U.S. Department of Labor Announces Increased Salary Requirement for Overtime Exemptions

 

Last year we informed you of the United States Department of Labor (“DOL”) proposal to amend the white-collar overtime exemption to increase the salary threshold necessary to be considered exempt from the FLSA overtime laws. On May 23, 2016, the DOL announced the long-awaited revision to its regulations, which more than doubles the minimum salary requirement to qualify for the overtime exemption. This change will have significant implications for employers across the country.

According to statistics published by the DOL, the amended regulations will require employers to pay overtime to as many as 4 million additional employees unless their salary is increased to the new minimum threshold. The new regulations take effect December 1, 2016, and raise the requirement for exempt status from $23,660 ($455 per week) to $47,476 ($913 per week).

It is important to remember that the salary requirement under the FLSA will be adjusted for inflation every three years, so this is not a one-time increase. That said, the so-called “duties test” (meaning the primary duties the employee performs must fall into the administrative, professional or executive classification) was not changed under the amended regulations.

Now would be an excellent time for your company to schedule online wage and hour training for your managers. Given the large number of employees who now may be subject to overtime compensation (or a healthy raise), it is important to review all of the wage and hour laws that are the subject of significant litigation throughout the country.

The DOL changes also present special problems for California employers, as the federal salary threshold is actually higher than that currently required under state law (twice the minimum wage). This means that a significant number of employees in California will need salary review to see if they still qualify for overtime exemptions. Further, California’s recently enacted staggered minimum wage increases will place the California salary threshold higher than the federal standard by 2019, causing continued confusion for employers.

Syntrio is committed to helping businesses avoid costly incidents associated with wage and hour litigation. Syntrio’s cost-effective wage and hour training courses are designed with the decision-making management employee in mind. Therefore, the examples used within are real-life scenarios that are easy to comprehend, even when the user does not have a technical background in wage and hour law. 

Contact www.syntrio.com for more information about our wage and hour courses for employees and management and remember to follow us on Twitter, Google Plus and LinkedIn for daily updates on compliance that impact your company.

Individual Liability for California Managers in Wage & Hour Cases Now a Reality

 

In a bit of news that no employer will be glad to hear, California has further complicated its wage and hour law to include individual liability for managers, officers, and directors who violate California wage and hour provisions. Throughout its legislative history, California has long been known as the most employee-friendly state when it comes to wage and hour law. That said, the state has until now been reluctant to impose liability on managers and other high level employees.

Governor Jerry Brown recently signed into law an amendment to Labor Code section 558.1, which effectively states that owners, directors, officers, or managing agents of the employer may be held liable as the employer for wage and hour violations. In short, this means that plaintiffs’ attorneys in California will now be able to seek damages from the individual actors in minimum wage, overtime, and meal and rest break cases in addition to the company itself. This shift in policy presents a wide variety of challenges in litigating these matters and will cause the costs of wage and hour litigation to rise even further.

Syntrio Has Developed Cost-Effective California Wage and Hour Training

The best means of avoiding a wage and hour lawsuit is to train your managers on effective compliance with California wage and hour law. Syntrio has recently revamped its online training courses to include the latest changes in California law. Moreover, the courses use real-life scenarios to illustrate the dangers of failing to comply. Indeed, Syntrio’s wage and hour programs go into detail on the nuances of California’s complicated wage and hour laws, and are broken up into distinct sections that highlight where mistakes most frequently occur.

Wage and hour lawsuits are some of the most frequently litigated employment matters in the state of California. By failing to prepare your managers for the challenges they are likely to face from Plaintiffs’ attorneys and employees, you are putting your high-level employees at a significant disadvantage. Now that those employees can be held personally liable for wage and hour violations, arming them with education is a protection they deserve. With the recent changes in the law, now is the perfect time to review your policies and procedures and schedule training for your managers, officers, and directors that will keep them from making mistakes that could leave them personally lighter in the wallet.

