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DOL and IRS Tackle Worker Misclassification
The Department of Labor (DOL) and Internal Revenue Service (IRS) published a Memorandum of Understanding for Employment Tax Referrals establishing a system to share information to assist in the identification of emerging and ongoing employment tax compliance issues related to misclassification of employees and independent contractors. The IRS intends to target business that lack a good-faith basis for worker misclassification which will result in substantial penalties. Employers should review their independent contractor processes and address any misclassification issues to mitigate any tax penalties.
Proposed USCIS Fee Increase
A dramatic increase has been proposed by the U.S. Citizenship and Immigration Services (USCIS) for fees for nonimmigrant visas and the permanent residency process. The proposed fee schedule is due to the fact that USCIS is self-funded and it also funds humanitarian programs. USCIS is accepting comments on the fee changes until March 3. A final regulation is expected this summer.
California: FAST Recovery Act Temporarily On Hold
On December 30, 2022, a temporary restraining order blocked AB 257 or the Fast Food Accountability and Standards Recovery Act (FAST Recovery Act). The Act required the establishment of a Fast Food Council which would set minimum standards for wages, working hours, and working conditions related to health, safety, and welfare of fast food workers at restaurants with at least thirty establishments nationwide. The temporary restraining order is due to a legal challenge attempting to put provisions of AB 257 on the 2024 ballot. Employers should continue to monitor updates on the legal challenge.
California: ALRB Gives Additional Guidance for “Card Check” Law
AB 2183 went into effect on January 1, 2023. It created easier options for agricultural workers to vote for or against unionization by offering a “card check” sign-up process. The California Agricultural Labor Relations Board (ALRB) has now provided additional guidance as well as a portal for employers to register a Labor Peace Compact. AB 2183 allowed employers to enter into a labor peace compact which was an agreement to act neutrally with respect to unionization. Employers must sign up before January 1st of each year if they wish to enter into a labor peace compact. Employers with agricultural workers should consult with legal counsel to have a plan in place on how to navigate this law.
Berkeley, CA: New Fair Work Week Ordinance
Effective November 2023, Berkeley employers must provide work schedules at least two weeks in advance and provide 11 hours of rest between shifts to employees under the Fair Work Week Ordinance. Failure to provide notice of schedule changes will result in one to four hours of predictability pay. Anticipated work schedules must also be provided to new hires. The ordinance applies to businesses with 10 or more employees in the city of Berkeley that are: 1) primarily engaged in building services, healthcare, hotel, manufacturing, retail or warehouse services industries employing 56 or more employees globally; 2) primarily engaged in the restaurant industry and employing 100 or more employees globally; 3) primarily engaged in retail or restaurant industries as a franchisee and are associated with a network of franchises with franchisees employing in the aggregate 100 or more employees globally; or 4) not-for-profit corporations that employ 100 or more employees globally.
Los Angeles, CA: Minimum Wage for Covered Healthcare Facilities Suspended
A Los Angeles ordinance which would have raised the minimum wage of some private healthcare facilities to $25.00 per hour has been suspended after a successful legal challenge. The ordinance is now on the ballot for a vote in 2024. The ordinance would have applied to most privately-owned healthcare facilities located within Los Angeles, and its definition of “healthcare workers” would have applied to almost all employees. Employers would also have been prohibited from offsetting the increase in wages by: reducing premium pay rates or shift differentials; reducing vacation, healthcare, or non-wage benefits; reducing hours of work; laying off workers; or increasing charges to workers for parking, work materials, or equipment. Healthcare employers will now have to wait for the result of the vote.
Mountain View, CA: Wage Theft Ordinance
The Mountain View Wage Theft Ordinance went into effect on January 1, 2023. It applies to all business operators in Mountain View who are required to have a business license. Those with no employees are exempt. The Ordinance requires businesses to submit a sworn affidavit affirming that they have paid any past wage-and-hour judgments to employees in full or that they haven’t violated any wage and hour laws and have no pending judgments. Affidavits must be submitted at the time of application or renewal for a business license. Failure to submit the affidavit may result in administrative citations, fines, penalties, or a criminal infraction.
San Francisco, CA: Paid Military Leave Mandate
Effective February 19, 2023, the Military Leave Pay Protection Act requires employers with 100 or more employees to provide paid military leave in the form of differential pay to employees for up to 30 days per calendar year. It applies to any employee of an employer who has workers within the geographic boundaries of San Francisco. Telecommuting is expected to qualify as performing work within San Francisco.
