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Posts Tagged ‘Obama’

Department of Labor Unveils Its Long-Awaited Proposed Overtime Rule

Posted on: March 11th, 2019

By: Brad Adler

On March 7, 2019, the U.S. Department of Labor (DOL) released its long-awaited proposed rule that would revise the white collar overtime exemption regulations.  In its proposed rule, the DOL proposed raising the minimum annual salary for exempt status from $23,360 to $35,308 (an increase in the weekly rate from $455 to $679).  This is a significantly smaller increase than the increase that had been adopted by the DOL in 2016 ($47,476 per year) while President Obama was in office.  Of course, a court blocked that increase from taking effect.

Like the 2016 final rule, the DOL’s new proposal would allow employers to satisfy up to 10% of the $35,308 minimum salary requirement by the payment of nondiscretionary bonuses, incentives and commissions.  Notably, however, while the 2016 rule required that the bonuses be paid at least quarterly, the new proposal contemplates that they can be paid annually (or more frequently if desired).  Specifically, employers would have one catch-up period at the end of a 52-week period to make up any shortfall in the employee’s salary to bring it up to the required minimum.

As a result of this proposed provision, the employer could pay the employee a guaranteed minimum salary of $611.10 per week (90% of the weekly salary) and, if bonus and incentive compensation do not bring the person up to the minimum salary level by the end of the year, the employer would have one chance to make up the difference.

In addition to increasing the minimum salary, the DOL also proposed increasing the minimum annual compensation to qualify for the FLSA’s “highly compensated employee” exemption, from $100,000 to $147,414 (of which, at least $679 per week must be paid on a guaranteed salary or fee basis).

The public will have 60 days to submit comments on the proposed rule, but the rule ultimately is expected to take effect on January 1, 2020.

If you have any questions or would like more information, please contact Brad Adler at [email protected].

NLRB Decisions are Trending Pro-Employer

Posted on: February 27th, 2019

By: Amy C. Bender

The National Labor Relations Board (“NLRB”) under the Trump administration is showing a return to more conservative, employer-friendly interpretations of the laws regarding employees’ rights to engage in concerted activity to improve wages and working conditions. As a reminder, these protections apply to almost all private-sector employees, regardless of whether they belong to a union.

Independent Contractors – The NLRB recently issued a decision returning to the pre-Obama era, employer-friendly “common law agency” test for determining whether a worker is an employee or an independent contractor. This ruling makes it easier for employers to classify workers as independent contractors, which benefits employers since independent contractors do not have certain rights that employees have, such as the right to unionize (and employers do not have to pay taxes or insurance on independent contractors, among other distinctions).

Joint Employers – The NLRB recently closed the period to submit comments on its proposed rule regarding the standard for when two entities are considered joint employers. Under the proposed rule, an entity will be deemed a joint employer only if it has and exercises substantial, direct, and immediate control over the essential terms and conditions of employment and has done so in a manner that is not limited and routine. The current standard from the Obama administration allows a finding of joint employment if an entity exercises indirect control or merely has the contractual right to exercise control, which can result in increased liability for businesses.

Employee Handbook Rules – The NLRB recently issued guidance on when an employer’s workplace policy interferes with employees’ rights to engage in protected concerted activity. The guidance provides that a policy will be placed into one of three categories (generally lawful, warrants individualized scrutiny, or unlawful) and be subject to a balancing test between the policy’s negative impact on employees’ ability to exercise their rights and the policy’s connection to employers’ right to maintain discipline and productivity in their workplace. This guidance provides employers more clarity and detail on how to craft lawful policies and also makes clear that policies will be analyzed to determine the impact they would have (and not just conceivably could have) on employees’ rights.

These developments signal good news for employers, and let’s hope this trend continues.

For questions or assistance in reviewing or preparing your workplace policies, contact Amy Bender at 770-818-1421 or [email protected]

Governor Wolf Proposes New Overtime Rules for Pennsylvania

Posted on: February 20th, 2018

By: Christopher M. Curci

Employers may recall the Obama administration’s efforts in 2016 to increase the overtime rule salary exemption from $23,600 annually to $47,476 annually.  By way of background, employers are required to pay overtime to employees who work over 40 hours in a given workweek.  However, many “white collar” employees are exempt from the overtime rules if their salary is above the $23,600 annual threshold.

The Obama administration’s proposed changes in 2016 caused quite a hubbub, finding strong support from pro-employee groups and strong opposition from pro-business groups.  Ultimately, the proposed changes were struck down by a federal court and the Presidential administration turned over to President Trump, largely mooting the issue.

However, Pennsylvania employers should be aware that Governor Wolf recently announced a similar change to Pennsylvania’s wage and hour laws as part of his “Jobs That Pay” initiative.  Governor Wolf’s proposal calls for increasing the salary exemption to $31,720 annually in 2020, $39,832 annually in 2021, and $47,892 annually in 2022.  Thereafter, the salary threshold will continue to increase every three years.

