Big Changes to Some Big Employers’ Employee Scheduling Practices

“Affected employers will have to provide their employees with seven days advance notice of their shift schedules”

On June 29, 2017, the House approved and sent to the governor, Senate Bill 828 which will require large employers in certain industries to provide advanced notice to employees of their work schedules. This new law will affect only retail, hospitality, and food service establishments with 500 or more employees worldwide. Affected employers will have to provide their employees with seven days advance notice of their shift schedules. Affected employers will also need to make a good faith effort to provide new employees with an estimation of the average number of hours the employee can expect to work in a month. It is expected that the governor will sign the bill into law.

The new law will also provide employees of the affected industries with a right to rest between work shifts. The right to rest, which an employee may waive, requires the employer to not schedule an employee to work during the first 10 hours following the end of a work shift. If the employer does schedule an employee during a rest period, then the employer must compensate the employee at time and a half for each hour worked during the rest period.

If an employer requests changes to an employee’s work schedule without seven days’ advance notice, then the employee may decline the work shifts. However, if an employee requests additional work shifts in writing, then the employer does not need to provide advanced notice. If an employee accepts the shift, then the employer will have to provide additional compensation in most circumstances. Additional compensation requirements will not apply in some circumstances such as when an employee initiates and arranges a work shift swap or coverage agreement with another employee.

Employees of the affected employers will also have a right to provide input as to limitations or changes to their work schedule. However, an employer will have no obligation to grant an employee’s work schedule requests.

Affected employers will be required to post in the work place a notice of employee rights under the new law. Employers will also be required to keep records for three years documenting their compliance with the new law.

Employers will be permitted to maintain a voluntary standby list of employees willing to cover shifts because of unanticipated customer needs or unexpected employee absences. Employees will have the option to be removed from the list at any time. An employer may not retaliate against an employee that does not want to be on the list or declines to work additional hours. The punishment for coercing an employee into being added to the standby list is a civil penalty up to $2,000.

The seven days’ notice requirement, good faith estimation of a new employees work schedule, voluntary standby list, right to rest between work shifts, employee right to input into work schedule, compensation for work schedule changes, notice of employee rights and recordkeeping requirements will become effective in July, 2018.The enforcement provisions and retaliation prohibitions will take effect in July, 2019. Beginning in July, 2020, affected employers will be required to provide two weeks’ notice to employees concerning their work schedules.

No Questions Asked: Oregon’s Equal Pay Act

Oregon’s Equal Pay Act Prohibits Questions About Salary

On May 22, 2017, the House unanimously re-passed House Bill 2005. The legislation, which is more commonly known as the Equal Pay Act of 2017, was amended by the Senate last week, and is now headed to Governor Brown for her signature.

While the majority of the media attention has been on the provisions in the bill that will prohibit discrimination against women in the payment of wages, there are other provisions affecting employment practices that employers should be aware of.

Under the new legislation, it will be a prohibited practice for an employer to screen a job applicant based on the applicant’s current or past compensation. Other than for internal hires, it will also be a prohibited practice to determine compensation for a position based on current or past compensation of a prospective employee. Additionally, a prospective employer may not seek an applicant’s salary history information from the applicant or from the applicant’s current or former employer, unless the prospective employer has made an offer of employment, with an amount of compensation included, to the prospective employee.

If an employer were to screen a job applicant, determine compensation, or seek out salary information in violation of the Act, they could face a lawsuit to recover up to two years of back pay, court costs, attorney fees, and other damages.

If Governor Brown signs the bill into law, as she is expected to do, the screening and compensation provisions will become effective January 1, 2019. The prohibition on seeking information on an applicant’s salary history will become effective 91 days after the Legislature adjourns.

“Not So Fast” – Federal Judge Grants Injunction Against Overtime Regulation

Rule Expanding Overtime Halted by Federal Judge

On Tuesday, November 22, a Federal District Court Judge in Texas granted a nationwide preliminary injunction against an Obama administration regulation, which sought to expand the eligibility of millions of workers for overtime pay.

