Federal Labor Law Posting Update

Became Effective August 1, 2016

Effective August 1, 2016, employers must post new Fair Labor Standards Act (FLSA) and Employee Polygraph Protection Act (EPPA) postings. Penalty amounts listed on previous versions of posters are incorrect as of that date.

The Department of Labor has removed penalty amounts from the posters and has added a section about the rights of nursing mothers to the FLSA poster. Employers are required to post the revised versions of these federal posters.

Comply with the Mandatory Posting Change. Update your posters today!

Over the past two years, there have been almost 100 mandatory state posting changes. And there have been 32 mandatory state changes so far this year.

Source: Department of Labor/Wage and Hour Division

Fair Labor Standards Act (FLSA) Minimum Wage Poster

Every employer of employees subject to the Fair Labor Standards Act's minimum wage provisions must post, and keep posted, a notice explaining the Act in a conspicuous place in all of their establishments so as to permit employees to readily read it. The content of the notice is prescribed by the Wage and Hour Division of the Department of Labor. An approved copy of the minimum wage poster is made available for informational purposes or for employers to use as posters.

A copy of the poster is available on the DOL website with printing instructions: https://www.dol.gov/whd/regs/compliance/posters/flsa.htm

This poster has been revised, and as of August 1, 2016, you must post this revised version.

Employee Polygraph Protection Act (EPPA) Poster

Every employer subject to the Employee Polygraph Protection Act (EPPA) shall post and keep posted on its premises a notice explaining the Act, as prescribed by the Secretary of Labor. Such notice must be posted in a prominent and conspicuous place in every establishment of the employer where it can readily be observed by employees and applicants for employment.

A copy of the poster is available in two versions on the DOL website with printing instructions: https://www.dol.gov/whd/regs/compliance/posters/eppa.htm

This poster has been revised, and as of August 1, 2016, you must post this revised version.

Poster last revised July 2016

Establishing Paid Sick Leave for Federal Contractors

A Proposed Rule by the Labor Department on 3/14/2016

Published in the Federal Register on 3/14/2016, this document extends the period for filing written comments until April 12, 2016 on the proposed rulemaking:  Establishing Paid Sick Leave for Federal Contractors. The Notice of Proposed Rulemaking (NPRM) was published in the Federal Register on February 25, 2016. The Department of Labor (Department) is taking this action in order to provide interested parties additional time to submit comments.

A Proposed Rule by the Labor Department on 2/25/2016

This rule proposes regulations to implement Executive Order 13706, Establishing Paid Sick Leave for Federal Contractors, signed by President Barack Obama on September 7, 2015, which requires certain parties that contract with the Federal Government to provide their employees with up to 7 days of paid sick leave annually, including paid leave allowing for family care. Executive Order 13706 explains that providing access to paid sick leave will improve the health and performance of employees of Federal contractors and bring their benefits packages in line with model employers, ensuring that Federal contractors remain competitive employers and generating savings and quality improvements that will lead to improved economy and efficiency in Government procurement.

The Executive Order directs the Secretary of Labor to issue regulations by September 30, 2016, to implement the Order's requirements. This proposed rule therefore defines terms used in the regulatory text, describes the categories of contracts and employees the Order covers and excludes from coverage, sets forth requirements and restrictions governing the accrual and use of paid sick leave, and prohibits interference with or discrimination for the exercise of rights under the Executive Order. It also describes the obligations of contracting agencies, the Department of Labor, and contractors under the Executive Order, and it establishes the standards and procedures for complaints, investigations, remedies, and administrative enforcement proceedings related to alleged violations of the Order. As required by the Order and to the extent practicable, the proposed rule incorporates existing definitions, procedures, remedies, and enforcement processes under the Fair Labor Standards Act, the Service Contract Act, the Davis-Bacon Act, the Family and Medical Leave Act, the Violence Against Women Act, and Executive Order 13658, Establishing a Minimum Wage for Contractors.

The comment period for the proposed rule ends on 3/28/2016.

View the article... 

Shell Oil and Motiva Enterprises to pay nearly $4.5M in overtime back wages

Shell Oil Co. and Motiva Enterprises LLC, which markets Shell gasoline and other products, have agreed to pay $4,470,764 in overtime back wages to 2,677 current and former chemical and refinery employees as a result of investigations by the U.S. Department of Labor that found violations of the Fair Labor Standards Act.

