Professional Service Agreement

Week in Review

March 23, 2015

Paid family and medical leave proposal reintroduced
Representative Rosa DeLauro (D-CT) and Senator Kirsten Gillibrand (D-NY) have reintroduced a measure that would create a national paid family and medical leave plan. The proposal would establish a paid family and medical leave insurance program with the aim of "ensuring that American workers would no longer have to choose between a paycheck and caring for themselves or a family member." The lawmakers noted that the current Family and Medical Leave Act provides unpaid, job-protected leave for serious health related events. However, only about half the workforce qualifies for this unpaid leave, and many more simply cannot afford to take it because it is unpaid. The Family and Medical Insurance Leave (FAMILY) Act (H.R. 1439: S. 786) would create an independent trust fund within the Social Security Administration to collect fees and provide benefits. The proposal would fund the trust by employee and employer contributions of 0.2 percent of wages each, creating a self-sufficient program that would not increase the federal budget. The FAMILY Act would make leave available to every person, no matter the size of his or her current employer and regardless of whether the person is currently employed by an employer, self-employed, or unemployed, so long as the person has sufficient earnings and work history. The proposal, which was first introduced in December 2013, has 82 original cosponsors. Gillibrand stated; "Choosing between your loved ones and your career and your future is a choice no New Yorker should have to make".

Suit over rescinded offer to applicant with seizure disorder is resolved
An Ohio based file sharpening company has agreed to pay $30,000 to a rejected job applicant and furnish other relief to settle a disability discrimination lawsuit filed by the EEOC after the company rescinded a job offer to an applicant with a seizure disorder. The company offered the applicant an operator position but rescinded the offer once it learned that he took a prescription drug for a seizure disorder, the EEOC said in a March 17 release. The company violated the ADA when it withdrew the job offer because it regarded the applicant as a disabled individual incapable of doing the job, the EEOC asserted in its complaint. In addition to the monetary relief for the applicant, the consent decree resolving the suit prohibits the company from engaging in future discrimination against disabled employees or applicants, and from retaliating against applicants or employees who exercise their rights to complain about discrimination or assist in an investigation or discrimination-related proceeding. The company also must implement a written disability policy and procedures to ensure equal employment opportunities to those with disabilities.

Michigan car dealership resolves suit alleging racial slurs against African American worker
A Michigan based Cadillac, Buick, GMC, dealer has agreed to pay $75,000 to settle a racial harassment lawsuit filed by the EEOC. The agency asserted that the auto dealership violated Title VII when it subjected a black employee to a racially hostile work environment. Specifically, the employee who worked as a detailer, was subjected to a racially hostile work environment by his supervisor and coworkers, including use of the N-word and other racial slurs and jokes, the EEOC said in an agency release. Cases such as this remind us of the employer's responsibility to have effective anti-harassment policies and train all employees regarding the company's commitment to providing a workplace free of harassment of any type.

Paid sick leave tops emerging issues addressed in Employee Handbooks
Paid sick leave tops the list of emerging issues most commonly addressed in employee handbooks, with 79.4 percent of respondents addressing this new legal trend in their handbooks, according to a new XpertHR survey. Data privacy is the second most common issue addressed (67.2 percent) and social media is a close third (64.2 percent). Medical marijuana, now legal in nearly half of the states, yet still against federal law, is a challenging issue for workplaces-but only 6.4 percent of respondents have explicitly addressed it in their handbooks. Bring your own device (BYOD) policies are addressed by 14.5 percent of handbooks; Lesbian /Gay /Bisexual Transgender (LGBT) protection by 17.2 percent; and e-cigarettes by 20.6 percent. Respondents find that keeping their handbooks current with an evolving workplace and workforce (41 percent) is the most challenging aspect, and keeping it current with the law at a close second (35.6 percent). A distant third (11 percent) is getting employees to comply with handbook policies. At SESCO we specialize in the development and update of employee handbooks. Contact us at for more information regarding our handbook services.

Labor Secretary's comments on budget proposal give an indication of DOL enforcement strategies
Secretary of Labor Thomas E. Perez, in testimony before the House Education and the Workforce Committee on March 18, to justify the President's budget proposal for the DOL, pointed to the need to raise the minimum wage and combat overtime wage violations, among other things, and outlined the DOL's new approach to enforcing wage and hour laws. His comments, particularly in the wage-and-hour arena, put certain employers on notice of stepped-up compliance enforcement efforts, particularly those at "the top of the chain."
Overtime pay. In addition to the Obama administration's efforts to make headway on the wages front through the president's executive order mandating a $10.10 minimum wage for workers on new federal construction and service contracts, Perez pointed to the Labor Department's move "to modernize the nation's rules on overtime pay, which have not kept up with inflation or with changes in the economy." Those rules have not been updated since 1975. "The basic premise of the overtime law that Congress enacted more than 75 years ago is pretty straightforward: If you work more, you should get paid more. But that basic principle is undermined in too many cases," Perez said. "The assistant manager at a fast food restaurant who puts in 60-70 hours a week for $455 and spends almost all of their time performing the same work as the employees they supervise and who does not get overtime is getting a raw deal. We are updating the rule to prevent this situation." In doing so, the DOL has "conducted unprecedented levels of outreach, holding multiple listening sessions with employers and workers in a wide array of industries," he asserted.
The new wage-law enforcement approach. The Wage and Hour Division's investigation force has been increased by more than one-third, Perez noted, also clarifying that the increase only brings staffing back to 1970s levels when the labor force was significantly smaller. The president's fiscal year 2016 budget calls for more staffing increases, requesting $277 million overall for the WHD, including a $31.7-million increase for additional enforcement staff and support. How has the WHD changed its approach to enforcement? "We have equipped our investigators with the modern tools they need to do their work. We've used data and evidence-based strategies to deploy them strategically," the Labor Secretary explained. "And we've also shifted the focus of our enforcement efforts. Instead of a purely reactive approach where we respond to incoming complaints, we have targeted investigations in industries where we know workers are vulnerable, and where they are often reluctant to raise their voices and exercise their rights." According to Perez, strategic enforcement yields "very real results for working families" and is also "a more efficient use of resources."

According to Perez, the WHD has directed its resources to:
• where the data and evidence show wage violations are most likely to occur,
• where emerging business models lend themselves to such violations, and
• where workers are least likely to exercise their rights.
And Perez made clear that the WHD's continued efforts will focus on industries with low-wage workers: "Wage violations are pervasive, especially for low-wage workers, and so we must continue to step up our efforts and take our enforcement to the next level. We want and need to create ripple effects that impact compliance far beyond the workplaces where we are actually on the ground investigating." Employers that fit the profile described by the Labor Secretary should consider themselves on notice of stepped-up compliance enforcement.