Tech Flex: August, 2017 Volume VIII

Transcription

1 Tech Flex: August, 2017 Volume VIII 1

2 Tech Flex: July, 2018 Volume VII Topics Covered In This Issue The topics covered in this issue are: Leave: Massachusetts Enacts Paid Family and Medical Leave Program Vermont Provides Crime Victim Leave Payroll: Alaska Prohibits Employers from Mandating Tip Sharing Delaware Increases Minimum Wage Law Impacting State Minimum Wage Enacted in Massachusetts Rhode Island Allows Electronic Wage Statements Voters in Washington D.C. Approve Phasing Out of Tip Credit Wilmette Opts Back Into Cook County Minimum Wage Time and Labor: Heads Up: Oregon Fair Work Week Act Took Effect July 1,

3 Tech Flex: July 2018 Volume VII 3 MASSACHUSETTS ENACTS PAID FAMILY AND MEDICAL LEAVE PROGRAM Governor Charles Baker of Massachusetts on June 28, 2018 signed into law legislation (H.4640) that introduces a new Paid Family and Medical Leave program. The Massachusetts Department of Family and Medical Leave (Department) will begin to pay benefits on January 1, The program will provide employees who contribute to the program the ability to take paid leave for up to 12 weeks a year care for a family member or bond with a new child, 20 weeks a year to deal with a personal medical issue, and up to 26 weeks to deal with an emergency related to deployment of a family member for military service. Weekly benefit amounts will be calculated as a percentage of the employee s average weekly wage, with a maximum weekly benefit of $850. Self-employed persons may opt into the program. For the law to apply to municipal employees, the city or town involved must vote to accept participation in the program. Job Protection: Employees taking family or medical leave under H.4640 are provided certain job protections. The law provides that an employee who has taken family or medical leave shall be restored to the employee s previous position, or to an equivalent position, with the same status, pay, employment benefits, length of service credit and seniority as of the date of leave. Payroll Income Tax to Fund Program The law creates a new payroll income tax effective July 1, The payroll tax would apply to most Massachusetts employers, including state and municipal government agencies. The tax would also apply to: self-employed individuals who elect to receive benefits; and businesses that employ independent contractors and must report payments for services on federal Form 1099-MISC. Employers will pay the tax at the initial rate of.63%. The treasurer and receiver for the new Family and Employment Security Trust Fund (Trust Fund) would set employer contribution rates each year. Employers could not deduct more than 40% of the contributions from an employee s wages for medical leave. However, employers could deduct to up to 100% of the contributions from an employee s wages for family leave. But an employer employing less than 25 employees in Massachusetts is not required to pay the employer portion of premiums for family and medical leave. Contributions to the Trust Fund are not required for employees wages above the contribution and benefit base limit established annually by the United States Social Security Administration for purposes of the Old-Age, Survivors, and Disability Insurance which for 2018 is $128,400. Some other highlights of the Massachusetts Paid Family and Medical Leave Program are as follows: 3

4 Tech Flex: July 2018 Volume VII 4 Average weekly wage is defined as an amount equal to 1/26 th of the total wages of an individual s two highest quarters in the base period, 1/13 th of the total for the highest quarter if the base period contains less than two quarters, rounded to the next highest dollar. Family member is defined as the spouse, domestic partner, child, parent or parent of a spouse or domestic partner of the covered individual; a person who stood in loco parentis to the covered individual when the covered individual was a minor child; or a grandchild, grandparent or sibling of the covered individual. A covered individual may not take more than 26 weeks, in the aggregate, of family and medical leave under this chapter in the same benefit year. The law allows for a covered individual to take medical leave during pregnancy or recovery from childbirth if supported by documentation by a health care provider that is immediately followed by family leave, in which case the 7 day waiting period for family leave shall not be required. Benefit year is defined as the period of 52 consecutive weeks beginning on the Sunday immediately preceding the first day that job-protected leave under H.4640 commences for the covered individual. ''Employee'' is defined as any individual employed by any employer subject to chapter.4640 and in employment subject to the law. ''Employer'' is defined as any employing unit subject to this chapter, the commonwealth, its instrumentalities, political subdivisions, their instrumentalities, any instrumentality of more than one of the foregoing, and any instrumentality of any of the foregoing and one or more other states or political subdivisions. An instrumentality of a political subdivision may include municipal hospitals, municipal electric companies, municipal water companies, regional school districts and any such other instrumentalities as are financially independent and are created by statute. Leave taken under the Massachusetts Paid Family and Medical Leave Program runs concurrently with leave taken under the Family Medical Leave Act (FMLA). Employees who take leave under the Massachusetts leave program while ineligible for leave under the FMLA shall be permitted to take leave under the FMLA in the same benefit year only to the extent they remain eligible for concurrent leaves under the Massachusetts Paid Family and Medical Leave Program. No Massachusetts family or medical leave benefits shall be payable during the first 7 calendar days of such leave; provided, however, that an employee may utilize accrued sick or vacation pay or other paid leave provided under an employer policy during the first 7 calendar days of such leave. Each employer and covered business entity must post in a conspicuous place on each of its premises a workplace notice prepared or approved by the department providing notice of benefits available under this chapter. The workplace notice shall be issued in English, Spanish, Chinese, Haitian Creole, Italian, Portuguese, Vietnamese, Laotian, Khmer, Russian and any other language that is the primary language of at least 10,000 or one-half of one percent of all residents of 4

