FLSA Overtime Rule Changes Finally Released

Posted by Bud O'Donnell on Wed, Jul 20, 2016 @ 04:14 PM

On May 18, 2016, the U.S. Department of Labor finally released its rules updating the overtime regulations under the Fair Labor Standards Act (“FLSA”) which will take effect December 1, 2016.  Not surprisingly, the updates significantly increase the salary threshold for executive, administrative and professional workers (“white collar employees”) and for highly compensated employees and include automatic updates to these thresholds going forward.

Under the new rules, any employee earning less than $47,476 a year ($913 a week) will be a covered non-exempt employee entitled to overtime. This new threshold, up from $23,660 ($455 a week), equals the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region.  Additionally, unlike the previously static threshold, the new rules will be adjusted upward every three years to reflect cost of living adjustments with the first update taking effect on January 1, 2020. 

 The new rule also increased the total annual compensation threshold for highly compensated employees from an annual salary of $100,000 to $122,148 (linked to 90th % percentile of earnings of full-time salaried workers in the lowest-wage Census Region).  Connecticut employers should not rely on this change as Connecticut does not recognize the highly compensated employee exemption.

 Although the new rules do not change the “duties test” under the FLSA, they do amend the “salary basis test” to allow employers to credit nondiscretionary bonuses and incentive payments (including commissions) towards satisfying up to 10% of the new salary threshold, so long as employers pay those amounts on a quarterly or more frequent basis.

 Given the new rules, employers must now either raise salaries of affected employees to meet the new threshold or begin treating these employees as nonexempt.  Employers must ensure that all “exempt” employees meet the duties tests for their applicable exemption and earn a salary that is high enough to satisfy the new threshold.  Employers should also take this opportunity to confirm that each “exempt” employee actually performs duties that meet their applicable exemption, regardless of the employee’s title or job description.

New Connecticut Law Regulates Employer’s Online Activity

Posted by Meredith Diette on Thu, May 21, 2015 @ 05:35 PM

As if the National Labor Relation Board’s aggressive expansion of social media protection wasn’t enough, Connecticut businesses must now contend with new legislation targeting employer’s online activity. On May 19, 2015, Governor Malloy signed into law “An Act Concerning Employee Online Privacy.” With this Act, Connecticut joins more than 20 other states to have legislation restricting an employer’s access to the social media accounts of applicants and employees. The Act, which goes into effect October 1, 2015, prohibits employers from requiring employees or applicants to:
  • Provide their user name and password or any other access to an employee’s personal online account;
  • Access an online account in the employers presence; or
  • Accept an invite or other invitation from the employer to join a group associated with the employee’s online account. The Act applies to both private and public employees and offers few limited exceptions.

Fines for violations of the Act range from $25 against applicants and $500 against employees and can increase to $500 and $1,000 for continuing or repeat violations.

Fortunately, this new Act doesn’t cover any account created, maintained, used, or accessed by an employee or applicant for the employer’s business purposes. Furthermore, employers will still be able to monitor, review, access or block electronic data stored on an electronic communications device paid for by an employer, or traveling through or stored on an employer’s network.


Additionally, employers can conduct an investigation: based on receiving specific information about activity on an employee’s or applicant’s personal online account to ensure compliance with (a) applicable state or federal laws, (b) regulatory requirements, or (c) prohibitions against work-related employee misconduct.

An employer conducting these investigations can require an employee to provide access to a personal online account, but cannot require disclosure of the user name, password, or other means of accessing the personal online account. For example, an employee or applicant under investigation could be required to privately access a personal online account, but then provide the employer with access to the account content.

Connecticut’s regulatory environment just got a little more challenging, and, as a result, employers should review their Internet policies and practices to ensure compliance.

Tags: Social Media, Employment Law

NLRB Approves Ambush Election Rules: Christmas Comes Early for Big Labor

Posted by Ryan O'Donnell on Mon, Dec 15, 2014 @ 12:19 PM

For organized labor, Christmas has come early. Unfortunately, Americas’ employers received a lump of a coal.

