Hospitality Labor and Employment Law Blog

Hospitality Labor and Employment Law Blog

Five Evolving Issues Confronting Employers in the Hospitality Industry

LinkedIn Tweet Like Email Comment

Our colleagues Jeffrey H. Ruzal, Steven M. Swirsky, Joshua A. Stein, Brandon C. Ge, Adam C. Solander, and Valerie Butera contributed to Epstein Becker Green’s recent Take 5 newsletter. In this edition, we address important employment, labor, and workforce management issues in the hospitality industry:

  1. The U.S. DOL’s Aggressive Moves to Expand FLSA Coverage
  2. The NLRB’s New Test for Determining Joint-Employer Status and Its Impact on Hospitality Employers
  3. At the 25th Anniversary of the ADA, How to Avoid Getting Bitten by Service Animal Complaints
  4. The Cadillac Tax: What Hospitality Employers Need to Know
  5. OSHA’s Revised Hazard Communication Standard

Read the full Take 5 here.

Epstein Becker Green’s Wage and Hour App Now Includes All 50 States and More

LinkedIn Tweet Like Email Comment

Wage & Hour Guide for Employers AppWe’d like to share some news with hospitality employers: Epstein Becker Green has released a new version of its Wage & Hour Guide for Employers app, available without charge for Apple, Android, and BlackBerry devices.

Following is from our colleague Michael Kun, co-creator of the app and leader of our Wage and Hour group:

We have just updated the app, and the update is a significant one.

While the app originally included summaries of federal wage-hour laws and those for several states and the District of Columbia, the app now includes wage-hour summaries for all 50 states, as well as D.C. and Puerto Rico.

Now, more than ever, we can say that the app truly makes nationwide wage-hour information available in seconds. At a time when wage-hour litigation and agency investigations are at an all-time high, we believe the app offers an invaluable resource for employers, human resources personnel, and in-house counsel.

Key features of the updated app include:

  • New summaries of wage and hour laws and regulations are included, including 53 jurisdictions (federal, all 50 states, the District of Columbia, and Puerto Rico)
  • Available without charge for iPhoneiPad, Android, and BlackBerry devices
  • Direct feeds of EBG’s Wage & Hour Defense Blog and @ebglaw on Twitter
  • Easy sharing of content via email and social media
  • Rich media library of publications from EBG’s Wage and Hour practice
  • Expanded directory of EBG’s Wage and Hour attorneys

If you haven’t done so already, we hope you will download the free app soon.  To do so, you can use these links for iPhoneiPad, Android, and BlackBerry.

Coping With the New Definition of Exempt Employees: The Proposed New Salary Test May Not Benefit Currently Salaried Employees

LinkedIn Tweet Like Email Comment

Under the Federal Fair Labor Standards Act (and state wage hour laws) certain hourly paid employees must be paid time and one-half their regular rate of pay for all hours worked over 40 in a regular work week.

But certain employees (for example many general managers and lead managers) are exempt from this requirement if they satisfy three qualifications imposed by federal regulations:

  1. The employee must be paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed;
  2. the amount of salary paid must be at least $455 per week; and
  3. the employee’s job duties must primarily involve executive, administrative, or professional duties as defined by the regulations (the “duties test”).

On July 6, 2015, the U.S. Department of Labor proposed a major change in the salary level test from $455 per week to $970 per week which if implemented would invalidate the exemption of any  currently exempt employee earning less than $970 per week ($50,440 annually) and reclassify those employees as non-exempt employees (pdf).

Such a reclassification could adversely impact the self-respect of many employees who believe that their salary is a mark of status superior to hourly paid rank and file employees and assures them of a regular paycheck in a regular amount each week.

In addition there is the specter of an employer having to pay hefty amounts for employees working many overtime hours or increasing head count to avoid overtime.

But there may be a silver lining for employers.  If the employer sets the regular rate for an employee reclassified from exempt to non-exempt at a rate which would yield an amount similar to the former salary when regular overtime is factored in, the employer may not be economically impacted and the employee will not get a government imposed raise for doing the same work s/he had always done.