5 Tech Flex: July 2018 Volume VII 5 Massachusetts. The required workplace notice must be in English and each language other than English which is the primary language of five or more employees or self-employed individuals of that workplace, if such notice is made available by the Department. Each employer must issue to each employee not more than 30 days from the beginning date of the employee s employment, the following written information in the employee s primary language: (i) an explanation of the availability of family and medical leave benefits, including rights to reinstatement and continuation of health insurance; (ii) the employee s contribution amount and obligations; (iii) the employer's contribution amount and obligations; (iv) the name and mailing address of the employer; (v) the identification number assigned to the employer by the Department; (vi) instructions on how to file a claim for family and medical leave benefits; (vii) the mailing address, address and telephone number of the Department; and (viii) any other information deemed necessary by the Department. Delivery of the required written information is considered made when an employee provides written acknowledgement of receipt of the information, or signs a statement indicating the employee s refusal to sign such acknowledgement. The employee must give not less than 30 days notice to the employer of the anticipated starting date of the leave, the anticipated length of the leave and the expected date of return or shall provide notice as soon as practicable if the delay is for reasons beyond the employee s control. For a copy of H.4640 please click on the link provided below. 5

6 Tech Flex: July 2018 Volume VII 6 VERMONT PROVIDES CRIME VICTIM LEAVE The Governor of Vermont, Phil Scoot, as signed into law legislation that amended 21 V.S.A. 495 effective July 1, 2018 to provide anti-discrimination and anti-retaliation protections to crime victims defined as any individual who has sustained physical, emotional, or financial injury as a direct result of the commission or attempted commission of a crime, as well as any individual who has secured an order of protection against an abuser or stalker. The new law also allows employees who are crime victims to take unpaid leave only, to attend a deposition or court proceeding related to: Certain criminal proceedings (the covered crimes are defined by the statute and range from things like sexual assault, domestic abuse and stalking to murder); Relief from abuse hearings; order against stalking or sexual assault hearings; or Relief from abuse, neglect, or exploitation of a vulnerable adult hearings. It is important to note that the new protections afforded 21 V.S.A. 495 does not alter the leave protections provided under 13 V.S.A which is provided to all Vermont employees for the purpose of testifying as a witness. Highlights of the law effective July 1, 2018 are as follows: All employers are covered and required to comply. Eligible employees are those who have continuously worked for six months or more, averaging at least 20 hours per week. The employee may choose to use accrued sick leave, vacation, or any other accrued paid leave to receive pay during the leave. The employer must continue employment benefits for the duration of the leave at the level and under the conditions provided during employment. The employer must post in each workplace a notice of the provisions of the law. The Vermont Commissioner of Labor is required to provide a form notice for this purpose. The employee is entitled to job restoration to the same or comparable job at the same level of compensation, employment benefits, seniority, or any other term or condition of the employment existing on the day leave began. For a copy of 21 V.S.A. 495 please paste the following into your browser. As%20Enacted.pdf 6

