August Updates

EEO-1 Component 2 Reporting Resources Issued

The EEOC recently updated the Component 2 reporting website with Frequently Asked Questions (FAQs), a sample form, instruction booklet, User’s Guide, and other instructional information to assist employers in navigating the Component 2 reporting requirement. Additionally, the home page of the website notes that an updated version of the upload file validation specifications was added to the site on the More Info page. Additionally, the secure file upload function and validation process is expected to be available by mid-August 2019. Employers should review the new resources to prepare for filing 2017 and 2018 Component 2 data by the September 30, 2019 deadline.

IRS Announces 2020 Health Savings Account Limits

The IRS has now published the annual maximum contribution limits for Health Savings Accounts (HSA).  HSA tax-free contribution limits are adjusted every year for inflation, and are as follows for calendar year 2020:

• $3,550 for individuals with self-only coverage (up $50 from 2019)
• $7,100 for family coverage (up $100 from 2019)

To participate in an HSA, the policyholder must be enrolled in an HSA-qualified, high-deductible health plan with a minimum annual deductible.  For 2020, this is defined as a health plan with an annual minimum deductible of:

• $1,400 for self-only coverage (up of $50 from 2019)
• $2,800 for family coverage (up $100 from 2019)

Finally, the 2020 maximum annual out-of-pocket expense limit will also increase to:

• $6,900 for self-only coverage (up $150 from 2019)
• $13,800 for family coverage (up $300 from 2019)

U.S. DOL Launches New Website for Wage Determination Data

As of June 14, 2019, the U.S. Department of Labor will be transitioning to a new website for wage determination data: https://beta.SAM.gov

The new website includes a number of features, such as:

• Search-based structure: Users may search for a variety of information, including specific Davis-Bacon Act and McNamara-O’Hara Service Contract Act wage determinations.
• Learning Center: includes tutorial videos, tools, and other information to familiarize users with the new site.
• Personal accounts: Users can make a beta.SAM.gov account, which will allow them to save previous searches, start or modify a collective bargaining agreement, and “follow” specific wage determinations to receive email alerts.
• Timeline and history of changes to wage determinations.

Sixth Circuit: FLSA Coverage Implicated by Using Out-of-State Products

On May 29, 2019, the Sixth Circuit Court of Appeal in Secretary of Labor v. Timberline South, LLC stated that an employer who regularly and recurrently uses equipment manufactured out-of-state to carry out its primary commercial intrastate activity is subject to the Fair Labor Standards Act (FLSA) requirements.  There, the employer used logging and harvesting equipment manufactured out-of-state to produce timber for sale within its state of operation.  According to the court, this triggered the FLSA’s “handling clause,” because the employer had employees handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce.

The court also stated that commuting time and bona fide meal periods are not considered compensable under the FLSA, even if there is an existing contract, practice, or agreement to pay for that time.  However, employers should still take care to comply with state wage and hour rules that may conflict with this ruling.

California: Sonoma, CA Minimum Wage Increases as of January 1, 2020

Sonoma, like many other cities in California, has now adopted a local minimum wage ordinance.  As of January 1, 2020, the minimum wage increases to $13.50/hour for employers of 26 or more employees, and $12.50/hour for employers of 25 or fewer employees.  While the minimum wage only applies to employees who work two or more hours per week within Sonoma, the headcount includes employees working outside Sonoma for the purpose of determining which wage tier employers must obey.

The new ordinance also incorporates yearly increases in the minimum wage, taking place on January 1 of each year, capping on January 1, 2024.  In addition, employers that pay at least $1.50/hour per employee towards employee medical benefits plan will receive a $1.50/hour healthcare credit.

Nevada: No Sexual Harassment Confidentiality in Settlement Agreements

As of July 1, 2019, AB 248 prohibits employers from entering into settlement agreements for lawsuits that bar a claimant from disclosing the existence of the settlement or the factual basis of a claim for (1) a criminal sexual offense (regardless of prosecution status), (2) sex discrimination, or (3) retaliation for reporting alleged sexual discrimination. The bill also requires victims’ identities be kept confidential upon request. Employers should review these restrictions with legal counsel when settling civil litigation or administrative claims.

