A Recap on Labor and Employment News: What to Look Out for in 2016
There has been a lot of labor and employment news in the headlines over the course of 2015, and here are three of the biggest attention-grabbing items you should keep an eye out for in the coming year:
- New DOL Guidance on Worker Misclassification. The Department of Labor (DOL) created shockwaves when it issued a new administrative interpretation for the legal test of whether a worker is an independent contractor or an employee (see our blog from November 4, 2014, “Watch out for Worker Misclassification!). The sum of this guidance from the DOL is that it will now be more difficult than ever to properly classify a worker as an independent contractor, and failure to do so will have major implications for businesses resulting in potential tax, wage and hour, and benefits consequences. The test for classification is whether or not these workers are subject to “close control” (e.g., independent contractors are free from control and direction; perform services outside the usual scope of services; and are engaged in an independently established business or are the legitimate sole proprietor or partnership by law.)
- Revision to the FLSA’s White Collar Regulations. Again, these proposed amendments to the Fair Labor Standard’s minimum salary level for overtime can potentially create a tsunami of issues for employers. In a nutshell, the amendments more than double the minimum salary level (from $23,600 to over $50,000 per year in 2016) for certain employees to be deemed exempt from overtime as administrative workers, professional, and computer workers. (Of less concern is the amendment which increases the minimum level of pay necessary to be deemed and exempt highly compensated employee – from $100,000 to $122,148 per year.) These regulations have the potential to become a compliance nightmare for businesses nationwide.
- Expansion of the NLRB’s Test for “Joint Employment”. The National Labor Relations Board (NLRB) announced just last month that it was changing the test for determining whether two businesses are “joint employers”. If the test survives an expected court challenge, many more businesses, such as franchisors-franchisees, manufacturers-distributors, and staffing agencies and their clients might be held jointly liable for employment claims (such as wage and hour violations, discrimination, harassment, etc.) and have the potential for much easier union organization and infiltration.
We will continue to keep our membership up on the latest in these and other labor and employment issues.
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