WORKPLACE COMPLIANCE IN THE TRUMP-ERA: IT IS NOT ABOUT TWITTER

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It has been noted politicians campaign in poetry and govern in prose.  That may sound too lofty to describe current times, but the sentiment remains: promises made on the campaign trail do not easily translate into law. We have a Republican President and a Republican Congress, which historically has meant a more business-friendly regulatory environment.  Yet as the first 100 days will show, unwinding is neither quick nor easy. The Affordable Care Act has not been repealed and little is on the horizon. The President’s Budget Blueprint for 2018 proposes to slash the Department of Labor’s (DOL) budget by 21%. What does this mean for employers right now, or even over the next year?

In short, not a lot. Meanwhile, state and local governments are legislating like mad to fill the gaps that could be created by proposed budget cuts and executive orders. President Trump is an active Twitter user but as detailed below, that communication belies the actual activity of the federal government. #Realtalk

Are employers off the hook for federal mandates? Not so fast. Most of the federal regulations that govern the workplace remain in place and, given the inability to repeal the much lamented ACA, may not change at all.

Below is a quick overview of the current federal landscape under President Trump. Without actual policy as a guide, we are using the President’s proposed budget as a crystal ball. Please note that many states, including Massachusetts and California, have stricter mandates than the federal laws:

THE FUTURE OF DOL/OSHA/EEOC ENFORCEMENT

The President has proposed $2.5 Billion in cuts to the U.S. Department of Labor’s (“DOL”) operating budget. Because Congress has to approve the budget this is only an outline of the actual budget.  The blue print is short on details, but does expressly call for reduced funding for grant programs, job training programs for seniors and disadvantaged youth, and support for international labor efforts.  It also proposes to eliminate the U.S. Chemical Safety and Hazard Investigation Board (“CSB”) – an independent, federal, non-enforcement agency that investigates chemical accidents at certain facilities.  These cuts account for $500 million dollars of the DOL budget. The blueprint does not specify where the other $2 billion in cost savings will come from, except to say more funding responsibility will go to the states.  If approved by Congress—a big if–the cuts will involve a loss of funds that could be distributed heavily through DOL’s enforcement programs. This will include the EEOC and OSHA. Yet the process by which these agencies collect fines is a valuable revenue generator and unlikely to end easily.

At this point, the likelihood of the final budget looking like the proposed one is total conjecture. Furthermore, even with the expected cuts to the DOL’s enforcement and regulatory programs, it is important to recall that under the last Republican administration—no fan of regulation– the DOL still enforced the law. Moreover, as the federal government delivers more labor enforcement responsibility to the states, employers will increasingly be forced to work to achieve compliance on two fronts, instead of one.

RIGHT NOW

Every administration has used the media as a means of furthering and communicating its chosen agenda, and the Trump administration is no exception.  The choices the administration makes in what it chooses to publicize likely signal the administration’s direction; but also shape the public’s perception of what it is actively doing.  The Trump administration and President Trump in particular use social media and news reports for the purpose of shaping the public’s understanding their activity.  From a compliance standpoint, this actually creates risk for employers.

Despite the President’s proposed budget and awaited confirmation of a new Labor secretary, the New York Times reported  that DOL enforcement actions continue.  In a departure from past practice, the department has stopped publicizing fines against companies. As the New York Times points out, the Obama administration used the announcements as an enforcement tool, and a means to influence employers.  However, the announcements also served as an important window for employers into the DOL’s current position on important compliance issues such as wage and hour or OSHA safety enforcement.  If a company in the same industry was recently fined for a practice, that action provided others in the industry with important notice to examine their practice.  Employers no longer have this benefit.  Furthermore, those who believe that the lack of information surrounding DOL enforcement means they no longer have to worry about the threat of an audit do so at their own peril.  At the present, and until the new budget is confirmed months from now, agency enforcement has not changed.  For those inclined to believe the confirmation of the new Labor secretary will change that should keep in mind that DOL audits are a money-maker for the agency.  There seems to be little reason for them to stop.

WHAT TO DO

The last few years have seen a seismic change in the number of employment laws on both the state and federal level.  If it has been a few years since your organization has updated its employee handbook, you have a compliance problem on your hands.  Updating your handbook and policies is an important step to mitigate risk.

And remember, statutes, regulatory guidance and case opinions published by the courts are what impact compliance obligations, not the news. What happens on Twitter does not reflect the actions of the agencies of the federal government. #Really

The EEOC Jumps on the Employee Classification Bandwagon

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The Equal Employment Opportunity Commission (EEOC) has issued updates to its Strategic Enforcement Plan for 2017-2021 .   At first glance it looks a lot like the current plan.  Then, like many government statements, there is a hidden line that gives a clue to where the EEOC is going:

The Commission adds a new priority to address issues related to complex employment relationships and structures in the 21st century workplace, focusing specifically on temporary workers, staffing agencies, independent contractor relationships, and the on-demand economy.

The US government is playing catch up to the gig economy—Uber, Lyft, etc.  Yet this priority has noteworthy implications for all employers.  Misclassification of employees is a complicated and expensive issue. The EEOC is joining the chorus of the  Department of Labor (DOL) Misclassification Initiative.

