Our colleagues at Epstein Becker Green have a post on the Hospitality Labor and Employment Law blog that will be of interest to our readers in the retail industry: “Mayor de Blasio Proposes Mandatory Paid Personal Time Law.”

On January 9, 2019, Mayor Bill de Blasio announced his plan to make New York City the first city in the country to mandate that private sector employers provide paid personal time (“PPT”) for their employees. Under the proposal, employers with five or more employees would be required to grant their employees 10 days of PPT to use for any purpose, including vacation, religious observance, bereavement, or simply to spend time with their families. It is unclear whether the proposed legislation would apply to only full-time workers, or whether, similar to the Earned Safe and Sick Time Act (“ESSTA”), it would include many part-time employees as well. The Mayor said he would work with the New York City Council to develop the legislation, and several Council members have already voiced their support for the proposal. …

Read the full post here.

As expected given the extreme volume of website accessibility lawsuits filed over the last few years, in the first few weeks of the new year, United States’ Circuit courts have finally begun to weigh in on the law as it pertains to the accessibility of websites and mobile applications, and the results are generally disappointing for businesses.

Background

The U.S. Department of Justice (“DOJ”) has long taken the position that Title III of the Americans with Disabilities Act (“Title III”, “ADA”) applies to both websites and mobile apps, however, its withdrawal of Advanced Notice of Proposed Rulemaking (“ANPRM”) on December 26, 2017 and its September 25, 2018 letter (which effectively passed the onus to Congress to issue legislation on website accessibility standards), have prompted an onslaught of private demand letters and lawsuits filed in both state and federal court against businesses based on the theory that their websites are inaccessible to individuals with disabilities. As those who have confronted these lawsuits may know, the current state of the law has led to businesses being subject to duplicative actions in different jurisdictions, primarily, New York, California, and Florida. Last fall, both the Ninth and Eleventh Circuit courts held oral argument on website accessibility cases, with both panels expressing similar concerns about the current uncertainty in the law and how one can achieve and confirm a sufficient level of accessibility.

The Ninth Circuit Reverses Domino’s

Yesterday, in Robles v. Domino’s Pizza, the Ninth Circuit held that Title III applies to both websites and mobile applications. This decision reversed the district court’s dismissal of a class action lawsuit which asserted that Domino’s Pizza violated the ADA and California’s Unruh Civil Rights Act (UCRA) by failing to make its website and mobile app accessible to individuals who are blind or visually impaired. While the district court’s decision in Robles was always considered an outlier, the Circuit Court’s decision is significant because the Ninth Circuit considered, and rejected, defenses which have traditionally been advanced by businesses that have litigated website accessibility matters. For example, the Court refused to accept as a matter of law/summary judgment that providing a telephone hotline is sufficient alternative method for a company to satisfy its obligations under Title III to customers who are blind or have low vision (noting it was an issue of fact that required specific and contextual supporting factual evidence). The Court also rejected the concept that imposing liability in this context violates companies’ due process rights because DOJ has failed to issue clear technical standards for compliance.

At the outset, the Ninth Circuit agreed with the district court that Domino’s is a “place of public accommodation” and accordingly, the ADA applies to its website and mobile app, thereby requiring it to provide auxiliary aids and services to make its visual materials available to individuals who are blind. Drawing upon prior district court decisions from within the Ninth Circuit, the Court focused on the “nexus” between Domino’s website and mobile app and its physical restaurants, and found that the alleged inaccessibility of the website and app unlawfully prevents customers from accessing the goods and services at Domino’s physical locations. Notably, the Ninth Circuit declined to determine whether the ADA covers websites or mobile apps whose inaccessibility does not impede access to the goods and services at a physical location, reinforcing courts in the circuit’s position more narrowly construing the ADA to apply only to websites with a nexus to a brick-and-mortar location (as opposed to the more expansive positions taken by district courts in Massachusetts, New York, and Vermont).