Alternatively, under certain circumstances, the employer is permitted to pay a salary to non-exempt employees, which would help avoid the potential stigma of losing a salary and instead being paid an hourly wage, as discussed above.  This is known as the fluctuating work week method of paying overtime.

Here is how it works:

A non-exempt employee whose hours typically vary from week to week is paid a salary which is agreed to cover all hours worked in each regular workweek.  Thus, salary status is preserved.

To determine the amount of overtime owed, the regular rate is calculated by dividing the employee’s weekly salary by the number of hours worked each week. Since the salary covers all hours worked each workweek, the employer is only required to pay an additional half time amount for each hour worked over 40 in a workweek.

Here is an example:

Under the hourly rate of pay method of compensation, a non-exempt employee paid $20 per hour earns $800 for a forty hour week and must be paid $30 per hour for each hour worked over 40 in a workweek

If s/he works an additional 10 hours the employer must pay an additional $300 for that workweek for a total of $1,100 per week.

Under the fluctuating workweek calculation, the employee would be paid a salary.  Assuming the employee’s weekly salary is $800, if the employee works 50 hours in one workweek, the employer would calculate overtime by dividing $800 by 50 hours yielding a regular rate of $16 per hour.  Because the $800 salary is paid for all hours worked, the employer is only required to pay an additional half-time, which in this case is $8.00, for each of the ten hours worked in excess of 40.  Thus, the employer’s overtime exposure for this workweek is only $80 for a total of $880 per week, as opposed to $1,100 under the hourly rate of pay method.

Assuming the DOL’s proposed new regulations to increase the salary basis are implemented, employers can take measures to avoid the significant increase in their operating costs and help sustain profitability.

CAVEAT:  Check your state laws to see if the fluctuating work week method is allowed.  The New York State Hospitality Regulations (pdf) do not permit the fluctuating work week method for restaurant operations.  Thus, New York restaurant operations employers should set an hourly rate so as to minimize the cost of regular overtime.

Washington Court Dismisses Challenge to NLRB’s Ambush Election Rules

LinkedIn Tweet Like Email Comment

My colleague Steven M. Swirsky at Epstein Becker Green published a Management Memo blog post concerning U.S. District Judge Amy Berman Jackson granting summary judgment in favor of the NLRB – “Washington Court Dismisses Challenge to NLRB’s Ambush Election Rules.”

Following is an excerpt:

U.S. District Court Judge Amy Berman Jackson on Wednesday issued a 72 page opinion (PDF) rejecting each of the arguments raised by the U.S. Chamber of Commerce, the National Retail Federation and other business groups and found that the Amended Election Rules adopted by the National Labor Relations Board in December 2014, which took effect in April 2015, in an action that argued that the Board had exceeded its authority, violated the Administrative Procedures Act and that the Amended Rules were unconstitutional.

Read the full original post here.

EEOC Rules Discrimination Based On Sexual Orientation Illegal Under Title VII

LinkedIn Tweet Like Email Comment

My colleagues Nancy L. Gunzenhauser, Kate B. Rhodes, and Judah L. Rosenblatt at Epstein Becker Green have a Retail Labor and Employment Law blog post concerning a recent EEOC modification to employment discrimination protection: “EEOC Rules Discrimination Based On Sexual Orientation Illegal Under Title VII.”

Following is an excerpt:

The EEOC held that “[s]exual orientation discrimination is sex discrimination because it necessarily entails treating an employee less favorably because of the employee’s sex.”  The EEOC noted that sex-based considerations also encompassed gender-based considerations under Title VII. This ruling, if accepted by federal courts, would extend protection under Title VII to decisions made on the basis of sexual orientation. While only the Supreme Court can issue a final, definitive ruling on the interpretation of Title VII, EEOC decisions are given significant deference by federal courts.

Read the full original post here.

EEOC Updates Pregnancy Discrimination Guidance

LinkedIn Tweet Like Email Comment

My colleagues Nathaniel M. Glasser and Kristie-Ann M. Yamane (a Summer Associate) at Epstein Becker Green have published a Financial Services Employment Law blog post concerning recent modifications to pregnancy discrimination that will be of interest to many of our readers: “EEOC Updates Pregnancy Discrimination Guidance.”

