On January 1, 2017, Florida’s minimum wage will increase from $8.05 an hour to $8.10 an hour. Even though many employers are currently focused on getting ready for the December 1, 2016, increase in the minimum salary requirement for most white collar exemptions, they should not overlook the increase in the minimum wage to be paid to their non-exempt workers. Failing to pay non-exempt employees Florida’s statutory minimum wage can result claims against employers pursuant to section 24, Article X of the State Constitution and section 448.110, Florida Statutes. The tip credit that can be taken by Florida employers with tipped employees will remain the same, but the direct wage paid to tipped employees will increase from $5.03 to $5.08.
In addition, to raising the minimum wage, Florida employers are required to post a minimum wage notice in a conspicuous and accessible location. You can download the 2017 Florida Minimum Wage Notice from the Florida Department of Economic Opportunity’s website. This notice requirement is in addition to the requirement that employers post regarding the federal minimum wage. There are commercially available Florida specific “all in one posters” that satisfy both the federal and state notice requirements. The 2017 “all in one” posters should be available in the near future.
All employers who are subject to the Fair Labor Standards Act’s (“FLSA”) minimum wage provisions and the Employee Polygraph Protection Act (“EPPA”) must post, and keep posted, notices explaining these laws. The notices must be posted in a prominent and conspicuous place in every establishment where they can readily be observed by employees and applicants for employment. These posters have been revised, and as of August 1, 2016, employers must post the revised versions.
You may download the revised posters from the United States Department of Labor (“DOL”) website at:
If you are unsure about whether you are required to post these new federally mandated posters, or would like more information about which federal posters you are required to post, you may access the DOL’s FirstStep Poster Advisor for guidance at: http://webapps.dol.gov/elaws/posters.htm.
On July 14, 2016, several house democrats, including Representative Gwen Graham from Florida, sponsored the Overtime Reform and Enhancement Act. The OREA (H.B. 5813) proposes to change the Department of Labor’s new overtime rules in two significant ways. First, the OREA would provide a gradual schedule to increase the minimum salary required to meet the salary basis test for purposes of determining whether an employee is exempt from overtime. Second, the OREA would eliminate one of the more controversial aspects of the DOL’s new rules, the automatic three-year increase to the salary threshold. The OREA was read twice and then referred to the House Education and the Workforce Committee. The OREA is supported by the US Chamber of Commerce and the Society for Human Resource Management, and opposed by the AFL-CIO.
On August 1, 2016, the Department of Labor increased civil money penalties for more than 60 kinds of violations of labor and employment laws, ranging across the board from wage-and-hour rules and occupational health standards to benefits requirements and immigration regulations. The Occupational Safety and Health Administration has seen the first increase to its civil penalties in 25 years, with maximum fines rising by nearly 80% to $12,471 for serious violations and $124,709 for willful or repeated violations. Other significant increases involve penalties for violations of the Immigration and Nationality Act’s prohibitions on displacing a U.S. worker with an H1B visa holder (rising from $35,000 to $50,758), as well as for violations of the Fair Labor Standards Act’s prohibitions on child labor (rising to $12,080 per violation, $54,910 if serious injury or death occurs, and $109,820 if child labor violations are willful or repeated resulting in serious injury of death). Penalties for willful violations of the FLSA’s wage and overtime provisions have also increased from $1,100 to $1,894. The increase in fines for willful FLSA violations comes on the heels of the new DOL rule extending overtime protections to nearly 4 million more workers, which could drive more wage-and-hour litigation. The DOL began applying these new, increased rates to penalties assessed after August 1, 2016.
The Family and Medical Leave Act (“FMLA”) applies to employers with 50 or more employees in 20 or more work weeks in the current or preceding calendar year. The FMLA requires covered employers to post a General FMLA Notice that explains not only the protections and requirements of the FMLA, but also how employees can file complaints with the U.S. Department of Labor alleging violations of the FMLA. The notice should be displayed in a conspicuous area, and posted regardless of whether any employees are FMLA eligible. Earlier this year, the DOL released a new version of this notice. Although employers can continue with the existing poster, the new poster presents the required information in a more user friendly manner and its use ensures the most recent required information is posted.
The Department of Labor recently issued a rule imposing new reporting requirements on private sector employers who engage attorneys or consultants to persuade employees concerning the right to organize and collectively bargain. Employers who have entered into an agreement for labor relations services before July 1, 2016 are exempt from the reporting requirement, even if the need for services arises after July 1.
