Labor&Employment Personnel File

Break Time for Nursing Mothers Required Under the FLSA

A little-known provision of the 2010 Patient Protection and Affordable Care Act amended the Fair Labor Standards Act (“FLSA”) to require employers to provide “reasonable break time” for nursing mothers to express breast milk at work. This rule became effective on March 23, 2010. As it appears that few employers are aware of this rule, we are passing information regarding the break time requirements to our subscribers through this e-alert.

The law requires employers subject to the FLSA to provide unpaid, reasonable break time for an employee to express breast milk in a private place for one year after her child’s birth. The Act defines “private place” as a place, other than a bathroom, that is shielded from view and free from intrusions from co-workers and the general public, which may be used by an employee to express breast milk.

The IRS’s New Voluntary Classification Settlement Program: Worker Misclassification Amnesty or Trap for the Unwary

Both the federal and various state governments in recent years have significantly increased their enforcement of worker classification laws.  These laws all address the question of whether a particular worker should be classified as an independent contractor or an employee.  Companies that have been audited by the federal and state governments and found to have misclassified workers have faced large back employment tax liabilities, interest, and penalties.

In a new twist on enforcing federal worker classification laws, the Internal Revenue Service recently announced a new Voluntary Classification Settlement Program (VCSP).  The VCSP “provides an opportunity for taxpayers to reclassify their workers as employees for employment tax purposes for future tax periods with partial relief from federal employment taxes.”  As the name implies, VCSP is a voluntary program. 

To be eligible for VCSP, an employer must (1) have consistently treated the workers to be reclassified as independent contractors; (2) have filed all required IRS Form 1099 for the workers to be reclassified for the previous three years; and (3) not currently be under IRS or state audit for misclassification of workers. 

Employers may apply for VCSP using IRS Form 8952.  Among the information required to be disclosed on the Form 8952 is (1) the number and description of the classes of workers to be reclassified; (2) the total taxable compensation paid to the soon-to-be reclassified workers for the most recently closed tax year; and (3) the estimated federal employment tax liability for those workers.

The IRS has discretion as to whether it chooses to accept any VCSP application.  If an employer is accepted into the program and ultimately signs a settlement agreement, the employer must prospectively treat the reclassified workers as employees.  Employers also receive the following benefits:  (1) the employer’s federal employment tax liability will be limited to only ten percent (10%) of the total federal tax liability for the most recently closed tax year and the employer must pay this amount; (2) the employer will not be liable for any interest or penalties on the ten percent payment; and (3) the employer will not be subject to a federal employment tax audit with respect to the workers being reclassified. 

While the VCSP has the potential advantage of limiting federal employment tax liability and removing the specter of future federal audits for the reclassified workers, there are a number of potential risks.  First, if the IRS chooses not to accept an employer’s application – for any reason – the employer has effectively identified itself as a potential target for future IRS audits and provided the IRS, under penalty of perjury, with the raw information needed to start an audit.  Second, the VCSP only applies to potential federal employment tax liability.  VCSP participation does not and cannot provide any protection again state audits or state employment tax liabilities.  Once workers are identified as misclassified as part of VCSP, employers face not only possible state employment tax liabilities, but also possible liability under various state workers compensation and unemployment insurance laws. 

Employers interested in participating in the IRS’s new VCSP should consult with legal counsel and their tax advisors to determine (1) whether VCSP is right for them and, if so, (2) how best to plot a course through the labyrinth of federal and state employment laws so as to maximize the benefits of VCSP and minimize the downside risks of VCSP rejection and/or audit by state governments.

This article was written by Michael Schrier, Jackson Kelly, PLLC. 

Obama's Jobs Bill Bars Discrimination Against the Unemployed

In response to the continued downturn in the national economy, on September 12, 2011, President Barack Obama submitted to the United States Congress the American Jobs Act of 2011. While this bill has a number of provisions related to such measures as tax reduction and the funding for teachers, first responders and construction projects, it also includes a provision entitled the “Fair Employment Opportunity Act of 2011”. Significant for employers, this provision provides applicants for employment protection under federal law from employment-related discrimination due to their status as unemployed.

Eight Figure EEOC Settlement Underscores Need for Flexibility in ADA Accommodations

In the September, 2011 edition of HR Magazine, it is reported that 24 named subsidiaries of a telecommunications company collectively paid $20,000,000.00 to settle a nationwide class disability discrimination lawsuit filed in Baltimore arising from charges of discrimination under the Americans with Disabilities Act (“ADA”).  According to the article, this payment constitutes the largest disability discrimination settlement in a single lawsuit in EEOC history.  The settlement is pending court approval.  In a press release issued by the EEOC, the Director of the EEOC’s Philadelphia District Office, said, “[t]his settlement demonstrates the need for employers to have attendance policies which take into account the need for paid or unpaid leave as a reasonable accommodation for employees with disabilities.” 