Syntrio is committed to helping employers avoid the costly mistakes (and litigation) that are associated with complicated areas of employment law. We are also able to custom-tailor our courses to fit the needs of your business. Contact www.syntrio.com for more information about our wage and hour courses for management and remember to follow on TwitterGoogle Plus and LinkedIn for daily updates on compliance issues that may impact your business!

 

Large California Grocery Chain Sued for Unpaid Overtime

Wage and Hout Training

 

On September 24, 2015, a group of California employees filed a wage and hour lawsuit against grocery giant Vons in Santa Barbara County. The lawsuit seeks $4 million in damages and alleges that the grocery chain did not pay required overtime compensation. The suit also claims Vons required its employees to work through meal periods over a four-year period and alleges that Vons destroyed and falsified time records to eliminate overtime hours and show that employees had taken their meal breaks when they allegedly had not.

Lawsuit Yet Another Example of California Employers in Hot Water

California wage and hour law is the most complicated in the country. If you or your company have employees working in that state it is imperative that you seek advice and training to ensure that your managers and payroll administrators understand the laws and their nuances and are doing everything they can to comply with California’s complex overtime, meal and rest, and recordkeeping requirements (among others).

As the Vons lawsuit shows, repeated violations over a period of time can go unnoticed and can add up to a significant amount of damages. Worse yet, California law allows for plaintiffs’ attorneys to recover fees on behalf of their clients in the event they successfully pursue a claim. Therefore, in addition to the potential $4 million in damages Vons could be liable for if they are found to have violated California law, there could be hundreds of thousands of dollars more in attorneys fees that the company may have to pay. Don’t let this happen to your business.

Syntrio Has Developed Cost-Effective Training Programs for Your Business

Syntrio has recently released two new courses specifically designed to aid California managers and supervisors in complying with California Wage and Hour law. The first, “Wage and Hour Basics for California Managers” is designed for California managers who supervise employees subject to California state minimum wage, overtime, and meal and rest break laws. The shorter second course is entitled, “Meal and Rest Break Training” and goes into greater detail about the nuances of this complicated area of California law that is one of the bases of the lawsuit discussed above. We recommend your managers and supervisors participate in both courses to have the fundamentals necessary to comply with the law.

Syntrio is committed to helping employers avoid the costly mistakes (and associate litigation) that are associated with complicated areas of employment law. We are also able to custom-tailor our courses to fit the needs of your business. Contact www.syntrio.com for more information about our wage and hour courses for management and remember to follow on TwitterGoogle Plus and LinkedIn for daily updates on compliance issues that may impact your business!

 

Changing Overtime Exemption Could Cause Big Problems for Management

The United States Department of Labor has announced a proposal to amend the white-collar overtime exemption for executive, administrative, and professional employees to increase the salary threshold necessary to qualify for the exemption. Under the proposed rule, in 2016 the salary necessary to qualify for the exemption at the federal level would be $970 per week, and not less than $50,440 per year. This is in stark contrast with the current annual requirement of $23,660.

Importantly, to qualify for the exemptions, employees must also meet the job duties tests for the executive, administrative, professional (or other limited exceptions) which are also under review, and also potentially subject to changes by the end of the year. In the mean time, we can assume that the salary threshold for meeting the exemption will go up, which could have an extreme impact on some businesses and classes of employees.

Line Managers Suddenly May Require Overtime Payments

In one of the most devastating examples of how the new regulations may impact businesses, we examine the fast food industry. Currently there are shift managers who direct other employees and perform management duties but make low annual salaries. Presently, those employees are not necessarily required to receive overtime under the present salary threshold. However, when the regulations are amended those managers likely now will be required to receive time and a half payment for hours worked in excess of 40 and businesses will have the nightmare of accounting for which hours are spent performing management versus regular work.

