New York has for many years had a law on the books that prohibits employers from retaliating against an employee because the employee has complained about an alleged violation of the wage and hour laws. Specifically, New York Labor Law Section 215 states that an employer may not "discharge, threaten, penalize, or in any other manner discriminate or retaliate against any employee" because the employee complained of an alleged violation of the Labor Law or otherwise cooperated with a Department of Labor or Attorney General investigation regarding an alleged violation of the Labor Law.
On July 29, 2019, Governor Cuomo signed legislation amending the statute to specify that the phrase "threaten, penalize, or in any manner discriminate or retaliate against any employee" includes threatening to contact or contacting United States immigration authorities or otherwise reporting or threatening to report the citizenship or suspected immigration status of an employee or an employee's family member. The legislation is effective 90 days after the date on which the Governor signed it.
On April 1, 2019, the Wage and Hour Division of the U.S. Department of Labor ("DOL") announced a proposed update to its joint employment regulations, which is the first significant revision to the DOL's joint employment rules since their promulgation in 1958. The proposed updates to the regulations attempt to clarify joint employer status for purposes of wage liability under the Fair Labor Standards Act ("FLSA").
On March 26, 2019, the New York State Court of Appeals issued a ruling that will have a significant positive impact on home care agencies across the state. In a five-to-two decision, the Court upheld the validity of the New York State Department of Labor’s “13 Hour Rule” for cases involving 24-hour live-in care. Under the “13 Hour Rule,” a residential employee assigned to work a 24-hour shift need only be paid for 13 of those hours, so long as he or she is provided with an 8-hour sleep break and three hours of meal breaks. (If the employee’s meal breaks are interrupted, or if the employee does not get five uninterrupted hours of sleep, the employer must pay for the entire break.) Bond, Schoeneck & King, PLLC, participated in the case, representing amicus curiae (“friend of the court”) Consumer Directed Personal Assistance Association of New York State.
On March 7, 2019, the U.S. Department of Labor issued proposed regulations that would increase the minimum weekly salary to qualify for the Fair Labor Standards Act white collar exemptions from $455 per week ($23,660 per year) to $679 per week ($35,308 per year). These new proposed regulations are intended to replace the USDOL's 2016 regulations raising the minimum weekly salary to $913 per week ($47,476 per year), which were held by the U.S. District Court for the Eastern District of Texas to be invalid approximately one week before those regulations were set to take effect.
The New York State Department of Labor announced recently that it does not intend to implement its proposed regulations that would have imposed burdensome requirements on employers to provide call-in pay to employees under a variety of circumstances not currently covered under existing regulations. The regulations were initially proposed in November 2017, and then were revised in December 2018 after public comments were received and reviewed. The NYSDOL now intends to let the regulatory process expire with respect to the proposed regulations and potentially revisit this issue in the future.
On February 5, 2019, the Second Circuit Court of Appeals held that students at a for-profit cosmetology school who provided cosmetology services to the general public at the school's salon as part of the requirements to qualify for taking the New York cosmetology licensing exam were not employees who were entitled to compensation under the Fair Labor Standards Act or the New York Labor Law. In Velarde v. GW GJ, Inc., the Court applied the "primary beneficiary" test established in its previous decision in Glatt v. Fox Searchlight Pictures, and concluded that the students were the primary beneficiaries of the relationship because the practical experience they gained at the salon was a necessary prerequisite to becoming licensed cosmetologists.
Employers who provide sick leave and vacation leave time may also have a policy or practice of allowing employees to “sell back” accrued, unused time. Under these “buy-back” programs, the employer will, for a select time period, pay employees for their unused time, in addition to any actual work performed by the employee in that workweek. This then raises the question: do these payments for sick and vacation time have to be counted as part of the employee’s “regular rate” for purposes of computing overtime due during the workweeks in which that time is paid out to the employee?
Although the minimum wage rate under the Fair Labor Standards Act remains $7.25 per hour and the U.S. Department of Labor has not issued any new proposed regulations to raise the minimum salary to qualify for a white-collar exemption under federal law, employers in New York will be required to comply with the new state minimum wage rate and the new state salary threshold to qualify for the executive and administrative exemptions, effective December 31, 2018.
On April 2, the U.S. Supreme Court held, in Encino Motorcars, LLC v. Navarro, that service advisors at automobile dealerships are exempt from the overtime requirements of the Fair Labor Standards Act. The Court was divided 5-4 on this issue, with Justice Thomas writing the opinion on behalf of the majority and Justice Ginsburg writing the opinion on behalf of the 4 dissenting Justices. The Court reversed a Ninth Circuit Court of Appeals' decision, which found that service advisors were non-exempt employees who were eligible for overtime pay.
On January 5, 2018, the U.S. Department of Labor’s Wage and Hour Division reissued 17 opinion letters that were withdrawn in 2009, shortly after President Obama began his first term in office. The USDOL under the Obama administration withdrew the 17 opinion letters on March 2, 2009, stating that they were being withdrawn “for further consideration” and that it would “provide a further response in the near future.” However, it does not appear that the USDOL actually revisited any of the opinion letters that had been withdrawn, so the USDOL under the Trump administration has now reissued those opinion letters and has renumbered them as FLSA2018-1 through FLSA2018-17.
Although the minimum wage rate under the Fair Labor Standards Act remains $7.25 per hour and the U.S. Department of Labor’s efforts to raise the minimum salary to qualify for a white-collar exemption under federal law have stalled, employers in New York should be aware that the state minimum wage rate and the state salary threshold to qualify for the executive and administrative exemptions will increase effective December 31, 2017.
The increases to the state minimum wage effective December 31, 2017, are as follows:
Employers outside of New York City, Nassau, Suffolk, and Westchester counties: $10.40 per hour
Employers in Nassau, Suffolk, and Westchester counties: $11.00 per hour
Employers in New York City with 10 or fewer employees: $12.00 per hour
Employers in New York City with 11 or more employees: $13.00 per hour
Fast food employees will be entitled to an even higher wage rate effective December 31, 2017, as follows:
Fast food employees outside of New York City: $11.75 per hour
Fast food employees in New York City: $13.50 per hour
The salary threshold to qualify for the executive and administrative exemptions effective December 31, 2017, are as follows:
Employers outside of New York City, Nassau, Suffolk, and Westchester counties: $780.00 per week
Employers in Nassau, Suffolk, and Westchester counties: $825.00 per week
Employers in New York City with 10 or fewer employees: $900.00 per week
Employers in New York City with 11 or more employees: $975.00 per week
New York does not set a salary threshold to qualify for the professional exemption, so employees must meet the current federal salary threshold of $455.00 per week to qualify for the professional exemption. For all of the white-collar exemptions, employees must also meet the applicable duties requirements.
A chart summarizing the minimum wage rates, tip credits, uniform maintenance allowances, meal and lodging credits, and exempt salary thresholds under the Miscellaneous Industries Wage Order can be found here. A chart summarizing this same information under the Hospitality Industry Wage Order can be found here.