Employment Law This Week- September 21, 2017: EEOC Pay Data Collection Requirement, DOL Overtime Rule, Parental Leave Policies, NYS Paid Family Leave Program
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This week’s stories include ...
(1) OMB Suspends EEOC Pay Data Collection Requirement
Our top story: New pay data collection requirements are put on hold. A division of the Office of Management and Budget (OMB) has issued an immediate stay on new EEO-1 reporting requirements announced in 2016 under the previous administration. Under the rule, federal contractors and private employers with 100 or more employees would have been required to gather information on employee pay and hours worked by race, ethnicity, and sex, and grouped by occupational category. Susan Gross Sholinsky has more:
“The revised EEO-1 report is not actually rescinded. However, it will be stayed until the [Equal Employment Opportunity Commission (EEOC)] submits a new information collection package. It's unlikely, though, that that will happen, because Acting EEOC Chair Victoria Lipnic has actually opposed the revised EEO-1 report from the beginning. And she recently said publicly that she hopes the OMB's decision prompts discussions of more effective ways to encourage employers to review compensation practices in order to ensure equal pay and to close the wage gap. The filing deadline, which used to be September 30th, is now March 31st, and the window for selecting a representative pay period used to be between July 1st and September 30th. It's now between October 1st and December 31st, as had been suggested in the revised EEO-1 report.”
(2) Judge Stays DOL Overtime Rule
The Department of Labor (DOL) exceeded its authority with its amended overtime rule. That’s the conclusion reached by the same Texas federal judge who stayed the Obama-era rule just before it took effect in 2016. The rule introduced a new minimum salary level for the overtime exemption that was more than double the current minimum. The court found that the rule made overtime status depend predominantly on salary level and was inconsistent with the language of the Fair Labor Standards Act, which refers only to job duties. In the wake of this ruling, the DOL has withdrawn its Fifth Circuit appeal of the judge’s earlier injunction, signaling that the agency intends to abandon the rule. The DOL has published an RFI for new proposed regulations, with the comment period ending September 25.
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(3) EEOC Files Suit Over Parental Leave Policies
The EEOC has filed its first lawsuit alleging sex discrimination in parental leave policies. This the latest indication that the EEOC is scrutinizing parental leave policies where men and women are treated differently. The EEOC filed suit against Estee Lauder, alleging that the beauty products company discriminated against a male employee when he was denied the same amount of paid leave offered to biological mothers following the birth of a child. The company policy provides six weeks of parental leave to primary caregivers, typically mothers, and two weeks to non-primary caregivers, most typically fathers.
(4) NY Tax Officials Publish Guidance on Paid Family Leave Program
New York State’s new paid family leave program takes effect in January. Now, state officials have made clear how the benefits will be taxed. Benefit payments will be treated as taxable non-wage income. Withholding will not be automatic, but employees can request that employers withhold taxes from benefit payments. New York’s paid family leave program is the most comprehensive in the country, ultimately providing up to 12 weeks of paid protected leave for bonding with a new child, caring for a close relative, or dealing with pressures surrounding a family member’s call to active duty in the military.
(5) Tip of the Week
Jil Galloway, Senior Vice President and Chief Administration Officer at Mitsubishi International Corporation, provides some advice on shifting your pay incentive structure:
“Pay incentive structures can be used to meet the top priorities of your organization. In the past, it was common for companies to want to generate a sense of pride in contributing to the company overall, so meeting the company’s objectives were heavily weighted in the evaluation process at the end of the year. In today's environment, we see that pay incentives are being effectively used to attract and reward strong individual performers. When making incentive plan changes, consider what motivates your key talent within the organization, and how to ensure that the incentive plan will encourage them to stay in your organization.”