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Ready or Not: CA Minimum Wage Increase starts Jan. 1 2016

Effective January 1, 2016, the California minimum wage will increase to $10.00 per hour. This increase requires that any employees with an hourly wage of less than $10.00 have their hourly wage increased as of January 1, 2016 for all time worked.

For any employee who receives an increased hourly wage rate, employers are required to provide that employee with a written notice of the change within seven (7) days of the effective date of the change. This notice may be given to each employee via a Labor Code 2810.5 form (available online at www.dir.ca.gov/dlse/LC_2810.5_Notice.pdf), through a written notice explaining the change, or through a wage statement reflecting the change provided within seven (7) days of the effective date. For employers who are not providing paychecks/wage statements by January 7, 2015, employees should receive a separate written notice informing them of the change.

The increase in minimum wage also affects the salary threshold for exempt employees under California’s minimum wage and overtime requirements under the “white collar” exemptions, which include the administrative, executive, and learned professional exemptions. To qualify as exempt under these exemptions, employees must be paid at least double minimum wage. Accordingly, beginning January 1, 2016, California exempt employees must receive an annual salary of at least $41,600 (and higher for computer professionals and highly compensated employees).  However, employers should keep in mind that recent proposed regulations from the federal Department of Labor call for an increase in the minimum salary threshold for these exemptions to approximately $970 per week (or $50,440 per year) for 2016, with increases each year to follow.  It is anticipated the DOL will issue final regulations in the coming months.

As always, in addition to the compensation requirement, to qualify as exempt, employees must also perform the duties set forth in the applicable Wage Orders and, for computer professional employees, in Labor Code section 515.5. The duties requirements for each of the exemptions are very fact and circumstance specific.

For more information on the increase in minimum wage and how it may affect both your non-exempt and exempt employees, please contact a member of Troutman Sanders’ employment practice.

November 12, 2015   No Comments

Keys to a Successful Workplace Investigation

7_Effective Workplace
Whether it’s allegations of favoritism, harassment, or unethical conduct, an efficient and impartial investigation can help employers root out actions that are harming the company and can provide evidence to support the company’s decision.  All too often investigations are conducted without a clear plan and assigned team, leading to conflicting results and a poor defense in litigation.  A bad investigation can often lead to sanctions or punitive damages later in litigation – a situation far worse than conducting no investigation at all. Lawyers at Troutman Sanders have handled numerous investigations of all different types of alleged workplace misconduct and can help guide employers around potential landmines in managing workplace investigations.

Be sure to join us at our annual Labor & Employment and Benefits seminar October 29 to learn how to avoid the pitfalls and conduct effective and efficient workplace investigations.

October 27, 2015   No Comments

Crisis Management a “Wheel of Fortune” for Employers

4_Workplace Crisis
Crisis concerns have occurred from the time of the pharaohs up through the Enron or Tylenol episodes of the last decade, and as recently as the VW manipulation of emission data.  What may be a small concern for one company could be a huge liability for another.  For employers, when a crisis erupts, the consequences can be a game of “Wheel of Fortune” – a misfortune, if handled improperly, or good fortune, for the employer’s reputation, to come out unscathed. A crisis management plan is no “one size fits all”.

Our featured presenter, veteran PR strategist Carol Cookerly, has given some wise breakthrough advice on managing these crisis issues when they arise: “The best strategy is not to think about how to diffuse the problem, but how to think long-term and make your organization stronger.  If you think that way, the problem will diffuse itself because you will be doing things that will take you to the next level.”

Join us on October 29 during our annual Labor & Employment and Benefits seminar as we walk through a crisis management exercise designed to help HR practitioners and legal staff examine the health, safety and workforce management concerns as well as analyze communication practices arising from a crisis event. We’ll see you then.

October 26, 2015   No Comments

Independent Contractors vs. Temporary Employees vs. Leased Employees? And the Winner Is…

5_Legal Issues
More than ever before, companies are turning to contingent workers to meet their staffing needs.  Indeed, according to a recent SAP and Oxford Economics report, 83% of executives state that their companies are increasing their use of contingent workers.  But which type of contingent worker is best for your company? Leased employees? Temporary employees? Independent contractors? Companies often find themselves internally debating this issue. But with the penalties and liability associated with misclassification and handling of contingent workers so steep, there is no need to have this debate alone.