Regular Wage and Hour Training Necessary for Upper Management

With the rapid changes in wage and hour regulations comes the need for strategic decisions on how to compensate employees who may now be subject to overtime payments. Thankfully, we are well prepared on the changes and ready to train your upper managers on the nuances of the new regulations, and how they may impact your employees and classes of managers. By scheduling training, your company can avoid the massive pitfalls and penalties brought on by violating the federal (and state) wage and hour laws.

Syntrio’s cost-effective wage and hour training courses are designed with the decision-making management employee in mind. Therefore, the examples used within are real-life scenarios that are easy to comprehend, even when the user does not have a technical background in wage and hour law. Given the immense changes taking place in this area of the law combined with the extreme risk of class-action litigation, we feel that wage and hour training is essential to the modern business.

Syntrio is committed to reducing the number of wage and hour lawsuits filed in state and federal courts by facilitating compliance with state and federal laws and commitment to the utmost ethical standards in wage payment. Contact Syntrio for more information and remember to follow us on TwitterGoogle Plus and LinkedIn for daily updates on employment law and compliance issues that may impact your business!

 

The “Three Strikes” of Illegal Employer Action

Now that two full months have passed in calendar 2015 it is a good time to take a quick look at the most common forms of misconduct committed by employers. Indeed, employers are commonly making mistakes and violating laws in today’s workplace, and the only way to reduce these incidents is to keep the issues in the forefront. When managers can identify a problem before it gets out of hand, proper training and education can have he or she prepared with a solution.

Employers are Understanding that Litigation is a Sunk Cost

Fewer employees fear the perceived team of expensive defense attorneys and threats of retaliation if they complain about employer misconduct than in years past. As such, more employees are carrying out their threats of filing a lawsuit against their current or former employers. With that knowledge in mind, employers are beginning to see that fighting the problem on the back end using high priced attorneys is not the way to run a business. Instead, the common management pitfalls are ripe for training to proactively combat the problem, and many business owners are taking an offensive approach to employment law and human resources issues.

1. Discrimination

Discrimination claims are by far the most common form of employee lawsuit. Discrimination is when someone is treated less favorably (or more favorably in some cases) because of his or her membership in a protected class (i.e. race, sex, religion, etc.) There are longstanding federal and state laws prohibiting discrimination in the workplace, yet it persists as the most common form of employee charge today. Although employers are doing their best to eliminate bias in the workplace, certain prejudices persist among rogue managers, and therefore discrimination is a problem that is not going away.

2. Retaliation

Retaliation is a form of discrimination that occurs in conjunction with a discharge or other adverse employment action such as a demotion, pay decrease, lack of promotion or other disciplinary action and occurs as the result of an employee complaint or refusing to commit what he or she believes to be an illegal act (among other things). By learning how to properly handle employee complaints and requests to exercise statutory rights there is a great reduction in the risk that a retaliation claim will even be brought by a disgruntled employee.

3. Wage and Hour Violations

Unless your company employees all overtime exempt employees you are obligated under federal law to pay added compensation for employee hours worked in excess of forty in one week (there are also states that impose even stricter requirements on employers such as California). As you are also undoubtedly aware, the federal law requires payment of a minimum wage of at least $7.25 per hour (or higher in many states).

There are a significant number of traps that employers fall into with respect to the wage and hour laws, and managers are wise to learn the intricacies of federal and state wage and hour laws. Your employees certainly are brushing up on their internet research!

Syntrio is Available to Discuss Cost-Effective Training

The aforementioned topics merely scratch the surface of the three most common types of employee lawsuits. All companies can benefit from taking a proactive approach toward employment law issues, which is why Syntrio offers a robust LMS containing products that meet nearly every compliance need that can arise within a company or particular industry. Further, if something you need is currently unavailable, our team of experts will develop a course custom-tailored to suit your needs.

Contact Syntrio for more information and remember to follow us on TwitterGoogle Plus and LinkedIn for daily updates on employment law and compliance issues that may impact your business!