Happy New Year! As we recover from the holiday season and year-end wrap-up, it is a good time for employers to evaluate their workplace policies and practices to make sure that they are in line with the ever-changing employment law landscape. The coming year will show many changes in federal and state employment law, and employers should look to be prepared for those changes in 2020 and beyond.

Fair Labor Standards Act (FLSA)

Effective Jan. 1, a final rule issued Sept. 24, 2019, by the U.S. Department of Labor (DOL) amends the FLSA regulation to:

• Increase the minimum annual salary for most exempt employees paid on a salary basis from the old level of $455 per week (or $23,660 per year) to $684 per week (or $35,568 per year).
• Allow employers to count nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the standard salary level test, as long as they are paid annually or more frequently.
• An increase from $100,000 to $107,432 as the minimum annual salary for highly compensated employees who face a looser duties test.

The DOL estimated that an additional 1.3 million workers who were overtime exempt under the prior rates will now be eligible for overtime unless their employers increase salary thresholds to comply with the new minimum rates.

New W-4 Form

All new hires must be provided with the redesigned IRS Form W-4.

Immigration

Both the Department of Homeland Security (DHS) and the DOL are strictly enforcing workplace immigration laws. Employers should review their I-9 files for completeness in case of an audit or even a raid. Employers in high-risk industries like restaurant and food services, food processing, construction, assembly work and agriculture might also consider conducting a hiring audit to verify compliance.

National Labor Relations Board (NLRB)

The NLRB announced a new test for balancing employee rights to complain against management rights. Rules banning the disclosure of pay or benefits are prohibited, but rules banning violence, threats and language creating hostile environment are permitted. The NLRB also addressed social media usage. Employers cannot require employees to use their real names when criticizing their employers, but can require employees to state a general disclaimer when targeting the employer by name indicating that the views are their own. More stringent standards are applied to the joint employer status test, and the independent contractor test have been scaled back.

US Supreme Court Docket

• Are LGBTQ workers protected under Title VII?

The most anticipated employment decision of the year is expected from a trio of cases asking whether Title VII of the Civil Rights Act of 1964 prohibits employment discrimination based on lesbian, gay, bisexual, transgender and queer (LGBTQ) status. Oral argument was heard in the fall and a decision is expected shortly.

• Can the current administration end the DACA program?

In November 2019, the court heard three consolidated cases involving the current administration's announcement that it intended to rescind the Deferred Action for Childhood Arrivals (DACA) program, which allowed some undocumented immigrants who came to the United States as children to temporarily work and avoid deportation. Several appellate courts blocked the government from rescinding the program, holding that the prior administration had the right to create the program and the current administration's decision to eliminate it was likely arbitrary, capricious or otherwise not in accordance with the law. The U.S. Supreme Court will determine if the federal government has the right to wind down the DACA program or not. Employers who have any employees who are part of the DACA program should pay attention to the decision so that they can determine proper courses of action if the program is eliminated.

• What standard applies to a worker's bias claims?

In Bobb v. Wilkie, the high court will determine the standard of proof for federal government workers who bring claims under the Age Discrimination in Employment Act. In the pending case, the federal government argued that the employee must show that the adverse employment action would not have been taken "but for" the employer's bias. The employee alternatively argued that a more lenient standard should apply, namely whether age bias was a motivating factor for the negative employment decision. Oral argument was also presented in Comcast v. National Association of African American-Owned Media in which the standard of proof in race discrimination claims under Section 1981 of the Civil Rights Act of 1866 will be determined.

State Minimum Wage Increases

Twenty states increased minimum wage, effective Jan. 1, and many others are contemplating minimum wage hikes. States with increases now have higher minimum wage requirements than the federal minimum wage, which still stands at $7.25 per hour. New Jersey is now $11, California is $13 for employers with greater than 26 employees, and Washington is $13.50. Employers should make sure that their nonexempt employees are being paid the requisite state and city minimum wage. For a full listing of the states with Jan. 1, 2020, minimum wage hikes, see www.epi.org/minimum-wage-tracker/#/min_wage.

Fluctuating Workweek

After years of litigation, the Pennsylvania Supreme Court has confirmed that the use of the fluctuating workweek method (FWW method) of calculating overtime compensation is unlawful under the Pennsylvania Minimum Wage Act (PMWA) in Chevalier v. General Nutrition Centers, Pennsylvania Supreme Court No. 22-WAP-2018. Under the FWW method of pay, an overtime-eligible employee receives a fixed salary for all hours worked regardless of how many hours are worked in a particular week. For workweeks in which the employee works more than 40 hours, he is entitled to overtime pay calculated at one-half the regular rate of pay (the fixed weekly salary divided by the actual number of hours worked in the workweek). The theory behind the method is that the fixed salary for all hours worked compensates the employee for the straight time component of the worked hours over 40 (or, the "time" part of "time and a half") and all that is left to pay is the half time component. This practice is permitted by federal law, but was called into question in Pennsylvania based upon the express language of the PMWA, namely, that employees "shall be paid for overtime not less than one and one-half times the employee's regular rate." The Pennsylvania Supreme Court found that this language, plus the fact that the PMWA is silent on the FWW method of pay, forbids employers from using it. The Chevalier decision comports with decisions of the federal district courts in Pennsylvania, which have previously rejected the FWW method under Pennsylvania law. Three other states, Alaska, California and New Mexico, have also rejected the FWW method of pay under their respective state laws.