Join us on October 29 for our annual Labor & Employment and Benefits seminar and participate in the debate on the pros and cons of using leased employees, temporary employees, and independent contractors.  Among other topics, we will discuss which type of contingent worker is best for your company based on cost, flexibility, administrative hassles, control, employment compliance, and risk and costs of misclassification.   We will also discuss how to determine whether a worker is misclassified and best practices for using each type of contingent worker.

October 22, 2015   No Comments

Wage & Hour Law Changes: What Does It All REALLY Mean?

Earlier this year, the U.S. Department of Labor (DOL) issued new proposed regulations under the Fair Labor Standards Act (FLSA) to dramatically increase the minimum salary required for most exempt employees to remain exempt going forward.  The DOL regulations generated a huge number of comments, but now the DOL is getting ready to issue their final regulations and put the new requirements in place.

Do you understand the proposed changes to the FLSA salary threshold for exempt classifications?  You need to, and, if you come to our our annual Labor & Employment and Benefits seminar starting at 8 a.m. on October 29, you will!  We will clear up any confusion about the regulations and discuss important topics such as:

  •  What changes employers need to make to their compensation practices to prepare for the proposed changes — and when to make them.
  •  What liabilities employers are exposed to for failing to adapt their compensation practices to the higher salary thresholds.
  • How to know — and what to do — if the changes will have a significant cost or business impact on your workforce.

The DOL and other government agencies are cracking down on improper exemptions under the FLSA and other ways to address what the current Administration views as unfair pay or treatment of employees.  Getting caught unprepared for a wage and hour audit or employee lawsuit is painful, disruptive, and very expensive.  Don’t let it happen to you!

Make sure you join us on October 29 at 8 a.m. for our annual Labor & Employment and Benefits seminar. We’ll help you understand all the changes and what to do to be prepared as these changes come into effect soon.  To RSVP for this program, please click here.

October 21, 2015   No Comments

Is Your Company’s Confidential Information Leaving at 5 p.m.?

A Gartner Inc. Executive Program survey predicts that 50% of companies will require employees to provide their own devices for their jobs by 2017. If your employees use their own mobile phones to do work, it’s quite possible your company’s confidential information walks out the door every night. This raises cybersecurity concerns for a company’s intellectual property and confidential trade secrets. The need to secure a company’s protected information must also be balanced with an employee’s right to privacy. However, technology continues to push the expectation of worker productivity to wearable technologies (Apple Watch, anyone?). Does your company employ a BYOD policy? Are you confident that your company’s information is secure?

Make sure you join us on October 29 for our annual Labor & Employment and Benefits seminar starting at 8 a.m. We’ll help you understand the elements of a successful BYOD policy and how to balance employee privacy risks against the need to safeguard your company’s confidential information.

October 19, 2015   No Comments

You’re invited to attend Troutman Sanders’ 2015 Labor & Employment and Benefits Seminar


Troutman Sanders invites in-house counsel, HR professionals and other executives and managers charged with labor and human resources responsibilities to attend a half-day labor & employment seminar to learn the latest news on recent employment cases, hear best practices in HR strategies and understand how to remain compliant with key HR laws.

Seminar topics include:

  • Impacts of DOL’s New FLSA Regulations
  • Implications of Supreme Court DOMA Decision
  • Expanded Job Flexibility for Foreign Nationals
  • Avoiding Pitfalls in Background Screening
  • Conducting Successful Workplace Investigations
  • Legal Issues Involved in Using Independent Contractors and Temporary Employees
  • Bring Your Own Device (B.Y.O.D.) Policies and Employer Privacy Issues
  • Effective Workplace Crisis Management Tips

To RSVP for this program, please click here.

CLE and SHRM credits pending.

October 7, 2015   No Comments

Reserved Authority and Indirect Control: Yesterday’s NLRB Decision Establishes New Joint Employer Standard and Threatens Contract Employment

The National Labor Relations Board issued a landmark decision yesterday, reversing its precedent and establishing a new standard for determining when entities can be considered “joint employers” under the National Labor Relations Act. The 3-2 decision in Browning-Ferris Industries of California, Inc. held that Browning-Ferris, the owner
and operator of a recycling facility, was a joint employer with its contractor, who provided workers (sorters, screen cleaners and housekeepers) to Browning-Ferris through a temporary labor services agreement. In its decision, the Board departed from its prior joint employer standard in significant ways. The new standard will make it much easier to establish a joint-employer relationship under the NLRA. Workers formerly excluded from union representation as non-employees could now be considered members of a collective bargaining unit with legal rights to negotiate terms and conditions of their employment through a union. [Read more →]

August 28, 2015   No Comments

OFCCP Releases Checklist for Compliance with Section 503

If you are a federal contractor subject to Section 503, then you are aware of the new regulations that were released in September 2013. While those regulations were released nearly two years ago, the most burdensome of these requirements (implementation of the Subpart C requirements) have not yet been implemented by most contractors because of the transition year period that allowed contractors to delay compliance with Subpart C. As contractors have been permitted to delay compliance, we have seen virtually no enforcement from OFCCP of the Subpart C requirements in audits. That is all about to change.