The department’s Wage and Hour Division conducted investigations at eight Shell and Motiva facilities in Alabama, California, Louisiana, Texas and Washington, which found that the companies violated FLSA overtime provisions by not paying workers for the time spent at mandatory pre-shift meetings and failing to record the time spent at these meetings.

“Employers are legally required to pay workers for all hours worked,” said U.S. Secretary of Labor Thomas E. Perez. “Whether in the international oil industry, as in this case, or a local family-run restaurant, the Labor Department is working to ensure that responsible employers do not experience a competitive disadvantage because they play by the rules.”

The Wage and Hour Division’s Houston District Office coordinated investigations with the Gulf Coast, New Orleans, San Francisco and Seattle District Offices to ensure nationwide compliance by Shell and Motiva. The findings revealed that those eight Shell Oil and Motiva refineries failed to pay workers for time spent attending mandatory pre-shift meetings. The companies required the workers to come to the meetings before the start of their 12-hour shift. Because the companies failed to consider time spent at mandatory pre-shift meetings as compensable, employees were not paid for all hours worked and did not receive all of the overtime pay of time and one-half their regular rate of pay for hours worked over 40 in a workweek. Additionally, the refineries did not keep accurate time records.

Shell, with U.S. headquarters in Houston, is an oil and natural gas producer involved in processing crude oil to manufacture energy products, including gasoline, diesel fuel, jet fuel and petroleum coke. Motiva, which is partially owned by Shell, is a leading refiner, distributor and marketer of fuels in the Eastern and Gulf Coast regions of the United States. It markets petroleum products under the Shell brand.

Shell and Motiva have signed settlement agreements that call for training of managers, payroll personnel and human resources personnel on the FLSA’s requirements. The training will stress the importance of requiring accurate recording and pay for all hours worked with emphasis on pre- and post-shift activities.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

US Labor Department investigates BBC Foundations & Flatwork, finds more than $137,000 in back wages due to 31 employees

Contractor denies employees prevailing wages, fringe benefits on federal transit project

BBC Foundation & Flatwork LLC has paid $137,705 in back wages to 31 employees of the Carleton concrete company for performing work on a federal transit project in Toledo, Ohio. An investigation by the U.S. Department of Labor’s Wage and Hour Division found that the contractor violated the Fair Labor Standards Act, Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act.

“In this competitive contracting environment, no contractor should gain an economic advantage by paying workers below the wages and fringe benefits required on a federally funded construction project. Not only does this practice undercut what is legally owed to the workers involved, it results in unfair competition,” said Timolin Mitchell, director of the Wage and Hour Division’s Detroit District Office. “Enforcement of the prevailing wage laws levels the playing field for all contractors and ensures that workers bring home the wages they have rightfully earned.”

Investigators found BBC Foundation & Flatwork paid employees less than the required prevailing wages and fringe benefits for work on a Federal Transit Administration project to build a new Toledo Area Regional Transit Authority facility, violating the DBRA and CWHSSA. BBC, performing work on this project as a subcontractor to The Garrison Co., of Farmington Hills, falsified certified payroll documents it submitted to the contracting agency in an attempt to show payment at the required rates by recording fewer hours than were actually worked. This practice also resulted in a failure to pay employees overtime, since the falsified payroll forms indicated employees worked less hours than they actually did. As a result of these violations of the CWHSSA, liquidated damages were computed and notification was forwarded to the Federal Transit Administration.

Investigators also found violations of the FLSA including a failure to pay employees overtime compensation at time and one-half their regular rates of pay for hours worked beyond 40 in a week. The employer operated under two different business names and failed to combine hours worked when employees performed work under both companies during the same workweek. Additionally, BBC did not maintain time records documenting daily and weekly numbers of hours worked, as required.
The company has paid the back wages found due in full. BBC further agreed to comply with the FLSA, the DBRA and the CWHSSA in the future, and to implement a system to monitor payroll for overtime hours.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates of pay for hours worked beyond 40 per week.

The Davis-Bacon Act requires all contractors and subcontractors performing work on federal and certain federally funded projects to pay their laborers and mechanics the proper prevailing wage rates and fringe benefits, as determined by the secretary of labor. On a Davis-Bacon Act covered project, the prime contractor is responsible for the compliance of all subcontractors.

