Category: wage and hour division

  • President Biden Nominates Deputy Secretary Julie Su to Head the DOL – CUPA-HR

    President Biden Nominates Deputy Secretary Julie Su to Head the DOL – CUPA-HR

    by CUPA-HR | February 28, 2023

    On February 28, President Biden announced he would nominate Julie Su to lead the Department of Labor (DOL). Su is currently the deputy secretary of labor under Marty Walsh, who announced he would leave the agency mid-March to head the National Hockey League Players’ Association.

    Given previous opposition during her nomination to become deputy secretary, Su will likely face a difficult nomination process. In 2021, Su was confirmed into her current position by a 50-47 vote with no Republican support. Republican criticism during her nomination process arose from her prior role as secretary of the California Labor and Workforce Development Agency. During her tenure in California, the agency handled oversight and enforcement of the state-passed bill, Assembly Bill 5 — a controversial law regarding independent contractor status and misclassification. Additionally, the agency oversaw COVID-19 pandemic relief and dealt with subsequent issues, including unemployment insurance fraud.

    President Biden said in his statement “It is my honor to nominate Julie Su to be our country’s next secretary of labor. Julie has spent her life fighting to make sure that everyone has a fair shot, that no community is overlooked and that no worker is left behind. Over several decades, Julie has led the largest state labor department in the nation, cracked down on wage theft, fought to protect trafficked workers, increased the minimum wage, created good-paying, high-quality jobs, and established and enforced workplace safety standards.”

    Su is backed by many Democrats and Asian American members of Congress as well as several labor unions, including the Service Employees International Union.

    Regardless of how her nomination goes, Su is in line to become the acting secretary of labor once Walsh leaves office. There are no limitations on what an acting secretary can do leading the agency, leaving Su with full authority over the DOL while her nomination is pending. Regulations anticipated in the near future, including the Wage and Hour Division’s overtime exemption rulemaking, will likely not be delayed as a result of this nomination.

    CUPA-HR will keep members apprised of major updates at the Department of Labor and any significant guidance or regulations released by the agency.



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  • DOL Wage and Hour Division Publishes First Opinion Letter Under Biden Administration, Regarding FMLA Leave – CUPA-HR

    DOL Wage and Hour Division Publishes First Opinion Letter Under Biden Administration, Regarding FMLA Leave – CUPA-HR

    by CUPA-HR | February 21, 2023

    On February 9, the Department of Labor’s Wage and Hour Division (WHD) issued an opinion letter stating that employees with chronic serious health conditions may use Family and Medical Leave Act (FMLA) leave to reduce work hours indefinitely. The WHD opinion letters serve as a means by which the public can develop a clearer understanding of what FMLA compliance entails. This particular letter is the first issued by the Biden administration.

    The letter from the WHD and Acting Administrator Jessica Looman comes in response to an employer’s letter asking whether “an employee may use FMLA leave to limit their work schedule for an indefinite period of time if the employee has a chronic serious health condition and a healthcare provider certifies that the employee has a medical need to limit their schedule.” The question only applies to employees who are regularly scheduled to work more than eight hours per day.

    The opinion letter specifies that if an employee is regularly scheduled to work more than eight hours per day but has an FMLA-qualifying condition that grants them to take FMLA leave, then the employee is entitled to use the 12 weeks of FMLA leave to reduce their work hours to eight hours per day. It adds that an employee may indefinitely reduce their work hours so long as they don’t surpass the 12 weeks of FMLA leave in a 12-month period that they are entitled to under the law.

    The letter also addresses concerns from the employer that the need for a work day limited to eight hours may be “better suited” as a reasonable accommodation granted under the Americans with Disabilities Act (ADA). The letter states that the requirements and protections of the FMLA and ADA are separate and distinct, and that employees may be entitled to use protections granted under both laws at the same time. It further states that an employee who has exhausted all of the afforded FMLA leave for a 12-month period may have additional rights granted under the ADA to continue to work at the reduced level, but it clarifies that the WHD does not “interpret or provide any advice for” the ADA and its requirements.

    Finally, the letter states that employees are entitled to the equivalent of 12 standard workweeks of FMLA leave, which may be more than 480 hours (equivalent to working 40 hours per week for 12 weeks) if the regular schedule of the employee is greater than 40 hours per week. The letter uses an example of an employee regularly working 50 hours per week, in which case the employee would be entitled to 600 hours of FMLA leave.

