Top 5 Labor and Employment Law Trends for 2017
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Between a new president taking office, big labor and employment law changes and overtime regulations (on, then off), 2017 is sure to be a year of change for hourly employers. The temporary (for now) blocking of the new overtime regulations, growth of Ban the Box legislation, newly-released Form I-9 and recent developments under the Americans with Disabilities Act and Family (ADA) and Medical Leave Act (FMLA) are making it increasingly difficult to stay compliant in an ever-changing employment landscape Check out our “Top 5 Labor and Employment Law Trends for 2017” webinar presentation, featuring Ogletree Deakins, the nation’s leading labor and employment law firm to: -- Learn how the top five labor and employment law trends will impact the way you screen, hire and manage workers in 2017 -- Understand your options now that a federal judge has temporarily blocked the new wage & hour/overtime law from taking effect on December 1, 2016 -- Find out how new Form I-9 and Ban the Box employment legislation will affect your current hiring processes -- See how technology can help you ensure 100% screening and hiring compliance across all of your locations
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Top 5 Labor and Employment Law Trends for 2017
- 2. TODAY’S PRESENTER Stephen Woods Shareholder, Ogletree Deakins stephen.woods@ogletree.com
- 3. 3 Agenda Introduction Wage & Hour/Overtime Regulations New Form I-9 Ban the Box ADA & FMLA
- 4. Wage & Hour / Overtime Regulations
- 5. 5 Before Dec. 1, 2016 Wage & Hour / Overtime Rules 3 Separate Tests for Part 541 EAP Exemptions ● Salary Level/Amount Test ○ Exempt employee must be paid a minimum salary amount of $455 per week (or its equivalent if paid bi-weekly, semi-monthly, etc.) ● Salary Basis Test ○ Exempt employee must be paid a guaranteed salary not subject to reduction due to quality or quantity of work performed ● Primary Duties Test ○ Exempt employee must perform certain job duties that meet principal duties for EAP exemptions Highly Compensated Employee Exemption (HCE) ● Highly Compensated Employee Exemption (HCE)
- 6. 6 Federal Government Announces Changes Wage & Hour / Overtime Rules ● May 23, 2016 – U.S. DOL/WHD published Part 541 final rule ● FLSA Part 541 key provisions amending executive, administrative and professional (EAP) exemptions from overtime and minimum wage ○ “Salary level” test ○ $913 per week/$47,476 per year ■ Up to 10% could be met by non-discretionary bonus, incentive, or commission payments ○ $134,004 per year: highly-compensated individuals ○ Triennial adjustments, effective Jan. 1, 2020
- 7. 7 Law temporarily blocked Wage & Hour / Overtime Rules Overtime law was scheduled to take effect on Dec. 1, 2016Nov. 22, 2016 Judge issues Memorandum Opinion and Order and grants nationwide preliminary injunction
- 8. 8 Litigation Future, Congress, and Administration Possible Twists and Turns U.S. Dept. of Labor Not happy; issued condemnation Trump Administration Will have to initiate new rulemaking, including notice-and-comment period Congress Committees of both Senate and House of Representatives have issued statement supporting decision Other Congressional action – new statute; unlikely, at this point
- 9. 9 Litigation Future, Congress, and Administration Possible Twists and Turns ● What are the legal options? ○ Judge may decide whether to make injunction permanent and vacate Part 541 new final rule ○ Labor Dept./Justice Dept. may appeal order to the Court of Appeals ○ All legal options are being evaluated ● If preliminary injunction orders are reversed, will the regulations be enforced prospectively or retroactively?
