New Jersey Enters Partnership with USDOL To Fight Worker Misclassification

new jersey signExecutive Summary: Just months after New Jersey Governor Phil Murphy signed Executive Order No. 25 establishing a task force to combat employee misclassification, the NJ Department of Labor and Workforce Development (LWD) entered into a cooperation agreement with the US Department of Labor (USDOL) to work together to fight worker misclassification. Continue reading

DOL Issues Guidance to Aid in the Classification of Home Care Workers

Adams, Julie 300dpi
Julie Adams

Executive Summary: On July 13, 2018, the United States Department of Labor (“DOL”) issued a Field Assistance Bulletin (“FAB”) aimed at clarifying the standard utilized to determine if home care workers qualify as employees or joint employees under the Fair Labor Standards Act (“FLSA”).  Over the past few years, the DOL has issued and then withdrawn guidance regarding the proper standard and evaluation of home worker classification, leaving uncertainty for the industry.  The new guidance provides clarity on the subject and provides home care registries a road map for proper classification.

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Ninth Circuit Creates More Uncertainty in 80/20 Rule for Tipped Workers

Executive Summary: On February 16, 2018, the United States Court of Appeals for the Ninth Circuit granted en banc review of Marsh v. J. Alexander’s LLC, 869 F.3d 1108, creating a new layer of uncertainty for hospitality employers. The previous decision by a three-judge panel on September 6, 2017, had rejected what is commonly called the “80/20 rule,” which states that hospitality employers may not reduce a tip-earning employee’s hourly pay below the minimum wage when that employee spends more than 20 percent of his or her workweek on non-tip-earning tasks. The case will now be reconsidered by a larger panel of the Ninth Circuit, with oral argument scheduled for the week of March 19, 2018. The grant of en banc review suggests an intention to reconsider the panel’s prior holding or analysis.

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Eleventh Circuit Allows Employer to Share Employee’s Tips as Long as It Pays Employee Minimum Wage

Federal regulations currently treat tips as the employee’s property, regardless of whether the employer pays that employee the minimum wage or whether it uses a tip credit to satisfy the minimum wage requirement. Recently, the federal Department of Labor (DOL) proposed a rule that, if passed this year, would allow employers to require the sharing of tips with employees who do not customarily receive direct tips (such as restaurant cooks, dish washers, and similar workers), so long as the employer pays employees the full federal minimum wage of $7.25 per hour. Employers who use the tip credit option to satisfy the minimum wage obligation would not be allowed to require tip sharing with workers who do not customarily receive tips.

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New Year – New Wage Hour Opinions (Sort Of)

Executive Summary: In a change from the prior administration, the U.S. Department of Labor (DOL) on Friday reinstated nearly 20 “opinion letters” previously published under the Bush administration, but withdrawn prior to implementation by the Obama administration. The U.S. DOL also issued field bulletins providing new guidance on enforcement positions. The reissued letters predominately focus on specific industries; however, three of opinions generally apply to all employers. Below is a brief summary of each opinion. Should you wish to discuss these in greater detail, please contact Salvador Simao at ssimao@fordharrison.com.

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U.S. DOL Endorses Primary Beneficiary Test for Internships

Executive Summary: Recently, the US Department of Labor (DOL) announced that it will adhere to a new test for determining whether interns qualify as employees under the Fair Labor Standards Act (FLSA). The FLSA requires for-profit employers to pay “employees” for their work; however, whether interns or students qualify as “employees,” and, thus, are entitled to compensation for services provided, has been the subject of considerable litigation. In its statement, the DOL abandoned the six-factor test it instituted in 2010, and instead endorsed the “primary beneficiary” test which was established by the Second Circuit in Glatt v. Fox Searchlight Pictures, Inc. Further, the DOL stated that the Wage and Hour Division’s investigators will “holistically analyze internships on a case-by-case basis.” This is a strategic change in the DOL’s enforcement policies to align its procedures with several circuit court decisions.

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