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Employment and Labor Law Legislation

2014 Employment and Labor Law Legislation

Halfway through 2014, the U.S. House of Representatives is still controlled by a (slightly smaller) Republican majority that stopped many pro-labor initiatives before. The U.S. Senate remains controlled by a (slightly larger) Democratic majority.  The basically unchanged makeup of these two bodies mostly explains why the political gridlock of 2013 is not likely to change at least through the end of 2014.

The Obama administration’s tactic of using the Executive Branch’s regulatory powers to sidestep Congressional gridlock continued in 2013. Court challenges to regulatory law-making are becoming the norm, and important decisions have begun to be handed down.

What follows is a summary of major federal and state bills and regulations that are under consideration or pending. (updated 7/16/14)

FEDERAL

Restoring Overtime Pay for Working Americans Act

On June 18, 2014 Senator Tom Harkin (D-IA), Chairman of the Senate Health, Education, Labor, and Pensions (HELP) Committee, along with eight Senate Democrats, introduced legislation that is designed to restore overtime protections for low- and mid-wage salaried workers. The legislation would help to restore the 40-hour workweek for these workers.

Key provisions of the bill include:

Gradually raising the overtime salary threshold for executive, administrative, and professional (EAP) workers from $455 a week to $1,090 a week to match the inflation-adjusted level from 1975.

Gradually raising the threshold for “highly-compensated employees” from $100,000 to $125,000, based on inflation since the concept was introduced in the regulations in 2004, and indexing it to inflation after that.

Creating a “commonsense” definition of the term “primary duty.” This term is used in regulations to determine if a worker’s duties are overtime-exempt. Prior to 2004, a primary duty was that which was performed the majority of the time. Regulations issued in 2004 removed that 50% threshold. The bill would restore a 50% threshold.

Establishing recordkeeping penalties. Additionally, the bill would establish penalties for violations of the recordkeeping provisions of the FLSA, which would be the same as for violations of minimum wage or overtime: up to $1,100 if the violation is willful or repeated. (updated 7/11/14)

Workforce Innovation and Opportunity Act (WIOA)

On May 21, 2014, bipartisan leaders from the House and Senate introduced the Workforce Innovation and Opportunity Act (WIOA).  The bill, which will now be considered by both the House and Senate, modernizes and improves existing federal workforce development programs, helps workers attain skills for 21st century jobs, and fosters the modern workforces that American businesses will need to compete.  WIOA represents a compromise between the SKILLS Act (H.R. 803), which passed the House of Representatives in March 2013 with bipartisan support, and the Workforce Investment Act of 2013 (S. 1356), which passed through the Senate Health, Education, Labor, and Pensions Committee with a bipartisan vote in July 2013.  (updated 5/29/14)

Workforce Democracy and Fairness Act

Introduced by Rep. John Kline (R-MInn), this bill would overturn the NLRB’s so-called “ambush” election rules by helping protect employer free speech and worker free choice in union elections. The bill provides employers at least 14 days to prepare their case to present before a NLRB election officer and preserves their ability to raise additional concerns throughout the pre-election hearing. The legislation also reasserts the board’s responsibility to address critical issues before a union is allowed to represent workers. The bill was introduced on March 27, assigned to the House Committee on Education and the Workforce, and reported out of committee on April 9. (updated 5/5/14)

 

Employee Privacy Protection Act

Introduced by Rep. Phil Roe (R-Tenn), this legislation will counteract the NLRB’s attempt to provide union organizers more private information of workers and their families. The bill safeguards the privacy of America’s workers by allowing employees to choose the easiest and safest way to communicate with organizers during the election process. The bill was introduced March 27, assigned to the House Committee on Education and the Workforce, and reported out of committee on April 9. (updated 5/5/14)

Achieving Less Excess in Regulation and Requiring Transparency Act (ALERRT)

On March 4, 2014 the House passed omnibus federal regulatory reform legislation.  The omnibus legislation is H.R. 2804, now renamed the “Achieving Less Excess in Regulation and Requiring Transparency Act” (ALERRT). The vote was 236 (which included 10 votes from Democrats) to 179. It contains the following four sections:

Title I – The “All Economic Regulations are Transparent (ALERT)” Act would direct federal agencies to release detailed information each month about their proposed regulations. The bill would prevent new rules from becoming effective if proper notice regarding an impending rule is not provided. Agencies would also be required to publish information about their regulations on the Internet along with cost-benefit studies.

Currently the government is required by law to release information twice a year outlining each governmental agency’s proposed regulations.  According to Rep. George Holding (R - NC) who introduced the bill, the Obama administration has regularly failed to release this information on time, if at all.  He also noted that businesses rely on this information to anticipate forthcoming regulations and the effect(s) that regulations will have on their operations and plans.

Title II – The “Regulatory Accountability Act” was introduced by House Judiciary Committee Chair Bob Goodlatte (R-VA). Known as H.R. 2122, this Title was approved by the Committee by a vote of 13-9.  This proposed legislation is intended to increase government accountability over independent federal agencies such as the SEC and CFTC.  The bill would require federal regulatory agencies to choose the lowest- cost alternatives that meet statutory objectives and improve agency transparency and fact-finding.  It will permit costlier rules when needed to protect public health, safety, or welfare, provided the added benefits justify the added costs.  It also requires advance notice of proposed major rulemakings to increase public input before costly agency positions are proposed.

Title III – The “Regulatory Flexibility Improvements” Act would that ensure agencies adequately analyze proposed rules for their potential impacts on small businesses. It eliminates loopholes that agencies have used to avoid complying with the law. It would require initial and final regulatory analyses to describe alternatives to a propose rule that minimize any adverse significant economic impact or maximize the beneficial economic impact on small entities. (Title III began as a standalone bill H.R. 2542 introduced by Representative Spencer Bachus [R-AL], the chair emeritus of the Financial Services Committee.)

