Archive for the FLSA

Never Ever Retaliate

The Department of Labor has published new FLSA and FMLA Fact Sheets, emphasizing that both laws prohibit retaliation against those who file complaints under either law.

Here’s the FLSA sheet and here’s the FMLA sheet.

Retaliation has now become the #1 most common discrimination complaint filed with the EEOC. Please please please never ever retaliate.

(Special thanks to Eric Meyer for bringing this to the Blawg’s attention.)

Even Lady Gaga Must Pay Overtime

Employment law lessons are truly everywhere.

Wage & Hour Insights is reporting on a new lawsuit filed against Lady Gaga by her former personal assistant. In short, the plaintiff claims that she is owed several hundred thousand dollars because Lady Gaga failed to pay her overtime.

The Lawsuit

The complaint describes a 24-hour non-stop cycle of Gaga-ness, including allegations that the plaintiff:

  • worked “not only in [Lady Gaga's] home, but also during her travels for her global concert tours, from city to city throughout the world, at locales including stadiums, private jets, fine hotel suites, yachts, ferries, trains and tour buses”
  • “was always behind the scenes, and figuratively, if not literally, always at her side”
  • “was on duty during all hours of each twenty-four (24) day, with no entitlement to breaks, for meals or otherwise, or, at times, even sleep”
  • was responsible for keeping Lady Gaga “on her desired schedule from the earliest waking hour, for being responsive to the slightest need throughout the day, and for addressing spontaneous, random matters in the middle of the night”
  • was also responsible for “ordering meals and ensuring that they were correctly prepared and served at specific times; maintaining the availability of [defendant's] personal supplies; ensuring the availability of chosen outfits; ensuring the promptness of a towel following a shower; and serving as a personal alarm clock to keep [defendant] on schedule”

Wow.

The Lessons

All employers (even celebrity superstars who demand 24-hour attention including “towel promptness”) need to know the ins and outs of the Fair Labor Standards Act.

Never ever assume that an employee is exempt from overtime just because they’re paid a salary. And always always always carefully follow FLSA record-keeping and other requirements. If you don’t, you could be facing claims for backpay, damages and penalties far exceeding the original amount owed.

Click here for our handy FLSA Cheat Sheet to help you stay out trouble.

Wage & Hour Big 10 Answers

Here are the answers to yesterday’s Wage & Hour Big 10. We asked . . .

Which of the following must employers pay?

  1. On-call time
  2. Commute time
  3. Wait time
  4. Changing into and out of uniform if required at work
  5. Donning and doffing safety gear
  6. Walking between changing and production areas
  7. Rest periods of 30 minutes or less
  8. Bona fide meal periods of 30 minutes or more
  9. Travel during the course of the work day
  10. Travel outside work hours

The Answers

Generally speaking, employers must compensate Items 4, 5, 6, 7 and 9. (As always, check with your favorite employment lawyer familiar with your state’s laws before making any changes to your policies and procedures.)

Stay tuned for more wage & hour tools & tips in the coming days. In the meantime, here’s our handy FLSA Cheat Sheet for your perusal.

Wage & Hour Big 10

As we discussed yesterday, wage & hour issues are the undisputed #1 scary-lawsuit-producing employment law issue on the planet right now.

The following is a little test of your knowledge of the “Wage & Hour Big 10.” If you master these, you’ll be well on your way toward a future free of FLSA foibles.

Which of the following must employers pay?

  1. On-call time
  2. Commute time
  3. Wait time
  4. Changing into and out of uniform if required at work
  5. Donning and doffing safety gear
  6. Walking between changing and production areas
  7. Rest periods of 30 minutes or less
  8. Bona fide meal periods of 30 minutes or more
  9. Travel during the course of the work day
  10. Travel outside work hours

Tune in tomorrow for the answers.

Wage & Hour Woes

Wage and hour lawsuits continue to dominate the employment law headlines with seemingly no end in sight.

What can you do to avoid your company being the next target? We’re here to help. Over the next several weeks, we’ll be providing the latest tools and tips and answering your questions to help keep you out of trouble.

Today, we’ll start with some key facts . . .

Latest Stats & Hot Spots

  • The overall $$$ amount of class action settlements increased four-fold last year.
  • Employers idenitifed wage & hour suits as #1 in both current cost and anticipated increase.
  • Wage & hour “hot spots” include:
    • Overtime misclassifications (especially administrative)
    • Independent contractor misclassifications
    • Off-the-clock (pre-/post-shift work, computer logon/logoff, checking email to get assignments, etc.)
    • Tip-pooling
  • Rest / break / meal period claims are expected to decrease slightly.

