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140828790KE004_President_ObPresident Obama issued an executive order last week that would expand the pool of workers eligible for overtime pay under the Fair Labor Standards Act (“FLSA”).

You may or may not already be familiar with the overtime portions of the FLSA; in case you aren’t, we will provide you with a brief synopsis.  In short, the FLSA provides that many employers have to pay overtime to their employees who work more than 40 hours per week.  This provision is not universal, however, because the Department of Labor is given the ability to create exemptions to it.  As a friendly reminder, don’t forget that you can make overtime even if you are a salaried employee.  Although salaried employees are often exempted from overtime by the professional, executive, or administrative exemptions, there is a threshold below which salaried employees must be given overtime pay.  Prior to recent developments, the FLSA guaranteed overtime pay for salaried workers only if they made less than $455 per week or roughly $23,000 per year.

The new executive order issued last week, for which specifics have yet to be released, is estimated to increase that threshold to between $550 and $970 per week, or approximately $28,600 to $50,440 per year.  In other words, depending on the specifics of the executive order, salaried workers who make up to $970 per week may now be covered under this executive order.

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New and ImprovedThe Erlich Law Office is very proud to announce the launch of its fully redesigned website.  The site features detailed descriptions of our practice areas, profiles of our attorneys, and other resources, including information about our local counsel services for Virginia Federal and State Courts, a breakdown of the results we have obtained for past clients, and a newly improved and updated contact form.  The website can be found at https://www.erlichlawoffice.com/.

The Erlich Law Office is also very proud to announce the creation of our new blog, for which this will be the first entry.  We want this blog to be an accessible and informative resource for anyone who wants to be sure that they’re being treated fairly on the job.

The blog will feature updates and insights into recent developments in employment law in Virginia, Maryland, and the District of Columbia, as well as federal law.  We will provide updates containing information and reports on the proposal, discussion, debate, and passage of legislation on the federal level and on the state level in Virginia, Maryland, and the District.  Furthermore, the blog will cover judicial decisions and relevant precedent in state and applicable federal courts.  Our goal is to take developments in legislation and jurisprudence and make it easy for you to understand and apply to your own situation. If, after reading one of our blog entries, you feel like you need to speak to an attorney, please contact us.

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The Workplace Policy Institute has a comprehensive analysis of possible legislative and regulatory changes to employment law in the coming year. While the full article is certainly worth a read, here is a short summary of some of the most important points.

  • Congress is unlikely to pass any major legislation ahead of the midterms (surprise), as laws such as the Employment Non-Discrimination Act continue to be stalled in the House. However, some small immigration reforms, such as new visa rules, could be among changes that could make it through Congress. Enhanced protection for whistleblowers may also be on the agenda.
  • Executive branch agencies will likely pursue an aggressive regulatory agenda, partly under the auspices of President Obama’s income inequality push.
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I hope everyone had a safe and happy holiday season.  Here is a short link expanding on a new Department of Labor rule that will have a significant impact on labor law in the coming year.

As we touched on in an earlier post, the Department of Labor has been considering publishing a new regulation requiring more stringent reporting by employers to the DOL, and it recently revealed that the new rule will be published in March 2014.  Traditionally, the Labor-Management Disclosure and Reporting Act has required employers and labor consultants to report to the DOL all agreements regarding activities where the employer’s goal is to convince employees “as to the manner of exercising, the right to organize and bargain collectively through representatives of their own choosing.”  In other words, the law requires that employers and hired labor relations consultants report agreements where the employer seeks to limit or control unionization.  This reporting requirement includes extensive financial disclosures from the employer and any consultants.

