Tag Archives: compliance

BREAKING NEWS: Final Overtime Rule Released

Employers, the long wait is over. You finally have an answer regarding whether the federal overtime regulations are going to be changed. As discussed in our earlier blog posts Let’s Try this Again: Department of Labor Proposes Salary Increases for White-Collar Exemptions and Once More, With Feeling: Proposed Increase to Minimum Salary for Highly Compensated Employees, in March 2019, the U.S. Department of Labor abandoned its 2016 attempt to increase the salary threshold for exempt employees when it issued a much-anticipated proposed rule. On September 24, 2019, the DOL formally rescinded the 2016 rule and issued its new final overtime rule.

The new rule, taking effect on January 1, 2020, increases the earnings thresholds necessary to exempt executive, administrative, professional, and highly compensated employees from the Fair Labor Standard Act’s overtime pay requirements from the levels that had been set in 2004.  Specifically, the new final rule:

  • Increases the “standard salary level” from $455 to $684 per week (equivalent to $35,568 per year for a full-year worker);
  • Raises the total annual compensation level for “highly compensated employees” from $100,000 to $107,432 per year; and
  • Revises the special salary levels for workers in U.S. territories and in the motion picture industry.

And, for the first time, the final rule allows employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10 percent of the standard salary level for executive, administrative, and professional employees (not highly compensated employees).

Employers take note, however, that the new final rule does not change the duties portions of the otherwise affected exemptions. For more information about the new final rule, you can go to the Department of Labor website.

As New Year’s Day will be here before we know it, this is a good time for employers to audit their pay practices to make sure that employees are properly classified, update timekeeping and payroll systems, and train reclassified employees on new processes before the new rule takes effect.

Gail E. Farb
gfarb@williamsparker.com
941-552-2557

Avoiding Errors in the Match Game: Responding to the Rising Number of “No-Match” Letters

Starting late last year and continuing on the heels of tax season, the Social Security Administration (SSA) has been sending employers Employer Correction Request Notices, also known as EDCOR notices or “no-match” letters. An example “no-match” letter is available at the SSA’s website. These “no-match” letters notify an employer that the information submitted on an employee’s W-2, such as the Social Security Number or SSN, does not match the SSA’s records. Even though it’s not conclusive evidence that an employee is not authorized to work in the United States, it can put an employer on notice of a possible issue, which can lead to potential compliance issues and liability under federal law. See our previous discussion here and here on recent Form I-9 compliance issues.

Of course, common discrepancies can also trigger a “no-match” letter, such as  unreported name changes, typos or input errors by the SSA, reporting errors by an employer or employee, errors in recognizing multiple last names or hyphenated last names, or identity theft.

In other words, “no-match” letters can arise because of simple administrative errors. Employers should not presume the “no-match” letter conveys information about an employee’s immigration status or authorization to work within the United States. Still, the “no-match” letters may also indicate that an individual provided false identification.

Employers must be cautious when dealing with a “no-match” letter. An overreaction—such as requesting excessive or unnecessary documentation from employees—can violate the anti-discrimination provisions in federal law, which generally prohibit discriminatory employment practices because an employee’s national origin, citizenship, or immigration status. Thus, an employer should not attempt to do any of the following after receiving a “no-match” letter:

  • Take any adverse employment action against an employee subject to a “no-match” letter, including—but not limited to—firing, demoting, cutting hours, reducing the wages of, or writing up such an employee;
  • Follow different procedures for different classes of employees based on the employees’ respective national origin or citizenship status;
  • Require the employee immediately provide a written report that the SSA verified the requisite information (primarily because the SSA may not ever provide such a report);
  • Immediately reverify the employee’s eligibility to work by requesting a new Form I-9 based solely on the “no-match” letter; or
  • Require an employee produce any specific I-9 documents, such as a Social Security card, to address the no-match issue.

The question then becomes: How should employer respond to a “no-match” letter?

Unfortunately, the letters usually do not identify the employees for whom the SSA finds there is a “no-match” issue. To determine which employees’ information is at issue, an employer must first register with the SSA’s Business Service Online website. Through that website, an employer can then compare the employee names and SSN information in its files against the SSA’s records to make sure the information was correctly submitted, and no typographical error occurred. If an employer determines it misreported the information, it can issue a correction through an updated IRS Form W-2C. An employer generally has 60 days from receipt of the “no-match” letter to issue a Form W-2C to make corrections if that is the cause of the “no-match.”