The Circuit Court also noted that after the plaintiff filed the lawsuit, Domino’s website and mobile app began displaying a telephone number to assist customers who are visually impaired and who use a screen reading software. The Ninth Circuit held that a company’s use of a telephone hotline presents a factual issue, and, simply having a hotline, without any discovery regarding its effectiveness, is insufficient to award summary judgment to a company and determine that it has complied with the ADA. (This underscores that proving the sufficiency of an alternative means of access to a website – short of making the website itself accessible – could prove to be a costly endeavor.)

Citing DOJ’s failure to issue technical standards and withdrawal of ANPRM, Domino’s had argued that: (i) imposing liability would violate due process because it lacks fair notice of the technical standards that it is required to abide by; and (ii) the complaint was subject to dismissal under the doctrine of primary jurisdiction pending DOJ’s resolution of the issue. The Ninth Circuit rejected both arguments. First, the court held that DOJ’s failure to issue guidance on the specific standards or regulations does not eliminate a company’s obligation to comply with the ADA and its obligation to provide “full and equal enjoyment” to individuals with disabilities. Second, the Ninth Circuit held that the district court erred by invoking the doctrine of primary jurisdiction in order to justify its dismissal of the complaint without prejudice pending DOJ’s resolution of the issue. The court found that DOJ’s withdrawal of ANPRM meant that undue delay in resolving this issue “is not just likely, but inevitable,” which required the court to weigh in.

The Robles court did not rule on whether Domino’s website and mobile app comply with the ADA, and did not provide any guidance on how a company’s website or mobile app would comply with the ADA.

The Fourth Circuit Places Minor Restrictions On Standing

Two weeks ago, in Griffin v. Department of Labor Federal Credit Union, the Fourth Circuit considered another defense that has been increasingly asserted by businesses: whether plaintiff has standing to sue. In Griffin, the court rejected the plaintiff’s standing to bring a lawsuit against a Credit Union where he was not eligible for membership, he had no plans to become eligible to be a member, and his complaint contained no allegation that he was legally permitted to use the site’s benefits. The court also held that plaintiff’s status as a tester was insufficient to create standing where he was unable to plausibly assert that returning to the website would allow him to avail himself of its services. Unfortunately, this is an exceedingly narrow holding which should do little to undercut the rampant stream of filings by serial ADA website plaintiffs, as the heightened standard for joining a credit union would not apply to most other industries/websites. Therefore, while technically a victory for businesses, this decision did not issue the significant blow to serial plaintiffs that defendants had hoped would provide a clear defense moving forward.

Looking Ahead

We next await the holding of the 11th Circuit in Winn-Dixie. Unfortunately, it does not appear that, under this administration, we should expect DOJ to promulgate website accessibility guidelines. Similarly, with the government currently shut down (and other issues likely considered more pressing to the general public upon its reopening), it is extremely unlikely that Congress will amend the ADA or promulgate new legislation clarifying these issues in the near future.

Therefore, for the time being, businesses should expect to continue to face the seemingly endless stream of serial plaintiff website accessibility demand letters and lawsuits. As we have repeatedly noted, the best way to avoid falling prey to such a suit is to achieve substantial conformance with WCAG 2.1 Levels A and AA (confirming such status by human-based code and user/assistive-technology testing). Moreover, based upon the scope of the Ninth Circuit’s decision in Domino’s, these matters may soon expand to include mobile apps as well. Therefore, to the extent businesses had, to date, treated mobile application accessibility as a best practice, they should now consider the issue with increased urgency.

The New York State Department of Labor (“DOL”) recently issued proposed statewide regulations that would require employers to pay employees “call-in pay” when employers use “on call” scheduling or change employees’ work shifts on short notice. This is not the DOL’s first foray into this area – in November 2017, the DOL released similar proposed regulations but ultimately declined to adopt them. The DOL’s new set of proposed regulations would apply to the vast majority of employers operating in New York, but are of particular interest to New York City retail employers, who regularly use “on call” scheduling, and who are already subject to the New York City Fair Workweek laws.

