On December 12, 2019, the U.S. Department of Labor (“DOL”) announced a final rule clarifying and modifying the types of compensation included in an employee’s regular rate of pay for overtime purposes. This rule represents the first major change to the regulations governing regular rate of pay requirements under the Fair Labor Standards Act (“FLSA”) in over 50 years. The rule provides additional clarification for employers, and as U.S. Labor Secretary Eugene Scalia noted, “encourages employers to invest in the American workforce, to the benefit of their employees.” The rule provides that employers may exclude the following perks and benefits… Read more
The Confidentiality of Substance Use Disorder Patient Records regulations (commonly referred to as “Part 2”), a federal privacy law aimed at protecting patient records related to substance abuse treatment, will require employers to amend several of their group health plan service agreements no later than February 2, 2020. Background. Part 2 provides special privacy protections, over and above those provided by the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), to patient records related to substance abuse treatment that are created by federally funded treatment programs (e.g., programs that accept Medicare or Medicaid) (“Part 2 Programs”). Under these rules,… Read more
Bonuses During the holidays, many employers get in the spirit by giving non-exempt employees prizes, awards, nondiscretionary bonuses, and incentive payments. If these payments are based on the quality, quantity, or efficiency of production or hours worked, then the value of such payments must be calculated into the employee’s average hourly rate for the purpose of overtime pay. This means that any overtime worked in the pay period during which the bonus was received would need to be recalculated to adjust for the value of the prize, award, nondiscretionary bonus or incentive pay. If the prize is merchandise, the amount… Read more
In Chevalier v. General Nutrition Centers, Inc., the Pennsylvania Supreme Court recently decided that the fluctuating workweek pay method is unlawful under the Pennsylvania Minimum Wage Act (PMWA). The fluctuating workweek method is used to calculate overtime pay owed to non-exempt, salaried workers with inconsistent schedules, and is allowed for under the federal Fair Labor Standards Act. Under this method, non-exempt employees receive a fixed weekly salary, and overtime pay is calculated by dividing the employee’s salary by the actual numbers of hours worked in a given week to calculate the employee’s “regular rate,” then multiplying the regular rate by… Read more
In the past three weeks, almost one hundred lawsuits have been filed on behalf of blind and vision-impaired individuals claiming both restaurants and retailers are in violation of the Americans with Disabilities Act (ADA), and its state and local equivalents, for a failure to include braille on their gift cards. The complaints assert that for those patrons who are blind or vision-impaired, gift cards without braille are indistinguishable from other cards with the same shape, and therefore denies such individuals of the ability to distinguish between cards, ascertain the value of the card, or review other information contained on the… Read more
The IRS has released the 2020 cost-of-living adjustments applicable to the dollar limitations on benefits and contributions of retirement plans and health and welfare benefit plans. We recommend plan sponsors update their systems and formulas to include the limits that have been adjusted. These limits are effective on January 1, 2020. IRS ANNUAL COST-OF-LIVING ADJUSTMENTS – EMPLOYEE BENEFIT PLAN LIMITATIONS FOR 2020 For a printable version, click here. For more information on these cost-of-living adjustments, contact your SGR Executive Compensation and Employee Benefits counsel. SGR is in the process of preparing our yearly laminated chart of benefit limitations, but in… Read more
On October 8, 2019, effective immediately, the Governor of Puerto Rico signed into law Act No. 150, known as the “Act to Protect Employee’s Credit Information” (“the Act”). The Act prohibits employers from looking into the credit history of current or potential employees, including obtaining credit reports from credit agencies, and from making employment decisions based on such credit history. The Act does not reach all employees or applicants. Notably, positions which are managerial, regulated by the Department of Justice or the judicial branch, or require access to trade secrets, financial, or personal information, are exempt. Additionally, any position in… Read more
In response to the #MeToo movement, Illinois has enacted the Workplace Transparency Act (“WTA”) to increase employee protections from both harassment and discrimination. The WTA, set to take effect on January 1, 2020, impacts employment-related agreements, amends the Illinois Human Rights Act (IHRA), and creates certain industry-specific requirements. The WTA impacts employment agreements by creating prohibitions on arbitration and confidentiality clauses in an employee’s contract in regard to any form of harassment claims. Specifically, it prohibits unilateral agreements between an employer and employee where the agreement bars the employee’s ability to disclose unlawful employment practices, or where it requires the… Read more
On October 22, 2019, the Department of Labor (DOL) proposed new regulations that, when finalized, will give employers greater flexibility with respect to electronic delivery of required retirement plan notices. Under the proposed regulations, plan administrators can satisfy their notice delivery requirements by posting retirement plan notices to a website, as long as several specific requirements are satisfied. Covered Individuals. Website disclosure can be made to any participant, beneficiary or other individual required to receive a notice as long as that individual has provided an e-mail address or smartphone number. For current employees, an employer-assigned e-mail address or an employer-provided… Read more
California employers take heed! Numerous new California employment laws are coming your way. The following six employment-related bills were signed into law and go into effect on January 1, 2020: AB 749: A common provision in settlement agreements is that a former employee is not permitted to seek employment with his/her previous employer. These provisions, also known as “no-rehire” clauses, give an employer the assurance that they will not have to deal with the plaintiff again as a prospective employee. If the plaintiff does apply for a position with the employer, the employer can reject the application outright, no questions… Read more