Marijuana Legislation

Eleven states and the District of Columbia currently allow both medical and recreational use of marijuana; Illinois joined these states Jan. 1. The majority of the other states permit the use of medical marijuana. This is, of course, in conflict with federal law where marijuana use is still illegal.

The dilemma for employers focuses on the medial marijuana patients and whether or not the employees are protected under the Americans with Disabilities Act (ADA) or the state anti-discrimination laws. Given that marijuana is not legal in the eyes of the federal government, there is likely no ADA protection. However, there could be protection at the state level. In fact, a number of states, like Delaware, have carved out a protected status for medical marijuana patients. Employers should pay close attention to this developing area of law.

Mandatory Paid Time Off

More cities and states are enacting various paid leave laws. The cities of Philadelphia and Pittsburgh, the state of New Jersey and many others now have mandatory PTO that could require employers to modify their policies. As an example, effective Jan. 1 in Nevada, a new law allows an employee to take leave for any reason. Massachusetts has a paid family medical leave act in place with new benefits starting this year. The benefits in New York, California, Arizona and the city of Dallas in Texas are also expected to increase.

Family Policies

The push for work-life balance is ever present, and with the strong economy and job market, employers who wish to retain existing staff should make sure that their policies and benefits are competitive. Plainly, having family-friendly policies can help employers stand out as a desirable place to work. Employers should also make sure that they are in compliance with these policies as new laws and novel interpretations of older ones create confusion in this space. Here is what employers should keep in mind:

• Mothers' room—The FLSA provides unlimited breaks for moms to express milk during the first year of an infant's life. Hourly employees are entitled to as many unpaid breaks as they require. The break rooms must be private and they cannot be a restroom. This rule applies to all employers with 50 or more workers. It also covers employers with at least one employee unless the employer can show compliance would be an undue hardship. Additionally, California passed a new law requiring a surface to place a pump, a place to sit and access to electricity.
• Pregnancy, childbirth and paternity leave—The Family and Medical Leave Act of 1993 (FMLA) provides covered employees who work for covered employers with up to 12 weeks of unpaid childbirth and bonding time. Paid leave laws often cover the childbirth recovery, but not the bonding time. Some cities and states have enacted childbirth leave as well, and other states will likely follow suit. Presently, California, New Jersey, Rhode Island, New York, Washington and the District of Columbia have paid childbirth leave laws. Employers should look to include both primary and secondary caregivers, as there have been an increase in the number of lawsuits brought by men seeking equal rights for paternity leave; they are winning these suits.

Pay Equity

2019 saw a big push for pay equity from the Equal Employment Opportunity Commission (EEOC) and from employees themselves. Several cities and states also passed rules that prohibit prospective employers from asking about current or past salary when hiring. The idea behind these new rules is to eliminate the continuation of lower salaries for those in protected classes and require employers to make salary offers based upon experience, education and talent. Philadelphia did enact such a rule, but that rule was later determined to be unlawful. Other states who have enacted or will enact salary history ban rules include New York (Oct. 31, 2017), California (Jan. 1, 2018) and Colorado (Jan. 1, 2021). There has also been an increase in the number of pay equity suits and claims brought by employees. This is an issue that should be evaluated by human resources before employers face litigation and EEOC scrutiny. Employers should consider conducting an internal pay equity evaluation and working to fix any discrepancies.

Fair Scheduling Laws

There has been increased focus upon scheduling, especially with reference to employees in low-wage positions. The primary concern is that employers make last-minute changes or cancel shifts without notice. States and cities are passing new rules regulating when schedules should be posted and what changes employers can and cannot make. Twelve states and a number of cities have enacted fair scheduling laws to address employee concerns. The laws themselves vary so employers should make sure to understand scheduling requirements, if any, in all jurisdictions where they have workers. In New York, schedules must be posted no less than 72 hours in advance, and once they are posted, employers cannot make changes. The legality of the New York law is being challenged in court. In San Francisco, schedules must be posted two weeks in advance and changes by the employer result in extra pay for the affected workers based upon when the employer makes the change.

The Philadelphia Fair Workweek Law is set to go into effect April 1. Under the ordinance, large retail, hospitality and food service establishments will be required to: give existing employees the right of first refusal to work additional hours before hiring new employees; post and provide advance written notice of work schedules; provide predictability pay for any departures from the posted schedules; and permit a rest period of nine hours between shifts. It is estimated that these new requirements will impact 130,000 workers in Philadelphia.

Other Issues

In addition to hot-button issues and legal changes that require attention, employers should make sure to continue focusing upon sexual harassment prevention, proper implementation of the FMLA, disability policies, proper benefits management, wage-and-hour compliance and the art of proper documentation. As in any year or decade, employment law is evolving and thus requires those working in human resources or responsible for talent management in any way to stay up to speed on legal developments so that they can stay ahead of the changes.