On December 17, Washington Governor Jay Inslee, Senate Majority Leader Andy Billig, and House Speaker Laurie Jinkins issued a joint statement that included the Governor’s intention to direct the State’s Employment Security Department not to collect WA Cares Fund premiums that employers were to start withholding on January 1, 2022 and clear recognition by state lawmakers of a “pause” on premium collections by employers.
While President Biden’s vaccine mandate wends its way through the courts, another of the administration’s early initiatives impacting federal contractors is set to go into effect early next year.
On November 22, 2021, the Department of Labor (DOL) published its Final Rule implementing Executive Order 14026, which raises the minimum wage requirement for anyone working “on or in connection with” a covered federal contract from $10.95 to $15.00 per hour. The new minimum will also increase annually, starting January 1, 2023, to an amount determined by the Secretary of Labor based on inflation. The published rule explains that employees perform “on” a contract if they directly perform the specific services called for by the contract and perform “in connection with” a contract if their work activities are otherwise necessary to the performance of the contract. Employees performing “in connection with” covered contracts are excluded from coverage if they spend less than 20% of their work hours in a particular workweek doing covered work. Continue Reading Minimum Wage Increases to $15 for Federal Contractors Beginning January 30, 2022
The West Hollywood City Council unanimously approved a draft Ordinance establishing a citywide minimum wage and guaranteed leave during a November 3, 2021 City Council meeting that ended on November 4, 2021. The draft Ordinance can be found here and the City also issued a press release detailing the draft Ordinance.
The draft Ordinance sets forth the following phased minimum wage schedule:
|Hotel Employees||$17.64||Determined by Cost of Living Adjustment
Estimated to be: $18.31
|Employers of 50 or More||$15.50||$16.50||$17.50|
|Employers of Less than 50||$15.00||$16.00||$17.00|
Clarification Regarding Tip Pool Participation for Managers and Supervisors
The U.S. Department of Labor (DOL) recently clarified the rules under which managers and supervisors can participate in a mandatory tip pool. In a final rule effective November 23, 2021, the DOL clarified that managers and supervisors are permitted to contribute tips to a mandatory tip pool but may not receive tips from the pool. The rule also clarifies that managers or supervisors may keep a tip only when the tip is based on a service the manager or supervisor directly and “solely” provides. Thus, when managers or supervisors directly receive tips for services they directly and solely provide, an employer may allow them to keep those tips. Alternatively, the employer may require the manager or supervisor to share some portion of the tips with other eligible employees. Finally, the rule also confirms that employers that pay their tipped employees the full minimum wage and do not take a tip credit can impose a tip pooling arrangement that includes employees who do not regularly receive tips.
Clarification Regarding Dual Jobs
The DOL also issued a final rule, effective December 28, 2021. The DOL provides that “[u]nder the final rule, an employer can take a tip credit only when the tipped employee is performing tip-producing work or when the tipped employee is performing work that directly supports tip-producing work as long as the tipped worker does not spend a substantial amount of time doing tip-supporting work. The rule defines substantial amount of time as more than 20 percent of the hours worked during the employee’s workweek or a continuous period of time that exceeds 30 minutes.”
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Employers with tipped employees should contact experienced counsel with questions.
On October 18, 2021, Plaintiff Ysa Santana Reynoso (Reynoso), a former employee of pork processor Hatfield Quality Meats, Inc. (Hatfield), filed a class action lawsuit before a state court in Pennsylvania against Hatfield seeking unpaid wages under the Pennsylvania Minimum Wage Act (PMWA) for time spent undergoing mandatory COVID-19 screenings.
On September 27, 2021, California Governor Gavin Newsom signed Assembly Bill No. 1003 (AB 1003) into law. The purpose of AB 1003 is to make the intentional theft of wages punishable as grand theft under the California Penal Code and, therefore, a felony in California. Previously, violations of wage and gratuity provisions were classified as misdemeanors. Continue Reading California Law Makes Intentional Wage Theft a Jailable Offense
In Port of Tacoma v. Sacks, the Court of Appeals of the State of Washington recently held that all out-of-town employee travel time is compensable under state law. The decision confirms the Washington State Department of Labor & Industries’ (L&I) interpretation that all travel time related to work is compensable, regardless of when it takes place. Accordingly, all businesses with hourly employees located in Washington should become familiar with the changes to the law.
The Washington State Employment Security Department audits records of employers located in Washington to confirm that wages and hours are accurately reported and to ensure compliance with the state’s unemployment insurance laws and rules. During the audit, ESD auditors will perform a wide variety of functions, including looking for evidence of unreported employees, casual labor, independent contractors, and other workers who provide personal labor; sampling payroll and time records to compare them to wages and hours reported to ESD; and reviewing the type of business activity and whether a new employer is assigned the correct tax rate.
On September 22, 2021, Governor Gavin Newsom signed Assembly Bill No. 701 (“AB 701”), which makes it unlawful for employers to require nonexempt employees at warehouse distribution centers (“Covered Employee” or “Covered Employees”) to meet production quotas that prevent compliance with meal or rest periods, use of bathroom facilities (including reasonable travel time to and from bathroom facilities), or occupational health and safety laws (“Prohibitive Production Quota”). Employers are also prohibited from taking adverse action against Covered Employees for failing to meet a Prohibitive Production Quota. AB 701 will take effect January 1, 2022 (the “Effective Date”).
On September 1, 2021, Massachusetts Attorney General Maura Healey approved two potential ballot initiatives (Initiative 1, Initiative 2) regarding the classification of app-based drivers. If passed, either initiative would enact the Relationship Between Network Companies and App-Based Drivers Act (the “Act”) and classify such drivers as independent contractors rather than employees. Continue Reading Massachusetts Eyes Gig Economy Driver Classification Ballot Initiative