Late last week, President Obama’s National Labor Relation’s Board finalized the so-called “ambush election rules”—a gift that was at the top of every union’s wish list. By speeding up the timeframe for representation elections, this new regulation will significantly handicap employers’ ability to contest union organizing drives.

obama santa

As Siegel O’Connor has previously noted, the average time between when a union files a representation petition—the first step in organizing a workplace into a union—is 38 days, but this new rule would reduce that to as few as 10 days.  Consequently, unions could launch guerrilla-organizing campaigns that, because of the compressed timeline, deny management its legal right to discuss with their employees whether a union has anything worthwhile or constructive to offer them or the company.

Employers across the country have strongly criticized the change. For instance, the Retail Industry Leaders Association (RILA) issued the following statement:

This flawed rule is harmful to both workers and employers. By dramatically changing the procedures that govern union elections, the rule limits the information available to employees prior to entering the voting booth, potentially subjects employees to harassment at home and undermines the due process rights of employers.

Bottom Line for Employers

Fortunately for America’s employers, these new regulations don’t go into effect until April 2015; additional legal and legislative challenges are likely. In the interim, however, Employers should contact their respective members of Congress and demand an end to the Obama NLRB’s hyper-partisan antics. Employers are also urged to contact their labor counsel and begin developing a strategy for contesting ambush elections.

Tags: National Labor Relations Board, Register Guard, Labor Law, SNAP elections, Employers, business, small business

Epic Fail: Obama NLRB Gives Unions Access to Employers’ Email Systems

Posted by Ryan O'Donnell on Mon, Dec 15, 2014 @ 10:35 AM

Earlier this week, the National Labor Relations Board (NLRB) issued a decision (Purple Commc’ns Inc) giving employees the right to use employers’ email systems for non-business purposes—including union organizing. This ruling overturns the Board’s 2007 decision in Register Guard, and opens up yet another front in the partisan Board’s war against employers.

In its decision, the Board declared the analysis in Register Guard to be “clearly incorrect,” and one that focuses “too much on employers’ property rights and too little on the importantance of email as a means of workplace commutation.” As a result of this ruling, agues the Board, the NLRB “failed to adequately protect employees’ rights under the Act” and abdicated its responsibility to “adapt the Act to the changing patterns of industrial life.” Indeed, throughout its analysis, the Board justifies its ruling by referencing email’s new role as the “primary means of workplace discourse.”

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Having dismantled Register Guard, the Board will now adopt a “presumption that employees who have been given access to the employer’s email system in the course of their work are entitled to use the system to engage in statutorily protected discussions about their terms and conditions of employment while on nonworking time.”

In an attempt to mollify employers, the Board offers the following three limitations on employee’s ability to use email for organizing purposes:

  1. This decision applies only to employees who have been granted access to the employer’s email system in the course of their work; employers are not required to provide such access
  2. Employers may justify a total ban on non-work use of email by demonstrating that special circumstances make the ban necessary to maintain production or discipline.
  3. This decision does not address nonemployees or any other type of electronic communication.

These limitations, however, offer little solace to employers already struggling to comply with the avalanche of union-friendly regulations churned out by an increasingly hostile NLRB.

A Powerful Dissent

The Board’s decision in Purple Commc’ns Inc., is unprecedented. As Board Member Philip Miscimarra notes in his dissent, “The [National Labor Relations] Act has never previously been interpreted to require employers, in the absence of discrimination, to give employees access to business systems and equipment for NLRA-protected activities that employees could freely conduct by other means.” Furthermore, it is all but impossible “to determine whether or what communications violate restrictions against solicitation during working.”

Member Johnson, who penned his own 32-page dissent, hammered the majority’s decision for essentially forcing employers to subsidize speech in violation of the U.S. Constitution. Johnson argues, “The First Amendment violation is especially pernicious because the Board now requires an employer to pay for its employees to freely insult its business practices, services, products, management, and other coemployees in its own email. All of this is now a matter of presumptive right…”

Looking forward, Johnson’s dissent warns that “Taken to its extreme, the majority’s…rationale would just as easily apply to taking over an employer auditorium, or conference room in the middle of the workday during an employer presentation/conference.

The Road Ahead

On a practical level, however, employers must now re-evaluate their internal rules and regulations regarding employee use of company email. Specifically, Purple Commc’ns Inc has now rendered most employee handbooks obsolete; employers should, over the next few weeks, review their employee email communications policy, and contact their labor counsel to examine how this stunning new decision will impact existing company policies.