However, the Act currently includes a significant exemption where the labor consultant only gives “advice” to the employer- a term the DOL has defined as covering situations where the consultant or attorney only provides advice to the employer without any direct contact with employees.  The new rule would change the interpretation of this exemption, and would more narrowly define “advice” to require more reporting by employers and consultants.  Specifically, the new rule redefines “advice” as “an oral or written recommendation regarding a decision or course of conduct.”  It also includes a new category of “persuader activities” that an employer must report.  That category is defined as: “a consultant’s providing material or communications to, or engaging in other actions, conduct, or communications on behalf of an employer that, in whole or in part, have the object, directly or indirectly, to persuade employees concerning their rights to organize or bargain collectively.”  Observers expect that the new category and broader definition will include such activities as preparing materials for employers regarding unionization and drafting employee handbooks that touch on union and labor law issues.  As such, activities that were previously unreported as “advice” will now have to be reported to the DOL- understandably, many companies and consulting groups are unhappy about the new, and probably expensive, requirements.  Many groups are expected to challenge the rule once it is enacted in 2014.

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On December 3, 2013, the 5th Circuit issued an important new decision finding that class action waiver provisions in mandatory arbitration agreements under the Federal Arbitration Act (“FAA”) are enforceable.  However, in the specific case at bar the court found that the agreement in question was unenforceable because it reasonably could be read to prohibit employees from filing complaints of unfair labor practices with the NLRB.

In the case, the employee and employer entered into an arbitration agreement which provided that arbitration was the exclusive forum for disputes, and that neither party could resort to filing a case in court.  The agreement also contained a class action waiver provision.  The provision provided that: “the arbitrator [would] not have the authority to consolidate the claims of other employees” and would “not have the authority to fashion a proceeding as a class or collective action or to award relief to a group or a class of employees in one arbitration proceeding.”

After his employment ended, the employee and a class of similarly-situated employees attempted to fashion a class-wide arbitration, alleging that they had not received overtime payments due to improper classification under the FLSA.  The employer responded by noting that the arbitration agreement banned such class arbitration attempts, but acknowledged that the employer could proceed on an individual claim if he so chose.  The employee claimed the arbitration agreement violated the NLRA.  A NLRB ALJ found that the arbitration agreement could be interpreted as prohibiting employees from filing unfair labor practice charges, and the NLRB agreed, noting that the agreement illegally prohibited the employee from engaging in concerted activities.

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Published right before Thanksgiving, the 2013 fall federal agency regulatory plans help to illustrate what proposed and final rules are on the agenda for the coming months.  The regulatory plans and fall agendas highlight agency priorities and goals and give a preview of future developments in federal employment law.

At the Department of Labor, the agency in general is focused on its “Plan/Prevent/Protect” initiative, which is designed to lessen the agency’s enforcement and inspection burden by issuing rules designed to put the responsibility for ensuring workplace compliance on the employer or regulated entity (such as a union).  Among the DOL’s subsidiary agencies, OSHA is working on publishing final rules that will establish standardized procedures for filing whistleblower complaints under a number of federal statutes, as well as updating workplace infectious disease standards.  The Office of Labor Management Standards will probably publish some version of its controversial “persuader rule,” which would greatly expand the types of union-related activities that trigger employer reporting requirements.  The Office of Federal Contract Compliance programs will continue to update its revised affirmative action requirements, as we covered here earlier, and will likely provide updated sex discrimination guidelines.  Finally, the Wage and Hour Division will be updating its definition of “spouse” to conform to the Supreme Court’s decision in U.S. v. Windsor.

At the EEOC, the agency plans to issue an updated rule increasing the monetary penalty for violations of the agency’s notice posting requirements under Title VII and the ADA.  The NLRB may move forward with a rule that will significantly change pre and post-union election procedures.  An earlier version of the rule was stayed after litigation found it invalid.  Lastly, the Department of Health and Human Services is going to be publishing rules implementing the Affordable Care Act’s non-discrimination provisions, which provide protections against discrimination in health programs and by activities of covered entities.

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Sometimes, a situation arises where an employee cannot return to work after FMLA leave expires.  Although different lengths of leave have been considered appropriate under the ADA, usually indefinite leave has never been looked at as a reasonable accommodation.  Recently, however, the New York Court of Appeals issued a ruling that may call that assumption into question.