Should an employer determine that it properly reported the information, then the employer will need to further investigate and may want to seek guidance from counsel before taking further action.

John C. Getty
jgetty@williamsparker.com
(941) 329-6622

Important Notice for Employers Required to Submit EEO-1 Report

The Equal Employment Opportunity Commission issued a notice this morning that, due to the recent partial lapse in appropriations, the deadline to submit EEO-1 data will be extended until May 31, 2019. The EEO-1 is an annual survey that requires certain employers to file the EEO-1 report. The EEO-1 Report, Standard Form 100, is a compliance survey that requires company employment data to be categorized by race/ethnicity. As set forth on the EEOC’s website, all companies that meet any of the following criteria are required to file the EEO-1 report annually:

  • The company is subject to Title VII of the Civil Rights Act of 1964, as amended, with 100 or more employees; or
  • The company is subject to Title VII of the Civil Rights Act of 1964, as amended, with fewer than 100 employees, if the company is owned by or corporately affiliated with another company and the entire enterprise employs a total of 100 or more employees; or
  • The company is a federal government prime contractor or first-tier subcontractor subject to Executive Order 11246, as amended, with 50 or more employees and a prime contract or first-tier subcontract amounting to $50,000 or more.

Details instructions for the 2018 EEO-1 filers, including the exact date of the survey opening, will be forthcoming. Filers should refer to the EEO-1 website in the coming weeks for updates on the new schedule. Also, see the EEOC’s FAQ for further information.

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
(941) 552-2558

Guidance for Employers from the Dark Side?

A long time ago in what seems like a galaxy far away, Congress passed the National Labor Relations Act. Since then, Congress has continued to pass laws governing the employee/employer relationship. In 1938, it passed the Fair Labor Standards Act; in 1964, it passed the Civil Rights Act; and in 1993, it passed the Family and Medical Leave Act. These acts and many others can make businesses feel like they have been thrown into a trash compacter or frozen in carbonate. Management attorneys, a.k.a the light side of the force, provide guidance and counsel to businesses and assist in navigating these laws which seem to appear and/or change as if powered by a hyper drive. On Thursday, April 27, from 8:00 a.m. to 12:00 p.m. at Michael’s on East in Sarasota, businesses will have an opportunity to learn about recent developments and current trends related to wage and hour compliance, employee criminal conduct, and sexual orientation and gender identity not only from their Jedi, but also from a Sith, a.k.a. a plaintiff’s employment attorney. It is not often that businesses have an opportunity to learn from both sides of the Force.

This seminar will provide guidance in important areas of employment law to assist professional service providers in their role as employers. The workshop will include best practices from legal compliance and human resources perspectives, and will conclude with a Sith providing insight into employers’ mistakes that strengthen the dark side. This seminar is intended to be an interactive presentation with the aim of providing solutions to troublesome employment issues confronting law firms and other professional service providers. To learn more about this event and to register, visit the Sarasota County Bar Association website.

Disclaimer: This seminar does not have a Star Wars theme; I just watched The Force Awakens on HBO this weekend.

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
(941) 552-2558

Deadline for Filing the 2016 EEO-1 Survey is September 30

The submission deadline for private employers that are required to complete the EEO-1 Survey is September 30, 2016. The EEO-1 Report, Standard Form 100, is a compliance survey that requires company employment data to be categorized by race/ethnicity. As set forth on the Equal Employment Opportunity Commission’s website, all companies that meet any of the following criteria are required to file the EEO-1 report annually:

    1. The company is subject to Title VII of the Civil Rights Act of 1964, as amended, with 100 or more employees; or
    2. The company is subject to Title VII of the Civil Rights Act of 1964, as amended, with fewer than 100 employees, if the company is owned by or corporately affiliated with another company and the entire enterprise employs a total of 100 or more employees; or
    3. The company is a Federal government prime contractor or first-tier subcontractor subject to Executive Order 11246, as amended, with 50 or more employees and a prime contract or first-tier subcontract amounting to $50,000 or more
    4. https://www.eeoc.gov/employers/eeo1survey/fact_sheet_filers.cfm
    5. https://www.eeoc.gov/employers/eeo1survey/faq.cfm
    6. If your business meets one of the three criteria set forth above and you are not familiar with the EEO-1, the following links will provide essential information:

https://www.eeoc.gov/employers/eeo1survey/faq.cfm

https://www.eeoc.gov/employers/eeo1survey/fact_sheet_filers.cfm.

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
941-552-2558