Following is an excerpt:

In the wake of the U.S. Supreme Court’s decision in Young v. UPS, [1]  the EEOC has modified those aspects of its Enforcement Guidance on Pregnancy Discrimination and Related Issues (“Guidance”) that deal with disparate treatment and light duty.

Under the prior guidance, issued in 2014, the EEOC asserted that a pregnant worker could prove a violation of the Pregnancy Discrimination Act (“PDA”) simply by showing that she was “treated differently than a non-pregnant worker similar in his/her ability or inability to work.”  The 2014 guidance also took the position that an employer could not refuse to offer a pregnant worker an accommodation by relying on a policy that provides light duty only to workers injured on the job.  The Supreme Court, however, was highly critical of and rejected this interpretation of the PDA, finding that it would require employers who provide a single worker with an accommodation to provide similar accommodations to all pregnant workers, irrespective of other criteria.

 Read the full original post here.

Proposed DOL Rule To Make More White Collar Employees Eligible For Overtime Pay

LinkedIn Tweet Like Email Comment

I recently wrote a Wage and Hour Defense blog post with my colleague Michael S. Kun and it will be of interest to all hospitality employers – “Proposed DOL Rule To Make More White Collar Employees Eligible For Overtime Pay.”Clock

Following is an excerpt:

More than a year after its efforts were first announced, the U.S. Department of Labor (“DOL”) has finally announced its proposed new rule pertaining to overtime. And that rule, if implemented, will result in a great many “white collar” employees previously treated as exempt becoming eligible for overtime pay for work performed beyond 40 hours in a workweek – or receiving salary increases in order that their exempt status will continue.

Read the full original post here.

Five EEOC Initiatives to Monitor on the Agency’s Golden Anniversary

LinkedIn Tweet Like Email Comment

My colleague Nathaniel M. Glasser recently authored Epstein Becker Green’s Take 5 newsletter.   In this edition of Take 5, Nathaniel highlights five areas of enforcement that U.S. Equal Employment Opportunity Commission (“EEOC”) continues to tout publicly and aggressively pursue.

  1. Religious Discrimination and Accommodation—EEOC Is Victorious in New U.S. Supreme Court Ruling
  2. Transgender Protections Under Title VII—EEOC Relies on Expanded Sex Discrimination Theories
  3. Systemic Investigations and Litigation—EEOC Gives Priority to Enforcement Initiative
  4. Narrowing the “Gender Pay Gap”—EEOC Files Suits Under the Equal Pay Act
  5. Background Checks—EEOC Seeks to Eliminate Barriers to Recruitment and Hiring

Read the Full Take 5 here.

Mayor Signs NYC Ban-the-Box Law

LinkedIn Tweet Like Email Comment

On Monday, June 29, 2015, Mayor Bill de Blasio signed into law the bill passed by the New York City Council “banning-the-box.” The law goes into effect on Tuesday, October 27, 2015. As discussed in our earlier advisory, the ban-the-box movement removes from an employment application the “box” that requests criminal conviction history. New York City’s law also imposes additional requirements upon the employer when making an adverse employment decision on the basis of criminal conviction history.

NLRB Dramatically Educates Private School on Meaning of Concerted Protected Activity

LinkedIn Tweet Like Email Comment

My colleague Nancy L. Gunzenhauser at Epstein Becker Green has a Management Memo blog post that will be of interest to many of our readers: “NLRB Dramatically Educates Private School on Meaning of Concerted Protected Activity. ”

Following is an excerpt:

While we have been reminding readers of the fact that  the National Labor Relations Act (the “Act”) protects employees regardless of whether they are represented by a union and the Act applies to non-unionized workforces, too, recently  a National Labor Relations Board (the “NLRB”) Administrative Law Judge issued a decision following an unfair labor practice (“ULP”)  hearing based on a charge filed by a teacher at New York City’s prestigious Dalton School that should serve as an object lesson for employers in all non-union businesses.

Read the full original post here.