Tags: NLRB, Unions, National Labor Relations Board, right to unionize, Register Guard, violation of National Labor Relations, Labor Law

Non-Compete Clauses: A Critical Update for Employers

Posted by Meredith Diette on Tue, Sep 23, 2014 @ 04:05 PM

The Connecticut Appellate confirmed today that continued employment alone will not bind an existing employee to an adverse change in contract terms. 

In Thoma v. Oxford Performance Materials, Inc., Conn. App. Ct., No. AC 35313, official release 9/23/14, the Court found that a terminated executive was entitled to benefits of her original employment agreement, despite having the executive having signed a second employment agreement negating said benefits. 

CT appSpecifically, the Oxford executive signed a first employment agreement with provisions including severance pay in the case of termination without cause and received at increase in salary.  Some time after, Oxford decided that the benefits in the first agreement were too generous and revised the agreement.  Both parties signed the second agreement, which excluded any severance benefits and did not provide any further increase in salary.  As provided in the first agreement, the executive’s salary increased.  When Oxford terminated the executive over a year later and failed to pay her severance, she sued Oxford. 

Ultimately, the Court’s decision should not come as a huge surprise to Connecticut employers.  For some time, Connecticut courts have leaned toward requiring some form of additional consideration to bind existing employees to any adverse change in their terms or conditions of employment.  Employers should know that if they want to incorporate a non-compete agreement or a mandatory arbitration clause, these significant restrictions on employees must be done in connection with hiring or some incentive other than continued employment to be binding and enforceable. 

Tags: Labor Law, Employers, Employment Law, Litigation

Harris v. Quinn: What's Next for Employers?

Posted by Ryan O'Donnell on Mon, Jun 30, 2014 @ 11:31 AM

This morning, the U.S. Supreme Court held that personal care assistants who are paid by the state of Illinois—but mostly supervised by the homecare recipients they serve—are not “full-fledged” public employees. As a result, these employees cannot be forced to pay union dues or fees.

In a 5-4 decision, the majority ruled that requiring personal care assistants to pay union dues would violate the First Amendment rights of nonmembers who disagree with the positions that unions take.

The Court noted that these assistants are “different from full-fledged public employees,” because they work primarily for their disabled client, and do not receive the same benefits as regular state employees.describe the image

This decision deals a considerable blow to organized labor. Unions are losing members—and, in turn, the dues and fees provided by said members—at an astonishing rate. Had the court ruled in their favor, public-sector unions would have had access to 26,000 new members—and their wallets. And given that nine other states, including Connecticut, allow personal care assistants to join unions, the impact will be felt far beyond Illinois.

In making its decision, the court refused to overturn Abood v. Detroit Board of Education, a 1977 Supreme Court cases that requires “full-fledged” public employees to pay dues, even if they are not members of the union. Justice Alito, writing for the majority, noted that:

Abood itself has clear boundaries; it applies to public employees. Extending those boundaries to encompass partial-public employees, quasi-public employees, or simply private employees would invite problems...If we allowed Abood to be extended to those who are not full-fledged public employees, it would be hard to see just where to draw the line, and we therefore confine Abood's reach to full-fledged state employees.

However, labor unions will likely emphasize that the ruling stressed the unique nature of the personal care assistant:

PAs are much different from public employees. Unlike full-fledged public employees, PAs are almost entirely answerable to the customers and not to the State, do not enjoy most of the rights and benefits that inure to state employees, and are not indemnified by the State for claims against them arising from actions taken during the course of their employment. Even the scope of collective bargaining on their behalf is sharply limited.

Bottom Line for Employers:

Look for this decision to trigger a battle over the definition of “full-fledged public employees,” as well as a renewed organizing push from public sector unions.

Tags: right to unionize, Labor Law, Employers, business, supreme court, public sector

Employer Alert: Connecticut Minimum Wage Increase

Posted by Ryan O'Donnell on Thu, May 22, 2014 @ 12:55 PM

Earlier this month, the Connecticut legislature wrapped up its 2014 regular session—a whirlwind few months that left employers scrambling to adjust to several new laws and regulations.

