March 2019 Government Affairs Update

FLSA Overtime Rules Update Released

The U.S. Department of Labor has issued its proposed regulations on determining overtime exemptions for executive, administrative and professional employees. If adopted in their current form, the new rules would

  • Increase the salary basis threshold to $679/week ($35,308/year) from the current threshold of $455/week ($23,660/year);
  • Increase the total annual compensation requirement for highly compensated employees from $100,000/year to $147,414/year;
  • Seek public comment on the Labor Department’s commitments to reviewing the salary basis threshold every 4 years and to soliciting public input on future changes; and
  • Make no proposed changes to the job duties test.

The complete draft of the proposed regulation is available online. Comments are due by May 21, and IPMA-HR will survey members to obtain information for its comments.

DOL: Employers Cannot Designate More Than 12 Weeks of Leave as FMLA Leave

The Labor Department’s Wage and Hour Division on March 14, 2019, issued an opinion letter in which it stated, “An employer may not delay the designation of FMLA-qualifying leave or designate more than 12 weeks of leave (or 26 weeks of military caregiver leave) as FMLA leave.”

What this means in practical terms is that an employee who substitutes paid leave for unpaid Family and Medical Leave Act-qualifying leave must have the time counted against his or her FMLA balance. Further, according to the letter, “Once an eligible employee communicates a need to take leave for an FMLA-qualifying reason, neither the employee nor the employer may decline FMLA protection for that leave” until after the employee uses up all of his or her paid leave.

The FMLA requires employers to provide notice designating leave as FMLA leave within five business days of receiving sufficient information from the employee.

Equality Act Introduced to Bar Sexual Orientation, Gender Discrimination in Employment

Rhode Island’s Democratic Rep. David Cicilline is leading this push to amend Title VII of the Civil Rights Act of 1964. IPMA-HR supports the employment provisions in the legislation, and H.R. 5 has 239 co-sponsors in the House of Representatives. The bill’s Senate counterpart (S. 788) has 43 co-sponsors.

The proposed legislation has also drawn support from a large number of corporations and associations, including the U.S. Chamber of Commerce, the Business Roundtable and the College and University Professional Association for Human Resources. About 20 states already provide protections against discrimination based on sexual orientation or transgender identity.

IPMA-HR Supports Requiring Employees to Exhaust Administrative Options on Title VII Claims

The Association joined several public sector organizations in filing an amici curiae in support of the employer in Fort Bend County v. Davis. U.S. Supreme Court justices are scheduled to hear oral arguments on April 22.

At issue is whether an employment discrimination or retaliation lawsuit is barred when the plaintiff employee fails to exhaust his or her administrative remedies with the EEOC or an equivalent state agency. In this particular case, IT worker Lois Davis filed harassment and retaliation charges with the Texas Workforce Commission, which gave her the right to sue. Before exercising that option, she was dismissed for failing to work on a Sunday when she said she had a religious obligation. The lawsuit she did eventually file included a religious discrimination claim that the state commission had not reviewed.

The U.S. Circuit Court of Appeals for the Fifth Circuit in hearing a petition to reinstate the lawsuit after a federal district court dismissed it ruled that the failure to exhaust administrative remedies is a waivable rule rather than a jurisdictional rule. Other federal appeals courts have ruled to impose an administrative exhaustion requirement.

Public Safety Employer-Employee Cooperation Act Would Require Collective Bargaining for Public Safety Workers

Introduced by Michigan Democrat Dan Killdee and Pennsylvania Republican Brian Fitzpatrick, H.R. 1154, would make it mandatory for employers to recognize first responders’ rights to form or join a union and to bargain over wages, hours and terms and conditions of employment. These rights would be administered by the Federal Labor Relations Authority. IPMA-HR is opposed to the bill.