- 10. 10 What has happened with similar overtime cases? ● Home Health Care Exemption ○ Supposed to take effect January 1, 2015 ■ Changed exemption to provide that home health care workers are entitled to overtime ● Dec. 22, 2014 – enjoined, then vacated the new rule ● Aug. 21, 2015 – reversed the lower court, effective October 13, 2015; affirmed new rule ● Is the rule effective January 1 or October 13, 2015? ○ Courts are split
- 11. 11 Option I What are your options? Delay and see how things play out Risk: If the injunction is lifted or overruled, employees could seek compliance with the regulations retroactively Get employees to track their time on or after Dec. 1 If injunction is lifted or overruled, employer has accurate measure of hours actually worked Tracking hours doesn’t mean employer must pay overtime retroactively, between Dec. 1 and overruled date, but the employer may decide to do so
- 12. 12 Option II What are your options? Go ahead and make the called-for changes No legal downside, but may be unnecessary Very expensive
- 13. 13 Option III What are your options? Undo all already-made changes ● Understand the retroactivity risk ● Get employees to track their time Communicate changes ● Give employees advanced notice ● Ensure you’re compliant w/ applicable state and legal notice requirements Undoing changes can be messy, especially if they have to be redone later Most employers are not making changes to salary increases … yet ● Communicate with employees about injunction and potential for further future changes
- 14. 14 Wage & Hour / Overtime Regulations Key Takeaways Evaluate whether to hold off on implementing the proposed new salary level If your company decides to hold off, track hours for employees whose salary is between $455/week [old salary level] and $913/week [proposed salary level]
- 15. New Form I-9
- 16. Poll Question #1 How do you currently complete the Form I-9 for new hires? 16
- 17. 17 Nov. 14, 2016 USCIS publishes new Form I-9 Until Jan. 21, 2017 Employers may continue to use current version (dated 03/08/2013 N) Jan. 22, 2017 Employers must use new form (dated 11/14/2016 N) Timing & Compliance New Form I-9
- 18. 18 Smart Features What’s New? Smart Form now available on USCIS Website ● Drop-down menus ● Hover text ● Real-time error notifications ● Calendars for filling in dates New changes increase compliance ● Alerts user that required field was left blank ● Automatically marks fields that do not apply to an employee with “N/A”
- 19. 19 Content-Based Changes What’s New? Section 1 New Form allows for multiple preparers and/or translators to participate in completion of form 2 If employee provides A-Number or USCIS number, employee must indicate whether number provided is A-Number or USCIS Number 3 USCIS replaced “Other Names Used” field with “Other Last Names Used” 1
- 20. 20 Content-Based Changes What’s New? Section 2 New field for “Citizenship/Immigration Status” New field added that allows employers to input additional information that they previously notated in margins of “old” Form I-9 1 2
- 21. 21 Smart form, not electronic I-9 What’s New? Although new Smart Form is completed on USCIS’s Website, Form is not an “Electronic I-9” Employers must continue to print a copy of Form I-9 and proceed with their normal signing, storing, and reverification practices for paper Forms I-9 1 2
- 22. 22 New Form I-9 Key Takeaways New Smart Form features May ease compliance burdens and reduce technical errors Do not alleviate employer’s responsibility to review proper documentation from employee and abide by anti-discrimination provisions
- 23. Ban the Box
- 24. Poll Question #2 How do you currently run background checks on candidates? 24
- 25. 25 Criminal Background Inquiries or Checks State Restrictions After selection Illinois (selection and notification) if no interview, after conditional offer Minnesota if no interview, after conditional offer Connecticut cannot inquire on initial employment application effective January 1, 2017 Vermont or once applicant has been otherwise deemed qualified for the position Effective July 1, 2017 During or after first interview Rhode Island Massachusetts After first interview Oregon if no interview, after conditional offer New Jersey After conditional offer Hawaii Utah Utah prohibits employers from procuring SSN , DOB and DL # before a conditional job offer, unless requested of all applicants – this may restrict the timing of when a background check can be conducted
- 26. 26 Criminal Background Inquiries or Checks Local Restrictions After selection Chicago, IL & Cook County, IL (selection and notification) if no interview, after conditional offer Seattle, WA after screening to determine whether candidate is qualified During or after first interview Buffalo, NY if no interview, must notify applicant if BC will be conducted before employment After first interview Montgomery County, MD Prince George’s County, MD Rochester, NY if no interview, after conditional offer and notice of BC San Francisco, CA interview must be live After conditional offer Austin, TX Baltimore, MD if no interview, after employment Columbia, MO District of Columbia New York City, NY Philadelphia, PA Portland, OR Los Angeles, CA effective date TBD
