Here’s the current employment law update:

SB 1015 – Domestic Work Employees: Labor Standards

Previously, employees that worked as personal attendants were exempt from overtime and other wage and hour rules.

On January 1, 2014 the Domestic Worker Bill of Rights went into effect and provided that a “domestic work employee who is a personal attendant” is eligible for overtime at one and one-half times the employee’s regular rate of pay if the employee works more than nine hours per day or more than 45 hours per week. The Domestic Worker Bill of Rights was to be in effect until January 1, 2017 – at which time the legislature will decide whether to renew it.

SB 1015 deletes the repeal date, which means that the Domestic Worker Bill of Rights will remain in effect indefinitely.  

AB 1066 – Agricultural Workers: Wage, Hours, and Working Conditions

Federal, state and local laws require employers to comply with wage and hour rules and pay non-exempt employees overtime and minimum wage – and to comply with meal and rest break rules.

Currently, Wage Order 14 sets different standards for overtime for agricultural employees (e.g., 1.5 times the employee’s regular rate of pay for hours worked beyond 10 hours per day and for the first eight hours or the 7th consecutive day of work; two times the employee’s regular rate of pay for all hours worked over eight on the 7th consecutive day.)

AB 1066 added sections 857 through 864 to the Labor Code which creates new overtime standards for agricultural employees (“under the same standards as millions of other Californians”), on a gradual basis: 

The Governor is authorized to suspend a scheduled “phase-in” only if the Governor suspends a scheduled minimum wage increase (SB 3, signed in April). If suspension occurs, all phase-in dates will be postponed by an additional year.

AB 2337 – New Notice Requirement to Employees 

Current law (Labor Code § 230.1) prohibits employers with 25 or more employees from retaliating or discharging employees who are victims of domestic violence, sexual assault, or stalking, for requesting time off to: 

  • Seek medical treatment;

  • Obtain services from a domestic violence shelter or program; or

  • Obtain counseling or participate in safety planning.

This act requires employers to give written notice to new employees regarding the right to take protected time off for the purposes stated above. The notice must also be provided to current employees upon request.

The Labor Commissioner will develop a form that employers may use to comply with this notice requirement. The notice will be available before July 1, 2017. Employers are not required to comply with notice requirement until the Labor Commissioner posts the form on the DLSE website.

AB 2230 – New OT Exemption Requirements for Certain Teachers 

Current law provides that individuals employed as teachers at private elementary or secondary academic institutions are exempt from overtime payment requirements if, among others, they earn no less than two times the state minimum wage for full time employment.

This bill will change the salary requirement for the exemption. As of July 1, 2017, an individual employed as a teacher will be exempt if, among other criteria, the employee earns the greater of:

  1. No less than 100 percent of the lowest salary offered by any school district to a person in a position that requires a valid California teaching credential (excluding individuals employed in that position pursuant to an emergency permit, intern permit, or waiver); OR

  2. No less than 70 percent of the lowest scheduled salary offered by the school district or county in which the private elementary or secondary institution is located, to a person who is in a position that requires the person to have a valid California teaching credential (excluding individuals employed in that position pursuant to an emergency permit, intern permit, or waiver).

In effect, AB 2230 ties private school teaching salaries to that of public school teachers – establishing a wage floor that increases with the public sector.

 

Sue M. Bendavid and Tal Burnovski Yeyni are Employer Defense Attorneys at our Firm. 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Wednesday
May182016

Wage & Hour: DOL Doubles Down on Salary Threshold 

Lawyer for EmployersAttorney for Employers

 

by Tal Burnovski Yeyni

818-907-3224

 

White Collar Overtime ExemptionConsidering all of the political movements regarding minimum wage, equal pay and other wage and hour concerns over the past few years, most employers could read the handwriting on the wall regarding overtime rules. That handwriting has now become official:

The Department of Labor Final Rule regarding the minimum salary level required for the exemption of executive, administrative and professional employees was released today.

In the event of a conflict between federal and state laws, employers must comply with the rule most favorable to employees.  Prior to today’s Final Rule, an employee designated exempt under Federal law must have made at least $455 per week ($23,660 annually). This amount is substantially lower than the minimum salary required for exemption under California law, thus requiring California employers to comply with the state salary level test for exemption.

Here are the key changes: 

  • DOL Final Rule: Effective December 1, 2016, the "standard" salary level will increase to $913 per week (equivalent to $47,476 annually for a full-year employee), nearly double the current federal weekly threshold.  The DOL launched a Frequently Asked Questions page here.