CapPrimarily, Connecticut employers should be concerned about the legislature’s decision to increase the minimum wage. Under SB 32 (“An Act Concerning Working Families' Wages”). Connecticut’s minimum wage will (as of January 1 of each of the next three years) increase to:

·         $9.15 per hour in 2015;

·         $9.60 per hour in 2016; and

·         $10.10 per hour in 2017.

Furthermore, hotel, bar, and restaurant employees’ minimum wages (with the corresponding tip credit), will also change

The legislature’s decision to raise the minimum wage will negatively impact not only employers, but working-class families as well. Indeed, minimum-wage increases reduce the number of entry-level minimum-wage jobs available—actually hurting many of the workers the legislation endevors to help. 

Connecticut employers should review all policies and procedures to ensure compliance with these changes to the minimum wage law.

Tags: Employers, business, small business, jobs, minimum wage

Northwestern Football Players Free to Organize Says NLRB

Posted by Bud O'Donnell on Thu, Mar 27, 2014 @ 12:07 PM

NCAA unions

Hopefully, you had an opportunity to enjoy some college football last year. If not, you might be out of luck, because if a new ruling from the National Labor Relations Board stands, the game will never be the same.

 Yesterday, in a stunning decision, the Board held that, “all-grant-in-aid scholarship players for the [Northwestern University] football team who have not exhausted their playing eligibility are ‘employees’ under . . . the Act.”

 So, how can student-athletes also be employees? The NLRB concluded the players “are not primarily students.” That conclusion came from the following findings:

  • The players spent 50-60 hours a week on their “football duties” during the month-long training camp before the school year even started;
  • The players spend an additional 40–50 hours a week during the 4–5 month football season;
  • These hour commitments are “more hours than many undisputed full-time employees work at their jobs”; and
  • The time spent on football constituted “many more hours than the players spend on their studies.”

As a result of this ruling, the Northwestern University players, as well as athletes at other private universities who meet the above-noted criteria, can organize with a labor union. In fact, the Northwestern athletes have already joined the College Athletes Players Association.

In response to this decision, Northwestern University's president emeritus said that if the football players were successful forming a union, he could envision a number of private universities punting their programs.

"If we got into collective bargaining situations, I would not take for granted that the Northwesterns of the world would continue to play Division I sports," Henry Bienen said at the annual conference for the Knight Commission on Intercollegiate Athletics.

Shortsighted and overly technical, the Board’s ruling will likely hurt the players its ostensibly trying to helpall the while adding new, dues-paying members to national labor organizations. Although Northwestern is going to appeal the Board’s ruling—a process that might take years—should this decision stand, the consequences could be dire.

If, for example, schools drop football programs, there will be fewer opportunities for student-athletes to attend a major university; more likely than not, these players will opt to skip the NCAA experience, and play football in Europe, Canada, or new “developmental” football leagues that will form should college programs be eliminated.

Rather than helping student-athletes earn their degrees while playing the game they loveand perhaps even earning a shot at a lucrative professional football career—the Board’s decision only ensures that fewer student-athletes will have an opportunity to earn a degree, which would prepare them for life after football.

But why allow a few inconvenient truths get in the way of this Hail Mary bomb to organized labor?

Photo credit: CBNC.com

Tags: Unions, National Labor Relations Board

NLRB Moves to Implement “Ambush” Election Rule

Posted by Bud O'Donnell on Wed, Feb 12, 2014 @ 10:54 AM

Breaking News:  Last week, the National Labor Relations Board (NLRB) announced that it’s moving to shorten the length of time in which a labor union certification election is held.

ambush election

The Basics:  According to the Board, this new rule would:

  • Allow for electronic filing and transmission of election petitions and other documents;
  • Ensure that employees, employers and unions receive and exchange timely information they need to understand and participate in the representation case process;
  • Streamline pre- and post-election procedures to facilitate agreement and eliminate unnecessary litigation;
  • Include telephone numbers and email addresses in voter lists to enable parties to the election to be able to communicate with voters using modern technology; and
  • Consolidate all election-related appeals to the Board into a single post-election appeals process.

Impact on Employers: Currently, the average time between when a union files a representation petitionthe first step in organizing a workplace into a unionis 38 days, but this new rule would reduce that to as few as 10 days.  Consequently, unions could launch guerrilla-organizing campaigns that, because of the compressed timeline, deny management its legal right to discuss with their employees whether a union has anything worthwhile or constructive to offer them or the company. 