When Would Employers Have to Pay Call-In Pay?

The proposed regulations would require employers to pay their employees “call-in pay” under the following five circumstances:

  • Reporting to work: An employee who reports to work for any shift at the request or permission of the employer must receive four hours of call-in pay.
  • Unscheduled shift: An employee who reports to work at the request or permission of the employer for a shift that was not scheduled at least 14 days in advance must receive two hours of call-in pay.
  • Cancelled shift: An employee whose shift is canceled by the employer within 14 days of the start of the shift must receive two hours of call-in pay. If the employee’s shift is cancelled within 72 hours of its scheduled start, the employee must receive four hours of call-in pay.
  • On-call: An employee who is required by the employer to be available to report to work for any shift must receive four hours of call-in pay.
  • Call for schedule: An employee who is required to contact the employer within 72 hours of the start of a shift to confirm whether to report to work must receive four hours of call-in pay.

Call-in pay for time that an employee actually attends work should be calculated at the employee’s regular rate or overtime rate of pay. All other call-in pay should be calculated at the basic minimum hourly rate with no allowances.

Exceptions to the Call-In Pay Requirements

The proposed regulations do include a number of exceptions to the call-in pay requirement, including the following:

  • The proposed regulations do not apply to employees who are covered by a valid collective bargaining agreement that expressly provides for call-in pay.
  • An employee would not be entitled to call-in pay during any work week in which his or her weekly wages exceed 40 times the applicable basic hourly minimum wage rate.
  • Employers do not need to pay call-in pay for unscheduled shifts for new employees during their first two weeks of employment, or for any employee who volunteers to cover a new or previously scheduled shift.
  • In the event that an employer responds to a weather or other travel advisory by offering employees the option to voluntarily reduce or increase their scheduled hours (i.e., arrive early/late, depart early/late), the employer does not need to pay call-in pay for employees’ unscheduled or canceled shifts.
  • An employer does not need to pay call-in pay when it cancels a shift at the employee’s request for time off, or due to an act of god or other cause outside the employer’s control.

Special Note for New York City Retail Employers

Retail employers operating in New York City are already subject to the Fair Workweek laws, which took effect in November 2017. Under the City law, retail businesses must schedule employees’ shifts at least 72 hours in advance, and cannot add or cancel shifts with less than 72 hours’ notice. In addition, retailers generally cannot require employees to come to work with less than 72 hours’ notice, or require them to call in within fewer than 72 hours before the start of a shift to determine if they should come to work. The DOL’s proposed regulations, however, would permit employers to take these very same actions as long as they pay employees the correct amount of call-in pay. The DOL’s proposed regulations do not address this potential conflict with the New York City Fair Workweek laws, or any other potential impact on the existing City law.

The comment period on the DOL’s proposed regulations has closed, and we can expect that they could be adopted as early as the first quarter of this year. It is more likely that the DOL will adopt these regulations on this go-round – especially given the current political climate within New York State (including the most recent mid-term elections, which put Democrats in control of the state legislature). We will keep you updated with any further developments. If the regulations are adopted, all New York employers – particularly retail employers in New York City – should contact counsel to ensure that their policies are updated and in compliance.

Our colleagues  at Epstein Becker Green have a post on the Hospitality Employment and Labor blog that will be of interest to many of our readers in the retail industry: “New Massachusetts Department of Family and Medical Leave Launches Website, Issues First Round of Guidance.”

Following is an excerpt:

The brand-new Massachusetts Department of Family and Medical Leave (“DFML”) has launched its webpage and issued the first set of guidance for both employers and employees. The DFML was created to help facilitate the implementation of Massachusetts’ new Paid Family and Medical Leave programs (“PFML”). The deadline for employers to start making contributions toward the PFML programs is July 1, 2019, and employees may begin receiving benefits beginning on January 1, 2021.

