With the increased minimum wage in New York, the Minimum Wage Poster will change, and a new poster should be hung as close to December 31st as possible (ideally on the first business day after). The New York Department of Labor makes all of its posters available free of charge and a link to the PDF of the new poster is here.
Posts tagged: Labor & Employment
An interesting case out of Massachusetts raised some questions about what an employee subject to a non-solicitation agreement can do. The employee announced her new position on her LinkedIn profile, and her former employer sued because among her followers were some of her now-former clients. The employer argued that this posting solicited her clients to come do business with her.
The court in this case was able to make a ruling based on other issues, and did not have to get into the LinkedIn issue. However, it put both employers and employees on notice – announcements on social media (be it LinkedIn, Facebook, or Twitter) can violate agreements and should be carefully considered. For employees, whenever you leave a job to start a new one, you should review any restrictive covenants that you signed (non-compete agreements, non-disclosure agreements, and non-solicitation agreements) to see what you are able to do. If there are limits on your ability to make public announcements, or if you have followers who are in a restricted group (either now-former co-workers or clients of the previous company), you may want to restrict the announcement to ensure that only people who can see your new job are able to. It will take you more time to set up, but it will be time spent saving yourself from a lawsuit.
On December 31, 2013, New York’s Minimum Wage will increase to $8.00 per hour. As of the last day of the year, any employee must make at least that amount. Waiters and other food service tipped employees see no change in their base amount, as the tip credit will increase with each change in the minimum wage.
On January 1, 2014, Florida’s Minimum Wage will increase to $7.93 for non-tipped employees. This is part of Florida’s annual readjustment of the minimum wage based upon inflation. As the Florida tip credit remains the same, the direct wage that employers must pay tipped employees will increase to $4.91.
Election Day is this coming Tuesday (November 5). Employers are supposed to ensure that their employees have enough time to vote. Employees who gave notice by Sunday (Friday was the last working day) are entitled to up to two hours off with pay to vote. The two hours come either at the beginning or the end of their shift.
This only applies to employees who must be at work within 4 hours of polls either opening or closing. Polls open at 6AM and close at 9PM.
This past week, new rules from the Department of Labor went into effect. These rules make some changes to the way employee deductions can be made – now there are five broad categories of permitted deductions. The first three are unchanged.
- Required deductions – these are deductions for state and federal taxes, as well as any other deductions required by law, such as garnishments.
- Union dues
- Deductions for the employee’s benefit – this includes health insurance, day care, and other company-provided services where the employee receives a benefit. Services that are for the employee’s convenience (such as check-cashing) are not considered a benefit and fees cannot be charged/deducted. While this regulation is unchanged, the DOL has provided additional clarification and categories of employee benefit.
The two new ones are:
- Repayment of salary advances
- Repayment of overpayment of salary
Both categories require the employee to be told how the deduction will be made. In the case of the salary advance, the employee must be given the terms of the advance (how much will be advanced, how much each deduction from future wages will be, when the deductions will cease) ahead of time. In either case, employers must have a written grievance procedure and, if the deduction is grieved, the employer must halt deductions. For salary advances, it is also important to be aware that the employer cannot charge interest under this program.
The new regulations do not change many existing rules – for example, employers still cannot fine employees for tardiness or other workplace rule infractions and take those fines out of employee salaries directly. While you can discipline employees for these infractions with suspensions or firing, you cannot make them work while deducting salary.
Most employers are aware that the Internal Revenue and the Departments of Labor (both federal and New York State) are reviewing companies and their determinations of whether individuals are Independent Contractors or Employees. Employers must also be aware that the Departments of Labor are also vigorously investigating wage/hour complaints, for failure to properly pay employees.
A “wage/hour” complaint can be two-fold. It can be for failure to pay for the hours worked and/or the failure to pay overtime. These investigations are generally started by a complaint by an employee (or ex-employee). An employee must be paid for all of the hours that he or she works. Issues can arise for “non work” hours, such as if the employee is required to be on call or getting ready for or cleaning up from work.