New Jersey: Discrimination Claim Does Not Require an Adverse Employment Action to Proceed

In Richter v. Oakland Board of Education, the state appellate court indicated that the plaintiff does not need to suffer an adverse employment action to pursue a discrimination claim.  There, an employee sustained significant injuries after suffering a seizure resulting from low blood sugar levels.  The employee alleged that her injuries would not have occurred if the school board had granted her request for an accommodation to eat her lunch earlier in the day, allowing her to maintain proper sugar levels.

The lawsuit was initially dismissed because the employee could not demonstrate an adverse employment action in order to succeed on a failure to accommodate claim.  However, the New Jersey appellate court stated that common law claims allow exceptions for work-related injuries where there is an intentional wrong.  In this case, the board of education was aware that refusing the employee’s request for accommodation could cause her bodily injuries. As a result, employers should take care when evaluating a request for accommodation before taking an adverse action.

New Jersey: Hotel Employers Must Provide Panic Buttons for Employees

On June 11, 2019, the state legislature approved Senate Bill 2986, which requires hotels with more than 25 guest rooms to provide panic buttons to any hotel employees who are assigned to work in a guest room alone.  The panic button must be a portable two-way radio or other electronic device that allows the employee to quickly call for help from an onsite security officer or appropriate hotel staff.  These devices must be provided at no cost to the employee no later than January 1, 2020.

In addition to provisioning the devices, covered hotel employers must also comply with other new requirements concerning investigating incidents, reassigning employee work, recordkeeping, and education/notice regarding panic buttons.  Employers can read the full text of the bill here.

New Jersey: State Protections May Extend to Out-of-State Employees

On June 27, 2019, the New Jersey Court of Appeal in Calabotta v. Phibro Animal Health Corp. stated that the state Law Against Discrimination (NJLAD) applied to an employee who lived and worked in Illinois, but applied for a job transfer to New Jersey. The employee claimed “associational” discrimination for the denied transfer allegedly due to his wife’s cancer status. The court reviewed choice-of-law rules in stating that statutory interpretation, the fact that the position would have been filled in New Jersey, the employee had unrelated employer agreements with choice-of-law provisions stating that New Jersey law applied, and that the employer was headquartered in New Jersey, support applying New Jersey law to the claim. Employers should review out-of-state employee requests with legal counsel before taking adverse action.

New York: Farmworkers Win the Right to Collectively Bargain

The federal National Labor Relations Act (NLRA) currently excludes farmworkers from the definition of “employee,” exempting agricultural laborers from the having the right to organize.  However, states can implement their own legislation to grant such rights to farmworkers, which is exactly what happened with a New York state appeals panel on May 23, 2019.

As a result, pending further appeal or other legislation, farmworkers in New York now have the right to organize, bargain, and strike.  Participating in organization is a protected activity and employees may not be retaliated against for collectivizing in effort to improve terms and conditions of employment.

Rhode Island: The Airline Deregulation Act Preempts State Sunday and Holiday Pay Laws

On June 18, 2019, in Brindle v. Rhode Island Dept. of Labor and Training, the Rhode Island supreme court stated that the Airline Deregulation Act (ADA) preempts state laws requiring employers to pay non-exempt employees time-and-a-half for time worked on Sundays and state holidays. Specifically, because of testimony that the increased labor costs would lead to reductions in staff, fewer flights, and impact customer service, the court stated that the state law negatively impacted the airline services and therefore was preempted. Although this ruling is limited to the ADA, it may have a wider impact should other similar industries seek to have the same determination made.

Washington: Obesity is a Protected Class by Itself

On July 11, 2019, in Taylor v. Burlington N. R.R. Holdings, Inc., the Washington Supreme Court stated that “obesity does not have to be caused by a separate physiological disorder or condition because obesity itself is a physiological disorder or condition” under the Washington Law Against Discrimination (WLAD). Additionally, employees are not required to actually be obese, and are protected if employers perceive them as having the impairment of obesity. Employers should review pre-hire examination procedures, update discrimination and harassment policies, and train applicable managers on reasonable accommodation requirements.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

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