The DFML’s first set of guidance provides comprehensive FAQ documents, one for employers and one for employees. …

Read the full post here.

As those of you who have followed my thoughts on the state of the website accessibility legal landscape over the years are well aware, businesses in all industries continue to face an onslaught of demand letters and state and federal court lawsuits (often on multiple occasions, at times in the same jurisdiction) based on the concept that a business’ website is inaccessible to individuals with disabilities.  One of the primary reasons for this unfortunate situation is the lack of regulations or other guidance from the U.S. Department of Justice (DOJ) which withdrew long-pending private sector website accessibility regulations late last year.  Finally, after multiple requests this summer from bi-partisan factions of Members Congress, DOJ’s Office of Legislative Affairs recently issued a statement clarifying DOJ’s current position on website accessibility.  Unfortunately, for those hoping that DOJ’s word would radically alter the playing field and stem the endless tide of litigations, the substance of DOJ’s response makes that highly unlikely.

DOJ’s long-awaited commentary makes two key points:

  1. DOJ continues to take the position that the ADA applies to public accommodations’ websites, explaining that this interpretation is consistent with the ADA’s overarching civil rights obligations; and
  2. Absent the adoption of specific technical requirements for websites through rulemaking, public accommodations have flexibility in determining how to comply with the ADA’s general requirements of nondiscrimination and effective communication.

This line of reasoning is similar to that adopted in judicial decisions holding that while the ADA’s overarching civil rights obligations apply to websites, it would be inappropriate to specifically require compliance with WCAG 2.0/2.1, without the WCAG having been officially adopted by the government as a required standard.  Of course, as those cases note, DOJ’s position begs the question, if a business has to make the goods and services offered on its website accessible to individuals with disabilities how else can it provide for “full and equal enjoyment” and/or “effective communication” if the business does not otherwise offer a website in substantial conformance with WCAG 2.0/2.1.  Indeed, DOJ’s views on this issue stops far from providing businesses with an ironclad defense.  While DOJ explains that public accommodations have “flexibility” in determining how to comply with the ADA’s requirements it also cautions that, “…noncompliance with a voluntary technical standard for website accessibility does not necessarily indicate noncompliance with the ADA.” (emphasis added)  By way of example, a select number of cases have contemplated the validity of offering telephone service as an alternative to an accessible website (something DOJ had also previously considered during the since abandoned rulemaking process), with several courts expressing doubt that the availability, speed, and thoroughness of such a telephone service could ever fully equal that of the independently usable accessible website.  With that in mind, any employer looking to establish that it provides a viable alternative to an accessible website would have to be prepared to engage in a significant amount of litigation to prove the viability/accessibility of its alternative offering.

In concluding its response, DOJ seemingly passes the onus for resolving these issues back onto Congress, noting, “Given Congress’ ability to provide greater clarity through the legislative process, we look forward to working with you to continue these efforts [to address the risk of litigation on covered entities].”  Of course, given the number of higher profile matter currently confronting both DOJ and Congress, it would not be surprising if promulgating new website accessibility legislation/regulation will not be high on their lists.

On January 1, 2019, the length of paid leave and amount of weekly benefits under the New York Paid Family Leave Act (“NY PFL”) are scheduled to increase, the first of three yearly increases. The NY PFL, which took effect earlier this year, allows employees to collect up to a maximum of eight weeks of benefits within a 52-consecutive week period. In 2018, employees are eligible to earn 50% of their average weekly salary, up to a cap set at 50% of the state average weekly wage. Currently, the NY PFL benefits has been calculated based on the 2016 New York State average weekly wage, which is $1,305.92 per week. Thus, the maximum benefit amount in 2018 is $652.96 per week.