Enforcement, Enforcement, Enforcement

Now is not the time to violate the FLSA. Last year, the Department of Labor hired 200+ new Wage & Hour Compliance Officers to enforce compliance. It also invested $25+ million and and hired 100 DOL enforcers to target independent contractor misclassifications.

Also notable is the government’s new “We Can Help” Campaign in which it’s running public service announcements encouraging potential claimants to come forward. In addition, a joint DOL/American Bar Association program was recently launched to connect employees with FLSA lawyers.

OK, I’m scared. Where should I start?

Click here to access our patented FLSA Cheat Sheet. Study it intensely and then stay tuned for more on this critical subject.

Sources: ManpowerGroup, Seyfarth Shaw, Fulbright & Jaworski, Jury Verdict Research

The Supremes on Retaliation

The following is everything you could ever possibly want to know about the Supreme Court’s recent ruling in Kasten v. Saint-Gobain Performance Plastics Corporation.

The Question

Does the Fair Labor Standards Act (FLSA) provision that prohibits retaliation against employees who “file” a complaint cover verbal complaints?

The Answer

Yes

The Facts

Kasten was employed in Saint-Gobain’s Portage, Wisconsin facility. He was repeatedly warned and then discharged for violating company time clock policies.

Kasten filed a lawsuit alleging that he was discharged in retaliation for making verbal complaints to his supervisors and HR in which he asserted that the location of the company’s time clocks prevented employees from getting full credit for time spent “donning and doffing” protective gear. Kasten never put his complaints in writing and never complained to any government agency.

The Law

The FLSA’s anti-retaliation provision forbids employers from discharging an employee “because such employee has filed any complaint” alleging a violation of the statute.

The Lower Courts

Saint-Gobain argued that to “file” a complaint under the FLSA means to put it in writing. The district court agreed and granted the company’s motion for summary judgment.

The Seventh Circuit affirmed, stating that the employee’s informal complaints did not constitute protected activity under the “plain language” of the statute.

The Supremes

The Supreme Court reversed the Seventh Circuit and remanded the case, ruling 6-2 that “filed any complaint” includes both verbal and written complaints. Justice Breyer delivered the Court’s opinion, with Justices Alito, Ginsburg, Kennedy, Roberts and Sotomayor joining. (Justice Kagan did not participate.)

The Dissent

Justice Scalia dissented, arguing that the language in the statute does not cover internal complaints made only to an employer and that an employee must complain to a government agency to be protected. Justice Thomas joined in all but one footnote of the dissent.

The Supremes’ Reasoning

The Court disagreed with the Seventh Circuit’s opinion that the answer could be found within the “plain language” of the statute. Instead, it relied heavily on previous interpretations by federal agencies that have consistently interpreted the “filed any complaint” language to include verbal complaints. It also expressed concern that protecting only written complaints would: (1) be unfair to less educated employees, (2) prevent government agencies from using verbal methods of receiving complaints (e.g., hotlines and interviews) and (3) discourage employers from using informal grievance procedures.

The Test

The Court established a “fair notice” test for determining when a verbal complaint is “filed” for purposes of the FLSA: it “must be sufficiently clear and detailed for a reasonable employer to understand it, in light of both content and context, as an assertion of rights protected by the statute and a call for their protection.”

The Implications

This case is the third this year in which the Supreme Court has expanded employee rights. In January, the Court extended Title VII’s anti-retaliation provision to those “associated” with a complaining employee. In March, the Court confirmed the “cat’s paw” theory of liability, which makes a company potentially liable for the discriminatory motives of a supervisor even if (1) the supervisor played no role in the decision under consideration and (2) the decision-makers themselves had no discriminatory intent.

What Should You Do?

Employers should:

  • take all complaints seriously whether verbal or in writing;
  • train managers to forward any and all complaints to HR and/or the appropriate level of management for handling;
  • require employees to document all complaints (or have HR document the complaints and require employees to sign off); and
  • refrain from taking any retaliatory action against an employee who makes a complaint.

For all you legal gurus out there who would like to read the Court’s opinion in its entirety, click here. Enjoy!

What Are “Clothes”?

Seems like a simple enough question, but it’s one that has resulted in lots and lots of litgation under the Fair Labor Standards Act (FLSA).

In a move that generated very little discussion in the employment law/HR universe, the Department of Labor (DOL) recently clarified exactly what “clothes” means under Section 203(o) of the FLSA. That section states that time spent “changing clothes or washing at the beginning or end of each workday” does not constitute compensable time if it is excluded by the “express terms or by custom or practice” of a collective bargaining agreement.