  • California Employers: In this state, the current threshold is $41,600 ($3,466.67 monthly; $800 weekly), so California employers must comply with the higher Federal salary level (for exemption purposes) as of December 1st.  


  • Use of Bonuses to Satisfy the Test: Nondiscretionary bonuses and incentive payments (including commissions) may be used to satisfy up to 10 percent of the standard salary test requirement.

    Moreover, if an employee does not earn enough in nondiscretionary bonuses and incentive payments (including commissions) in a given quarter to retain their exempt status, the DOL now permits a "catch-up" payment at the end of the quarter. If the employer chooses not to make the catch-up payment, the employee would be entitled to overtime pay for any overtime hours worked during the quarter.


  • Automatic Updates: To ensure effectiveness of the salary level test, the DOL will update the standard salary compensation requirements every 3 years, with the first update taking effect on January 1, 2020.


  • Increase in California Minimum Wage Requirements: Note that last month, Governor Jerry Brown signed into law a bill gradually increasing California’s minimum wage to $15.00 per hour by January 1, 2022 (for employers with 26 or more employees).  As the salary level for exemption is an extension of California’s minimum wage (two times the state’s minimum wage), employers must pay close attention to the automatic updates of the DOL and the increase in California’s minimum wage, to determine which salary test they must comply with for the exemption. 

Here’s California’s newly approved Minimum Wage Schedule:  

Wage and hour and other employment laws can become very confusing given how state and federal regulations can trump one another. Employers should seek the advice of experienced employment counsel to stay compliant.

Tal Burnovski Yeyni is an attorney in our Employment Practice Group

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Wednesday
Mar192014

Bridging the Pay GAP

Lawyer for EmployerWage and Hour Defense

 

by Nicole Kamm
818.907.3235

 

Last week, GAP announced it would be increasing its minimum wage to $9 in 2014 and $10 in 2015 for employees nationwide. In its press release, GAP’s Chairman and CEO, Glenn Murphy, stated the clothing company “did this because it is right for our company and right for our people.”

Just one step behind, President Obama is continuing to push efforts to increase federal minimum wage to $10.10 per hour – more  than a dollar higher than the $9 proposal made in his 2013 State of the Union address. Federal minimum wage has not increased since 2009. In states that don’t mandate a higher rate, federal minimum wage remains $7.25 per hour.

Also last week, President Obama directed the Department of Labor to propose revisions to the Fair Labor Standards Act (FLSA) regulations regarding overtime exemptions. The President asked the Labor Secretary to consider: 

  1. How existing protections can be “modernized” to conform to the intentions of the FLSA

  2. The changing nature of the workplace 

  3. Simplifying regulations to make them easier to understand by both employees and employers, and easier for employers to apply 

This has been interpreted to mean we can expect a proposed: 

  1. Increase in minimum salary paid to an employee for the employee to qualify as exempt (currently, $455 per week); and

  2. Replacement of the FLSA “primary duty” test with a more substantive test to require an employee to spend a certain percentage of his/her time on exempt duties to qualify for exempt status. 

Both of the above changes would substantially decrease the number of employees who qualify under the federal exemption test.

 

What Does This Mean for California Employers?

 

Bottom line – not much.

California minimum wage is already going up to $9 per hour as of July 1, 2014, and $10 per hour as of January 1, 2016. Now is a good time for California employers to start gearing up for the increase, including issuing new wage notices pursuant to Labor Code section 2810.5, adjusting overtime calculations, and reviewing exempt employee salaries to ensure they are at least two times the minimum wage ($37,440 as of July 1st).

As for the proposed FLSA changes, California employers are already subject to more narrow overtime exemptions requirements under state law. Among other things, to qualify as exempt in California, an employee must be paid a salary of at least $640 per week ($720 as of July 1st). California employees must also spend more than 50 percent of their weekly work time on exempt duties.

Though there is much debate over proposed changes in federal employment laws, California employers can take some comfort knowing that - in most cases - they are already required to comply with what may be implemented on a national level. Somewhat surprisingly - it would appear California is a trendsetter these days when it comes to changes in national employment law.