Beginning on or after January 1, 2019, leaves of absence taken under the NY PFL will increase to a maximum of 10 weeks of benefits within a 52-consecutive week period. The benefit amount will also increase to 55% of an employee’s average weekly salary, up to a cap set at 55% of the state average weekly wage. In 2019, the NY PFL benefits will be calculated based on the 2017 New York State average weekly wage, which is $1,357.11. The new maximum weekly benefit in 2019 will be $746.41 per week.

An employee’s payroll contribution toward NY PFL is also scheduled to increase beginning on January 1, 2019. The deduction amount will increase to 0.153% of an employee’s weekly salary, at an annual contribution amount less than the cap of $107.97. This is an increase from the 2018 deduction amounts, which were 0.126% of an employee’s weekly salary, with an annual contribution cap of $85.56.

As a reminder, beginning on January 1, 2020, the maximum length of leave will stay at 10 weeks, but the benefits will be calculated based on 60% of an employee’s average weekly wage, up to a cap set at 60% of the state average weekly wage. On January 1, 2021, the last of the annual increases will be set. Then, the maximum length of leave will increase to 12 weeks in a 52-consecutive week period and benefits will be payable based on 67% of an employee’s average weekly wage, up to a cap set at 67% of the state average weekly wage.

The New York City Commission on Human Rights (“Commission”) recently issued a 146-page guide titled “Legal Enforcement Guidance on Discrimination on the Basis of Disability” (“Guidance”) to educate employers and other covered entities on their responsibilities to job applicants and employees with respect to both preventing disability discrimination and accommodating disabilities. The New York City Human Rights Law (“NYCHRL”) defines “disability discrimination” more broadly than does state or federal disability law, and the Guidance is useful in understanding how the Commission will be interpreting and enforcing the law.

The basic principles of the NYCHRL’s prohibition against disability discrimination are as follows:

  1. Employers may not discriminate against a qualified job applicant or employee on the basis of an actual or perceived physical or mental disability;
  2. Employers may not discriminate against an applicant or employee based upon his or her association with an individual with an actual or perceived disability;
  3. Employers must provide applicants and employees, upon their request, with a reasonable accommodation to perform the essential duties of the job, if the disability is known or should have been known by the employer, unless, among other reasons doing so would result in undue hardship; and
  4. The cooperative dialogue law, which becomes effective October 15, 2018, will require employers to engage in and document a “cooperative dialogue” with a person who has requested an accommodation or who the employer “has notice may require such an accommodation.” As the Guidance makes clear, the Commission generally construes these four tenets and the myriad employer responsibilities they embody liberally. For example, as set forth in the chart below, the NYCHRL prohibits a wide range of conduct.

Prohibited Conduct under NYCHRL

Prohibited Conduct Definition Example(s)
Disparate Treatment Treating a job applicant or employee with a disability or perceived disability differently from other applicants or employees without a disability. Refusal to hire an otherwise qualified applicant as a sales clerk because the individual has a speech impediment (assuming the applicant can still be easily understood).

 

Harassment A single or repeated incident that “creates an environment or reflects or fosters a culture or atmosphere of stereotyping, degradation, humiliation, bias, or objectification,” of an individual because of his or her actual or perceived disability. Under the NYCHRL, the severity or pervasiveness of the harassment is only relevant to damages. A supervisor calls an employee who has cerebral palsy a “spaz,” and states that he would not have hired him or her if he knew that the employee’s disability was “this bad.”
Discriminatory Policies/Practices Policies or practices that exclude workers with disabilities from whole job categories or specific positions without an individualized assessment of the candidate and the essential requisites of the job, unless the employer can demonstrate a legitimate non-discriminatory justification for the exclusion policy.

 

A policy that requires employees to be “100%” healed to return to work and that does not allow for consideration of a reasonable accommodation. (An employer cannot require an employee with a disability “to have no medical restrictions if the employee is able to perform his job with or without a reasonable accommodation.”)