Title IV – The “Sunshine for Regulatory Decrees and Settlements Act” was originally introduced by Representative Doug Collins (R-GA). It would require a federal agency against which a civil action is brought to publish the notice of intent to sue and the complaint in a readily accessible manner. The notice and the complaint must be available online no later than 15 days after receipt.  It would require parties to a civil action to participate in mediation or alternative dispute resolution when attempting to settle an action. It would also require an agency seeking to enter a consent decree or settlement agreement to publish the decree or settlement agreement in the Federal Register and online, to indicate the basis for the decree or settlement agreement, description of the terms, and whether it provides for attorney fees.  This information would need to be published no later than 60 days after the decree or settlement is filed in court. (updated 3/24/14)

Affordable Care Act (ACA) – Please refer to ACA web page located under the ASE Research Services Tab for further specifics and updates. (updated 3/24/14)

Amendment to Fair Credit Reporting Act Would Prohibit Credit Checks – (S. 1837) A bill amending the Fair Credit Reporting Act (FCRA) to prohibit employers from asking for credit history was introduced into the U.S. Senate in December, 2013. This bill is comparable to a House bill introduced last February. If enacted, the bill would amend the Fair Credit Reporting Act to stop employers from requiring, or suggesting, that applicants disclose their credit history. It would also prohibit employers from obtaining a consumer or investigative report of job candidates. In addition, the measure would bar companies from disqualifying applicants based on a poor credit rating or any other information on their creditworthiness.

Though supported by the (majority) Democratic side of the Senate, this bill is expected to run into opposition from Republicans and would therefore run into particular opposition with the Republican majority in the House of Representatives.  S. 1837 currently sits in the Senate Health, Education and Labor Committee. (Added 1/29/2014)

Department of Commerce and the Workforce Consolidation Act (S. 1836) –  Proposed by U.S. Sen. Richard Burr (R- North Carolina) and co-sponsored by U.S. Sens. Daniel Coats (R-Indiana) Indiana and James Inhofe (R-Oklahoma), the bill would merge the Department of Labor, the Department of Commerce, and the Small Business Administration to establish a Department of Commerce and the Workforce. The consolidated Department of Commerce and Workforce would maintain the independent functions of both agencies while combining their administrative offices. “Duplicative programs cost the federal government staggering amounts of money every year,” Burr said. “Combining offices with similar functions within these two agencies is a commonsense approach that reduces wasteful spending and would streamline our approach to comprehensive economic policy.” The bill was introduced December 17, 2013 and referred the same day to the Senate Homeland Security and Governmental Affairs committee, headed by Senator Thomas Carper (D-Delaware), where it currently remains. (updated 1/7/14)

Equal Employment for All Act of 2013 (S. 1837) –  Senator Elizabeth Warren (D-Mass) on December 17 introduced the Equal Employment for All Act of 2013, co-sponsored by Senators Richard Blumenthal (D-Conn), Sherrod Brown (D-Ohio), Patrick Leahy (D-Vt), Edward J. Markey (D-Mass), Jeanne Shaheen (D-NH), and Sheldon Whitehouse (D-RI). The bill would amend the Fair Credit and Reporting Act to prohibit employers from requiring potential employees to disclose their credit history as part of the job application process. Specifically, employers would be barred from using consumer credit reports of prospective and current employees for employment purposes or taking an adverse action. The bill was assigned to the Senate Health, Education, Labor and Pensions (HELP) Committee, headed by Sen. Tom Harkin (D-Iowa) where it currently resides. (updated 12/19/2013)

Employee Rights Act (S.1712) - If enacted this law would mandate secret-ballot elections for representation and decertification elections and require secret-ballot strike votes as well. It would also preempt efforts by the National Labor Relations Board (NLRB) to reintroduce its “quickie” election rules by barring unions from obtaining employees’ private information and “ensure due process” in determining appropriate bargaining units and voter eligibility.

Another significant provision of S. 1712 would mandate recertification elections to reaffirm a union’s representative status (also through a secret-ballot vote) when employee turnover exceeds 50%. “If there is turnover in the workforce, there should be vote to determine if the union still has the support of current employees,” Hatch said.

Also if S. 1712 is enacted, unions would be barred from using workers’ dues and fees for political activities without workers’ written consent. The bill also would allow every employee in a union-represented bargaining unit — both union members and non-members — to participate in contract ratification and strike votes.

The bill was introduced Nov. 14, 2013 by Sen. Lamar Alexander (R-Tenn) and Sen. Orrin Hatch (R-Utah). It was referred to the Senate HELP committee (see above) where it currently resides. (CCH 11/21/2013)

Employment Non-Discrimination Act (ENDA) Re-introduced (HR 1755) This bill would add sexual orientation and gender identity the list of protected classes where employment discrimination is prohibited. This legislation was previously introduced but died at the close of the last session of Congress.

This bill would make it unlawful for an employer with 15 or more employees:

(1) to fail or refuse to hire or to discharge any individual, or otherwise discriminate against any individual with respect to the compensation, terms, conditions, or privileges of employment of the individual, because of such individual's actual or perceived sexual orientation or gender identity; or

(2) to limit, segregate, or classify the employees or applicants for employment of the employer in any way that would deprive or tend to deprive any individual of employment or otherwise adversely affect the status of the individual as an employee, because of such individual's actual or perceived sexual orientation or gender identity.

The bill defines "gender identity" as "the gender-related identity, appearance, or mannerisms or other gender-related characteristics of an individual, with or without regard to the individual's designated sex at birth."

The bill would also prohibit employment agencies and labor organizations from discriminating against individuals on these bases, and ban retaliation against individuals who exercise their rights under this bill. The provisions would not apply to religious organizations or the armed forces, or require employers to establish hiring quotas or provide preferential treatment to employees based on their sexual orientation or gender identity.