 

Nicole Kamm is a Wage and Hour Defense Lawyer at our firm. She can be reached via email: nkamm@lewitthackman.com

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.
Friday
Mar222013

Wage and Hour Trends – The Rise of the Intern

Employer Defense Lawyer Los Angeles

 

by Sue M. Bendavid
March 22, 2013

Employer Lawyer Los Angeles Google+

 

Interns. Remember the good old days when as an employer, you could expect them to arrive punctually, help out in the day-to-day operations of your business, and be asked for little in return but job training (which used to be considered invaluable for those trying to break into the biz) and a glowing reference?

Those days may be long gone, if trends in employment litigation are any indication – and these trends aren't just in individual claims. Class actions are being brought against several very high profile employers.

In February 2012, a former Harper's Bazaar intern filed suit against the Hearst Corporation, claiming 40-55 hour work weeks without compensation. A New York Court later granted class certification – meaning approximately 3,000 former interns were joined in the suit against the media mogul.

Last summer, two interns working on the film, Black Swan, expanded their wage and hour claim to include all unpaid interns working for Fox Entertainment Group over the last two years. In December, talk show host Charlie Rose agreed to a six figure settlement for 190 unpaid interns who worked for The Charlie Rose Show between 2006 and 2012.

Also in December, a former assistant football coach initiated a class action claim against Hamilton College, alleging the school misclassified him and other plaintiffs as interns, paid them sums that didn't meet minimum wage, failed to pay overtime, and failed to pay split shift pay.

The above suits were all filed in New York, but given this increase in litigation initiated by interns, it may be time to discuss what an internship is in the legal sense, and how California employers can reduce the risk of claims.

 

How to Avoid Wage and Hour Claims by Unpaid Interns

 

What is an internship? Ideally, it's an educational experience, particularly if it's an unpaid internship. The United States Department of Labor's Wage and Hour Division (WHD) has very specific guidelines regarding hiring interns and offering internships on an unpaid basis.

Whether you're running a for-profit business or a not-for-profit organization and are thinking about getting an intern to help, you should consider what you're offering vs. what you'll be getting in return. The WHD provides a six point test to help employers decide if they need to compensate interns or not.

 Ask yourself these questions:

  1. Will you provide training similar to that provided in an educational environment? You should provide a learning environment, not a work environment.

  2. Is the internship you're offering a benefit to the intern? Will the student gain valuable "real job" experience, or will they be doing the "busy work" no one else wants to do?

  3. Will the intern displace a regular employee? If yes, you should compensate the intern. Otherwise, make sure the student is working under close supervision of your staff.

  4. Will you as an employer, be gaining any advantages from bringing in an intern? If yes, you may need to pay your intern. If your work is actually impeded by the presence of the intern, chances are better that you'll be providing more of the educational environment the WHD recommends.

  5. Will the student be entitled to a job at the end of the internship? If your answer is yes, that actually encourages the intern to work, rather than learn, which could lead to potential wage and hour claims.

  6. Does the intern understand that s/he is not entitled to wages? You should make clear up front, whether or not you will be compensating the intern for her/his time.

The six elements satisfy federal criteria. Not long ago, The California Division of Labor Standards Enforcement, or DLSE (commonly known as the Labor Board), adopted these six criteria as well (and disavowed certain other factors previously used by the DLSE).

This was according to a DLSE opinion letter handed down April 7, 2010:

The DLSE has consistently applied federal interpretations of statutes, regulations, and case law under the FLSA [Fair Labor Standards Act] where there is no inconsistency with State laws…Since DOL's [Department of Labor's] 6-point formulation is derived from the early U.S. Supreme Court's opinion in [the] Portland Terminal case and has been applied (with varying degrees of deference) by the federal appellate courts, it is reasonable and appropriate for the DLSE to look to the factors used by the DOL in determining the exemption for purposes of coverage of State minimum wage coverage for trainees/interns in the absence of a State statute or regulation on the matter.

It's important for employers to correctly classify their employees, independent contractors and interns. Misclassification can leave you open to claims for unpaid wages – including a failure to pay minimum wage and unpaid overtime, waiting time penalties (for not paying wages on a timely basis), and other penalties and tax claims. .

When all is said and done, remember that the person who should most benefit from an unpaid internship is the student. That means you are offering real educational opportunities, and not just taking advantage of getting some extra tasks done, or of lightening the work loads of your regular employees.

 

Sue M. Bendavid is a Wage and Hour Attorney who protects and defends employers from employee claims. For more information about wage and hour issues and avoiding employment litigation risks, contact Ms. Bendavid via email: sbendavid@lewitthackman.com.

 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.
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