 

Actions Based on Stereotypes and Assumptions Reliance on stereotypes or assumptions when taking adverse action, without regard to an individual’s specific ability or circumstance. Refusal to hire an applicant:

Who uses a wheelchair, because of concerns that the applicant may be unable to attend off-site meetings; or

Whose cancer is in remission, because of concerns that the cancer will recur.

 

Neutral Policies that Have a Disparate Impact

 

Policies or practices that are facially neutral, but more harshly affect one group, unless the policy or practice bears “a significant relationship to a significant business objective of the employer.” “No fault” absence or maximum leave policies;

A policy that, without exceptions, penalizes employees who exceed a permissible amount of sick leave.

Associational Discrimination Taking adverse action against individuals who associate with people who have disabilities based on unfounded stereotypes and assumptions.

 

Firing an employee who volunteers as an aide to people who are HIV-positive out of fear that the employee will contract the disease;

Refusing to hire an applicant with a disabled child because of concerns that the applicant may be an unreliable employee.

Disability Inquiries: What May Employers Ask Applicants and Employees?

 Applicants

The NYCHRL prohibits job postings, applications, interviews, and other selection processes that “directly or indirectly suggest an intent to discriminate” based on disability. For example, employers should not ask an applicant if he or she has or has had a disability, or inquire as to the details of the applicant’s disability. Nor should an employer request medical documentation regarding a disability. The Guidance also cautions employers against adopting a range of practices and policies, from height and weight standards to employment tests, unless the job requirement for which the criterion or test is being used is significantly related to an important business objective.

However, employers may require an applicant to take or pass a medical exam or test after the applicant receives a conditional offer of employment, as long as this requirement is applied consistently to all prospective employees, the test is job-related, and it is not used to screen out individuals with a disability.

The Guidance also cautions employers against asking applicants questions concerning gaps in their work history, “as this may lead to inquiries relating to an applicant’s disability,” or the disability of an individual with whom the applicant is associated.

To avoid potentially improper questions, the Guidance advises employers to focus their application and interview inquiries on the applicant’s ability to perform “the essential requisites of the job, with or without an accommodation,” and to present such questions in a “yes or no” format.

Finally, the Guidance reminds employers that they are required to provide reasonable accommodations to prospective employees during the application and interview processes, such as screen-reading software for a visually impaired applicant.

Employees

Generally, an employer should avoid inquiries into an employee’s disability or perceived disability unless the employee makes a request for a reasonable accommodation or the employer “has notice” of the disability, for example, where a job applicant arrives for an interview in a wheelchair, or an employee shows up for work one day using crutches or wearing a hearing aid. However, within narrowly defined parameters, an employer may inquire about an employee’s disability or require a medical exam when an employee who has been on medical leave wants to return to work. With the focus of any such inquiry limited to information that is necessary to assess the employee’s ability to work, an employer may inquire about the employee’s disability if the employer:

Has reason to believe the employee’s ability to perform essential job functions is impaired;

Is concerned that the employee will pose a direct threat to the safety of him/herself or others; or

Engages in a “cooperative dialogue” to determine whether and what kind of an accommodation should be provided for the employee.

Notably, employers may require all employees to undergo periodic medical examinations, but only if the policy is uniformly applied, the exam is “narrowly focused” on assessing the employees’ ability to perform their job functions, and the test is administered in the same manner to all employees.

New York City Law on Requests for Reasonable Accommodation

Under the NYCHRL, all requested accommodations are presumed to be reasonable. As a result, an applicant or employee need not prove that the requested accommodation: (1) is necessary; (2) does not pose an undue hardship to the employer; or (3) is readily feasible. However, an employer can require medical documentation to support a request for an accommodation, although it cannot require a specific type of documentation.

To overcome the presumption of reasonableness, an employer must show that: (i) there is no accommodation that would enable the applicant or employee to perform the essential duties of the job; (ii) the proposed accommodation would impose “undue hardship” on the employer; or (iii) the applicant or employee was offered and rejected a different accommodation that was reasonable. The mere fact that the accommodation will cause the employer to incur an expense does not constitute undue burden. Rather, the Commission weighs the cost involved in the context of other considerations, including the size of the employer and the duration for which the accommodation is needed.