    It’s worth noting that the content of the letter is consistent with long-standing guidance and enforcement of the FMLA. The letter may draw increased attention to the issue, however, since the letter is the first provided by the Biden administration’s WHD.

    CUPA-HR will continue to monitor for any future WHD opinion letters and will keep members apprised of any significant updates in the future.



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  • CUPA-HR Participates in DOL Overtime Regional Listening Sessions – CUPA-HR

    CUPA-HR Participates in DOL Overtime Regional Listening Sessions – CUPA-HR

    by CUPA-HR | June 14, 2022

    In May and June, CUPA-HR participated in five regional listening sessions hosted by the Department of Labor (DOL) on the anticipated Notice of Proposed Rulemaking (NPRM) to update the criteria for the “executive, administrative and professional” exemptions for overtime pay under the Fair Labor Standards Act (FLSA). The listening sessions provided regional employers the opportunity to discuss their support or concerns with changes to the minimum salary level required to be exempt from overtime payments under the FLSA.

    CUPA-HR joined each of the five sessions to express concerns with the timing of the proposed increase to the minimum salary threshold to qualify for exempt status under the FLSA. Specifically, we raised concerns with the timing of such changes, as they would come while institutions, employees and students are still grappling with the challenges of the COVID-19 pandemic, a tight labor market and historically high inflation. Additionally, several CUPA-HR members joined the calls to raise similar concerns and discuss issues more specific to their individual institutions.

    Though many in higher ed and other industries are expressing similar concerns about raising the overtime minimum salary threshold level at this time, labor unions and worker advocates have led efforts to both raise the minimum salary threshold and expand coverage of overtime regulations to workers currently not covered under the FLSA. Notably, the National Education Association sent a letter to DOL urging the agency to remove the teacher exemption that currently exempts teachers from the FLSA requirements to receive overtime payments regardless of how much they are paid.

    The overtime NPRM that was targeted for release in April 2022 is now expected to come anytime within the next couple of months, though more information on when it will be released may be included in the anticipated Spring 2022 Regulatory Agenda. CUPA-HR will continue to monitor for the NPRM and will keep members apprised of any updates to the overtime regulations.



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  • DOL to Host Regional Listening Sessions for Proposed Overtime Rule Regulations – CUPA-HR

    DOL to Host Regional Listening Sessions for Proposed Overtime Rule Regulations – CUPA-HR

    by CUPA-HR | April 7, 2022

    In the Biden administration’s fall 2021 regulatory agenda, the Department of Labor (DOL)’s Wage and Hour Division (WHD) announced that it planned to release in April 2022 a Notice of Proposed Rulemaking (NPRM) changing criteria for the “executive, administrative and professional” exemptions from the overtime pay requirements under the Fair Labor Standards Act (FLSA). In May and June, the DOL will host five regional listening sessions allowing stakeholders to discuss the anticipated proposed rule aimed at changing the exemptions to the federal overtime pay requirements.

    With listening sessions extending into May, the WHD will not be able to meet the April target date, but we do expect the agency will release a proposed rule in 2022 with compliance likely required in 2023. While the DOL has not shared how it may change the exemptions, it is holding listening sessions to elicit stakeholder input as to whether changes are appropriate and what changes would be appropriate at this time.

    Background

    According to the regulatory agenda, one of the goals of the NPRM would be “to update the salary level requirement of the section 13(a)(1) exemption [under the FLSA].” Changes to the overtime exemption minimum salary threshold have been proposed recently under both the Obama and Trump administrations. In 2016, President Obama’s DOL issued a final rule to increase the salary threshold from $23,660 to $47,476 per year and impose automatic updates to the threshold every three years, but the rule was subsequently struck down by federal court before taking effect in 2017. In 2019, the Trump administration issued a new final rule that raised the minimum salary threshold from $23,660 to $35,568 annually, which went into effect on January 1, 2020. The $35,568 threshold remains in effect today.

    On March 29, in anticipation of the upcoming Biden administration rule, the DOL held a virtual higher education-specific listening session for D.C.-based higher education associations, including CUPA-HR. The listening session was scheduled after CUPA-HR and 14 other higher education associations submitted a request that the DOL hold such meetings prior to releasing the anticipated NPRM. CUPA-HR and several other higher education associations joined the session to discuss potential concerns institutions may have with an increase to the minimum salary threshold at this time.