 

If you have not reviewed your employee classification to comply with the December 1, 2016 DOL deadline on the “White Collar” Overtime mandate  you might reconsider an audit or position classification service. The message from the Feds is clear: misclassify employees at your peril (and you thought I was going to write: we just keep coming up with new regs to make it harder to do business!).

 

We can help. Call 508.548.4888 or email  Mike@foleylawpractice.com

DOL OT Rule Going Away? Don’t count your chickens… .

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In a new development, 21 states and many business groups are requesting that the Texas court enjoin implementation of the new DOL overtime exemption rules.  As far as their chance of success, at least in the near term, it is not good.

Reports are that both cases have been assigned to Judge Amos Mazzant, who was nominated by President Barack Obama in 2014. It has been suggested that this assignment may not bode well for the plaintiffs.  Theoretically, prospects may improve if the lower court decision is taken up on appeal to the Fifth Circuit.

The states are claiming that the DOL overstepped by raising the salary level for what should be exempt duties–regardless of salary. Moreover, the plaintiffs allege that the automatic indexing that raises the threshold salary over three years is an overreach of authority and should include provisions for economic conditions or the effect on resources.

Our view is that we all stay the course, and continue compliance efforts. With the compliance date of December 1 so close, it would be risky to leave the fate your workplace with the courts. In the meantime we will closely monitor this case and if the courts stop implementation, that will be a wonderful surprise.

EMPLOYMENT LAW ALERT: Less than 3 months to comply with overtime rules

Why all the hype

  • The long-awaited and much-debated “White Collar” regulations issued on May 18, 2016, become effective December 1, 2016 – your compliance deadline.
  • The DOL has already set up field offices in every state and is conducting random audits. The fines associated with these audits are high. In addition to unpaid overtime, misclassification of employees can result in liquidated damages, equitable relief, and reimbursement of attorneys’ fees.
  • The risk is not limited to the FLSA. Each state has its own unique employment laws. Some of these laws are consistent with the FLSA, others are not. State agencies and Attorney Generals’ Offices also conduct audits and initiate lawsuits, compounding the risk to employers.
  • The new overtime regulations have given every employer the perfect opportunity to not only reclassify positions impacted by the new salary levels, but to correct positions that were improperly classified as exempt from the start. This is a unique and limited opportunity.

Do I need a lawyer?

  • In the event of a lawsuit, internal audits of exempt/non-exempt classifications can be used as evidence of a willful violation of the FLSA, which lengthens the statute of limitations from two to three years. The strongest protection is the careful use of the attorney-client privilege to protect the audit itself. Engaging human resources staff or consultants or even in-house counsel to conduct the audit will not allow the company to avail itself of the attorney-client privilege. By retaining outside counsel to perform this service, all findings are protected by Attorney-Client privilege.
  • This is an exceptional chance to obtain an indemnified legal opinion that all the jobs in your workplace are accurately classified as exempt or non-exempt, under both state and federal law.

We Get It!

  • That is why we developed our 2016 Positions Classification Service and charge a fixed/flat fee for that service.
  • Getting started is very easy.
  • We provide your team the forms, checklists and worksheets that will carefully guide you through the classification process.
  • We will review the forms, checklists and documents that you provide us to insure exempt positions comply with state and federal law.
  • You can relax knowing that you have well-written job descriptions and that each employee is correctly classified and being compensated under the pertinent state and federal laws.

Introducing Our Service:

Introducing Our New Lawyer

Speaking of help, we are very proud and excited to introduce Attorney Julie Fletcher to our practice. Prior to joining Foley & Foley, Julie worked in the areas of immigration and employment law for several years at national law firms in Boston. Check out her bio.

Closing Thoughts

The United States Department of Labor has been on a roll, impacting wages, job classifications, the FMLA and Affirmative Action Compliance for Federal Contractors, just to name a few of their recent initiatives.

Please let us know how we can help your team better manage employment law compliance and HR-related risk.

CONTACT US 508-548-4888 or mike@foleylawpractice.com

We can help.


© 2016 FOLEY & FOLEY, PC, ALL RIGHTS RESERVED

Help is on the way! Implementing the new DOL mandates.

As you know, the final version of the Department of Labor’s (DOL) updated overtime rules have been issued.  In a nutshell, these overtime rules will raise the salary threshold for “white collar” workers from $455 per week to $913 per week starting December 1, 2016.

Our clients and the groups we have presented to have expressed a great deal of anxiety about these new overtime rules.  Many are totally overwhelmed.  Who will be impacted?  How do we handle this? What does compliance even look like?

In response to these concerns, we created a Position Classification Service to help our clients and the groups in which we are involved.  We recognize the incredible vulnerability employers are feeling, and we want to help.  We believe this service provides two vital benefits:

  • Clear, step by step checklists that allow your business to create legally compliant employment classifications and job descriptions.  The resource documents we provide and the classification process will train your employees so that they are better able to create accurate job descriptions and employee classifications going forward.
  • Legal counsel at a flat fee.  We will review your job descriptions and job classifications, edit them, and provide you with clear guidance regarding compliance with these new laws.  Because this review is conducted by outside counsel, it is protected by attorney client privilege.  In other words, if we discover a mistake, that knowledge is protected.

Position Classification Process

 

Please let us know how we can help.