Social Networking Announcements by the NLRB

On August 18, 2011, the National Labor Relations Board (“NLRB”) issued a report summarizing recent case developments in 14 separate cases concerning social media in the workplace.  The cases involved Facebook and Twitter posts by employees.  In four of the cases, the Division found that the employees were engaged in “protected, concerted activity” because the employees were discussing terms and conditions of employment with fellow employees.  

U.S. Supreme Court Raises the Bar for Class Actions

In Wal-Mart Stores, Inc. v. Dukes, et al.—a seminal decision in what is described by Justice Antonin Scalia as “one of the most expansive class actions ever”—the United States Supreme Court held that the certification of a class brought on the behalf of 1.5 million current and former female employees against Wal-Mart for injunctive relief, declaratory relief, and backpay for alleged discrimination in violation of Title VII of the Civil Rights Act of 1964 was not consistent with Rules 23(a) and (b)(2) of the Federal Rules of Civil Procedure, which govern class action claims. The immediate result of this decision is that any of the 1.5 million employees who wish to pursue a claim against Wal-Mart will have to file an individual lawsuit based on facts specific to her claim of discrimination. However, the long-term effect of this decision is likely far reaching because this ruling will make it more difficult for plaintiffs to bring sweeping class action employment discrimination against employers.

No-Match: A Red Flag for All Employers

As of April 6, 2011, the Social Security Administration (“SSA”) resumed the issuance of “no-match” letters notifying an employer that its records do not match those of the SSA.

 

Don’t Allow the Innocuous Language in the No-Match Letter Fool You.

You will receive a no-match letter when there is a discrepancy between an employee’s name and social security number as reported on a W-2 or W-2c and the SSA’s records. A no-match letter simply states that the SSA cannot put earnings on the employee’s Social Security records until the discrepancy in the records is resolved. In a trap for the unwary, the letters provide no indication that a no-match letter may provide partial evidence that you employ an individual who is unauthorized to work in the United States, and that you consequently could face fines, civil or criminal sanctions.

Memorial Day Reminders for Reemployment of Returning Service Members

In light of the anticipated draw down of US military forces in Iraq and Afghanistan in the coming months (and in honor of the upcoming Memorial Day holiday), now is a good time to make sure that all private and public sector employers have a plan to comply with the federal Uniformed Services Employment and Reemployment Rights Act (USERRA).

USERRA is a federal employment law designed to protect the civilian employment of employees called to duty in the U.S. armed forces. Among other things, USERRA creates reemployment rights for returning members of the uniformed services, provides anti-retaliation protections for employees who are members of the uniformed services, and provides special protection to employees with disabilities incurred in or aggravated during military service. USERRA protects current and returning employees who served in the Army, Navy, Marine Corps, Air Force, Coast Guard, military Reserve units, as well as Army National Guard or Air National Guard. Unlike most federal employment laws, USERRA applies to all private and public (federal, state, and local) employers, regardless of the total number of employees employed by the employer. 

THERE'S AN APP FOR THAT?

As a "public service" to employees, the U.S. Department of Labor has created a free smartphone app to record hours worked for the purposes of tracking and calculating pay under state and federal wage and hour laws.  The "DOL--Timesheet" app allows employees to record their time and calculate their gross pay, both regular and overtime.  It can account for breaks--if the employee records them--but does not appear to account for withholdings and other deductions or vacation pay, sick time and other paid time off that is not "actually worked" for the purposes of calculating overtime pay.  In addition, the app cannot address tips, commissions, bonuses, deductions, holiday pay, pay for weekends and shift differentials.  The app currently works only on the iPhone and iPod Touch.  The agency is developing an app for other types of smartphones.  

Magee to Speak on Wage and Hour Issues and Retaliation Claims at HR Conferences

Given the nationwide increase in wage and hour lawsuits, as well as the significant trends and changes in laws relating to litigation and day-to-day operations, Erin E. Magee, a Member of Jackson Kelly's Labor and Employment  Practice Group, will address "Hot Topics in Wage and Hour Law" at the 2011 IPMA -WV Spring Conference on April 28, 2011 from 10:30 a.m. to 12:00 p.m. at the Chief Logan Lodge in Logan, WV.