The regulation was ruled by Judge Mazzat to have likely exceeded the authority of the Obama administration because it nearly doubled the overtime salary threshold. The regulation would raise the minimum annual salary amount from $23,660 to $47,476. It would automatically qualify workers for overtime pay, so long as their annual salary was below the new $47,476 threshold.

Twenty-one states and over fifty business organizations have backed the request for an injunction to delay the regulation’s effective date of December 1, 2016, until the judge could make a final ruling based on the merits.

Small business owners and business organizations applauded the decision, arguing that the regulation would substantially burden business owners with increased labor costs. The Labor Department and worker advocacy groups argue that by blocking the regulation, workers who already put in 40 hours a week will continue to work longer hours for unfair pay.

Many employers have been making plans for the effective date of the new regulations, which is now just eight days away. Employers may have already notified employees about their new pay arrangements. Should employers reverse those salary decisions and postpone their implementation? There are many unknowns at play, not the least of which is that the Trump administration will take over responsibility for this litigation in January 2017. Might a Trump administration concede this case, and let an injunction remain in place?  That is a possibility. Might the new administration have the Department of Labor issue new regulations extending the date for implementation of the new salary/overtime rules? That’s also possible. One other possibility is an appeal and a higher court vacating the injunction. In that case, could the December 1, 2016 effective date be made enforceable retroactively?

Each employer must make a business decision about what is appropriate for their workforce, and determine how much risk (given the uncertainty) they are willing to accept. One important point for employers – adjustments to compensation terms can be made prospectively, but it is dangerous for an employer to retroactively modify an employee’s compensation, particularly if the modification is to reduce pay. An employer and employee have a contractual relationship, with many applicable state and federal regulations. Employers should be cautious about any course of action that could be seen as a breach of the employment contract, or a violation of state or federal laws.

For more information, read this article from Bloomberg.

No Sharing: Defend Trade Secrets Act (DTSA)

Employers should be sure that they are in compliance with the DTSA

On May 11, 2016, President Obama signed the popular Defend Trade Secrets Act (DTSA), which gives employers a federal cause of action for trade secret misappropriation. One of the key features is that the DTSA allows employers to obtain equitable remedies, actual damages, punitive damages, and attorney’s fees as well as remedies available under state law.

There are a few circumstances where an employee or contractor is immune from prosecution for sharing trade secrets: (1) when disclosing to the government or government attorneys solely for the purpose of reporting or investigated a suspected violation of law; (2) when disclosing to a personal attorney in connection with a retaliation lawsuit for reporting a suspected violation of law; and (3) when disclosing in any complaint or other document filed in a lawsuit, as long as its filed under seal.

The DTSA requires employers to provide notice of these immunities in any agreement with an employee or contractor related to trade secrets or other confidential information. If the employer does not provide this notice, their available damages will be reduced. They will not be entitled to punitive damages or attorney fees, which limits the effectiveness of the agreement.

The good news? This only applies to agreements entered into on or after May 11, 2016. Agreements entered into before then do not have to include the notice provisions. But looking forward, employers should contact their legal counsel to make sure that any agreements they enter into will comply with the DTSA.

Piece-Rate Workers Entitled to Rest Period Pay

A major change has taken place for piece-rate workers in Washington. The Washington Supreme Court decided in March of 2015 that piece-rate workers are entitled to receive wages during their rest periods. Not only are piece-rate workers entitled to rest period pay, they must receive the greater of either their regular rate of pay or minimum wage. Moving forward, agricultural employers who employ piece-rate workers may need to change their practices to comply with the holding of the case.