An employer could still enforce dress or grooming standards, so long as employees who have undergone or are undergoing gender transition may follow the dress or grooming standards applicable to their intended gender.

Individuals aggrieved by the type of discrimination proscribed by this bill would be entitled to remedies afforded under Title VII of the Civil Rights Act, although only disparate treatment – and not disparate impact – claims would be recognized.

The Senate Committee considering this legislation voted it out to the full Senate floor for debate on November 4, 2013 (S. 815). At the end of December the full Senate passed the bill  64 – 32. The New York Times reported that this is the first significant move on this legislation  since 1996 and that the full Senate will consider a measure to extend federal nondiscrimination law to gay, lesbian and bisexual people. Though this legislation in one form or another has been introduced and considered for over 40 years, this is the first time trans-gendered people are also included for protection against discrimination in employment and housing. (NYT 11/4/2013; Littler Mendelson Newsletter 12/30/2013)

A House version of the bill of the same name (HR 1755) was introduced April 25, 2013 and referred to the House Committee on Education and the Workforce the same day. The bipartisan ENDA was reintroduced in the House by Jared Polis (D-CO) and Ileana Ros-Lehtinen (R-FL) and cosponsored by 158 others.  It currently resides in that committee, which is headed by Rep. John Kline (R-MN). (updated 1/7/14)           

Family and Medical Leave Inclusion Act Re-introduced (HR 1751) The US House and Senate will also take up legislation that allows employees to take unpaid leave to care for a same-sex spouse or partner, parent-in-law, adult child, sibling, grandchild or grandparent. As with the Employment Non-Discrimination Act, the bill failed to pass in the last session of Congress and had to be re-introduced. It was referred to the House Subcommittee on Worker Protections on July 8, 2013. (updated 10/30/13) 

Working Families Flexibility Act of 2013 Introduced

Under the terms of this bill (HR 1406), as introduced by Rep. Martha Roby (R-Alabama) on April 9, 2013, workers who are entitled to get overtime pay could choose instead to receive compensatory time, and could also choose to bank it -- up to 160 hours a year. With these hours in the "bank," there would be time to care for a family member, or attend school functions, proponents say. Just like overtime compensation, which is paid at a rate of one and a half hours of pay for every hour worked, one and a half hours of time could be set aside for each overtime hour worked. And, if the workers later decide they'd rather have the money, all they have to do is ask, and the company must pay it within 30 days. After 80 hours in the bank, the company can decide to pay OT in cash, not time. HR 1406 was referred to the Senate committee on Health, Education, Labor, and Pensions on May 9,2013. (updated 10/30/13)

Rep. Carolyn Maloney (D-NY) and Sen. Bob Casey (D-PA) have reintroduced legislation that would provide employees with a statutory right to request flexible work terms and conditions. The Flexibility for Working Families Act (H.R. 2559, S. 1248) would authorize an employee to request a change in the terms or conditions of employment relating to (1) the number of hours the employee is required to work; (2) the times when the employee is required to work or be on call for work; (3) where the employee is required to work; (4) the amount of notification the employee receives of work schedule assignments. This bill was referred to the House Subcommittee on the Constitution and Civil Justice on July 15, 2013. (updated 10/30/13)

Family and Medical Leave Enhancement Act of 2014

Representative Carolyn B. Maloney (D-NY)  introduced HR 3999 that would amend the FMLA to cover employers with 25 or more employees, rather than the current coverage threshold of 50 or more employees. It would also permit employees to take “Parental Involvement” leave and “Family Wellness” leave.  Parental Involvement is leave for employees to participate in or attend activities that are sponsored by a school or community organization and are related to a program of the school or organization that the employee’s son, daughter, or grandchild attends. Family Wellness is leave that would apply to routine family medical care needs, including medical and dental appointments of an employee’s son, daughter, spouse, or grandchild, or to attend to the care needs of elderly relatives, including visits to nursing homes and group homes. (Updated 2/11/14)

Paycheck Fairness Act

Senator Barbara Mikulski (D-Md.) and Representative Rosa DeLauro (D-Conn.) reintroduced in their respective chambers the Paycheck Fairness Act (S. 84/S. 2199 and H.R. 377) on January 23, 2013, intended to shrink the pay gap between men and women. The bill has been introduced several times during the last few years, but the Senate failed to overcome the threat of a Republican filibuster in May 2012. On April 23 the bill was referred to the House Subcommittee on Workforce Protections.

The sponsors maintain that because women earn 77 cents for every dollar earned by a man for equal work, there must be corrective action to fix the disparity that costs both women and their families approximately $434,000 on average over the course of their careers.

Under the legislation, employers would be required to demonstrate that any disparity complained of is related to job performance and not to the gender of the employee. The legislation also would prohibit employers from retaliating against employees who communicate salary information with coworkers, and thirdly would strengthen remedies for pay discrimination by increasing compensation women can seek. This would allow them not only to seek back pay, but also punitive damages for pay discrimination. At this writing the bill remains in committee. (updated 1/7/14)

On Wednesday April 9, 2014, the bill failed by a 53-44 vote to be passed out of committee. The bill can be brought to the floor again during this term although that is not expected to happen.(updated 4/10/14)

Employee Paycheck Protection Act: (H.R. 175) stems from the recent U.S. Supreme Court case, Knox v Service Employees International Union, in which the high court ruled that public sector unions cannot compel non-members to fund the union’s political and social speech without proper notice. The bill was introduced January 4, 2013 by Rep. Tim Griffin (R-Arkansas). It was referred to the House Subcommittee on Health, Employment, Labor and Pensions on April 23, 2013 where it currently resides.

