Wage and Hour

The U.S. Department of Labor Issues New Proposed Regulations on Joint Employer Status

April 24, 2019

By Paul J. Buehler III

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").

Read More >> The U.S. Department of Labor Issues New Proposed Regulations on Joint Employer Status

New York's Highest Court Upholds "13 Hour Rule" for Home Health Aides Working 24-Hour Shifts

March 28, 2019

By Michael D. Billok and Mary E. Aldridge

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.

Read More >> New York's Highest Court Upholds "13 Hour Rule" for Home Health Aides Working 24-Hour Shifts

USDOL Issues Proposed Regulations to Increase the Salary Level to Qualify for the White Collar Exemptions

March 8, 2019

By Subhash Viswanathan

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.

Read More >> USDOL Issues Proposed Regulations to Increase the Salary Level to Qualify for the White Collar Exemptions

New York State Department of Labor Drops Proposal Regarding Call-In Pay . . . For Now

March 1, 2019

By Subhash Viswanathan

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.

Read More >> New York State Department of Labor Drops Proposal Regarding Call-In Pay . . . For Now

Second Circuit Court of Appeals Holds That Cosmetology Students at a For-Profit Cosmetology Training School Were Not Employees Under the Fair Labor Standards Act or New York Labor Law

February 28, 2019

By Samuel G. Dobre

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.

Read More >> Second Circuit Court of Appeals Holds That Cosmetology Students at a For-Profit Cosmetology Training School Were Not Employees Under the Fair Labor Standards Act or New York Labor Law

How Do Vacation and Sick Leave Buy-Back Programs Affect the Calculation of the Regular Rate for Overtime Purposes?

February 21, 2019

By Theresa E. Rusnak

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?

Read More >> How Do Vacation and Sick Leave Buy-Back Programs Affect the Calculation of the Regular Rate for Overtime Purposes?

Reminder: New York Minimum Wage Rates and Salary Thresholds for the Executive and Administrative Exemptions Will Increase on December 31, 2018

December 7, 2018

By Subhash Viswanathan

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.

Read More >> Reminder: New York Minimum Wage Rates and Salary Thresholds for the Executive and Administrative Exemptions Will Increase on December 31, 2018

U.S. Supreme Court Rejects Narrow Construction of FLSA Exemptions - April 2018

April 6, 2018

By Subhash Viswanathan and Stephanie H. Fedorka

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.

Read More >> U.S. Supreme Court Rejects Narrow Construction of FLSA Exemptions - April 2018

USDOL Reissues 17 Opinion Letters That Were Withdrawn in 2009

January 23, 2018

By Subhash Viswanathan

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.

Read More >> USDOL Reissues 17 Opinion Letters That Were Withdrawn in 2009

Reminder: New York Minimum Wage Rates and Salary Thresholds for the Executive and Administrative Exemptions Will Increase on December 31, 2017 - New York Labor and Employment Law Report

December 21, 2017

By Subhash Viswanathan

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.

New York Proposes New “Call-In” Pay and Scheduling Requirements

November 14, 2017

By Andrew D. Bobrek

Employers in New York will be subject to new “call-in” pay and scheduling requirements under recently-proposed state Regulations.  Governor Andrew Cuomo recently announced these proposed Regulations, which the New York State Department of Labor (“DOL”) will reportedly publish in the State Register on November 22, 2017.

New York regulators have recently focused their enforcement sights on the so-called “just-in-time” or “on-demand” scheduling of workers.  According to Governor Cuomo, this practice entails the scheduling or cancelling of a worker’s shift with little or no advance notice.  At the Governor’s direction, the DOL recently held hearings across the state on this issue, which then led to issuance of the proposed Regulations.

If enacted, the proposed Regulations would amend New York’s catch-all “Miscellaneous Industries” minimum wage order, including those portions applicable to non-exempt “nonprofitmaking institutions” across the state.

Call-In Pay Under Current New York Law

Under the Miscellaneous Industries minimum wage order, non-exempt employees who report to work are currently entitled to call-in pay equal to the lesser of four hours of pay or pay for the number of hours in the regularly-scheduled shift, at the state minimum wage rate.  Notably, the DOL has interpreted this provision, such that it only effectively applies to non-exempt workers who earn at or very near the state minimum wage.  In this regard, the DOL previously stated in Opinion Letter No. RO-09-0133, dated December 2, 2009:  “[I]f the amount paid to an employee for the workweek exceeds the minimum and overtime rate for the number of hours worked and the minimum wage rate for any call-in pay owed, no additional payment for call-in pay is required during that workweek.” (emphasis added).

In other words, under DOL’s interpretation, New York employers could potentially apply an “offset” — for amounts paid to workers above the state minimum wage and overtime rates during the same workweek — against any “call-in” pay otherwise due to workers.

Additionally, under current law, employers are generally free to schedule, and, when necessary, cancel shifts before employees report for work, without incurring any additional payment obligation.

Call-In Pay Under the Newly-Proposed DOL Regulations

  • The recently-proposed Regulations would create a number of new circumstances when non-exempt employees will be eligible to receive “call-in” pay, including the following:
  • Employees who report to work for a shift that was not scheduled at least 14 days in advance will be entitled to an additional two hours of call-in pay;
  • Employees whose shifts are cancelled within 72 hours of the start of that shift will be entitled to at least four hours of call-in pay;
  • Employees who are required to be on-call and available to report to work for any shift will be entitled to at least four hours of call-in pay; and
  • Employees who are required to be in contact with their employer, within 72 hours of the start of a shift, to confirm whether or not to report to work for that shift will be entitled to four hours of call-in pay.

Under the Regulations, the above call-in pay must be calculated at the current state minimum wage rate (which now varies by location and workforce size) without any allowances, and employees must receive their “regular rate” for their actual time of attendance.  However, these new requirements will not apply to otherwise covered employees whose weekly wages exceed 40 times the applicable state minimum wage.

The proposed Regulations will also replace current “call-in” pay requirements with the following:

  • Employees who report to work for any shift will be entitled to at least four hours of call-in pay.

Notably, the proposed Regulations state:  “Call-in pay shall not be offset by the required use of leave time, or by payments in excess of those required under” the applicable minimum wage order.  Although this provision is not entirely clear on its face, conceivably, it was drafted with the intent of curtailing application of the above-referenced weekly “offset” provided under prior DOL interpretation.

Finally, the proposed Regulations state that the above requirements will not apply to certain employees “who are covered by a valid collective bargaining agreement that expressly provides for call-in pay.”  Further, the requirements may not apply in certain other circumstances, such as when a business cannot begin or continue operations due to a state of emergency or other “Act of God” beyond its control.

Employers should also be mindful that New York City recently passed a similar law that will become effective on November 26, 2017.  This other local law places somewhat similar requirements on retail employers, and also places additional requirements on certain fast food establishments.

According to DOL, the proposed Regulations will be subject to a 45-day comment period after official publishing.  We will update this article with any further developments, and will be announcing a free webinar on the proposed Regulations in the coming days.

If you have any questions about this issue in the meantime, please contact Andrew D. Bobrek, any of the attorneys in our Labor and Employment Law Practice, or the attorney in the firm with whom you are regularly in contact.

Author’s Note:  A special thanks to Richard White, who assisted in drafting this article.