Pursuant to these new rules, agricultural employers must provide workers with a full, uninterrupted 10-minute break in each four-hour period of work. In addition, employers must pay piece-rate workers separate compensation for their rest period, and the separate payments must be based on the regular rate of pay or minimum wage, whichever is greater. To compute the regular rate, the employer must divide the total compensation earned in a workweek by the total active hours of work (not including the break time). Then, the employer must use the greater of their regular rate of pay or minimum wage, and multiply it by the amount of time the worker spends on rest periods. This amount should be added to the piece-rate workers weekly pay. For more information on compliance, the Washington Department of Labor and Industries has issued a helpful Administrative Policy.

If you still have questions, please contact the attorneys at Samuels Yoelin Kantor, LLP. We provide employers with advice and representation for a wide variety of legal issues. Our attorneys practicing employment law advise employers on how to avoid problems. We represent employers in State and Federal court, as well as in administrative proceedings with the Equal Employment Opportunity Commission, the Civil Rights Division of the Oregon Department of Justice, and the Oregon State Wage and Hour Division.

Who Owns Your Password?

In the modern world passwords are ubiquitous. By the time we’ve finished our morning coffee we’ve likely used a password to check our email, access our computer, and even open the door to the office. In some contexts we understand (even if we don’t give it much thought), that the password doesn’t “belong” to us: the security code to the building where you work is a prime example. But in other settings a sense of personal ownership pervades. After all, we choose our own passwords for our email and social media accounts. The content of those accounts and even our choice of the password itself is often quite personal. Unfortunately, there is no clear-cut answer to the broad question of who “owns” a password. When personal and business contexts collide, however, one should keep these guidelines in mind:

The entity that owns the software likely owns the passwords protecting the software.

The case law in Oregon is sparse, but suggests that the owner of the system or software also owns the password that gives access to that system or software. Unauthorized use (for example, an employee’s withholding of the password) is analogous to theft from the owner. In State v. Schwartz a former employee of Intel was found guilty of theft when he copied access passwords which allowed access to the company’s computers. The court held that the term “property” as used in the theft statute, includes “anything of value,” and that the passwords had value. In concluding that theft had occurred, the question of whether that “property” belonged to Intel was never put at issue. Although these were passwords used to access individual computers they were Intel property and, one assumes, were not owned by the individuals to whom the passwords were assigned.

The software licensing agreement or an employee handbook can provide guidance to the ownership interest.

When a software program allows the user to choose their own password, the user may be under the mistaken assumption that they “own” the password they chose. Of course, just because I choose my Netflix password does not mean that I have an unbounded ownership interest in it: for instance, I am not under the impression that I can sell my password, and thus my Netflix access. Similarly, an employee handbook can make clear that the use of company computers necessarily involves a company interest. Understanding that a personal password on a company computer does not come with increased privacy rights can provide protection to the employer against potential litigation. This point was made in Thygeson v. US Bancorp, where the handbook warned that personal use of the computer was prohibited and monitored, and the employee therefore did not have a reasonable expectation of privacy. Of course, this doesn’t mean there can’t be overreaching. Oregon, like many other states has adopted legislation denying employers the right to even ask for an employee’s personal social media password.

The law of password ownership is still in its developing stages. As our reliance on technology and use of social media in the workplace continue to increase, password ownership is more likely to be at issue. At present, Oregon case law has been developing more through the criminal context (identity theft or unlawful searches) than on the intellectual property front. But while the contours of password ownership remain undefined, considerations of the underlying software ownership and restrictions in the licensing agreement may be the best guides. 

Sick Time Ordinance Goes Into Effect

As of January 1, 2014 employers in the City of Portland are required to provide sick-time for their employees. Employers with 6 or more employees are required to provide 1 hour of paid sick leave for every 30 hours an employee works. Employees with 6 or fewer people are required to provide the same amount of unpaid sick leave. Some confusion regarding the new ordinance surrounds whether an employer is located inside Portland city limits. For example, construction, delivery, and other businesses may have headquarters located outside of city limits, but have employees working within city limits. Employees are covered for the hours they spend working inside city limits, regardless of where the employer is located. The City of Portland’s website (http://portlandoregon.gov/sicktime) has an extensive list of FAQs, as well as other resources for employers and employees regarding the ordinance. Employers may also find it helpful to sit down with their attorney to determine whether their sick leave policy is compliant with the new ordinance.