Under the bill, unions would be required to provide so-called “Hudson” notices to all employees covered by a collective bargaining agreement, explaining how the fees are apportioned. Such notices would explain how the union calculated the share of such dues or fees that are for non-political costs related to collective bargaining. The bill would also make it clear that unions cannot require non-members to pay dues or fees unless the non-member has provided affirmative consent. (updated 1/7/14)

Fair Pay Act  

The Fair Pay Act of 2013  (S. 168) was introduced in the Senate by Sen. Tom Harkin (D-Iowa) on January 29, 2013. The bill would require employers to provide equal pay for jobs that are comparable in skill, effort, responsibility, and working conditions. The bill would also require employers to give their workers the information they need to determine when jobs are undervalued. The bill was referred to the Senate Committee on Health Education, Labor, and Pensions on the same day it was introduced. (updated 10/30/13)

Payroll Fraud Prevention Act of 2014

The Payroll Fraud Prevention Act of 2014 (H.R. 4611) has the same title as the Payroll Fraud Prevention Act of 2013 (S.1687), which was introduced on November 12, 2013, and the Payroll Fraud Prevention Act of 2011 (S.770), which was introduced on April 8, 2011. If enacted, the 2014 bill would expand the federal Fair Labor Standards Act (which currently addresses minimum wage, overtime, and child labor laws) to cover misclassification of employees as Independent Contractors. It would also create a new definition of workers called "non-employees," impose upon businesses the obligation to provide a classification notice for both "non-employees" and "employees," would make the misclassification of "employees" as "non-employees" a new labor law offense, and would expose businesses to fines of up to $5,000 per worker for each violation of the law. Those provisions were included in the 2011 and 2013 versions of the bill.

The bill has a number of other key provisions, but the one most likely to receive attention is the obligation for every employer and enterprise to provide a classification notice for both "non-employees" and "employees." This notice would require every business to provide a written notice to all workers performing labor or services (a) stating that they have been classified by the business either "as an employee or non-employee," (b) directing them to a U.S. Department of Labor website for further information about the rights of employees under the law, and (c) informing them to contact the Labor Department if they "suspect [they] have been misclassified."

All businesses would be affected by the Payroll Fraud Prevention Act of 2014, even those that did not use any ICs or other non-employees. Each employer or enterprise would be required to issue such notices to all its employees within six months following passage of the law for incumbent workers and, with respect to new employees and ICs, at the commencement of the new worker's employment or IC relationship. (updated 5/28/14)

Three Bills to Stop the NLRB from Conducting Business

Senators introduced bills to curtail activities of the National Labor Relations Board in light of the Appeals Court decision holding the Board has operated without a quorum since 2012.  If passed, the bills would do the following:

  • The Advice and Consent Restoration Act would both block the pay of any board member not confirmed by the Senate and would block the board from taking any action until these appointees are legally confirmed. The bill was introduced on February 6, 2013 by Rep. Mike Kelly (R-PA) and referred to the House Subcommittee on Health, Employment, Labor and Pensions on the same date. It currently resides in that committee (updated 1/7/14)
     
  • NLRB Freeze Act of 2013 was introduced January 30, 2013 by Sen. John Barrasso (R-Wyoming) and referred to the Senate Committee on Health, Education, Labor, and Pensions on the same day. The bill would stop the NLRB from enforcing all rules, regulations and decisions issued since January 2012. (updated 10/30/13)
     
  • Restoring Constitutional Balance of Powers Act of 2013 was introduced by Sen. Mike Johanns (R-NE) on January 31, 2013 and referred to the Senate Committee on Health, Education, Labor, and Pensions on the same day. The bill would prohibit the Board from enforcing or implementing decisions and regulations without a constitutionally confirmed Board or director. Under the bill, the Board would be forbidden from using funds to undertake or enforce any actions that began on January 4, 2012, the date of the recess appointments. (updated10/30/13)

Protecting Health Care Providers from Increased Administrative Burdens Act (HR 3633)

Representative Tim Walberg (R-MI), Chair of the House Education and the Workforce Committee’s Workforce Protections Subcommittee, introduced this bill on December 3, 2013. The bill was referred to the House Education and Workforce (HEW) committee on the same day, where it currently resides. The HEW committee is chaired by Rep. John Kline (R-MN).

HR 3633 would exempt healthcare providers from the jurisdiction of the Office of Federal Contract Compliance Programs (OFCCP). It was introduced because it was discovered that such providers were previously exempted from OFCCP jurisdiction under the Defense Appropriations Law of 2011; but when a new Defense Appropriations Law was enacted in 2013, the exemption was excluded. Therefore, until HR 3633 is enacted into law or the courts intervene, healthcare providers who currently have TRICARE contracts are subject to OFCCP regulations. (updated 1/7/14)

The Social Networking Online Protection Act (SNOPA) (HR 537)

Reintroduced on February 6, 2013 by Rep. Eliot L. Engel (D-NY), SNOPA is intended to protect the users of social networking sites from having to divulge their personal information to employers. SNOPA also protects both employees and applicants, and those facing disciplinary action from being required to give passwords or other information used to access their online accounts. The bill was referred to the House Subcommittee on Workforce Protections on April 23, 2013 and remains there as of this writing. (updated 1/7/14)

Federal Right-to-Work Bill  (S. 204)

On January 31, 2013 Senator Rand Paul (R-KY) introduced legislation to amend the National Labor Relations Act to prohibit the use of union security clauses in collective bargaining agreements. If enacted into law, the National Right-to-Work Act would prohibit employers across the country from conditioning employment on the payment of union dues or fees. The bill would also amend the Railway Labor Act to the same effect. On February 4, 2013, the bill was reported out of committee and placed on the Senate Legislative Calendar under General Orders, but no action has been taken on it since then.

