In 2019, New Jersey, New York, and Pennsylvania each enacted substantial legislation affecting companies that employ individuals in those states. This GT Alert provides a summary of the most significant of these legislative changes and will help employers stay abreast of the changes relevant to their businesses. Please note that the laws described extend protections to employees who work in the state and therefore can affect out-of-state employers.
Gov. Newsom signed 870 bills into law and vetoed 172. Fortunately, not all of them were labor and employment related. This GT Alert provides an overview of the new employment-related laws, which will likely create additional challenges for California employers. As always, we focus here on what is likely to be important as opposed to everything tangentially employment-related in some way.
This GT Alert provides an update on employment and pension law in the Netherlands for 2019. Topics covered include diversity in boards of larger companies; the Balanced Labour Market Act (Wab), effective 1 January 2020; amendments to restructuring rules applied by the Employee Insurance Agency (UWV), effective 1 October 2019; Dutch pension system reforms; and Pending acts and regulations, including Transfer of Undertaking in Bankruptcy Act (Wet overgang van onderneming in faillissement), changes to civil servant status, and extended birth leave. We also provide a list of training courses offered by GT and our areas of concentration in Labor & Employment law in the Netherlands.
After the California Second District Court of Appeal’s Oct. 8, 2019, decision in Gonzales v. San Gabriel Transit, Inc., brought as a garden variety wage and hour class action claiming various classifications of drivers who agreed to be and were treated as independent contractors were in fact employees, the California Supreme Court will have the final say on whether the ABC test in Dynamex Operations West v. Superior Court, 4 Cal.5th 903 (2018), generally not well-received by businesses, is a retroactive expression of existing law, or prospective only.
New York employers have until Wednesday, Oct. 9, 2019, to train each of their employees on sexual harassment prevention. The training must be conducted annually thereafter, and must satisfy all of the statutory requirements for content and interaction. Employers who have not yet conducted training should do so as soon as possible. For more information, including training parameters, see our October 2018 GT Alert here.
Contact your Greenberg Traurig attorney to schedule training or for guidance on compliance with these training requirements and related employment laws.
The U.S. Department of Labor (DOL) on Sept. 24, 2019, announced a final rule raising the annual minimum salary requirements for the Fair Labor Standards Act (FLSA) overtime exemptions for executive, administrative, and professional employees. The final rule, effective Jan. 1, 2020, will significantly impact businesses. Experts predict the rule could result in the reclassification of as many as 1.3 million currently exempt employees as non-exempt.
Under the final rule, the salary level for these “white collar” exemptions will increase from $23,660 per year ($455 per week) to $35,568 per year ($684 per week). In this respect, the final rule increases the salary level a few dollars per week more than the original rule proposed on March 7, 2019.
On Sept. 18, California Gov. Gavin Newsom signed Assembly Bill 5 (AB5) into law. AB5, effective Jan. 1, 2020, seeks to codify and clarify a California Supreme Court case (Dynamex Operations West, Inc. v. Superior Court of Los Angeles), which dramatically changed the standard for determining whether workers in California should be classified as employees or as independent contractors. Specifically, the Dynamex court held there is a presumption that workers are employees, and placed the burden on an entity classifying an individual as an independent contractor to prove that such a classification is proper under a three-part “ABC” test.
Although much of the public debate surrounding AB5 has centered around the “gig economy” (such as ridesharing companies), whether AB5 impacts more traditional business relationships, such as franchisee-franchisor relationships, remains up for debate.
On Sept. 12, 2019, the California Supreme Court in ZB, N.A. v. Superior Court of San Diego County (Lawson) delivered a victory for California employers, clarifying that a plaintiff bringing a Private Attorneys General Act (PAGA) action may not recover as a “civil penalty” the “wages” referenced in Cal. Labor Code section 558, and thereby limited the monetary recovery workers can seek under PAGA.
PAGA allows a plaintiff-employee to seek civil penalties on behalf of the plaintiff and other “aggrieved employees” for a Labor Code violation, if the Labor Commissioner first receives proper notice of the claim and declines to take action on it. Among the Labor Code sections often relied on by plaintiffs in such cases is Labor Code section 558, which enables the Labor Commissioner to collect $50 and $100 in civil penalties against employers that unlawfully deny overtime compensation to workers, and allows the Commissioner to recover “an amount sufficient to recover underpaid wages.” Though PAGA provides that amounts recovered by a private litigant are to be distributed 75% to the state and 25% to “aggrieved employees,” section 558 provides that any wage-based recovery under section 558 goes entirely (100%) to the workers.
On Aug. 23, 2019, a federal judge in the United States District Court for the Eastern District of Pennsylvania awarded over a million dollars in lost wages and punitive damages to two former employees of Lloyd Industries after a jury found the company and its owner fired them in retaliation for their participation in a 2014 federal safety investigation by the Occupational Safety and Health Administration (OSHA). The company fired one of the employees after OSHA began an onsite investigation, and fired the other employee shortly after OSHA issued the Citation and Notification of Penalty, assessing monetary penalties on Lloyd Industries.
Significantly, the court’s award of $500,000 in punitive damages is the largest punitive award under the anti-retaliation provision (Section 11(c)) of the Occupational Safety and Health Act (OSH Act). In addition to the punitive damages, the judge awarded the former employees more than $500,000 in front and back pay and prejudgment interest. The judge also required that the employer and its owner post an anti-retaliation notice at the plant and never again violate the OSH Act’s anti-retaliation provision.
For those companies employing Massachusetts workers, payroll withholdings to fund the leave program established by the Massachusetts Paid Family and Medical Leave Act (PFML) will begin Oct. 1, 2019.
As reported in previous GT Alerts (see July 2018 and May 2019), the PFML provides eligible employees with paid medical and family leave benefits effective Jan. 1, 2021. Individuals will be entitled to up to 20 weeks of paid medical leave and 12 weeks of paid family leave per year, with a combined maximum amount of family and medical leave of 26 weeks per year. The benefit amount is based on an individual’s earnings and is capped at $850 per week.