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Tenth Circuit: Employers Who Take Tip Credits May Keep Customer Gratuities

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July 3, 2017

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In Marlow v. New Food Guy, the Tenth Circuit stated that employers of tipped employees may keep customer gratuities, as long as the employee is already paid the required minimum wage.  An employer’s retention of tips under this circumstance does not violate the tip credit provision of the Fair Labor Standards Act (“FLSA”).

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Second Circuit: “Black Car” Drivers are Independent Contractors Under the FLSA

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April 21, 2017

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A recent Second Circuit case confirmed that New York City “black car” drivers—workers who provide high-end transportation services, e.g., limousines—are independent contractors under the Fair Labor Standards Act (“FLSA”).

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Ninth Circuit: Wage Rates Used for Overtime Hours Cannot Be Lower Than Those Used for Non-Overtime Hours

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March 21, 2017

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In Brunozzi v. Cable Communications, Inc., the Ninth Circuit stated that wage rates cannot be decreased in weeks when overtime is worked, as compared to weeks when no overtime is worked. There, two cable technicians were paid a piece rate per cable system installed, plus a contractually-based production bonus each pay period as part of their regular wages.  When the employer calculated overtime, it reduced the production bonus by the amount of overtime paid for piece rate work, which meant that employees received lower wage rates than when they did not work overtime.

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DOL Increases Civil Money Penalties for 2017

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January 13, 2017

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The U.S. Department of Labor (“DOL”) has published final regulations regarding increases for civil money penalties arising from violations of certain employment regulations, such as ERISA, OSHA, FLSA and FMLA.  These penalties are adjusted annually based on the Consumer Price Index to account for inflation.

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Ninth Circuit: Car Dealership Service Advisors Not Exempt from FLSA

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January 9, 2017

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We previously reported on Navarro v. Encino Motorcars, LLC, wherein a group of service advisors at an auto dealership alleged that they did not receive owed overtime compensation. At that time, the Ninth Circuit decided to defer to the U.S. Department of Labor’s interpretation of the Fair Labor Standards Act (“FLSA”); the U.S. Supreme Court reversed this decision and remanded the case to the Ninth Circuit to determine how the FLSA statutes apply to auto dealership service advisors.

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Judge Blocks White Collar Overtime Exemption Rule from Taking Effect Nationwide

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November 22, 2016

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Since the U.S. Department of Labor issued the finalized White Collar Overtime Exemption Rule (the “Rule”) in May this year, employers across the country have been preparing to comply with the Rule’s requirement for white collar employees to earn $47,476 annually in order to maintain exemption status rather than being paid overtime.  In an eleventh hour ruling, just days before its effective date of December 1st, a Texas federal judge ordered a preliminary injunction on the Rule, preventing the Rule from going into effect nationally on its slated December 1st start date.  The Rule was expected to result in millions of workers either (a) being re-classified as non-exempt, and therefore entitled to wage and hour protections, including overtime pay; or (b) receiving dramatic salary increases to keep workers classified as exempt.

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Ninth Circuit States Employers Must Include Cash-in-Lieu of Benefits Payments in Overtime Calculation

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June 2, 2016

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Offering a flexible benefits plan is an oft-cited tool for organizations to improve employee satisfaction, recruitment, and retention.  However, employers should be very careful when designing benefits plans that permit cash-in-lieu of payments, as the City of San Gabriel discovered in a recent case.

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Sixth Circuit Sets Standard for Employer Constructive Knowledge of Overtime Hours Worked

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May 19, 2016

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The Sixth Circuit recently stated in Craig v. Bridges Bros. Trucking LLC. that an employer has constructive knowledge of an employee working overtime if it would have discovered the overtime by “exercising reasonable diligence.”  The plaintiff, Donna Craig, was a bookkeeper for Bridges who processed payroll, including her own compensation.  Craig frequently worked over 40 hour weeks and recorded her hours worked in time sheets, including overtime.  However, Bridges only paid Craig overtime once.  Craig alleged that Bridges told her she was not eligible for overtime.  On the other hand, Bridges argued that Craig should have known she was eligible for overtime, and that the company was unaware that Craig worked overtime.

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July Updates

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This HR Alert addresses the following topics:
  1. UPDATE: “Persuader Rule” Blocked by Texas Court
  2. EEOC Issues Sample Notice for Employers Offering Wellness Programs
  3. HIPAA Audits Coming Soon
  4. FLSA Overtime Classification of Auto Dealer Service Advisors in Question
  5. California Supreme Court Puts Federal Bonus Overtime in Doubt
  6. Connecticut Bans the Box
  7. Connecticut Allows Use of Payroll Cards
  8. Massachusetts Allows Self-Help Discovery
  9. New Jersey Employers Prohibited from Shortening Time Limit on Lawsuits/Claims
  10. District of Columbia Extension of Raised Minimum Wage
  11. Tennessee Expands Scope of Garnishments

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Ninth Circuit States Federal Rounding Regulation Does Not Require Employees to Gain or Break Even

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Montana, Nevada, Oregon, and Washington Employers

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May 2, 2016

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The Ninth Circuit Court of Appeals stated in Corbin v. Time Warner Entertainment Advance/Newhouse Partnership (“TWEAN”) that the federal rounding regulation for timekeeping, versus actual time worked, does not require employees to gain or break even over each pay period.  Rather, the regulation is intended to calculate wages such that they average out over the long term.  In Corbin, an employee argued that he had wrongfully been deducted minutes of compensable time as a result of the rounding system.

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