7 Tech Flex: July 2018 Volume VII 7 ALASKA PROHIBITS EMPLOYERS FROM MANDATING TIP SHARING Effective June 29, 2018, Alaska Department of Labor and Workforce Development finalized regulations, specifically 8 AAC , which prohibits employers from redistributing employees tips among other workers. Background: In 2017, the United States Department of Labor proposed regulations that would allow employers to take a portion of tipped wages away from tipped workers. These regulations were referenced in Alaska s Administrative Code. In response, the Alaska Department of Labor and Workforce Development developed regulations that would not allow such a practice in Alaska. In 2018, the United States Congress passed a law prohibiting employers from taking employees tips. However, this law still allows employers to redistribute those tips to nontipped employees. It is important to note that although the Alaska regulation prohibits the ability of employers to mandate tip sharing, it does not limit or prohibit the voluntary sharing of tips by employees. DELAWARE INCREASES MINIMUM WAGE On July 1, 2018 Delaware Governor John Carney signed legislation (SB 170) that increases the state minimum wage rate from the current level of $8.25 per hour as follows: October 1, 2018 October 1, 2019 $8.75 per hour $9.25 per hour It is important to note that SB 171 did not adjust the minimum cash wage for tipped employees, which remains at $2.23 per hour. For a copy of SB 170 please click on the link provided below. In addition, another piece of legislation was enacted (HB 483) in Delaware that stipulates that effective January 1, 2019, an employer may pay a training wage to an employee who is 18 years of age or older, during the first 90 consecutive calendar days of employment, at a rate up to 50 less than the state minimum wage rate. Employees under the age of 18 may be paid a youth wage at a rate up to 50 less than the state minimum wage rate. The increase in the state minimum wage to $8.75 is effective January 1, 2019 for these employees. For a copy of HB 483 please click on the link provided below. 7

8 Tech Flex: July 2018 Volume VII 8 LAW IMPACTING STATE MINIMUM WAGE ENACTED IN MASSACHUSETTS On June 28, 2018, Governor Charles Baker signed into law H which increases the minimum wage in Massachusetts for non-tipped employees gradually over the next five years to $15.00 per hour. The current minimum wage for non-tipped employees is $11.00 per hour. The increases are scheduled as follows: January 1, 2019 $12.00 January 1, 2020 $12.75 January 1, 2021 $13.50 January 1, 2022 $14.25 January 1, 2023 $15.00 In addition, the minimum cash wage for tipped employees will increase from its current level of $3.75 as follows: January 1, 2019 $4.35 January 1, 2020 $4.95 January 1, 2021 $5.55 January 1, 2022 $6.15 January 1, 2023 $6.75 For a copy of H.4640 please click on the link provided below. 8

9 Tech Flex: July 2018 Volume VII 9 RHODE ISLAND ALLOWS ELECTRONIC WAGE STATEMENTS On June 28, 2018, Governor Gina M. Raimondo signed into law Senate Bill 2597-a (SB 2597-a) allowing employers to provide wage statements and records electronically. However, the employer must furnish a printed or handwritten record to an employee, in lieu of an electronic record, at no cost to the employee, when a written authorization from an employee is provided to the employer. SB 2597-a was effective on the date of signature by the Governor. For a copy of SB 2597-a please click on following link: VOTERS IN WASHINGTON D.C. APPROVE PHASING OUT OF TIP CREDIT On June 19, 2018, Washington D.C. voted by a margin of 55% to 45% to approve Initiative 77 which gradually phases out the use of tipped credits to pay tipped employees with the result being that by 2026, tipped employees and non-tipped employees will be receive the same minimum wage. It is important to note that although the voters approved, the Imitative is subject to a 30- day review by the United States Congress. In addition, the D.C. Council could still block or change the measure. A majority of D.C. council members and Mayor Muriel Bowser have come out against Initiative 77. ADP will continue to monitor and report as more information becomes available. Background: Currently non-tipped minimum wage employees earn $12.50 an hour, but tipped employees, like servers and bartenders, earned $3.33 an hour and supplement the rest of their income with tips. If the employee does not make enough in tips to bring their hourly wage to the minimum wage, the employer must increase the employee s cash wages to make up the difference. In summary, Initiative 77 (if it should take effect as currently written) requires the following: Gradually increase the minimum wage in the District of Columbia to $15.00 hourly by 2020; Gradually increase the minimum wage for tipped employees so that they receive the same minimum wage directly from their employer as other employees by 2026; Beginning in 2021, require the minimum wage increase yearly in proportion to increases in the Consumer Price Index. The minimum wage increases under the initiative will not apply to D.C. government employees or employees of D.C. government contractors. The effective date of Initiative 77 is unclear at this time. Although the ballot measure stipulates that the first increase in the tipped wage, from $3.33 per hour to $4.50 per hour, should take place on July 1, 2018, it does not appear that the ballot measure can be enacted for several months. The sponsors of Initiative 77 have indicated they will not push for retroactive pay. 9