Further, the NYCHRL imposes a duty on employers to provide reasonable accommodations to applicants and employees both when the disability is known and when the employer should have known about the disability, even if the applicant or employee did not request an accommodation. If the employer suspects or should suspect that the individual may need an accommodation, the employer should not ask the individual if he or she has a disability. Rather, the employer should “ask if there is anything going on that the employer can help with” and inform the person of the support services provided by the employer to individuals with disabilities.

The Guidance instructs employers to assess requests for a reasonable accommodation on a case-by-case basis, and offers some specific suggestions for reasonably accommodating the needs of a disabled applicant or employee. For example, employers can make their online application process accessible to individuals with visual impairments, or allow an employee with anxiety to bring his or her service dog to the office. Employers can also provide a quieter workspace to reduce noisy distractions for an employee with a mental health condition.

The Guidance also discusses leaves of absence as a reasonable accommodation. It advises that a paid or unpaid leave of absence is an appropriate accommodation mostly “in circumstances in which no other accommodation can be made,” or where, under the facts of the situation, it is the “preferred” accommodation. The Commission advises that, absent special circumstances, an employer should seek an accommodation that allows an employee to remain working.

Finally, the Guidance encourages employers to include information on their reasonable accommodation policies and processes in an employee handbook.

Compliance

Employers should review current policies and practices, including application forms and accommodation request forms, to ensure that they are consistent with the Guidance, particularly with respect to the procedures and documentation requirements under the new “cooperative dialogue” law. Additionally, employers should update employee handbooks to reflect any modifications in company practices concerning accommodation and the cooperative dialogue process. Employers also should train managers and supervisors on their obligations with respect to avoiding disability discrimination and following the reasonable accommodation process, including the substantive and documentation requirements imposed under the cooperative dialogue law.

Finally, employers should ensure that Human Resources and supervisory personnel understand the potential interplay of the cooperative dialogue law with another recently enacted statute – the Temporary Schedule Change for Personal Events Law – which became effective on July 18, 2018. Many requests for accommodation involving proposed changes to the hours or location of work will implicate both laws, and will require the employer to document the requests and employer responses in a particular manner.

This post was written with assistance from Alison Gabay, a 2018 Summer Associate at Epstein Becker Green.

Our colleagues   at Epstein Becker Green have a resent post on the Wage and Hour Defense Blog that will be of interest to our readers in the retail industry: “California Supreme Court’s Clarification of De Minimis Doctrine Leaves Many Questions Unanswered – and Does Little to Ease Plaintiffs’ Path to Class Certification.”

On July 26, 2018, the California Supreme Court issued its long-awaited opinion in Troester v. Starbucks Corporation, ostensibly clarifying the application of the widely adopted de minimis doctrine to California’s wage-hour laws. But while the Court rejected the application of the de minimis rule under the facts presented to it, the Court did not reject the doctrine outright. Instead, it left many questions unanswered.

And even while it rejected the application of the rule under the facts presented, it did not address a much larger question – whether the highly individualized issues regarding small increments of time allegedly worked “off the clock” could justify certification of a class on those claims. …

Read the full post here.

The expiration date for the U.S. Department of Labor’s (“DOL”) model Family and Medical Leave Act (“FMLA”) notice and medical certification forms has once again been extended. The new expiration date is now August 31, 2018. Expiration dates are located at the top right corner of the model FMLA forms.

The DOL’s model FMLA notices and certification forms were originally due to expire on May 31, 2018, then again on June 30, 2018, and the DOL has again pushed the expiration date, now to the end of August, from the July 31, 2018 expiration date. Once approved by the Federal Office of Management and Budget, the new FMLA forms will be valid through 2021.