The Governor’s office estimates the proposed changes will increase the wages of 460,000 workers in Pennsylvania.  While the proposed changes have not yet been passed and would not take place for some time, employers should always be aware of the potential for significant change in wage and hour laws.  It is important that employers plan well in advance for such significant change to manage their own business finances and avoid costly wage and hour violations.

Christopher M. Curci, Esq., is a Pennsylvania and New Jersey Labor and Employment Attorney and member of Freeman Mathis & Gary’s Labor and Employment Law National Practice Section.  He represents employers in litigation and advises clients on all aspects of employment law.  If you need help with this or any other employment issue, he can be reached at [email protected].

President Obama Signs Bipartisan Bill Creating Federal System Of Trade Secrets Law

Posted on: May 12th, 2016

By: Mike Wolak and Amanda Cash

On May 11, 2016, President Obama signed the Defend Trade Secrets Act (“DTSA”) into law.  The DTSA is intended to create a more predictable, nationwide body of trade secrets law through a single federal statute.  The new law, which overwhelmingly passed both houses of Congress, will give companies a direct path to federal court as a plaintiff.  Until now, employers and businesses had to bring trade secrets claims under state law, which often presented disadvantages for large employers operating in multiple states.  The DTSA creates a federal cause of action that, for the first time, gives federal district courts original jurisdiction over trade secret disputes, including contract and tort claims that are currently asserted under state laws.  Companies can now consolidate their claims and file directly in federal court, which many argue is better equipped than state court to handle the often complex and highly technical aspects of trade secret cases.  This is important for employers who face daunting hurdles in protecting their trade secrets, especially given the constantly increasing risks associated with technological advances and cyber security issues.  It is important to note that the DTSA does not preempt state law, but will co-exist with state trade secret laws.

Employers must also be cognizant of the DTSA’s other important provisions, such as the following:

  • The DTSA Seizure Clause:  The DTSA allows trade secret owners, including employers, to make ex parte applications to a court for an order seizing property necessary to prevent dissemination of trade secrets.  This provides employers with a mechanism to forcefully recover trade secrets from alleged misappropriators, without a hearing or answer from the accused.  The DTSA limits this “extraordinary remedy” to situations where a request for a temporary restraining order or preliminary injunction would be inadequate.  Employers should pursue this remedy with extreme caution, however, and ensure they possess the requisite evidence to warrant such a seizure.  A wrongful or excessive seizure can support a claim against the trade secret owner for damages, including lost profits.
  • Whistleblower Immunity.  The DTSA provides a safe harbor in the form of civil and criminal immunity to those who disclose trade secrets to the government to investigate potentially criminal activity.  The DTSA thus requires that employees be notified of their right to disclose trade secrets as part of government investigations.  This notice must be provided in any contracts or employment agreements that govern the use of trade secrets or confidential information.  Rather than merely inserting the DTSA’s language into future employment contracts, employers should ensure they have policies for handling confidential information and whistleblower policies that are made available to employees.  Furthermore, without this express notice to employees, employers will not be permitted to recover punitive damages or attorneys’ fees if they pursue trade secret theft claims.  Finally, employees must also be advised that they are permitted to turn over confidential information to their attorneys or to the court in a retaliation suit, so long as the disclosure is made under seal.

The DTSA contains a number of critical changes to trade secret law that employers need to be aware of.  The DTSA gives employers unique opportunities to protect trade secrets in federal court and to employ forceful mechanisms to prevent dissemination.  Employers, however, must also be aware of the compliance requirements and limiting provisions of the DTSA, including the communication of certain whistleblower rights to employees, the consequences of a wrongfully implemented seizure, and the provisions aimed at preventing injunctions that unfairly restrict employee mobility.

For more information, please contact Mike Wolak at [email protected] or at 770.303.8638.

2012 Election Cycle: Major Business Concerns Include Immigration, Baseless Lawsuits

Posted on: August 27th, 2012

By: Kelly Morrison

The Eleventh Circuit recently weighed in on Georgia’s controversial Immigration Reform Act, restoring a provision which allows police to verify the immigration status of criminal suspects failing to produce appropriate identification.  This mirrors the U.S. Supreme Court’s holding with regards to a similar Arizona law.

Meanwhile, the Obama administration has spent its first term quietly advocating for loopholes in the current system, mostly aimed at undocumented aliens under age 18.  Political pundits expect a more direct campaign for federal immigration reform from the victor of the 2012 election.

Although Georgia has addressed both immigration and tort reform at the state level, more than 60 percent of Americans believe that frivolous litigation has slowed economic growth and recovery.