10 Tech Flex: July 2018 Volume VII 10 WILMETTE OPTS BACK INTO COOK COUNTY MINIMUM WAGE The Village Board of Wilmette, Illinois has voted to opt into the Cook County, Illinois minimum wage ordinance, effective October 1, 2018, reversing a previous decision to opt out of the Cook County ordinance. The Wilmette minimum wage rate is currently $8.25 per hour equal to that of Illinois minimum wage rate. Effective July 1, 2018, the Cook County minimum wage is $11.00 which will be the Wilmette minimum wage as of October 1, It is important to note that Wilmette decided to continue to opt out of the Cook County paid sick leave ordinance that requires employers to provide one hour of paid sick leave for every 40 hours worked to employees who have worked at least 80 hours in a 120-day period in the county. HEADS UP: OREGON FAIR WORK WEEK ACT TOOK EFFECT JULY 1, 2018 Employers operating in Oregon are reminded that Oregon s predictive scheduling law, the Fair Work Week Act, took effect for covered employers on July 1, The law establishes certain requirements related to the scheduling of covered employees in certain industries. Some key features of the law are discussed below. Covered Employers The law applies to businesses in the retail, hospitality and food service industries that employ at least 500 employees worldwide. Determination of the number of employees must take into consideration chains, which are companies with shared ownership plus similar trade names or other marks, and integrated enterprises, which requires an examination of interrelationships, control, common ownership and other factors. According to Oregon s Bureau of Labor and Industries (BOLI), the number of employees employed by an employer is calculated based upon the average number of employees employed on each work day during each of 20 or more workweeks in the current calendar year or immediately preceding calendar year. Covered Employees The law only applies to employees of covered employers who perform services relating to the categories retail trade, hotels and motels or food services. The following categories of workers are not covered: Salaried, exempt employees; Workers supplied by a worker leasing company; and Employees of a business that provides services to or on behalf of an employer. According to the regulations promulgated by BOLI, the last category above refers to employees of a covered employer who provide services that are wholly distinct from and 10

11 Tech Flex: July 2018 Volume VII 11 ancillary to a covered employer s primary business function. For example, a non-exempt bookkeeper employed by a hotel would not be covered by the law. Employer Obligations under the Law Notice of good faith estimate of work schedule This requirement applies to employees hired on or after July 1, For these new employees, employers must provide the following information at the time of hire: Median number of hours the employee is expected to work in an average month; An explanation of the voluntary standby list; and An explanation as to whether an employee who is not on a standby list may expect to work on-call shifts, and if so, an objective standard for when an employee may be expected to work on-call shifts if the employee is not on the standby list. The information provided in the good faith estimate may be based on prior year schedule if it is an estimate of seasonal or episodic work. Voluntary standby list Employers may maintain a voluntary standby list of employees who agree to be willing to work additional hours based on unanticipated customer needs or unexpected absences. To take advantage of maintaining such a list, the employer must provide employees with written notification of the following: That inclusion in the list is voluntary; How to be removed from the list; How the employer will notify standby list employees of additional hours and how to accept the additional hours; That the employee is not required to accept the additional hours offered; and That an employee on the standby list is not eligible for additional compensation for changes to the employee s written work schedule resulting from acceptance of additional hours as a result of being on the list. Employers are required to provide employees on a standby list notice of additional hours by one or more of the following methods: In-person conversation; Telephone; ; Text message; or Other electronic or written format. Advance notice of work schedule Employer must provide covered employees with written work schedules at least seven calendar days in advance of the first day on the schedule. Such schedules must cover the day after the last schedule was provided, and must include all work and on-call shifts for the entire period covered by the schedule. Schedules must be provided to new employees 11

