Articles Posted in

Yesterday, we reported in our blog, What Happened to those Federal Rules Revising the White Collar Exemption to Overtime Pay?, that Solicitor of Labor, M. Patricia Smith, had announced at an American Bar Association conference that the proposed rules revising the salary levels for the white collar exemptions under the Fair Labor Standards Act would not be finalized earlier than late 2016.   Nevertheless, according to the semiannual regulatory agenda (Fall-2015) published by the Office of Management and Budget (OMB), the proposed rules are scheduled to be finalized in July 2016, thereby rendering it likely that they will be in effect at some point toward the end of the third quarter of 2016.  Did Solicitor Smith misspeak or is the OMB overly-optimistic?  We will know soon enough.



Our July 2015 blog, Department of Labor Publishes Long Awaited Proposed Rules Revising White Collar Exemptions to Overtime, reported that the U.S. Department of Labor had released for public comment modifications to the “white collar” exemptions to overtime pay under the Fair Labor Standards Act (FLSA).  The public comment period for these proposed rules ended on September 4, 2015, and resulted in approximately 270,000 comments, which the Wall Street Journal reported was more than three times the number of comments received during a prior rule change in 2004.  Employers and employees expected that the new rules would be finalized by the end of 2015 or at the latest, early 2016.  However, during the American Bar Association’s Labor and Employment Law conference held in Philadelphia this month, Solicitor of Labor, M. Patricia Smith, announced that the final rules would likely not be issued sooner than late-2016.  She attributed the delay to the large volume of comments received on the proposed rules, which the Department of Labor is still reviewing.

The proposed regulations provide for an increase of the minimum salary level required to qualify for the white collar exemptions to overtime pay.  Currently, to qualify for the exemption, a white collar employee must be paid a salary of at least $455 per week ($23,660 per year), in addition to satisfying a duties test detailed in the regulations.  The proposed modifications dispense with stating a set salary amount, and instead seek to tie the salary level requirement to the 40th percentile of weekly earnings.  Assuming that the rules became effective in 2016, although 2017 is becoming more likely,that would translate to a salary level of $970 per week ($50,440 per year).  The higher salary level will result in millions more employees being deemed non-exempt, and therefore entitled to overtime pay.

If you have any questions regarding the proposed regulations or issues relating to the FLSA, you can contact Salvatore Gangemi .



As the end of the year rapidly approaches, new statutes affecting employers and employees are set to become effective.  Among them is a New York City ordinance, titled “Mass Transit Benefits Law,” which requires every employer with twenty or more full-time employees in New York City to offer those full-time employees the option to use pre-tax earnings to purchase “qualified transportation fringe benefits,” except for qualified parking.   The law defines “full-time employees” as “employees who work an average of thirty hours or more per week for such employer for such period of time as the commissioner establishes by rule.”  Although final rules have not been published, the proposed rules provide that to qualify as a full-time employee, the employee must have worked an average of 30 hours or more per week in the most recent four weeks, any portion of which was in New York City, for a single employer.”

The law entitles only those employees who are eligible to receive “qualified transportation fringe benefits” under the Internal Revenue Code to be offered the option to purchase them.  Consequently, the ordinance does not require employers to offer such pre-tax transportation benefits to independent contractors, partners and two percent shareholders of S-corporations.  Should the Internal Revenue Code redefine the meaning of qualified transportation fringe benefits at some point in the future, that revision would  apply to the New York City ordinance also.

Temporary help firms are specifically addressed in the proposed regulations , because their employees are generally sent to work at various locations and employers.  According to the ordinance, a temporary help firm that provides a full-time employee to another organization will be the employer for purposes of complying with the statute, even if the organization/client does not have the requisite number of employees to fall within the statute’s coverage.  In determining hours worked each week by an individual employed by a temporary help firm, the employer is required to aggregate the number of hours worked by the employee in the most recent four weeks at all placements.

In our July 6, 2015 Blog, New York City Mayor De Blasio Signs Ban-the-Box Legislation, we wrote about New York City’s enactment of the Fair Chance Act (FCA), which amends the New York City Human Rights Law (NYCHRL) to prohibit most New York City employers from inquiring into or otherwise considering an applicant’s criminal history prior to making a conditional offer of employment.   Last week, on November 5, 2015, the New York City Commission on Human Rights (NYCCHR) published its Interpretative Enforcement Guidance on the FCA, which purports to clarify the Act’s requirements and prohibitions.  In addition, the NYCCHR has prepared forms and notices for use by employers in complying with the FCA’s mandates.

The Interpretative Enforcement Guidance  reaffirms that the FCA does not prevent employers from inquiring into an applicant’s criminal history where state, federal or local law requires criminal background checks for a position.  It also clarifies the meaning of “conditional offer of employment.”  For example, a conditional offer of employment for temporary/help firms is “the offer to be placed in a pool of applicants from which the applicant may be sent to temporary positions.”

Importantly, the Interpretative Enforcement Guidance sets forth a list of separate per se violations of the FCA:

Section 193 of the New York Labor Law (NYLL) prohibits an employer from deducting amounts from an employee’s wages, except for amounts that are both for the benefit of the employee and are approved by the employee in writing.  In July 2012, we wrote about the narrow scope of permissible deductions under Section 193.  Such charges were generally limited to insurance premiums, pension contributions, union dues and similar payments.  As we wrote in our September 14, 2012 blog, New York Governor Signs Legislation Broadening Scope of Permissible Wage Deductions under New York Labor Law,  section 193 of the NYLL was amended to permit additional types of deductions to which an employee could consent.

Permissible charges under the 2012 amendments included (i) purchases at charitable events; (ii) discounted parking and mass transit charges; (iii) gym dues; (iv) employer-provided vending machine, cafeteria and pharmacy purchases; (v) tuition and boarding fees for educational institutions; (vi) some child-care expenses; and (vii) payments for certain types of housing provided by non-profit hospitals.

In addition, the 2012 amendments provided a mechanism through which employers could recover overpayments and loans to employees through wage deductions.  Prior to the 2012 amendments, employers were barred from recovering overpayments and loans through wage deductions completely, even if the employee consented to them.  The 2012 amendments still require employers to implement a policy and procedural mechanism to recover overpayments and loan payments, which comport with Section 193’s requirements.

Last month, Governor Cuomo signed five bills into law that strengthen New York law’s prohibitions against sexual discrimination. Each of these bills form a part of the Women’s Equality Act, and collectively address such areas as equal pay for equal work, sexual harassment, familial status discrimination, attorneys’ fees in sexual discrimination and sexual harassment cases, and reasonable accommodations for pregnant employees. The laws, which are described below, will take effect on January 19, 2016.

Pay Equity

Although New York law already prohibits employers from paying women less than men for performing the same work, the bill strengthens such prohibitions by (1) making it unlawful for an employer to prohibit employees from sharing their wage information with each other, thereby enabling employees to determine whether there exists a salary disparity between them and their coworkers; (2) requiring an employer to show that pay differentials between men and women are due to “a bona fide factor other than sex, such as education, training and experience,” and otherwise limiting the circumstances under which pay disparities between men and women might be permitted; (3) increasing the amount of damages in cases of sexual pay disparities based upon sex from 100% liquidated damages to 300%.

Contact Information