In the case, a bank executive took almost five months of leave for various medical issues, including major depression.  The bank contacted the employee, and asked whether he intended to return to work or whether he intended to give up his position.  The employee responded by stating that he had no intention of giving up his position, and that he had an “indeterminate” return-to-work date.  The bank responded by terminating him.  When the employee filed suit, the bank traditionally argued that his proposal of indefinite leave was not a reasonable accommodation.

Under New York City law, however, the court found that the bank had the burden of showing why indefinite leave would impose an undue hardship on the company.  Basically, the court noted that there is no accommodation that is per se unreasonable, and thus that the bank would have to show more before the court would dismiss the case.  Essentially, an employer faced with an indefinite leave request (in New York City) has to show either that 1) the employee could not perform the essential functions of the position with reasonable accommodation or 2) that the accommodation would result in an undue hardship.  The article notes, correctly, that the bank made a couple mistakes.  First, it ended the reasonable accommodation “interactive process” too early before finding out necessary information.  Second, it didn’t appropriately figure out how the employee’s indefinite leave was affecting its business.  By figuring out what hardships it was facing, the employer would have been in a better position to discuss the employee’s situation, and to engage with the employee about what kind of leave he was requesting.

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The EEOC has filed 12 religious discrimination lawsuits in fiscal year 2013, more than in the previous year, and indicative of the increasing attention being paid to it in recent months.  In general, this may be one of the areas of more frequent activity in employment law in the coming years.

Under Title VII, employers are prohibited from discriminating against employees or applicants based on religion.  Concurrent with that prohibition is a responsibility to reasonably accommodate an employee’s religious beliefs.  The EEOC has recommended that employers avoid challenging the validity of an employee’s religious beliefs, and instead argue that accommodating the belief constitutes an undue hardship.  The article notes that between 1992 and 2007 religious discrimination claims increased by 100 percent, and that the EEOC has taken notice and increased its steps to educated employers about prohibited practices.  In 2012 the EEOC received its second-highest amount of religious discrimination complaints ever.

Some of the religious discrimination cases filed by the EEOC can provide employers with lessons in what conduct is prohibited.  Many of the cases concern refusals by employers to accommodate specific requirements of a particular religion, such as growing a beard, not working specific days or hours, or wearing particular clothing.  Others involved the failure of an employer to allow an employee to use equipment that did not violate her religious beliefs, or company-wide mandatory attendance at a religious presentation.  Most of these seem easily remedied- as none involved essential job functions or could not be accommodated with some minimal degree of creativity.

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Particularly relevant for employers in this area, the Office of Federal Contract Compliance Programs (“OFCPP”) recently issued new rules that increase the affirmative action requirements of direct federal contractors and subcontractors.  The rules require that contractors take affirmative steps to hire individuals with disabilities, along with including more stringent reporting requirements and higher hiring targets for contractors.

The Department of Labor noted that the new rule was necessary because of the continuing high disparity in employment between individuals with disabilities and non-disabled individuals; although non-binding, the rule includes a seven percent utilization goal that encourages contractors to employ people with disabilities at all levels of their business structures.  The rule applies to contractors and subcontractors with a covered contract of $10,000 or more; contractors with 50 or more employees and a contract of $50,000 or more are also required to maintain written affirmative action policies.

The new rule overhauls Section 503 of the Rehabilitation Act of 1973, which prohibits discrimination and requires contractors to take affirmative action steps in personnel practices.  It also requires that employers use voluntary self-disclosure surveys for applicants and employees in order to determine whether they have disabilities (a reporting requirement).  Lastly, it orders that contractors develop more expansive affirmative action programs, and maintain up-to-date reasonable accommodation and harassment policies, along with promoting workplace training regarding discrimination.

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Our first article this week has an interesting look at FMLA

eligibility for an employee who likely didn’t work the minimum number of hours

in the prior year.  In particular, the