Employers Must Provide Notice on Health Insurance Marketplace by October 1, 2013

The Patient Protection and Affordable Care Act (“PPACA” sometimes referred to as Obamacare) creates a number of new requirements for employers. Recently, the Internal Revenue Service and Department of Labor announced that some of these requirements will be delayed until 2014 or 2015 to give employers, and the government, more time to ensure a smooth transition.

However, one requirement that has not been delayed until next year is the requirement that all employers subject to the Fair Labor Standards Act give notice to employees about the new Health Insurance Marketplace. The Marketplace is a government-run website that gives individuals and employees of small business the ability to find and compare private health insurance options. Under the PPACA, applicable employers must, by October 1, 2013, provide written notice to employees of the following:

  • The existence of the Marketplace, including a description of the services provided and how to access those services;
  • The eligibility of the employee for a premium tax credit if the employee purchases a qualified plan through the Marketplace; and
  • Notice that the employee may lose the employer contribution (if any) to any health benefits plan offered by the employer if the employee purchases a qualified health plan through the Marketplace.

The notices must be provided to all employees, regardless of whether they are full or part-time or if they’re currently covered by the employer’s health care policy. Employees hired after October 1, 2013 must be given the notice within 14 days of the employee’s start date.

The Department of Labor has two model notices available on its website at www.dol.gov/ebsa/healthreform, one for employers without a health plan and one for employers with a health plan. Note that the model notices are not state specific and some employers may want to alter the notice to give employees more comprehensive information. More information on the notices is provided by the Department of Labor in Technical Release No. 2013-02, provided at http://www.dol.gov/ebsa/newsroom/tr13-02.html.

The employment and tax lawyers at Samuels Yoelin Kantor LLP are available to provide counseling and answers on PPACA-related questions.
 

Indefinite Delay: Court of Appeals Enjoins NLRB’s Poster Rule

Employers preparing for the upcoming April 30, 2012 implementation date of the National Labor Relations Board’s (NLRB) poster display rule can put down the thumbtacks and tape – at least for a little while longer.

In light of conflicting district court decisions and pending appeals as to whether the NLRB has authority to order this mandatory poster rule, on April 17, 2012 the Washington D.C. Circuit Court of Appeals issued a temporary injunction against the agency. This means that employers will not be required to hang the poster until the question of NLRB authority is settled. Oral arguments for the case are scheduled to begin September 2012.

See this blog’s October 3, October 12, 2011 and January 18, 2012 posts for a full chronology of the NLRB poster requirements and deadline extensions.
 

Another Delay: April 30, 2012 is New Deadline for NLRA Poster

This blog reported on the National Labor Relations Board’s (NLRB) latest notice-posting requirement for employers falling under its jurisdiction (see our October 3 and October 12, 2011 posts). Once again, the NLRB has extended the deadline to hang the mandatory and controversial 11-by-17 inch poster. The original deadline was November 14, 2011, then extended to January 31, 2012, and now extended to April 30, 2012.
Why the extensions?

The NLRB reported that its first deadline extension was to grant confused employers more time to determine whether they were required to hang the poster.

Now, this second extension comes on the heels of a Washington D.C. federal judge’s request that the NLRB postpone the rule’s effective date pending current legal challenges to the Board’s authority regarding the rule. In addition to the Washington lawsuit (consolidated from originally two suits filed by various trade and labor organizations), the US Chamber of Commerce and South Carolina Chamber of Commerce also filed lawsuits in the US District Court of South Carolina challenging the notification rule.

Pending a court ruling on the matter, employers are expected to comply with the current rule. Contact SYK attorneysTim Resch or Steve Seymour for help with this or other employment and labor questions.