Tuesday, September 24, 2019: Final Overtime Rule Issued by USDOL
The U.S. Department of Labor’s Wage and Hour Division announced the Final Rule, “Defining and Delimiting the Exemptions for the Executive, Administrative, Professional, Outside Sales, and Computer Employees.” The Division opened the Proposal for public comment in March 2019 after a lengthy legal battle dating back to the Obama Administration’s original “Final Rule” in 2016. A Texas Federal Court then issued a permanent injunction stopping the Overtime Rule in August of 2017.
Effective January 1, 2020, the following updates to the regulations of the Fair Labor Standards Act will become legally effective, barring a lawsuit challenging them and a federal Court then enjoining them:
- Raising the “standard salary level” from $455 to $684 per week (equivalent to $35,568 per year for a full-time employee);
- Raising the total annual compensation level for “highly compensated employees (HCEs)” from $100,000 to $107,432 per year;
- Allowing employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10 percent of the standard salary level, in recognition of evolving pay practices; and
- Revising the special salary levels for workers in U.S. territories and in the motion picture industry.
USDOL has submitted its Final rule to the Office of the Federal Register (OFR) for publication and is currently pending placement on public inspection at the OFR and publication in the Federal Register. This version of the final rule may vary slightly from the published document if minor technical or formatting changes are made during the OFR review process. Only the version published in the Federal Register is the official final rule.
Thursday, September 26, 2019: Scalia to Head DOL
The U.S. Senate confirmed Eugene (Gene) Scalia to be the Secretary of Labor. Scalia (son of former United States Supreme Court Justice Antonin Scalia) now fills the position Alexander Acosta vacated on July 19, 2019.
Mr. Scalia was a partner in the Washington, D.C. office of Gibson, Dunn & Crutcher. He was Co-Chair of the Firm’s Administrative Law and Regulatory Practice Group and a member of its Labor and Employment Practice Group, which he co-chaired for twelve years. He is also a member of the Firm’s Appellate and Constitutional Law Practice Group and had served on its Executive Committee and its Partnership Evaluation Committee. Mr. Scalia was also one of six Gibson Dunn partners recognized in the 2019 Guide to World-Class Employment Lawyers by Human Resource Executive (HRE) magazine and Lawdragon.
Friday, September 27, 2019: EEO-1 Status Update
The EEOC on Friday reported to federal District Court Judge Tanya Chutkan in the National Women’s Law Center, et al., v. Office of Management and Budget and EEOC, et al., Civil Action No. 17-cv-2458 (D.D.C.) that the Commission was planning to keep the Component 2 reporting portal open for six weeks (until mid-November, 2019) beyond its closing date (today=September 30). Judge Chutkan had earlier ordered the Commission to keep the Component 2 reporting portal open until the Commission collected what the Court determined to be the agency’s “target response rate.” The Court defined the “target response rate” to be the mean percentage of Component 1 filers as measured over the last four years as compared to the required number of filers obligated in those years to file Component 1 data. The Commission had earlier reported that mean percentage to be 72%.
The EEOC also reported to the Court on Friday that as of September 25, 2019, with only five calendar days left to the September 30, 2019 Component 2 filing date that only 39.7% of eligible filers had submitted Component 2 EEO-1 data. So, the Commission is over halfway there, but with a long road ahead of it.
Note: A DE survey to its Members in March 2019 found that about 20% of DE’s Member companies would be unable to file before the end of this calendar year. Based on the DE Survey, it looks right now as though the Commission is likely going to have to keep its Component 2 reporting portal open until the end of this calendar year to collect the required 72% of Component 2 eligible filers.
The EEOC has reported it costs the taxpayers $1.5 million for every six-week period the Commission holds open the Component 2 reporting portal (i.e., $250,000 per week.) We are fielding many questions from Members about how to file the Component 2 report, and many are continually receiving “error reports” not allowing them to complete the submission.
In other news the EEOC reported to the Court, the Component 2 EEO-1 HelpDesk has answered a total of 27,237 calls from filers and has received 13,442 voice mails and 22,050 emails since opening. In the preceding week alone, the HelpDesk answered 2,347 calls from filers and received 2,243 voice mails and 4,114 emails.
Reminder: VETS-4212 Deadline – TODAY (Monday, September 30th)!!
The VETS-4212 reporting requirements apply to all federal Government contractors and subcontractors with “a” covered federal contract valued at $150,000 or more at any point during 2018. The deadline to file the report is today: September 30, 2019.
VETS-4212 Federal Contractor Reporting landing page contains filing information and FAQs.
Download the VETS-4212 form at 2019 VETS-4212 (PDF Document).
Reminder: EEO-1 Survey Component 2 Deadline – TODAY (Monday, September 30th)!!
EEO-1 filers should submit Component 2 data for calendar year 2017, in addition to data for calendar year 2018, by September 30, 2019.
- There are two ways to file:
- Complete the Online Form
- Data File Upload
- Employers should navigate to the LOGIN to File page to access the secure Online Filing System to complete the online form or to upload files.
What to do if unable to submit the data today?
Not to worry…No one should work overtime or fret. Calm. Breathe…for three reasons:
- The EEOC is going to keep the Component 2 reporting portal open until at least mid-November 2019, see story above “EEO-1 Survey Status Update.”
- There is no financial, economic, or other sanction for failure to file at all. Indeed, 27% of employers have historically declined or failed to file even the non-controversial Component 1 data. The EEOC has never sought to exercise the agency’s legal right to sue non-filers in federal court to seek an injunction to compel the employer to file. Moreover, there is no requirement causing Government contractors to file the EEO-1 Component 2 (only Component 1) because they are Government contractors. This is because OFCCP declined to file a Rule for public comment and review requiring Government contractors Executive Order 11246 covers to file Component 2 data. (OFCCP agrees, by the way. This is a not a controversial conclusion). Accordingly, no debarment sanction is available to OFCCP for Government contractors which fail or refuse to file Component 2 data.
- Per John Fox, “I estimate about 50% of eligible EEO-1 filers will likely miss the September 30 filing deadline and probably over 30% will NEVER file Component 2 data before the EEOC closes the Component 2 portal, PROBABLY BY December 31, 2019.”
THIS COLUMN IS MEANT TO ASSIST IN A GENERAL UNDERSTANDING OF THE CURRENT LAW AND PRACTICE RELATING TO OFCCP. IT IS NOT TO BE REGARDED AS LEGAL ADVICE. COMPANIES OR INDIVIDUALS WITH PARTICULAR QUESTIONS SHOULD SEEK ADVICE OF COUNSEL.
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John C. Fox, Esq. is President and Partner at Fox, Wang & Morgan P.C. where he represents companies and tries cases in state and federal courts throughout the United States. Mr. Fox has extensive trial experience, having spent more than 300 days in trial. Mr. Fox was also lead trial counsel in the first of the six wage-hour class actions known to have been tried in California and was lead trial counsel in what are believed to have been the two largest disability law suits in the United States. He is an across-the-board employment lawyer representing management nationwide. Full Bio »