Gainesville, FL: Limitation on Use of Criminal History Records
Effective December 15, 2022, the Fair Chance Hiring Ordinance prohibits employers with 15 or more employees from asking questions about an applicant’s criminal history in the application process. Job advertisements also cannot reference the exclusion of certain criminal histories unless otherwise required by law. After a conditional offer of employment is made, employers can conduct a background check based on criminal history. If the offer of employment is withdrawn due to the result of criminal history, employers must provide a notice describing the reason for disqualification as well as the applicant’s rights under the ordinance. Violators may pay a penalty of up to $1,000 per violation.
Louisiana: Restrictive Covenants Signed After Termination are Unenforceable
Louisiana law bars restrictive covenants as a matter of statutory law. There is a narrow exception which allows an employer to prevent a former employee from working for a competitor or soliciting customers after they leave employment provided that the agreement was signed during employment. In Setpoint Integrated Solutions, Inc. v. Kitely, the Court of Appeal of Louisiana reinforced the application of the law. There, the employer sought to enforce a non-compete clause against a former senior executive which was entered into after the separation of employment. Because there was ample evidence the agreement was entered into after termination, the Court invalidated the non-compete. Employers with Louisiana employees should review their restrictive covenants and their enforceability.
Michigan: Court Rules No Changes to Minimum Wage and Paid Sick Leave
On January 26, 2023, on Mothering Justice v. Attorney General, the Michigan Court of Appeals released its long-awaited ruling regarding a possible dramatic increase in minimum wage and an expansion of paid sick leave set to occur mid-February. At issue were state legislative changes made to two ballot initiatives which created the current minimum wage rules and paid sick leave. The challengers argued the changes were in violation of the state Constitution and should be voided with the original ballot initiatives reinstated. The Court of Appeals decision affirmed the state-amended laws. This means minimum wage remains $10.10 per hour with the next increase occurring in 2024. In addition, the Paid Medical Leave Act continues to provide an exemption to employers with fewer than 50 employees from providing a maximum of 40 hours of paid sick leave.
New Jersey: NJDOL Targets Residential Construction and Commercial Laundromats
The New Jersey Department of Labor and Workforce Development (NJDOLWD) announced it will target employers in commercial laundromats and multi-unit residential construction to make sure they properly pay their workers all wages and benefits. Those found to be in violation could be subject to audit, significant penalties, and stop-work orders. Employers in affected industries should consult with legal counsel to review their wage and hour compliance.
New York: Discrimination Protections for Citizenship and Immigration Status
Effective December 23, 2022, AB A6328A amended the New York State Human Rights Law to prohibit employment discrimination, harassment, or retaliation against employees and job applicants based on citizenship and immigration status. Employers can still check citizenship or immigration status for lawful purposes like complying with laws verifying legal work authorization status (e.g., Form I-9 completion).
New York: Workplace Safety Committees Protected
Effective, December 28, 2022, an amendment to the NY HERO Act now requires employers to recognize employee-formed workplace safety committees within five days of receiving a request from employees for recognition. Employees already had the right to form workplace safety committees to monitor and review workplace safety practices. The Department of Labor now has the authority to provide relief for violations of this section by fining employers $50.00 per day until the violation is remedied.
Oregon: Advance Notice of Mandatory Overtime for Bakery and Tortilla Manufacturers
Effective January 1, 2023, SB 1513 requires bakery and tortilla manufacturing employers to provide employees with at least 5 days’ advance notice of a mandatory overtime shift. The notice must include the date and time of the overtime shift. If the employer does not provide notice, employees can refuse to work the mandatory overtime shift without penalty of adverse action.
Oregon: Aiding and Abetting Under the Discrimination Law
On September 14, 2022, in Allison v. Dolich, the Oregon Court of Appeals said any person, even the principal decision maker directing an entity, can be liable for aiding and abetting under Oregon’s law prohibiting unlawful employment discrimination. This means individuals directing a business entity’s unlawful conduct can be held individually liable under the statute. Those defending lawsuits for violating Oregon’s employment discrimination law could now face individual claims against the decisionmakers for aiding and abetting.
Oregon: Human Trafficking Reporting Requirements for Marijuana Licensees
Effective January 1, 2023, HB 4074 requires employees of marijuana licensees to report human trafficking on licensed premises to the Oregon Liquor and Cannabis Commission. Marijuana licensees should update their policies and provide training to employees on reporting procedures.
South Carolina: Updated Antidiscrimination Poster & Pregnancy Accommodations Act Notice
On November 14, 2022, South Carolina revised its employment anti-discrimination poster. The poster can be found on the Human Affairs Commission’s website. The poster must be displayed in a conspicuous place on an employer’s premises. In addition, employers must provide written notice at hire that employees have the right to be free from discrimination or retaliation for medical needs arising from pregnancy, childbirth, or related medical conditions. Notice can be provided via handbook, a standalone policy, or via a copy of the new poster.
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. © 2023 ManagEase