Employment Law This Week®: New Minimum Wage Ruling, NYC’s Paycheck Deduction Law Challenged, Top Compliance Concerns, Fiduciary Rule Delayed

by Epstein Becker & Green
We invite you to view Employment Law This Week® - a weekly rundown of the latest news in the field, brought to you by Epstein Becker Green. We look at the latest trends, important court decisions, and new developments that could impact your work. Join us every Monday for a new five-minute episode!

This week’s stories include ...

(1) Ninth Circuit: See more +

We invite you to view Employment Law This Week® - a weekly rundown of the latest news in the field, brought to you by Epstein Becker Green. We look at the latest trends, important court decisions, and new developments that could impact your work. Join us every Monday for a new five-minute episode!

This week’s stories include ...

(1) Ninth Circuit: Minimum Wage Calculated by Weekly Average

Our top story: The U.S. Court of Appeals for the Ninth Circuit finds that the minimum wage can be calculated by the weekly average. Xerox paid call center workers in the State of Washington different amounts for different tasks. This system sometimes caused employees to earn less than the minimum wage in a single hour, but the employer supplemented their pay at the end of each workweek to meet the federal minimum. Several of the workers sued, claiming that the Fair Labor Standards Act’s minimum wage requirement must be met for each individual hour worked. The Ninth Circuit concluded that the minimum wage should be measured over the entire workweek, agreeing with four other circuits, and ruled in favor of the company. Here’s Jonathan Brenner, from Epstein Becker Green, with more:

“This was an issue of first impression in the Ninth Circuit, although it had been decided in several other circuits previously. Noting that the statutory language, legislative history, and purpose did not help answer the question of what the unit of measure is under the FLSA to determine minimum wage compliance, the court relied on maintaining consistency amongst the circuits, avoiding burden on multijurisdictional employers, congressional inaction in the face of existing interpretation, and numerous amendments to the statute over the years; and held that the workweek was the proper unit of measure to determine minimum wage compliance under the Fair Labor Standards Act; and it upheld summary judgment in favor of the employer from the court below.”

(2) Restaurant Groups Fight NYC’s Paycheck Deduction Law

Restaurant groups take on New York City’s paycheck deduction law. The National Restaurant Association has sued New York City in federal court over a new law that went into effect on November 26. Under the law, fast-food employees can ask their employer to deduct a portion of their salary and donate it directly to a nonprofit. The association says this provision violates federal labor law by requiring employers to send dues to union-supported organizations in non-union workplaces. The restaurant groups also allege that the law violates the First Amendment by requiring employers to send funds to organizations that they may not support, like the “Fight for $15” campaign.

(3) Poll Shows State and Local Laws Are Top Concern

State and local laws are top of mind heading into 2018. In a recent poll of readers, HR Dive found that over half of respondents consider state and local laws their top compliance concern, followed by Family and Medical Leave Act (FMLA) leave and EEO-1 reporting. HR Dive cites stagnation on the federal level as a major reason that states and municipalities are taking matters into their own hands. Salary history inquiry bans, minimum wage laws, ban-the-box provisions, and paid leave requirements are just some of the issues on state and local legislative agendas throughout the country.

(4) DOL Delays Fiduciary Rule

The U.S. Department of Labor (DOL) puts the fiduciary rule on ice for 18 months. The DOL has delayed key parts of its fiduciary rule for financial advisors until July 1, 2019. The DOL is using the time to fully consider prohibited transaction exemptions in the rule, including the controversial Best Interests Contract (BIC) exemption that would require fiduciaries to enter into an enforceable contract regarding standards of conduct. In February, President Trump asked the DOL to examine the Obama-era rule. The Impartial Conduct Standards, which require brokers to charge reasonable fees, refrain from making misleading statements, and work in clients’ best interests, took effect in June 2017.

(5) Tip of the Week

Will Hansen, Senior VP of Retirement Policy for The ERISA Industry Committee (ERIC), is here with tips on how tax reform could impact executive compensation programs:

“Tax reform is the number one topic in Washington, D.C., but the biggest hurdle in getting tax reform passed and signed into law is figuring out a way to pay for that tax reform. And every dollar counts. Changes to section 162(m), which would allow performance-based compensation to be included within that deduction allowance, would raise significant revenue. I would definitely keep an eye out for any future changes in this area, especially as tax reform progresses.”

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