On March 5th, 2013 similar legislation (HR 946) was introduced in the House by Rep. Steve King (R-Iowa). It was referred to the House Subcommittee on Health, Employment, Labor, and Pensions on April 23, 2013. It remains in committee as of this writing (updated 1/7/14)

Minimum Wage Increase – The Fair Minimum Wage Act of 2013 (S. 460, H.R. 1010)  Introduced in the Senate in 2013 by Sen. Tom Harkin (D-Iowa), chairman of the Senate Health, Education, Labor, and Pensions (HELP) Committee. The legislation would increase the minimum wage to $10.10 per hour in three steps over three years, and provide for subsequent automatic annual increases linked to changes in the cost of living. It also would gradually raise the minimum wage for tipped workers, currently $2.13 per hour, for the first time in more than 20 years — to 70% of the regular minimum wage. It is unlikely that the Republican-controlled House will approve it.

On February 12, 2014, President Obama signed an Executive Order raising the minimum wage for federal contract workers, including tipped workers. See “Federal Regulatory” section below for details. (Updated 1/30/2014)

Roll Back of “Quickie” Election Rules In response to the re-introduction of the controversial “Quickie” Election rules, the GOP House and Senate members introduced legislation to ensure that workers and employers are given sufficient time to respond to union organization.

The legislative response proposed would:

  • Guarantee that workers have time to gather all the facts to make a fully informed decision in a union election. No union election will be held in fewer than 35 days.
  • Ensure that employers are able to participate in a fair union election process. The bill provides employers at least 14 days to prepare their case to present before a NLRB election officer. It also protects their right to raise additional concerns throughout the pre-election hearing.
  • Reasserts the NLRB’s responsibility to address critical issues before a union is allowed to represent workers. The board must determine the appropriate group of employees to include in the union before the union is certified, as well as address any questions of voter eligibility.
  • Empower workers to control the disclosure of their personal information. Employers would have seven days to provide a list of employee names and one additional piece of contact information chosen by each individual employee.

This legislation was introduced March 27, 2014. (Updated 3/27/2014)

STATE

The following information details recent employment and labor laws introduced and/or enacted in Michigan. Pending bills introduced in 2011 and 2012 did not carry over to the new state legislative session. Any legislation pending at the end of 2012 had to be re-introduced in the 2013-2014 session and start the legislative process over again.

Workforce Opportunity Wage Act of 2014: On May 27 a new state minimum wage law was signed into law by Gov. Snyder. It is a compromise piece of legislation that incrementally increases the minimum wage and ties increases beyond 2019 to the Midwest regional rate of inflation.

On September 1, 2014 Michigan’s minimum wage will increase to $8.15/hour. The following details subsequent scheduled increases:

Beginning January 1, 2016, $8.50.
Beginning January 1, 2017, $8.90.
Beginning January 1, 2018, $9.25.

Tipped employees’ minimum wage will increase as the minimum wage increases. Tipped employee minimum wage will be 38% of the full minimum wage rate at the time.

This new law includes an inflation adjustment provision that will go into effect in January 2019. This provision will implement automatic increases to the minimum wage going forward each year, based on the increase to the Consumer Price Index (CPI) for the Midwest region. The formula will be calculated on an average annual change in the CPI for the most recent five-year period. The new rate will be posted each year on February 1. The Michigan State Treasurer will adjust the average annual rate, and the new rate will go into effect beginning April 1 of that same year. Any increase will be capped at 3.5%.

The law also provides that any increase prescribed will not take effect if the state’s unemployment rate as determined by the federal Bureau of Labor Statistics is over 8.5% for the preceding year.

Rather than amending the existing minimum wage law, this law repeals and replaces that law. This was done to intentionally derail the separate Raise Michigan ballot initiative (described below).

More information on this new law may be obtained from ASE’s Research department. (Updated 5/28/2014)

Minimum Wage Ballot Proposal  – Separate from the legislative action that produced the Workforce opportunity Wage Act of 2014, but acting simultaneously, an activist group in Michigan called the Raise Michigan Coalition collected enough signatures to place a proposal on the statewide election ballot in November 2014. If passed by the voters in November, the proposal would amend the Minimum Wage Law that was in place prior to this week’s passage of the Workforce Opportunity Wage Act (see above). The amendment would raise the existing minimum wage ($7.40/hour) to $8.10 in January 2015, $9.10 in January 2016 and $10.10 in January 2017. This ballot initiative also includes a provision for subsequent annual cost-of-living adjustments. Further, the initiative includes a more dramatic increase for tipped workers, from their current minimum wage of $2.65/hour by 85 cents annually until they reach the full minimum.

(Note that an original version of this initiative would have raised the minimum wage to $9.50 by January 2016. But the Raise Michigan Coalition revised it to the current numbers in order to bring it in line with the Federal initiative.)

To pass this initiative the group needed to gather at least 258,088 valid registered voter signatures by May 28 to put the initiative in front of the legislature. Raise Michigan delivered 319,784 petitioner signatures to the Michigan Department of State.

At this writing, the question is whether this initiative will have any validity at all, because it amends a law that no longer exists. Raise Michigan vows to continue to see it through to its conclusion at the November 5, 2014 election. (Updated 5/28/2014)

Michigan Republican lawmakers return to prevailing wage repeal in 2013 – Last year the Michigan House Republican caucus (which spearheaded the passage of Right-to-Work) announced its plan to pick up repeal of Michigan’s prevailing wage law. This was one of the first legislative priorities the state GOP set when it won control of the Michigan legislature and the governorship.

The prevailing wage law requires state-financed or sponsored projects for which a state agency, university, community college or school district is the contracting agent to pay workers a wage of at least the level of other construction workers in a given region.

Opponents of the law estimate that it costs Michigan upwards of $250,000,000 each year. Organized labor sees this as a further attack on it.