The CWHSSA applies to federal service contracts and federal and federally assisted construction contracts over $100,000. These require contractors and subcontractors on covered contracts to pay laborers and mechanics employed in the performance of the contracts one and one-half times their basic rate of pay for all hours worked over 40 in a workweek.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Payroll Fraud Prevention Act

The Payroll Fraud Prevention Act was introduced by Senator Sherrod Brown (D-OH) on April 8, 2011. This bill is in the first step of the legislative process. A similar bill, Employee Misclassification Prevention Act, proposed by the same Senator on April 22, 2010, did not come up for debate and never became law. It is not uncommon for a sponsor to reintroduce bills that were not debated.

If enacted, Payroll Fraud Prevention Act would require employers to provide written notice to employees and "non-employees" (aka - a person engaged, for the performance of labor or service, who is not an employee) that provides the following information:

• Their employee/non-employee classification;
• Direction to a Department of Labor Website for further information on the rights of employees under the law;
• The address and telephone number for the applicable local office of the Department of Labor;
• For individuals classified as non-employees, this statement: 'Your rights to wage, hour, and other labor protections depend upon your proper classification as an employee or non-employee. If you have any questions or concerns about how you have been classified or suspect that you may have been misclassified, contact the U.S. Department of Labor.'

Maintaining copies of these notifications would also be required if the bill is enacted along with a created presumption that if individuals are not notified they are employees.

Click here to read the entire bill and track the status.

This information is intended to be educational and should not be considered legal advice on any specific matter.

$10 Million provided to "combat" Worker Misclassification

From the Department of Labor Office of Public Affairs (OPA) news release:

The U.S. Department of Labor today outlined its part of the president's fiscal year 2013 budget request to Congress.

In FY 2013, the department will continue to protect workers and level the playing field for businesses by providing the Wage and Hour Division with $10 million to combat worker misclassification and other violations of the Fair Labor Standards Act and the Family and Medical Leave Act. When workers are misclassified as independent contractors, they are deprived of benefits and protections to which they are legally entitled, and law-abiding businesses are placed at a disadvantage against employers who violate the law.

For more information on the president's FY 2013 budget request for the Department of Labor, visit http://www.dol.gov/budget/.

THOMAS HOUSTON associates, inc. can assist you in areas of DOL compliance. We offer pro-active and proven compliance tools and methods.

For more information on compliance services offered by THOMAS HOUSTON associates, inc. please visit our website, call 1 (800) 330-9000 or click here to schedule a convenient time for a call from an Affirmative Action Consultant.

Department of Labor (DOL) Misclassification Initiative

Employer to pay $250,000 in back wages and damages following DOL investigation

Company pays more than $256,000 in back wages following DOL investigation

DOL recovers more than $219,000 in back wages and liquidated damages for 44 misclassified Boston-area restaurant employees

These are just a few examples of 2011 findings in investigations conducted as part of the DOL's Misclassification Initiative to vigorously examine the classification of employees/independent contractors.

In September 2011, as part of this initiative, a Memorandum of Understanding (MOU) was signed between the DOL and the Internal Revenue Service (IRS). Under this agreement, the agencies will work together and share information to "reduce the incidence of misclassification of employees, to help reduce the tax gap, and to improve compliance with federal labor laws." Additionally, the Department's Wage and Hour Division has signed MOUs with eleven states and other DOL agencies, including the OFCCP. These MOUs will enable the Department to share information and to coordinate enforcement efforts.

Classification of Independent Contractors is far from "cut and dry". The Supreme Court has said that there is no definition that solves all problems relating to the employer-employee relationship under the Fair Labor Standards Act (FLSA). The Court has also said that determination of the relation cannot be based on isolated factors or upon a single characteristic, but depends upon the circumstances of the whole activity. The goal of the analysis is to determine the underlying economic reality of the situation and whether the individual is economically dependent on the supposed employer. In general, an employee, as distinguished from an independent contractor who is engaged in a business of his own, is one who "follows the usual path of an employee" and is dependent on the business that he serves.

Further guidance on making Independent Contractor determinations may be found at the following websites:

Department of Labor - eLaws - Independent Contractor

IRS - Independent Contractor (Self-Employed) or Employee?

Read more about the DOL's Misclassification Initiative

THOMAS HOUSTON associates, inc. can assist you in meeting the challenges that will arise as a result of the upcoming OFCCP's regulatory efforts. We offer pro-active and proven compliance tools and methods.

For more information on the affirmative action compliance services offered by THOMAS HOUSTON associates, inc. visit our website www.thomashouston.com, call (800) 330-9000 or click here to schedule a convenient time for a call from an Affirmative Action Consultant.