Democrats’ Paid Family Leave Bill Now Before Congress

The Family and Medical Insurance Leave Act (S. 463/H.R. 1185), introduced in the Senate by Kirsten Gillibrand (D-N.Y.) and in the House by Rosa DeLauro (D-Conn.), would guarantee up to 12 weeks of paid leave to address a serious personal or family health issue, to care for a newborn or newly adopted child, or to deal with circumstances arising from a family member’s military deployment or serious service-related injury.

Employees taking leave under what is dubbed the FAMILY Act would receive 66 percent of their monthly wage up to a maximum of $4,000. Funds to cover the mandated benefit would come from new payroll contributions of 0.2 percent by employees and employers.

The FAMILY Act has 34 Senate co-sponsors and 167 House co-sponsors, and the House Committee on Education and Labor voted the bill out to the full membership of the lower chamber.

Republicans also favor providing paid parental leave, but their proposals for doing so primarily rely on allowing employees to use Social Security benefits. Under such a system, workers would need to delay retirement if they used paid family leave benefits earlier in their careers.

Bill to Require Paid Sick Leave Revived

Representative DeLauro and Senator Murray have also resubmitted their Healthy Families Act. This bill calls on organizations employing 15 or more people to offer their employees up to 7 sick days each year. No employer that already provides paid time off would be required to track sick leave separately. Also, employers would be allowed to cap unused sick leave carried over from year to year at 56 hours.

Paycheck Fairness Act Would Bar Salary History Questions

The House Committee on Education and Labor has voted out H.R. 7, which was introduced by DeLauro and has 239 co-sponsors. An identical bill, S. 270, was introduced by Murray and has attracted 45 co-sponsors.

If enacted, the legislation would prohibit employers from asking job candidates what they earned in previous positions and from relying on a candidate’s salary history when making hiring or promotion decisions. Additionally, employees would find it easier to pursue class actions for pay discrimination, and employers would have to prove that wage differentials are based on factors other than sex. This would constitute a shifting of the burden of proof in Equal Pay Act cases.

U.S. Supreme Court Vacates Major Equal Pay Ruling

Justices on Feb.15, 2019, returned a case that has major importance for setting salaries in the public sector to the U.S. Court of Appeal for the Ninth Circuit.

Appeals court judges had upheld a lower court’s finding that “prior salary alone or in combination with other factors cannot justify a wage differential between male and female employees.” The defendant in that case asked the U.S. Supreme Court to declare the decision void because one of the judges who voted for the controlling opinion died before the decision was issued.

The original case was brought by a female employee of a California county education department. In its Yovino v. Rizo ruling, the U.S. Supreme Court declared that it was an error to allow a deceased judge to exercise “the judicial power of the United States after his death … . Federal judges are appointed for life but not for eternity.”

Congress Considers $15 Minimum Wage

The Raise the Wage Act (H.R. 582/S. 150) calls for increasing the federally mandated minimum wage from $7.25/hour to $15/hour over the next five years. Once the $15 target is reached, future increases would be indexed to median wage growth across the nation.

Sen. Bernie Sanders (I-Vt.) is carrying the bill in the Senate with 30 co-sponsors, and Rep. Bobby Scott (D-Va.) is leading the effort in the House with 198 co-sponsors. Members of the House Committee on Education and Labor have held hearings.

Labor Secretary Alex Acosta opposes a minimum wage increase, predicting that requiring employers to pay employees more would result in job losses. Currently, 29 states, the District of Columbia and some local governments that have minimum wages above the federal minimum.

Calls to Repeal ACA’s ‘Cadillac Tax’ Continue

H.R. 748, the Middle Class Health Benefits Tax Repeal Act of 2019, has been introduced by Rep. Joe Courtney (D-Conn.). If passed, the legislation would permanently kill the planned 40 percent excise tax on high-cost health plans. IPMA-HR supports efforts to eliminate this provision of the Affordable Care Act. Twice delayed, the tax is now scheduled to take effect in 2022.

For additional information, please contact IPMA-HR Executive Director Neil Reichenberg at nreichenberg@ipma-hr.org.

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