The general rule is that all hourly employees must be paid time and one-half for all hours worked over 40 in a pay week. The overtime issue generally arises when employees are paid a flat salary. This is fine for executive and professionals, but the issue lies with administrative employees. First, the employee must have a salary of at least $455 per week. This applies to all employees under the flat salary exemption. In addition “the employee’s primary duty (must) include the exercise of discretion and independent judgment with respect to matters of significance”. If the wage and “discretion and independent judgment” tests are not met, then the employee must receive overtime for hours worked over 40 during a pay period. You must review if the employee is a true “salaried” employee. If the employee is “docked” for hours or days not worked, they may not be a true flat salary employee. There are a number of other factors that need to be considered for employees to be exempted from the overtime requirement for the “salaried employee” classification.
The employee has the right to sue the employer directly and if the employee is awarded any money (even $1) for unpaid wages or overtime, the employer is responsible for paying the employee’s legal fees. This would be in addition to any penalties assessed by the Department of Labor.
Businesses should create a “policy” and procedures for its calculation of wages and overtime. In addition, it should review all employees to whom overtime is not paid to make sure that that determination is accurate.
On Wednesday, I posted about a recent Supreme Court decision discussing who is a supervisor. On the same day, the New York Court of Appeals (the highest court for the state), issued an opinion regarding that same question but in a different context.
Starbucks is currently involved in two lawsuits over its practice of pooling tips, and the tip jars that are on all of the counters. The money collected in those jars is distributed to the baristas and the shift supervisors, based upon the number of hours worked in a given week. Some of the baristas sued, claiming that the shift supervisors were ineligible. On the tails of that lawsuit, a second one was filed by assistant store managers, claiming that they should be part of the tip pool. The cases made their way to the Second Circuit Court of Appeals, which asked the New York Court of Appeals for an advisory opinion regarding the language in Labor Law section 196-d
The opinion first lays out the duties of the four levels of personnel at Starbucks. Baristas are the front-line staff who take orders and serve drinks. Shift supervisors, the next level up, are primarily front-line staff; however, they do have the ability to serve in a limited management role – if a higher-level manager is not present, they can open or close the store, or close out the registers in the evening. They also have the power to assign the baristas to stations during the shift and can provide some feedback to baristas. Assistant store managers have the ability to set shifts, hire and fire employees, approve payroll and handle employee discipline. While they also are in primarily customer-service roles, they have additional powers over all other employees. The store manager is in charge of the entire operation. The court also noted that, unlike baristas or shift supervisors, assistant store managers are full-time, salaried employees who qualify for benefits and bonuses.
The court then discusses whether shift supervisors or assistant store managers are considered “agents” of the company, who would be ineligible for sharing in the tips. Because of the duties assigned to them, shift supervisors are not considered to be agents, but assistant store managers are. Without referencing the Supreme Court’s decision issued shortly before this was released, the New York Court of Appeals came to a similar conclusion. A supervisor, who is ineligible for a tip pool, is an employee who has the authority to make major employment decisions.
This decision will be important when looked at in conjunction with the Supreme Court decision in Vance. It will also be important, however, for restaurants, as it limits the ability of owners and managers, who may also be waiting on tables, from accepting the tips that they are given. Restaurants will need to come up with policies for handling these issues. Stores with tip jars will also need to ensure that only employees, and not supervisors, are sharing in pooled tips.
When dealing with a harassment claim, the liability of the company depends in large part, on the relationship between the harasser and the victim. When a co-worker is the harasser, then the employer is only liable when it takes no action. However, if the harasser is a supervisor of the victim, then the employer immediately has liability.
The definition of a supervisor was narrowed significantly by the Supreme Court in a decision this week, when it issued its ruling in Vance v. Ball State University. Where lower courts had sometimes found that the harassing employee could be deemed a supervisor whenever he had power of any kind over the victim, including the ability to assign normal work duties, this decision changed that. The Supreme Court ruled that a supervisor is someone who has direct authority over an employee. This means that an employee who does not exert control over the victim for purposes such as hiring and firing is not considered a supervisor. An employee who can simply exert some day-to-day control over the victim is not a supervisor.
This does not mean that a co-worker harassing another employee allows the employer to ignore the issue. Once an employee reports any type of harassment, whether it be from a co-worker or a supervisor, the employer is then on notice and a failure to respond appropriately could lead to a lawsuit, no matter who the harasser is. It is important that employers use an employee handbook to set out policies and procedures for dealing with harassment claims. It is equally important that, if a claim is made, the employer follows the policies and procedures that have been established. Outside counsel should also be alerted, and brought in, whenever there is a harassment complaint. Most importantly, however, the employer needs to act as neutrally as possible – bias towards one side or the other, even if it is merely perceived, could end up causing problems later on.