As previously posted, we will continue to monitor the DOL’s website and post any further developments on an extension of the current forms or issuance of new forms.

This post was written with assistance from Alison Gabay, a 2018 Summer Associate at Epstein Becker Green.

A legislative bargain requires give-and-take from all stakeholders. On June 28, 2018, Massachusetts Governor Baker signed House Bill 4640, “An Act Relative to Minimum Wage, Paid Family Medical Leave, and the Sales Tax Holiday” (the “Act”). This “grand bargain” gradually raises the minimum wage, provides for paid family and medical leave, makes permanent the Commonwealth’s annual tax holiday, and phases out Sunday and holiday premium pay requirements. While Massachusetts employers must now adjust to an increased minimum wage and new paid family medical leave program, retailers with eight or more employees may see those costs mitigated by the gradual elimination of Sunday and holiday premium pay mandates.

Currently, Massachusetts retailers must provide premium pay of 1.5 times the regular hourly rate to non-exempt employees who work on Sundays or certain holidays designated by state law. The holidays covered by the premium pay laws are New Year’s Day, Memorial Day, Independence Day, Labor Day, Columbus Day, and Veterans Day. The premium pay requirements do not apply to employees who are exempt from overtime pay mandates under Massachusetts law, specifically executive, administrative, and professional employees who earn more than $200 per week.

The Act will reduce, and ultimately remove, Massachusetts’ Blue Law premium pay requirement in accordance with the following schedule:

Effective Date Premium Pay Rate
January 1, 2019 One and four-tenths (1.4)
January 1, 2020 One and three-tenths (1.3)
January 1, 2021 One and two-tenths (1.2)
January 1, 2022 One and one-tenth (1.1)
January 1, 2023 No premium pay

Though covered employers will no longer be required to offer premium pay for Sunday and holiday work, the other provisions in the Blue Law remain unchanged. As such, retail employers may not require employees to work on Sundays or holidays, nor may employers discriminate or take adverse action against employees who refuse to work such shifts.

The phase out of premium pay is intended to provide relief for retailers; however, it also appears to create a subtle complication that may raise costs for Massachusetts retailers over the next four years. Under federal and state law, employers must pay non-exempt employees one-and-one-half premium pay for all hours worked over 40 in a week. Premium pay for work on Sundays and holidays may be creditable toward overtime compensation, but only if it is at least one-and-a-half times that employee’s “regular rate” of pay for the given workweek.

The “grand bargain” legislation thus reduces premium pay below this one-and-one-half-times threshold, such that it is no longer excluded from the overtime pay calculation, and therefore, the Massachusetts premium pay can no longer be used to satisfy the federal and state overtime pay requirements. As such, if an employee works more than 40 hours in the workweek, and some of those hours fall on a Sunday or qualified holiday, Massachusetts retailers may be required to provide the employee with both (1) the Sunday or holiday premium, and (2) overtime (above and beyond the premium pay already provided). To further complicate matters, the premium pay received for time worked on the Sunday or holiday will need to be incorporated into the employee’s regular rate of pay, which will affect the calculation of the employee’s overtime rate of pay. Note also that employees’ entitlement to decline Sunday/holiday work (and not be retaliated against) stays in effect as part of the grand bargain. It remains to be seen whether this fact, when considered along with the elimination of premium pay, will impact the number of employees willing to work on Sundays/holidays.

While state lawmakers may choose to revise the statute as it pertains to this complication, overall, the elimination of premium pay should still come as a welcome relief to many Massachusetts retailers, especially those directly competing with stores across the border in New Hampshire. Given that the first reduction in pay is set to take effect in a matter of months, covered employers should notify their employees about the reduction, ensure overtime calculations comply with federal and state laws, and confirm payroll systems are updated to reflect these changes.

This post was written with assistance from Eric I. Emanuelson, Jr., a 2018 Summer Associate at Epstein Becker Green.