Insights

On September 8, 2023, the Department of Labor (“DOL”) published a Notice of Proposed Rule Making (“NPRM”) proposing a number of changes that would, if enacted, substantially increase the number of workers who would be eligible for overtime pay under the federal Fair Labor Standards Act (“FLSA”).  Most critically, the NPRM would raise the annual salary threshold for the FLSA’s administrative, executive and professional exemptions -- the so-called “white collar” exemptions -- from $684 per week ($35,568/year) to $1,059 per week ($55,068/year).

On August 30, the U.S. Department of the Treasury (“Treasury”) published in the Federal Register proposed regulations addressing the prevailing wage and apprenticeship (“PWA”) requirements under Sections 45(b)(7) and (8) of the Inflation Reduction Act (“IRA”).  These proposed regulations incorporate and supplement the limited guidance issued previously, which includes Notice 2022-61, published by the Treasury in November 2022, as well as the Frequently Asked Questions (“FAQ”) on the Department of Labor’s IRA website.  The proposed regulations shed light on various issues of significance to taxpayers seeking the enhanced tax credits provided by the IRA, as well as other stakeholders. 

On Friday, April 28, 2023, the Fifth Circuit in Rest. Law Center v. United States Department of Labor, No. 22-50145, 2023 WL 3139900 (5th Cir. Apr. 28, 2023), reversed a decision from the Northern District of Texas (the “District Court”) that refused to enjoin the Department of Labor’s tip credit regulations amendment in effect since December 28, 2021. The amendment requires employers to pay tipped employees the full minimum wage for nontipped work directly supporting tipped work if it: 1) amounts to more than 20% of the employee’s total weekly time paid at the tipped minimum wage rate, or 2) exceeds 30 continuous minutes. The Fifth Circuit concluded in a 2-1 panel decision that the plaintiffs demonstrated that the ongoing management costs imposed on employers by the new “continuous 30-minute rule” in the form of additional timekeeping requirements results in irreparable harm.

On February 7, 2023, the New York State Department of Labor (“NYSDOL") published Enforcement Guidance providing information regarding the scope of the amendment to the New York State Labor Law provision that governs prevailing wage requirements for projects relating to certain renewable energy systems and NYSDOL’s enforcement power.  

On March 3, 2023, New York Governor Kathy Hochul signed into law A999 / S1326 (the “Amended Law”), which includes amendments to New York State’s pay transparency law (“Law”) that both broaden and lessen obligations on employers. Specifically, the Amended Law modifies the scope of covered jobs, eliminates the recordkeeping requirement, and clarifies the definition of “advertise.” What remains unchanged, however, is the September 17, 2023, effective date and the requirement to include the job description in an advertisement, if one exists. Crowell & Moring LLP (“Crowell”) previously reported on the originally-enacted Law, which can be found here.

On Friday, March 10, 2023, regulators shut down Silicon Valley Bank (“SVB”) and seized its deposits, resulting in the second largest U.S. banking failure since the 2008 financial crisis. Specifically, SVB was closed by the California Department of Financial Protection and Innovation, and the Federal Deposit Insurance Corporation (the “FDIC”) was named receiver. Since the FDIC insures deposits of up to $250,000, that amount was immediately available; however, the fact that deposits above and beyond the $250,000 limit were not immediately available alarmed many. After a weekend of chaos as many businesses scrambled for a solution to the illiquid funds, on Sunday, March 12, 2023, in a joint release among the Department of Treasury, Board of Governors of the Federal Reserve System and the FDIC, Treasury Secretary Janet Yellen instructed the FDIC to guarantee SVB customers access to all deposits, including the uninsured funds. The release further stated that New York-based Signature Bank was closed by its chartering authority and that its customers would also receive access to all deposits, including the uninsured funds. While this may have provided relief to many, it is important to keep in mind the lesson and best practices in the event of such a liquidity crunch.

The Manhattan District Attorney (“D. A.”), Alvin Bragg, recently announced in a press release dated February 16, 2023 (the “Press Release”) the creation of a new “Worker Protection Unit” (the “Unit”) to investigate and prosecute wage and hour violations and other violations of labor laws.  Prior to the creation of this Unit, the D.A.’s Office has prosecuted wage and hour violations primarily in the construction and real estate industries through the Construction Fraud Task Force.  According to the Press Release, the Unit will allow this Office to “significantly expand its focus to include other industries with high rates of worker exploitation and wage theft, such as home healthcare agencies, fast food and restaurants, and more.”  According to the Press Release, another focus of the Unit is to investigate and prosecute workplace safety laws.  The Unit will also partner with other units within the D.A.’s Office to encourage vulnerable and under-served populations to report wage and hour violations. 

On January 10, 2023 New Jersey Governor Phil Murphy signed into law a new version of New Jersey’s “mini-WARN Act,” or the Worker Adjustment and Retraining Notification Act (“NJ WARN Act”). The amendment makes the NJ WARN Act in some ways the most expansive WARN Act in the country: it increases the scope of covered employers, counts employee layoffs statewide (rather than by worksite) to meet the notice threshold, requires 90 days’ notice (rather than 60), and mandates severance payments even when proper notice is given. These changes will take effect on April 10, 2023.

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The Equal Employment Opportunity Commission (EEOC) has submitted a final proposal for the revised EEO-1 report to the Office of Management and Budget (OMB) for approval (the "30-Day Notice"), potentially moving the revised report one step closer to implementation. The EEOC published its initial proposal for changes to the EEO-1 Report in February 2016 (the "60-Day Notice), followed by a 60-day public comment period. In response to the public comments on the 60-Day Notice, the EEOC's 30-Day Notice incorporates just two changes: (1) it revises the EEO-1 submission date from September 30th to March 31st of each year to allow employers to use calendar-year W-2 data, and (2) it increases the EEOC's burden estimate from 6.6 to 17.1 hours. Unfortunately, the 30-Day Notice does little else to address employers' other concerns about this data collection. Written comments on the 30-Day Notice are due to OMB by August 15, 2016. 

The Department of Labor (DOL) today released its long-awaited changes to the Fair Labor Standards Act’s overtime regulations. Subject to the outcome of various expected legal challenges, these regulations are expected to take effect on December 1, 2016.

Today, the Obama Administration published the highly anticipated notice of proposed rulemaking (NPRM) and guidance for implementing the "Fair Pay and Safe Workplaces Executive Order," starting the clock on a 60-day notice and comment period. The NPRM and related guidance (available by PDF here and here and explained in more detail on our government contracts blog) would add onerous labor compliance reporting requirements for contractors and subcontractors on contracts valued over $500,000 (and on non-COTS subcontracts valued over $500,000), inject subjectivity into the contract award process through the addition of "Agency Labor Compliance Advisors" advising the CO with respect to responsibility determinations, limit contractors' right to arbitrate certain employment disputes, and add new "paycheck transparency" requirements for contractors.

The Department of Labor's long-awaited changes to the FLSA's overtime regulations are one-step closer to reality. In a May 5 blog post, Labor Secretary Tom Perez announced that DOL had transmitted its proposed regulations to the Office of Management and Budget for review. This review is expected to take a month or two (maybe more), after which they will be published in the Federal Register for a period of notice and comment. During OMB's review – and until their publication in the Federal Register – the DOL's proposed regulations are not available for public review.