U.S. Secretary of Labor Alexander Acosta announced in a June 7, 2017 press release that the U.S. Department of Labor (DOL) has withdrawn two of its recent administrator’s interpretations. One of the administrator’s interpretations, issued in 2015, focused on the misclassification of employees as independent contractors under the Fair Labor Standards Act (FLSA) and indicated that the DOL would be more closely scrutinizing independent contractor classifications. The other administrator’s interpretation, issued in 2016, examined joint employment relationships under the FLSA. Both interpretations were widely considered to be an attempt by the DOL to expand the coverage and enforcement of the FLSA. The withdrawal of the guidance documents likely indicates a shift in enforcement focus of the DOL under the Trump administration.

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While no one knows exactly how Donald Trump’s election as President will impact labor and employment laws in the country, it is a safe bet that there will be changes. Because Trump was virtually silent on the campaign trail regarding the specifics of any employment law policies, we are left to speculate on any upcoming changes.  We provide a brief overview of our best educated guesses on what changes could be in store given the election results.  Given Trump’s position on government enforcement and his pro-business stance, there is an expectation of changes to several employment-related laws. Continue Reading What Trump’s Election Means for Employment Laws

As we’ve blogged about before (see here), the Department of Labor published a Final Rule with an effective date of December 1, 2016, which nearly doubled the minimum salary an employee must earn to qualify for a “white collar exemption.”  However, on November 22, 2016, a Texas federal court blocked the enactment of the amendments to the federal “white collar” exemptions for executive, administrative, and professional employees that were set to go into effect this week.  Notably, the court did not halt the proposed amendments for the highly compensated employee exemption.

You can read the entire Client Alert, which includes details about the court order and actions for employers, here.

Internal pay audits are rarely enjoyable. Depending on the scope, these audits can be complex and require detailed analysis.  However, in the current legal climate, an internal audit can be extremely valuable and greatly reduce, or even eliminate, potential liability for wage and hour claims as well as pay equity claims.  As previously reported on this blog, increased scrutiny into pay equity discrimination, changes in EEO-1 reporting requirements, the Department of Labor’s joint employment efforts, and the updated FLSA exemption rules continue to place companies at greater risk of government audits, fines, and lawsuits.

Many employers may have already reviewed and updated their policies in anticipation of the changes to the “white collar” FLSA exemptions, which go into effect on December 1, 2016. But if your company has not yet done so, or to the extent you have not conducted a more comprehensive internal audit, your company should strongly consider doing so as soon as possible for several reasons. Continue Reading Don’t Wait! Now Is the Time to Conduct an Internal Wage & Hour Audit

As discussed in a prior post, the Department of Labor’s new overtime regulations increase the weekly minimum salary threshold an employee must be paid to maintain exempt status under the FLSA’s “white collar” exemptions. The Final Rule, which becomes effective December 1, 2016, could affect up to 4.2 million employees according to DOL estimates. But an employer hoping to classify its employees as exempt need not meet the new threshold entirely through base salary. Instead, the new regulations allow employers to use bonuses, commissions, and incentive payments to satisfy up to 10% of the minimum salary threshold.

Continue Reading “Catching Up” on Exempt Status—Using Bonuses and Incentive Payments to Meet the FLSA’s New Salary Threshold

On August 1, 2016, the U.S. Department of Labor and Doctors Associates Inc. (Subway Restaurants) announced a voluntary agreement formalizing their ongoing collaboration.  This agreement is a first of its kind and seeks to ensure that franchise owners have the tools necessary to comply with wage and hour laws.  Since 2012, Subway has made available a platform for the DOL to provide training and resources to franchisees.  Despite the DOL’s efforts, other companies have reportedly been reluctant to enter into similar agreements due to fears that other government agencies will use such an agreement as evidence of a joint employer relationship.  Interestingly, Subway has been collaborating with the DOL for over three years and although this collaboration has been very much in the public eye, no agency has indicated that such a relationship would make them a joint employer.  The DOL hopes the fact that Subway, the world’s largest franchisor, entered into the compliance agreement will encourage other companies to follow suit.  Given the various government agencies’ joint employer efforts, all companies, whether franchisors or not, should analyze their own specific circumstances before entering into a similar agreement. Continue Reading Does Subway’s Compliance Agreement with the DOL Really Raise Joint Employer Concerns?

Since the highly anticipated overtime rule was announced on May 18, 2016, the Department of Labor’s changes have been top of mind for employers across the U.S., and our clients have reached out to us with a number of questions regarding the Final Rule’s impact on their organizations. In this podcast, we address the most common questions clients have asked Baker & McKenzie, and we provide our recommendations for the steps employers should take to comply.

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On May 18, 2016, the Department of Labor finalized its highly anticipated overtime rule that updates the Fair Labor Standards Act’s “white collar” exemptions (including the executive, administrative, and professional exemptions) and the highly compensated employee exemption. Most notably, the Final Rule significantly increases the minimum salary an employee must earn to qualify for these exemptions. With an effective date of December 1, 2016, companies must understand the new Final Rule and take the appropriate steps to comply. Continue Reading DOL Issues Final Overtime Rule—Are Your Exempt Employees Still Exempt?

The Department of Labor’s Wage and Hour Division recently released Administrator’s Interpretation No. 2016-1, examining joint employment relationships under the Fair Labor Standards Act and the Migrant and Seasonal Agricultural Worker Protection Act.  This comes shortly after the National Labor Relations Board issued its well-publicized decision in Browning-Ferris Industries that dramatically broadened the “joint employer” concept under the National Labor Relations Act.  So where does the law now stand under the FLSA?

Continue Reading DOL Becomes Latest Agency to Target Joint Employment

As if oTexas Bar Today Top Tenil and gas companies didn’t already have enough to worry about, the U.S. Department of Labor’s wage and hour compliance initiative has targeted the oil and gas industry. Recently, numerous Texas-based oilfield services companies have been audited or sued, with several resulting in multi-million dollar payouts to employees misclassified as exempt under the Fair Labor Standards Act. In light of the increased enforcement efforts, we discuss several misconceptions about exemption status and overtime pay.  Continue Reading Are Your Exempt Employees Really Exempt?