Advocates for small business continue to oppose this law. In its Small Business Agenda for 2014, the Michigan branch of the National Federation of Independent Businesses calls for the repeal of the state’s Prevailing Wage Law, saying in part

. . . The state’s current prevailing wage law acts as a “super minimum wage” that sets wages much higher than local construction wages determined by fair competition in the free market. NFIB will be supporting legislation that will eliminate the prevailing wage requirement on public construction projects financed with state taxpayer dollars. (updated 1/16/14)

The “Employment Application Fairness Act” HB 4366 was introduced in the Michigan House on March 5. Known informally as “Ban-the-Box,” HB 4366 would prohibit employers from eliciting information on an initial application about conviction of a felony. Not included in the prohibition would be background checks or inquiries that take place after the initial application for employment is completed, or any inquiry necessary for the employer to comply with state or federal law. The bill also provides for damages upon violation. The bill was sent to the House Commerce Committee on March 6 where it remains as of this writing.

Supporters of the bill want to open up employment opportunities for past felons. Employer advocacy groups hold that employers have the right to know as much about an applicant as possible before they make any decisions about whether to allow them into the workplace. Reported 11/12/2013 in Gongwer.

This bill sits in the Commerce Committee as of 11/12/2013. (Updated 7/11/2014)

Parolee Hiring Assistance Legislation Introduced in 2014 (HB - 5216, 5217, 5218) - A package of bills designed to encourage businesses to hire parolees was introduced in the House on January 9, 2014.  HB 5216 would allow the state Department of Corrections to issue a “Certificate of Employability” to convicts just prior to their release. Under 5217, hiring someone with such a certificate would provide certain protections to employers from either civil or criminal liability for negligent hiring in the event the individual runs into legal problems in the context of his or her employment. HB 5218 offers similar protections to licensing boards to encourage them to issue licenses to otherwise-qualified ex-convicts.

Currently the legislation has bipartisan support. At this writing all three bills were passed by the House and reside in the Senate Judiciary Committee awaiting further action. (Updated 7/1/14)

The “Employment Leave Uniformity Act” - On March 13, the Michigan House Commerce Committee reported out. H. 4249, known as the “Employment Leave Uniformity Act,” on an 11-7 vote. The bill provides that counties, townships, cities, and villages may not adopt or administer ordinances or policies requiring an employer to provide an employee with paid or unpaid leave that is not required by federal law. This bill sits in the Commerce Committee as of 3/13/2013 (updated 7/11/14).

Equal Pay (Comparable Worth) – (S. 298) – This bill, if enacted into law, would find employment discrimination for failing to provide equal compensation for comparable work under certain circumstances. This bill has been sitting in Committee since its introduction in April, 2013. (Updated1/30/2014)

Employer Protection from Garnishment Liability – (House Bill 5390  and  5391) – If passed, this legislation would protect employers from unlimited liability for court mandated garnishments.

Under current law, if an employer fails to comply with a writ of garnishment for an employee, the employer may be held responsible for payment of the underlying debt. HB 5390 and HB 5391 are intended to limit employer liability under these writs of garnishment and to reform other areas that have long been an irritation for job providers.

Specifically, the bills would do the following:

  • Limit employer liability for amounts that should have been withheld under a writ of garnishment to a maximum of $100, and allow an employer to recover this amount from the employee
  • Establish clear due process for employers in the garnishment process
  • Give employers an extra window of time to respond a writ of garnishment before a default judgment can be entered for failure to respond
  • Extend the life of wage garnishments from 182 days until paid in full
  • Increase the processing fee employers are paid by creditors to process garnishments from $6 to $35

The bills were introduced March 5 by State Rep. Kevin Cotter (R-Mt. Pleasant) and referred to the Committee on Commerce, where they currently reside. (Updated 7/11/14)

The Supporting Knowledge and Investing in Lifelong Skills (SKILLS) Act

The SKILLS Act eliminates and streamlines 35 ineffective and duplicative programs, including 26

identified in a 2011 report by the nonpartisan Government Accountability Office.  Additionally, the proposal creates a Workforce Investment Fund to serve as a single source of support for employers, workers, and job seekers. States are required to reserve a certain percentage of funds to specifically target individuals with unique barriers to finding employment, including at-risk youth.  The SKILLS Act reinforces the role of America’s job creators in the workforce investment system by ensuring two-thirds of state and local Workforce Investment Board members are employers. (updated 7/11/14)

Elliott-Larsen Civil Rights Act Amendment Proposed

An amendment to the Elliot-Larsen Civil Rights Act that would extend protections to sexual orientation is being considered by the Michigan Legislature. This amendment is expected to be introduced in September of this year. (updated 7/11/14)

FEDERAL REGULATORY

Minimum Wage Executive Order: On February 12, 2014, President Obama signed an Executive Order raising the minimum wage for federal contract workers to $10.10/hour for new contracts beginning January 1, 2015. This increase includes tipped workers also. Tipped workers received an immediate increase from $2.13/hour to a minimum tip wage of $4.90/hour with 95-cent increases each year until the tipped minimum wage is 70% of the $10.10/ hour minimum wage. Regulations. The Executive Order applies to contracts for construction covered by the Davis-Bacon Act that exceed $2,000; contracts for services covered by the Service Contract Act that exceed $2,500; concessions contracts (for food, lodging, fuel, souvenirs, newspaper stands, or recreational equipment on federal property); and contracts to provide services, such as child care or dry cleaning, in federal buildings. In procurement contracts where workers’ wages are governed by the Fair Labor Standards Act (FLSA), the Executive Order applies only to contracts that exceed $3,000.

 

The Department of Labor issued proposed regulations on June 17, 2014 and extended the comment period to July 28, 2014 due to request by various organizations.  The Notice of Proposed Rulemaking (NPRM) defines key terms used in the Executive Order, including “contracts,” “contract-like instruments,” “concessions contracts,” and “workers.” A “contract” or “contract-like instrument” is defined as an agreement between two or more parties creating obligations that are enforceable or otherwise recognizable at law. A “concession contract” is a contract under which the federal government grants a right to use federal property, including land or facilities, for furnishing services. The proposed regulations use “worker” in a broad sense and covers those who would not otherwise be “service employees” under the Service Contract Act (SCA) or “laborers” under the Defense Base ACT (DBA).