In its new interpretation, the DOL has announced that the exclusion “does not extend to protective equipment worn by employees that is required by law, by the employer, or due to the nature of the job.” For five scintillating pages on what “clothes” are and aren’t, click here.

Exempt/Non-exempt Cheat Sheet

A number of people have asked where they can find the Exempt/Non-exempt Cheat Sheet referenced in yesterday’s webinar. Ask and you will receive: FLSA Cheat Sheet.

For future reference, all of our cheat sheets are located on the left side of the Blawg under “Tools & Tips.’

Enjoy!

Interns: Next Enforcement Target

Got any interns? If so, the federal government may soon be knocking on your door.

Internships “Mushrooming”

Given intense cost-cutting pressures and the scarcity of jobs for college students and others, the number of internships is “mushrooming,” according to Lance Choy of Stanford University’s Career Development Center.

Based on a study by the National Association of Colleges and Employers, 83% of recent college graduates had internships, a humongous leap from the 9% in 1992. Some experts estimate that as many as one-half of internships are unpaid.

Increased Enforcement

M. Patricia Smith, the DOL’s top enforcement official, has a history of targeting unpaid intern abuses in her previous post as New York’s Labor Commissioner. Under her watch, the DOL is upping enforcement, as well as education of companies, colleges and students.

“If you’re a for-profit employer or you want to pursue an internship with a for-profit employer, there aren’t going to be many circumstances where you can have an internship and not be paid and still be in compliance with the law,” said Nancy Leppink, Acting Director of the DOL’s Wage and Hour Division.

When Is an Intern Not an Intern?

The DOL applies a six-factor test to determine whether an intern or trainee is subject to the Fair Labor Standards Act (FLSA). Here’s language straight from a recent DOL Training and Employment Guidance Letter:

The U.S. Department of Labor’s Wage and Hour Division (WHD) has developed the six factors below to evaluate whether a worker is a trainee or an employee for purposes of the FLSA:

  1. The training, even though it includes actual operation of the facilities of the employer, is similar to what would be given in a vocational school or academic educational instruction;
  2. The training is for the benefit of the trainees;
  3. The trainees do not displace regular employees, but work under their close observation;
  4. The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded;
  5. The trainees are not necessarily entitled to a job at the conclusion of the training period and;
  6. The employer and the trainees understand that the trainees are not entitled to wages for the time spent in the training.

If ALL of the above factors are met, then the worker is a “trainee,” there’s no employment relationship under the FLSA and the FLSA’s minimum wage and overtime rules don’t apply.

Click here for the full text of the guidance letter and here for more on this issue from the The New York Times.

Furlough Facts

We’ve gotten several questions about the rules around furloughs and other reductions in pay. The Department of Labor has issued a timely new guidance entitled Frequently Asked Questions Regarding Furloughs and Other Reductions in Pay and Hours Worked Issues.

Here are the highlights . . .

If an employer is having trouble meeting payroll, does it still need to pay non-exempt employees on the regular payday?

Yes. Failure to do so violates the Fair Labor Standards Act (FLSA).

Is it legal for an employer to reduce the wages or hours of hourly employees?

Yes, as long as minimum wage and overtime laws are followed.

Does an employer need to pay an hourly employee for a full day of work if s/he was scheduled for a full day but only worked a partial day due to lack of work?

No. The FLSA does not require employers to pay non-exempt employees for hours not worked.

Can an employer reduce an exempt employee’s salary due to a slowdown?

Reductions in an exempt employee’s salary normally causes a loss of exemption, requiring payment of overtime and minimum wage. However, in some cases, a prospective reduction may not cause a loss of the exemption so long as other FLSA tests are met. (I’ll be posting more specifics on this particular question soon.)

Can an employer reduce the leave of a salaried exempt employee?

Generally, yes, provided that the employee still gets paid his/her salary in any week in which work is performed.

Can an exempt employee volunteer to take time off due to lack of work?

Yes (but it must be truly voluntary).

Can an employee still be on-call or performing work at home during a furlough day?

Whether on-call time is hours worked depends on the circumstances. Generally, if an employee is “engaged to wait,” it’s work time. If the employee is only “waiting to be engaged,” it’s not.

What are the penalties for violations?

Potential penalties include back wages and liquidated damages in an equal amount, plus interest, attorneys’ fees and court costs. Willful violations may result in criminal penalties, including fines and imprisonment.

(Special thanks once again to the Connecticut Employment Law Blog)