12 Tech Flex: July 2018 Volume VII 12 on or before their first day of work, and to employees returning from a leave of absence on their first day of work upon returning from leave. They must also be posted in the workplace, both in English and in the language typically used to communicate with employees. As of July 1, 2020, schedules must be provided 14 calendar days in advance. At any time after the advance notice of written work schedule is made, an employee may request in writing that the employer add the employee to more shifts. Changes to the written work schedule resulting from these written requests are not subject to the advance notice requirements of this law. Predictive schedule pay For schedule changes made with less than seven days advance notice (14 days beginning July 1, 2020), employers may be required to provide employees with predictive scheduling pay. Where an employee accepts such a schedule change, employers must pay employees for one hour at their regular rate of pay if the employer schedules the employee for an additional work-shift or on-call shift, or if the schedule change: Adds more than 30 minutes of work to the employee s work shift; or Changes the start or end time of the employee s work shift with no loss of hours. The employer must pay the employee at ½ the employee s regular rate of pay for each hour the employee does not work due to the employer: Subtracting hours from the employee s work shift for non-exempt reasons; Changing the date, start time, or end time of the employee s work shift for non-exempt reasons; Cancelling the employee s work shift for non-exempt reasons; Not asking the employee to work when the employee is scheduled for an on-call shift. The employee s regular rate of pay for purposes of predictive scheduling pay shall be determined as follows: (a) For employees paid on the basis of a single hourly rate, the regular rate of pay means the same hourly rate the employee earned for work performed during the pay period. (b) For employees who are paid multiple hourly rates of pay, the regular rate of pay means the hourly rate of pay the employee was to be paid for: (A) The work period or shift that commences prior to the required 10-hour rest period having been satisfied when the employee is required to be compensated for work performed during a rest period required by the predictive scheduling law; or (B) Work performed during the work period or shift affected by the employer-requested change in schedule when the employee is required to be compensated for a work schedule change pursuant to the predictive scheduling law; or (C) When the employee earns multiple hourly rates of pay during the work period or shift, the weighted average of the hourly rates of pay for the work period or shift. 12

13 Tech Flex: July 2018 Volume VII 13 (c) For employees paid a salary, the regular rate of pay means the employee s total wages earned during the pay period covered by the salary divided by the number of hours agreed to be worked in the pay period which the salary is intended to compensate. For an employee paid a salary whose hours of work vary from work week to work week, the regular rate of pay is determined by dividing the amount of the salary by the number of hours worked in the pay period. (d) For employees paid on a commission or piece-rate basis only, the regular hourly rate of pay is determined by adding together the total earnings for the pay period and dividing this sum by the number of hours worked during the pay period. (e) For employees paid an hourly, weekly or monthly wage and also paid on a commission or piece-rate basis, the regular rate of pay means the rate of pay equivalent to the employee s hourly, weekly or monthly wage. (f) For employees who are scheduled to work on an on-call basis, the regular rate of pay means the rate of pay the employee will earn when called in to perform work. (g) The regular rate of pay does not include: (A) Overtime, holiday pay, or other premium rates. However, where an employee s regular rate of pay includes a differential meant to compensate the employee for work performed under differing conditions (for example, a shift differential for working at night), such a differential rate is not considered to be a premium; (B) Bonuses or other types of incentive pay; (C) Tips; or (D) Any additional compensation an employer is required to pay an employee as predictive schedule pay. When predictive schedule pay is NOT required Employers are not required to pay employees for short notice schedule changes that are the result of the following: Subtraction of hours due to discipline of the employee; Threats to employees or property; Failure of public utility; Natural disaster or similar causes; Change or cancellation of ticketed events; or Use of voluntary standby list Right to rest between shifts Employers may not schedule or require employees to work for a period of ten hours following the end of the previous calendar day s shift; or within the first ten hours following the end of a shift spanning 2 calendar days without the employee s consent. If the employee consents, the employer must compensate the employee at 1.5 times the 13

14 Tech Flex: July 2018 Volume VII 14 employee s regular rate of pay for all hours worked within the mandated rest period. The mandatory rest period rule does not apply if the split shift is entirely within 1 calendar day. Right to have input into work schedule Employees have the right to identify any limitations or changes in work schedule availability and also may request not to be scheduled for work shifts during certain times or at certain work locations. Employers are not required to honor these requests, however, they may not retaliate against employees for making them. Notice and posting requirements Employers must display a poster, which will be developed by BOLI, giving notice of the rights and responsibilities of this law. The poster must be posted in a conspicuous place at the workplace or provided on an individual basis if displaying the poster is not feasible. Also, the employer is required to post the written work schedule in a conspicuous and accessible place, in English and in the language the employer typically uses to communicate with the employees. Recordkeeping requirements Employers must retain records demonstrating their compliance with the law for 3 years. Technical assistance from the BOLI can be found at this link: The final rules implementing the law can be found at this link: A link to the text of the law can be found at this link: A link to the poster employers are required to display can be found here: ADP does not make any representation or warranty that the information contained in this newsletter, when used in a specific and actual situation, meets applicable legal requirements. This newsletter is provided solely as a courtesy and should not be construed as legal advice. The information in this newsletter represents informational highlights and should not be considered a comprehensive review of legal and compliance activity. Your legal counsel should be consulted for updates on law and guidance that may have an impact on your organization and the specific facts related to your business. **Please note that the information provided in this document is current as of the date it is originally published.** 14