Further, the NPRM establishes standards for contractors to apply in determining whether their employees are covered by the Executive Order. The regulations also contain recordkeeping requirements and directions for finding the required rate of pay for all workers, including tipped workers and workers with disabilities.

DOL plans to adopt existing mechanisms used for enforcing prevailing wage laws to enforce the provisions of the Executive Order. Under the proposal, any contractor who DOL determines has failed to pay the proper minimum wage will be notified and asked to remedy the violation. Additionally, the contracting agency may be directed to withhold payments under the contract. If a notice of violation is issued, the contractor may appeal to an administrative law judge. (updated 7/11/14)

DOL extends FMLA coverage to same sex partners: On September 18, 2013 the U.S. Department of Labor (DOL) issued a regulatory guidance confirming that same-sex married couples are entitled to the same benefits of the Family and Medical Leave Act (FMLA) as more traditional heterosexual married couples.  The guidance indicates that FMLA spousal leave entitlements extend to same-sex spouses that reside in states that recognize same-sex marriages. (updated10/30/13)

Fair Labor Standards Act (FLSA) Exemptions

On March 13, 2014, President Obama directed the Department of Labor (DOL) to rewrite the FLSA exemption laws more tightly in order to make overtime pay available to more workers. The proposed changes will focus first on the Salary Level test (the minimum amount salaried workers must be paid in order to qualify as exempt from minimum wage and overtime requirements) and then on the Duties test (who should be exempt from overtime based on the kind of work they do).  The Obama administration believes that employers have abused these rules in the past, which justifies changing the requirements.

Under the President’s executive order, some fast food shift supervisors, loan officers, computer technicians, and others who are currently classified as exempt would become eligible for overtime. Employees would also be required to perform a minimum percentage of “executive work” to qualify for the so-called white collar exemption, narrowing a loophole that allowed companies to exempt low-level retail managers from overtime pay.

Final regulations will likely not come out until after the November 2014 elections. While the exact revisions the DOL will propose are not yet known, it is clear that the government views the current definitions of exemptions as too broad. (updated 3/24/14)

OFCCP new Disability and Veteran Regulations: The final rules were promulgated on September 24, 2013 and have become effective as of March 24, 2014.  These new rules establish a 7% utilization goal for individuals with disabilities (IWDs) (analyzed by job group, except for facilities under 100 which can be done by facility) and an 8% hiring benchmark for veterans. 

Contractors with an AAP in place on the Final Rule’s effective date may maintain that AAP until the end of their AAP year and delay their compliance with the AAP requirements for data collection (Subpart C) until the start of their next AAP cycle. Contractors are nevertheless encouraged to begin updating their employment practices and IT systems to come into compliance with the revised requirements for data collection as soon as possible.

Therefore, for example, an organization with a January 1, 2014 plan date must begin with data collection on January 1, 2015, and include the analysis in its January 2016 AAP.  If a company has an April 1, 2014 plan, data collection begins on April 1, 2014, and the analysis is included in the April 2015 AAP.   Hence, organizations with a plan year beginning after April 1 must decide whether for business reasons to have a plan year before April 1, or to continue on the same plan year.  By having an earlier plan year, the contractor has an additional year to collect and to conduct analysis on data. 

Contractors must collect data from both applicants and its current workforce.   The invitation to employees must be issued to all employees the first year that the contractor is subject to the self-identification requirement under Section 503.  Then employees must be invited to self-identify every five years after the initial invitation.  A contractor must also provide at least one reminder to employees within each five-year period that they may self-identify as IWDs.  Before data collection can begin, though, OFCCP stated it will provide an approved form for the collection of data.  Currently OFCCP has submitted an approved collection form to the Office of Management and Budget (OMB).  Once approved (it will be within six months), contractors can use those forms for data collection purposes.  For more information on the OFCCP regulations, click here.

National Labor Relations Board Reinstituted: The National Labor Relations Board had five confirmed members for the first time in more than a decade after the Senate took a series of votes approving a full slate of nominees in August 2013. The Board members are Democrat appointees Kent Hirozawa, Nancy Schiffer, Mark Gaston Pearce (NLRB chairman) and Republican appointees Harry I. Johnson III and Philip A. Miscimarra.

In January 2012, the U.S. Court of Appeals for the D.C. district ruled that President Obama violated the Constitution when he installed three officials onto the NLRB through recess appointments in 2012. The ruling was a blow to administration, and calls into question the long-established precedent of recess appointments, which bypass Congressional approval.  The case is currently (October 2013) before the U.S. Supreme Court.  The ruling was supported by two other federal Courts of Appeal in separate cases.  All rulings by the NLRB subsequent to the President’s recess appointments of the three officials are regarded as being in question.

The appointment of Acting NLRB General Counsel, Lafe Solomon, was also declared invalid in a separate proceeding relying on the Circuit Court of Appeals rulings concerning the original NLRB member appointments.  United States District Judge Benjamin H. Settle of the Western District of Washington dismissed the petition of Region 19 of the NLRB seeking injunctive relief pursuant to section 10(j) of the Act. In reaching that determination, Judge Settle reviewed whether the NLRB had the authority to issue the complaint underlying the request for injunction.  This ruling may put a number of NLRB actions authorized by the Acting General Counsel in question.  Appeal is currently (October 2013) under review.

National Labor Relations Act Poster – POSTING NOT REQUIRED.

Enacted by regulation, the National Labor Relations Board in early 2012 moved to require all employers to post a notice about employee rights to organize a union. This posting requirement is known as “Notification Of Employee Rights Under The National Labor Relations Act.”