Contractors are now or will soon be developing their first affirmative action plans that will be subject to the Subpart C requirements. The OFCCP appears to be gearing up to enforce these requirements, as it released this week a Checklist for Compliance with Section 503 of the Rehabilitation Act of 1973. Contractors should review the checklist. However, we would not recommend filling it out unless you are doing so in a way that your completion of the checklist and communications are protected by the attorney/client privilege! We would not be surprised if this Checklist becomes the outline that the OFCCP uses to evaluate your company’s compliance with Section 503 during its next audit.

August 13, 2015   No Comments

My Boss Drives Me Nuts! But Is That A Disability?

Managing interpersonal conflict in the workplace is always a delicate and time-consuming duty for managers and Human Resources personnel.  But what happens when an employee claims that he or she suffers from a disability due to stress from working with a specific manager or supervisor?  Must the employer accommodate the alleged disability by transferring the employee (or the supervisor!) to another role within the company?  According to a recent opinion from the California Court of Appeals, Higgins-Williams v. Sutter Medical Foundation, 237 Cal. App. 4th 78 (3d Dist. 2015), the answer is No.

Michaelin Higgins-Williams was a clinical assistant at Sutter Medical Foundation.  Initially hired in 2007, in June 2010 Higgins-Williams reported to her treating physician that she was experiencing stress because of interactions with her manager and with human resources.  Her physician diagnosed her as having adjustment disorder with anxiety and Higgins-Williams was granted a stress-related disability leave of absence from work under the California Family Rights Act (CFRA) and the federal Family Medical Leave Act (FMLA).  At the expiration of her entitlement to leave under each act, Higgins-Williams returned to work and received a negative performance review.  Following this review, Higgins-Williams claimed that she was being singled out for negative treatment and, after a September 2010 encounter in which her supervisor grabbed her arm, Higgins-Williams had a panic attack, left work and did not return.

Following these events, Higgins-Williams requested a leave of absence, which her employer granted.  After an additional leave of absence that extended into January 2011, her treating physician stated that she could not return to work until March 2011 and then only on light duty.  Sutter Medical Foundation requested additional information from Higgins-Williams and informed her that if she did not comply with the request, her employment would be terminated on February 1, 2011.  Higgins-Williams responded that she did not feel she could return to work on February 1 but that she would try to return on March 1 instead.  Sutter terminated Higgins-Williams’ employment as of February 1, 2011.

Higgins-Williams filed suit, claiming that Sutter violated the California Fair Housing and Employment Act (FEHA) by discriminating against a person with a disability, failing to engage in the interactive process and failing to make reasonable accommodations, retaliating against her on the basis of her disability, and wrongfully terminating her on the basis of her disability.  The trial court granted Sutter’s motion for summary judgment on each claim, holding that Higgins-Williams failed to demonstrate that she suffered from a mental disability as defined by FEHA.

On appeal, the court upheld the trial court’s decision and held that an employee’s inability to work under a particular supervisor because of anxiety and stress related to the supervisor’s oversight of the employee’s job performance did not constitute a disability under FEHA.  Citing Hobson v. Raychem Corp., 73 Cal. App. 4th 614 (1st Dist. 1999), another Court of Appeals decision in which an employee’s inability to work under a specific supervisor was found not to qualify as a disability under FEHA, the court of appeals stated that Higgins-Williams’ purported disability was the “inability … to work under a particular supervisor” that Hobson held was not a disability under FEHA.  Because she was unable to demonstrate the existence of a disability under FEHA, her claims for discrimination, retaliation and wrongful termination based on that “disability” all failed.

While there is no one-size-fits-all approach to managing interpersonal conflict or requests for accommodation, this case provides useful guidance for employers struggling to determine just what constitutes a disability and how to conduct the interactive process required when an employee requests an accommodation based on an alleged disability.

August 13, 2015   No Comments