As noted in a letter from the U.S. House of Representatives labor committee to NLRB chairman Mark Gaston Pearce, a former union attorney, “[t]his rule will seriously limit employer free speech and undermine employee free choice.”  The NLRB announcement also drew criticism from business groups such as the National Retail Federation.

Furthermore, employers need to be concerned about the impact on their employees’ privacy.  As unions are exempt from some state laws against stalking or trespassing when their members are engaged in organizing activities, as a report from the U.S. Chamber of Commerce revealed in 2012, questions as to how and to what extent unions will use employees’ personal information remain unanswered.

What’s Next:  The Board will be accepting public comments on the new proposed rulemaking through April 7, 2014.  The Board will also hold a public hearing during the week of April 7.

Bottom line for Employers:  With a clear Democratic majority, the Board will likely move quickly to implement this new rule. However, on March 5, 2014, the U.S. House of Representatives Education and Workforce Committee will be holding a hearing on the ambush election proposal.  We will continue to keep you updated as the NLRB continues to push its pro-union agenda.

Tags: NLRB, National Labor Relations Board, SNAP elections

The OSHA Trojan Horse: Organized Labor's New Scheme to Gain Access to Your Workforce

Posted by Bud O'Donnell on Mon, Dec 09, 2013 @ 03:51 PM

As union membership continues to tumble, organized labor is getting desperate.  First, the unions sought help from Washington; the Employee Free Choice Act, the RAISE Act and the President's unconstitutional "recess" appointment to the National Labor Relations Board all were attempts by labor-friendly politicians to help unions gain access to the non-union American workforce.  Now, federal agencies are riding to Big Labor's rescue, using the power of the executive branch to help organizers recruit more dues-paying union members. OSHA Trojan Horse

Earlier this year, the Occupational Safety and Health Administration (OSHA)-the Department of Labor's workplace safety watchdog-issued a guidance letter that offered a new interpretation of a long-standing rule.This new interpretation will allow labor union officials to participate in safety inspections at the request of an employee even if the employer is non-union.

During an OSHA safety inspection, employees are entitled to have an observer accompany the government investigators on the investigators' tour of the workplace.  For nearly half a century, this observer was understood to be an actual employee of the workplace in question; indeed, OSHA's own interpretative manual uses the word "employee" when describing the observer.  But in this new guidance letter, written by OSHA Deputy Assistant Secretary Richard E. Fairfax, labor union officials could participate in safety inspections at the request of an employee-even if the employer is non-union.

By re-interpreting this "observer" law in such an expansive fashion, OSHA is giving unions an unprecedented opportunity to not only gain access to non-union facilities—an organized labor "Trojan Horse"—but also to advance the idea that without union representation employees' personal safety is at risk

While ostensibly serving as "observers," union representatives will be able to spread a pro-union message among employees, a sales pitch reinforced by the sudden discovery of a number of potential safety hazards and OSHA violations.  Alleged violations need not be legitimate for the union's gambit to succeed; they need only generate concern among the company's workforce that management is fostering potentially unsafe working conditions.  And with an organizer on-site, masquerading as an observer, the solution to this sudden spike in safety violations will be offered: union representation.

Employers can still fight back.  First, companies must be prepared for the scenario described above.  When an OSHA inspector and an organized-labor observer arrive at your worksite, it is critical to demonstrate an interest in identifying and remedying any potential safety issues.  Such concern, however, does not mean acquiescence to bullying by an "observer" attempting to undermine employees' faith in management.  Have an OSHA expert, whether it is an attorney or a member of your management team, accompany the "observer" on his/her tour of your workplace.  Be prepared to counter any exaggerated or erroneous violations made by the observer—a critical step in undermining the union's credibility—while demonstrating to employees that management takes safety seriously.  Furthermore, make sure the "observer" is only allowed to participate in the actual inspection; do not let him/her wander the facility unsupervised.

Already struggling with a massive increase in federal regulations, health-care "reforms" and a sea of red tape, employers now must contend with a federal government determined to reverse the decline in organized labor's membership roles.  But employers can, and, indeed, must, take proactive steps to protect their rights and the rights of their employees.

Tags: Unions, Union Corruption, Associated Builders and Contractors, OSHA