On April 17, 2012 the D.C. (federal) Appeals Court, in response to an appeal of an adverse decision by that district’s lower federal court, issued and injunction against the NLRB posting rule. Originally scheduled for implementation April 30th, the Court’s injunction suspends the notice requirement until an appeal is heard by the Court.

On May 7, 2013 the D.C. (Federal) Appeals Court struck down the posting rule, ruling that the NLRB posting requirement overreached that agency’s authority.  On June 20, 2013 the U.S. Fourth Circuit Court of Appeals also stuck down the NILRB posing rule. On August 7, 2013 the National Labor Relations Board petitioned for rehearings in both the D.C. Circuit Court of Appeals and the Fourth Circuit Court of Appeals. (updated10/30/13)

In January, 2014 the National Labor Relations Board capitulated in its challenge to overturn the earlier lower court decisions against its posting rule and will no longer fight to require employers post its notice of rights poster. By failing to timely file for a writ of certiorari with the U.S. Supreme Court by January 2, 2014 it effectively killed its appeal on this issue.  (updated 1/8/2014)

Proposed Rule Changes Impacting Employer Union Organizing Response and Elections

On June 20 and 21 of 2011 the Department of Labor and the National Labor Relation Board proposed rules changing a decades-long interpretation and application of the National Labor Relations Board. On June 20, 2011 the Department of Labor (DOL) issued proposed regulation tightening the interpretation of “advice” under the Labor-Management Reporting and Disclosure Act (LMRDA). On June 21st, the National Labor Relations Board (NLRB) issued proposed rules that it says will “streamline” the union election process.

NLRB Quickie Election Rules – (Note: these Rules were re-issued February 6, 2014.)

On April 30, 2012 the NLRB Quickie Election Rule was promulgated.  One of the NLRB’s primary duties under the law is to protect the free and fair secret ballot election to determine whether employees choose to be represented by a union or not. The new rules do the following: 

  1. Provide an NLRB hearing officer the ability to limit the evidence that could be introduced at a representation case hearing
  2. Provide the hearing officer the authority to deny a party the right to file a brief
  3. Eliminate a party’s right to have the NLRB review a decision by a regional director to direct an election
  4. Eliminate current language that requires an election to be conducted within 25-30 days, thereby permitting elections to be held before the 25-day period. The amended rules call for 21 days or fewer
  5. Eliminate a party’s right to have the NLRB review any decisions by a regional director or an administrative law judge regarding post-election disputes
  6. Prohibit pre-election appeals and consolidate all appeals to be heard only after the election takes place
  7. Allow direct election appeals to the Board before an election only in  “extraordinary circumstances”

The Board believes that the proposed rule amendments would remove unnecessary barriers to the fair and expeditious resolution of questions concerning representation; that they would simplify representation-case procedures and render them more transparent and uniform across regions; eliminate unnecessary litigation and consolidate requests for Board review of regional directors’ pre- and post-election determinations into a single, post-election request; and would allow the Board to more promptly determine if there is a question concerning representation and, if so, to resolve it by conducting a secret ballot election.

On January 22, 2014 the Federal Register reported that the National Labor Relations Board rescinded its Quickie Election rule. This meant the rules governing organizing elections went back to the way they were previous to December 11, 2011. The restoration pertained to 29 CFR Parts 101 and 102, and confirmed the NLRB’s statements of procedures and rules and regulations to the D.C. District Court’s “mandate that ‘representation elections will have to continue under the old procedures,’” the Board said. Given the circumstances, the NLRB found it unnecessary to provide notice and comment on the restoration.

On February 6, 2014 the National Labor Relations Board issued new proposed “Quickie” Election rules under the reconstituted Board. See above summary. These rules are virtually the same as the previous rules that had been rescinded

On March 27, 2014 new legislation was introduced that would change the rules surrounding NLRB elections and establish legal protections for how NLRB oversees elections. The bill would:

  • Guarantee workers the time to gather all the facts to make a fully informed decision in a union election. No union election will be held in fewer than 35 days.
  • Ensure that employers are able to participate in a fair union election process. The bill provides employers at least 14 days to prepare their case to present before an NLRB election officer and protects their right to raise additional concerns throughout the pre-election hearing.
  • Reassert the board’s responsibility to address critical issues before a union is allowed to represent workers. The board must determine the appropriate group of employees to include in the union before the union is certified, as well as address any questions of voter eligibility.
  • Empower workers to control the disclosure of their personal information. Employers would have seven days to provide a list of employee names and one additional piece of contact information chosen by each individual employee.

See more information above at the Federal Legislation update section. (Updated 5/5/14)

DOL LMRDA Rulemaking Proposal – Persuader Regulations

The DOL states that its new rulemaking allows for more transparency by requiring employers to disclose  whom they are using to provide advice on influencing employees in connection with union organizing and bargaining. Currently employers are only required to disclose consultants they have hired who speak directly to employees on these matters. They are not required to file reports identifying outside consultants who are only giving advice to the employer.

Under the proposed rule, employers will have to report any arrangements with consultants that issue communications on behalf of an employer designed to “directly or indirectly persuade workers concerning their rights to organize or bargain collectively.”

This proposed disclosure requirement, the Labor Department states, also includes information about “union avoidance” seminars and conferences offered to employers by lawyers and labor consultants. This is because the Labor Department states such seminars “involve reportable persuader activity.”

ASE’s position is that both rules significantly curtail employers’ rights to communicate to and inform employees about what unionization means and how it may adversely affect them. ASE is in opposition to any restrictions or the imposition of regulations that curtail the employer’s right to maintain its business free from union influence or organization.

The Persuader Rules remain under review by the White House and the latest information from the Department of Labor on when they may be issued is expected in November or December, 2014. (updated 3/17/14)

 

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