Not to Be Labor the Point

Transcription

1 Not to Be Labor the Point Eric S. Crusius, Esq. Miles & Stockbridge Bill Walter, Partner DHG 1

2 Agenda Introductions Minimum wage requirements New SCA Wage Determinations and Labor Categories Misclassification issues Coming soon: Fair Pay Safe Workplaces Coming soon: New sick leave requirements Coming soon: New OT exemptions Coming Soon: New EEO-1 Disclosures 2

3 Speaker Information Eric S. Crusius, Esq. Miles & Stockbridge, P.C. (703) Bill Walter, Partner Dixon Hughes Goodman, LLP (703)

4 Minimum Wage: Effective Now $10.15 minimum wage for employees. Minimum wage regulation must be in the contract: applies only to certain contracts including SCA and DBA contracts. Includes employees working on the contract and those supporting the contract (including employees not usually covered by SCA or DBA). Wage increases automatically every year. 4

5 New SCA Wage Determinations and Labor Categories DOL is using new data sources for WDs. Wages will inevitably rise and WDs will cover smaller areas. Updates are only effective when WD is in your contract. New labor categories also added including: Customer Service Representative (no doubt to help with Affordable Care Act contracts); Substance Abuse Treatment Counselor; System Support Specialist; Aircrew Life Support Equipment Mechanic; Background Investigator; Single Point Entry Monitor; Cryogenic Technician; and Evidence Control Specialist. 5

6 Misclassification Misclassification is one of biggest complaints at DoL. Two types of misclassification: exempt v. non-exempt and employee v. independent contractor. Exempt employees must: 1. Paid on a salary basis (not hourly unless computer employee), 2. Salary must be at least $455 per week, and 3. Must meet the duties test. 6

7 Coming Soon: Fair Pay Safe Workplaces Executive Order signed on July 31, Proposed rules issued May 28, Final expected any day. Requires contractors to disclose violations of one of 14 federal labor laws and state equivalents that occurred in the last three years when bidding on a contract worth >$500,000. If apparent awardee, contractor must disclose actual violations and mitigating information. If awarded contract, contractor must disclose new violations every six months. 7

8 Coming Soon: Fair Pay Safe Workplaces What companies are doing to prepare: Creation of systems to track potential labor law violations Analyze potential labor law violations and potential resolutions Critical compliance headaches: Tracking minor violations Gathering information from subcontractors and reporting Prominent availability of labor law violation information Expect effective date of August 2016-January

9 Coming Soon: Fair Pay Safe Workplaces Primes are responsible for subcontractors. Violations include administrative merits determinations, civil judgments, and arbitration award or decision whether final or not. Three year look-back is keyed to determination date. Prior to awarding the contract, agency must make responsibility determination (using Agency Labor Compliance Advisors, or ALCAs) prior to award. Contractors may be referred to suspension and debarment, be required to sign a labor compliance agreement, or recommended for award. 9

10 Coming Soon: New Sick Leave Requirements Applies to certain services or construction contracts beginning January 1, Provides one hour of sick leave for every 30 hours worked (at least 56 hours per year for FTEs). Sick leave is not paid out upon termination, but must be reinstated if employee returns within 12 months. Sick leave must carry over. Can be used for own illness, care for close relative, certain court appearances, and counseling. Additional requirement to SCA and DBA. 10

11 Coming Soon: DOL Proposed Rule 29 CFR 541 Now: Exempt status requires salary of $455 per week/23,660 annually. Proposed: $921 per week/$47,892 annually. (likely will be higher). Now: For highly compensated employees, annual salary requirement is $100,000. Proposed: $122,148 annually or 90 th percentile of annualized weekly earnings. DOL wants an annual index for exempt salary requirements to keep a meaningful distinction between exempt and non-exempt employees. 11

12 Coming Soon: New EEO-1 Disclosures Proposed rule issued February 1, 2016 with comments due April 1, Would be effective beginning with Sept report. Would be applicable to companies and contractors with more than 100 employees. Contractors with employees would be exempt from requirements. Would require additional disclosure of W-2 earnings and hours worked. Open question: How will OFCCP use the data? 12

13 Issues in Focus Webinar Series Questions? 13

14 Join Us Next Month June 8, 2016 from 11:00 AM 12:00 PM for GSA Schedules a Checklist of High Risk Audit Areas: Issue Prevention, Detection and Remediation 14