    Regional Sessions

    In addition to the D.C. meeting held in March, the DOL is planning to host five additional regional listening sessions for employers. The sessions include the following:

    • Northeast Employers: May 13 at 3:30 p.m. EDT
    • Southeast Employers: May 17 at 2:00 p.m. EDT
    • Midwest Employers: May 20 at 3:30 p.m. EDT
    • Southwest Employers: May 27 at 3:00 p.m. EDT
    • West Employers: June 3 at 3:30 p.m. EDT

    If your institution is interested in participating in any of the regional meetings, please reach out to CUPA-HR’s Chief Government Relation Officer Josh Ulman at [email protected]. Additional information about the D.C. listening session and CUPA-HR’s talking points will be provided upon inquiry.



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  • DOL Issues Final Rule to Increase Federal Contractor Minimum Wage – CUPA-HR

    DOL Issues Final Rule to Increase Federal Contractor Minimum Wage – CUPA-HR

    by CUPA-HR | December 13, 2021

    On November 24, the Department of Labor (DOL)’s Wage and Hour Division (WHD) issued a final rule implementing President Biden’s Executive Order 14026 (EO), “Increasing the Minimum Wage for Federal Contractors.” The rule increases the minimum wage for federal government contractors for workers who work on or in connection with a covered federal contract to $15 per hour beginning January 30, 2022, and requires the secretary of labor to annually review and determine the minimum wage amount beginning January 1, 2023.

    As stated above, the final rule establishes standards and procedures for implementing and enforcing the minimum wage protections of Executive Order 14026. Starting January 30, 2022, all agencies will need to include a $15 minimum wage in new contracts, new solicitations, extensions or renewals of an existing contract, and exercises of an option on an existing contract. Under the EO and final rule, contracts with solicitations issued before January 30, 2022, and entered into, on or between January 30 and March 30, 2022 will be exempt from the wage. If such a contract is subsequently extended or renewed or an option is exercised under the contract, the $15 minimum wage will apply.

    Covered Contracts

    According to the EO and as finalized in the rule, the $15 minimum wage requirement only applies to the following contracts:

    • Procurement contracts for services or construction;
    • Contracts for services covered by the Service Contract Act (SCA);
    • Contracts for concessions; and
    • Contracts “entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public.”

    The new minimum wage clause will NOT need to be included in:

    • Federal grants;
    • Contracts or agreements with Indian Tribes under the Indian Self-Determination and Education Assistance Act;
    • Procurement contracts for construction that are excluded from coverage of the Davis-Bacon Act (DBA);
    • Contracts for services that are exempt from coverage under the SCA; and
    • Contracts for the manufacturing of materials, supplies, articles or equipment to the Federal Government.

    Covered Workers

    The WHD defines a covered worker in the final rule as “any person engaged in performing work on or in connection with a contract covered by the EO, and whose wages under such contract are governed by the [Fair Labor Standards Act (FLSA)], the SCA or the DBA, regardless of the contractual relationship alleged to exist between the individual and the employer.” A worker who performs “on” a covered contract is defined as “any worker who directly performs the specific services called for by the contract’s terms,” and a worker who performs “in connection with” a covered contract is defined as “any worker who performs work activities that, although are not the specific services called for by the contract’s terms, are necessary to the performance of those specific services.”

    One exemption to the rule’s minimum wage requirement is provided for FLSA-covered workers performing work “in connection with” covered contracts for less than 20 percent of their working hours in a given workweek.

    The final rule also clarifies that certain employees who are exempt from the minimum wage protections under the FLSA are also not entitled to the $15 minimum wage protection of the EO and final rule. In an FAQ page on the EO and final rule, the WHD provides “learners, apprentices, messengers and full-time students employed under certificates pursuant to FLSA sections 14(a) and (b)” as examples of individuals who are excluded from the EO’s minimum wage requirements.

    Additional Considerations

    As mentioned above, the secretary of labor will be granted authority to annually review and increase the minimum wage beginning January 1, 2023. The minimum wage will be increased by the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers to address inflation.

    Additionally, the EO and final rule change compensation for tipped employees working on or in connection with a covered contract. Beginning January 30, 2022, such tipped employees must be paid a wage of at least $10.50 per hour. By January 1, 2024, the tip credit must be eliminated for such employees, and they must earn the same minimum hourly rate that other covered employees are entitled to.

    CUPA-HR will keep members apprised of any updates and resources to aid institutions as the new minimum wage final rule becomes effective.



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