- 27. 27 Key Takeaways Ban the box Review and comply with applicable Ban the Box requirement(s)
- 28. ADA & FMLA
- 29. 29 Rules created to... Goals of FMLA Discourage “risk-weighers” Discourage “risk-weighers” Catch cheaters and weed them out of the workforce 1 2
- 30. 30 Goals of FMLA Discourage “risk-weighers” Rules created to... Create procedures designed to make clear “risk weighers” will be caught 2 Interrogate 3 Crack down on abuse 1
- 31. 31 Goals of FMLA Discourage “risk-weighers” Require advanced notice when taking leave ● Strengthen call-out policy ● Discipline for failure to follow ● Push for better notice ● Count absences if late notice received ● Alert Leave Management Team of patterns Ensure information is hyper-accurate about what life looks when on leave ● Update job descriptions to get more information ● Push back on certifications to make sure you are getting what you are entitled to receive ● Engage in the interactive process (ADA) ● Utilize interrogation tactics
- 32. 32 Call-Out Policies ADA & FMLA WHO Employee should call WHAT Reason for absence and expected length of absence WHEN As soon as practical and possible WHERE Where must the employee report? HOW Verbal notice
- 33. 33 NEW: Call-Out Considerations ADA & FMLA Employer obligations under FMLA ● Communicate with employee ● Send information Consider adding requirements for the employee to advise: ● Where he/she can be reached ● Where he/she can be reached if phone/address changes
- 34. 34 Interrogation on need for leave ADA & FMLA Are you sure you need to take this leave? ● For what? ● Is this already approved? What functions can you not perform? How are you going to get yourself home if you are incapacitated? Is it medically necessary that you take the leave? Is there any way you would be able to continue working? If you can drive, how can you not work?
- 35. 35 ADA: How to reasonably accommodate ADA & FMLA Do do not have to—and shouldn’t— use terms “disability,” “reasonable accommodation,” or “interactive process” in discussions with the employee Review current job description and any available physical job analysis for other positions considered Receive input from employee about his/her limitations Identify potential accommodations and assess how effective each would be, including discussions with employee and with internal HR/Legal Review medical documentation concerning employee’s condition and work restrictions, when appropriate If possible, identify essential and nonessential functions of job duties and job purpose Engage in good faith, interactive process with employee
- 36. Making facilities accessible and useable Restructuring jobs Creating part-time or modified work schedules Reassigning to vacant positions Acquiring or modifying equipment or devices Adjusting or modifying examinations, training materials or policies Providing qualified readers or interpreters Providing leave 36 Reasonable accommodations - examples ADA & FMLA
- 37. 37 When accommodation would cause undue hardship When an employer is excused from duty to accommodate ADA & FMLA When accommodation constitutes a direct threat to the health and safety of co-workers or to the employee 1 2
- 38. 38 An action requiring significant difficulty or expense... Undue hardship ADA & FMLA Nature and cost of accommodation needed Overall financial resources of facility or facilities involved Number of persons employed at facility Effect on expenses and resources, or impact otherwise of such accommodation Overall financial resources of employer Overall size of employer’s business with respect to number of employees Number, type and location of facilities Type of operation or operations of employer, including workforce composition, structure and functions Geographic separateness, administrative or fiscal relationship of facility or facilities to employer
- 39. 39 The Policy ● Revise LOA policies to include accommodative leave ● Select a period for a neutral absence control policy that takes accommodative leave into account Tips for administering leave as an accommodation Ensuring ADA Compliance, Shortening Leave Periods and Reducing Abuse Implementation ● Grant leave extensions in shorter increments and require new documentation showing leave is on track to be definite ● Document indefinite nature of leave in communications with employee and/or physician ● Require physician to estimate return date with “reasonable medical certainty” ● Require physician to represent that the definite leave will allow the employee to perform essential job functions
- 40. Q&A Stephen Woods Shareholder, Ogletree Deakins
- 41. HRCI Activity ID: 300644 Recertification Credit Hours Awarded: 1 Specified Credit Hours: HR (General) SHRM Activity ID: 16-WU75V Professional Development Credits (PDCs): 1 SAVE THE DATE I-9 Deep Dive Webinar January 25, 2017
- 42. NEW VENUE. MORE GREAT INFORMATION. MAY 15-17, 2017 BELMOND CHARLESTON PLACE CHARLESTON, SC HOURMINDS.COM Save the date for HourMinds 2017 in beautiful Charleston, South Carolina. Join us for conversation, and networking on all things hourly.