The prior “persuader” rule requires both employers and labor relations consultants (including attorneys) to report to the DOL only when they engage in persuasive communications directly with employees regarding the right to organize a union or bargain collectively. The rule’s long-standing “advice exemption” has generally exempted consultants and attorneys from the reporting requirements when they have simply provided “behind the scenes” guidance to employers (e.g., drafting speeches and letters directed to employees by management to dissuade employees from unionizing).
In the new rule, which takes effect July 1, 2016, the DOL narrows the “advice exemption” by broadening the reporting requirements to include activities undertaken by a consultant or attorney, even when there is no direct contact or communication with employees, where the object of the activity is to persuade employees concerning the right to organize and collectively bargain.
The new DOL rule has triggered numerous legal challenges throughout the country by employers and business associations. One of the principal objections is that the new reporting requirements essentially eviscerate the attorney-client privilege between the employer and its labor relations attorney.
For the first time in over forty years, the Department of Labor is publishing new sex discrimination regulations for federal contractors to reflect the current state of the law. The final rule updates the sex discrimination regulations of the Office of Federal Contract Compliance Programs (OFCCP) and makes explicit the protections against compensation discrimination; sexually hostile work environments; discrimination based on pregnancy, childbirth or related medical conditions; and discrimination based on unlawful sex stereotypes, gender identity, and transgender status. The regulations also promote fair pay practices. The new rule also implements Executive Order 11246, which prohibits companies with federal contracts and subcontractors from discriminating in employment on the basis of sex. These updated regulations should afford additional clarity and consistency for federal contractors and subcontractors, as they now reflect existing federal laws prohibiting discrimination on the basis of sex.
The day before the final rules extending overtime protections to 4.2 million workers were released, the White House provided its state-by-state and demographic breakdowns of the workers that as of December 1, 2016, will no longer qualify as exempt employees. It is not surprising that Florida was identified as one of the top three states, behind California and Texas, in terms of the percentage of total workers that are anticipated to be affected by the new rules. By percentage, the largest impact of the new rules will be on workers between the ages of 25-34, and those workers that have a bachelor’s degree. When considering not only those that have attained a bachelor’s degree, but also those that have some college, or an associate/occupational degree, that group will constitute 67.8% of the total affected workers. Employers are encouraged to consult with legal counsel to discuss options and strategies for ensuring compliance with this new regulation.
On May 18, 2016, the Department of Labor raised the minimum salary level that certain employees must be paid to qualify as exempt from the overtime pay requirements of the Fair Labor Standards Act. Under current regulations, executives (supervisors), administrative employees and professionals, must both perform “exempt” duties as defined by the DOL and be paid a guaranteed salary of at least $455 a week ($23,660 annually). This new regulation significantly increases the salary threshold to $933 a week ($47,476 annually), however, it does not alter the primary duty test. The federal government predicts that the new rule will result in companies having to pay an additional 4.2 million employees overtime, boosting wages for workers by $12 billion over the next ten years.
Additionally, as noted in comments included in a recent Law360 article, the DOL’s rule, while potentially extending overtime protections to 4.2 million more employees, may also have adverse effects for certain employees. In an effort to offset costs businesses may incur as a result of the new rule, both in terms of the expense associated with ensuring compliance, as well as having to pay overtime to formerly exempt employees or sufficiently increasing an employee’s salary so as to maintain the exemption, certain employers may reduce rates of pay, cut back scheduled hours to reduce risk of overtime, or offer less generous benefits to non-exempt employees.
A person can provide services to a company as an employee or an independent contractor depending upon the nature of the relationship between the service provider and the company. Misclassification of employees as independent contractors remains a primary focus of many government agencies, including the IRS, U.S. Department of Labor, Florida Department of Economic Opportunity Reemployment Assistance Programs, and Florida’s Division of Workers’ Compensation. Investigations by these agencies can be extremely costly, time-consuming, and even lead to personal liability and criminal penalties!
The presentation in the following link explains the detailed federal and Florida tests that are used by these four agencies to properly classify service providers. It also provides practical examples in which the tests can be applied. Additionally, the presentation includes guidance to help mitigate the potential for employer liability regarding other wage and hour complexities and pitfalls.