Employment Law This Week September 18, 2017: D.C. Policy Update, Wage and Hour Administrator Nominee, DOL’s 80/20 Rule
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This week’s stories include ...
(1) D.C. Policy Update from the U.S. Chamber of Commerce
Our top story: A progress report on labor and employment policy from the U.S. Chamber of Commerce. Marc Freedman is the Executive Director of Labor Law Policy for the Chamber. We caught up with him at our Annual Workforce Management Briefing to find out how things are shaping up at the Department of Labor (DOL), the National Labor Relations Board (NLRB), and the Equal Employment Opportunity Commission (EEOC) under the new administration:
“In the case of the DOL, we've seen some actions by the new secretary, Secretary Acosta. They removed some of the interpretations that we didn't favor, and those can be struck by the stroke of a pen, so that's impressive to see that happen—sort of the ‘low hanging fruit.’ In the NLRB context, of course, we heard from the Chairman this morning, and he described a series of rulings in which he was in the minority and couldn't push that point across. So we're waiting for ... there's two nominees that are in process. That would give a three-to-two Republican majority, and once you have that you can start to reverse some of those decisions and some of the actions of the previous NLRB. Same thing on the EEOC. We're still waiting for the nominees there to be confirmed who would then create a three-to-two majority on the EEOC, so a lot of what we hope will happen needs those people in place to make it happen.”
(2) DOL Wage and Hour Division Administrator Nominated
President Trump has nominated Cheryl Stanton as the new Administrator of the DOL’s Wage and Hour Division, a position that has been vacant since the President took office in January. Stanton is currently Executive Director of the South Carolina Department of Employment and Workforce, and, during her tenure, the Department reportedly paid off a debt of nearly $1 billion to the federal government. Before that, she was an employment lawyer with Ogletree, a position she returned to after serving as Associate White House Counsel under President George W. Bush.
(3) Ninth Circuit: DOL's 80/20 Rule Does Not Deserve Deference
The U.S. Court of Appeals for the Ninth Circuit found that the DOL is not entitled to deference on a tip-credit policy. The Ninth Circuit ruled on nine consolidated cases in which employees claimed that a tip credit was improperly applied to times during which they performed non-tipped work. The plaintiffs relied on the Wage and Hour Division’s Field Operations Handbook, which interprets a Fair Labor Standards Act (FLSA) regulation on “dual jobs.” The guidance stated that employees must be paid full minimum wage for non-tipped work if that work exceeds more than 20 percent of their hours in a workweek. Creating a split with the Eighth Circuit, the Ninth Circuit found that the DOL's 80/20 rule is an attempt to “create a de facto new regulation” and does not deserve deference.
(4) Tip of the Week
Nausheen Rokerya, Associate General Counsel, Labor & Employment, for Visiting Nurse Service of New York, offers some advice on what to do in light of recent employee arbitration agreement decisions. This includes most recently the Gold decision in New York, which found class action waivers to be unenforceable:
“New York employers sitting in Manhattan and the Bronx are bound by the Gold decision, and so they should carefully consider the likely impact it will have on litigation strategy of plaintiffs' attorneys. First, plaintiffs' lawyers are unlikely to file FLSA complaints in federal court, where Second Circuit precedent finding class action waivers enforceable is still binding. At the same time, we do expect to see an uptick in state court filings, where plaintiffs' lawyers are likely to seek to nullify class action waivers, making it nearly impossible for employers to then rely on those waivers to defeat class certification. While the Gold decision is current law in Manhattan and the Bronx, the U.S. Supreme Court is actually scheduled to hear oral argument on this very issue on October 2. We do expect the [Supreme] Court's decision to resolve the current split among the federal courts sometime in early 2018.”