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Total Articles: 10

Ninth Circuit Creates More Uncertainty in 80/20 Rule for Tipped Workers

Executive Summary: On February 16, 2018, the United States Court of Appeals for the Ninth Circuit granted en banc review of Marsh v. J. Alexander’s LLC, 869 F.3d 1108, creating a new layer of uncertainty for hospitality employers. The previous decision by a three-judge panel on September 6, 2017, had rejected what is commonly called the “80/20 rule,” which states that hospitality employers may not reduce a tip-earning employee’s hourly pay below the minimum wage when that employee spends more than 20 percent of his or her workweek on non-tip-earning tasks. The case will now be reconsidered by a larger panel of the Ninth Circuit, with oral argument scheduled for the week of March 19, 2018. The grant of en banc review suggests an intention to reconsider the panel’s prior holding or analysis.

USDOL Self-Report PAID Program: Benefits TBD

Last week the U.S. Department of Labor (USDOL) announced its Payroll Audit Independent Determination (PAID) pilot program to mixed reactions. The PAID program is meant to provide a framework for employers to proactively resolve potential federal Fair Labor Standards Act (FLSA) claims. In a nutshell, an employer will be able to self-report potential violations to USDOL and attempt to resolve the issues efficiently and under the agency's "supervision," as outlined on its website.

DOL to Roll Out Payroll Audit Independent Determination (PAID) Program

Earlier this month, the U.S. Department of Labor (DOL) announced the Payroll Audit Independent Determination (PAID) Program. PAID will be rolled out in April 2018 as a six-month pilot program to incentivize employers to address any wage and hour underpayments under the Fair Labor Standard Act (FLSA).


The Tax Cuts and Jobs Act signed into law on December 22, 2017 is prompting some prudent early tax 2018 actions by both employers and employees related to employee benefits. Many employers are electing to make additional employer qualified plan contributions for the 2017 tax year when the employer’s tax rate may be higher and thereby yield a bigger tax benefit. C corporations, in particular, whose federal income tax rate in 2017 was as high as 35%, may find worthwhile to make further 2017 plan contributions, such as discretionary profit sharing contributions, if permitted under their 401(k) plans (up to the general defined contribution plan limit of 25% of compensation), rather than make the same contributions for 2018 when the company’s tax rate is a flat 21%.

WHD Announces Pilot Program to Resolve Minimum Wage, Overtime Violations

The US Department of Labor's Wage and Hour Division (WHD) has announced a new pilot program to expedite resolution of certain minimum wage and overtime violations. Under the Payroll Audit Independent Determination (PAID) program, the WHD will resolve violations by assessing the amount of wages due and supervising the payments to employees.

It’s PAID: DOL to Supervise Settlements Again in Cases Voluntarily Disclosed by Employers

On March 6, 2018, the U.S. Department of Labor’s (DOL) Wage and Hour Division (WHD) announced a new nationwide program to resolve minimum wage and overtime violations under the Fair Labor Standards Act (FLSA). Referred to as the Payroll Audit Independent Determination (PAID) program, it is expected to be a six-month pilot initiative that allows employers to conduct self-audits of their payroll practices and voluntarily report underpayments to the DOL/WHD which, in turn, will supervise the back wage payments.

Second Circuit Provides Guidance on Intern-Employee Test

Executive Summary: On December 8, 2017, the United States Court of Appeals for the Second Circuit (which has jurisdiction over federal district courts in Connecticut, New York and Vermont) ruled in favor of an employer, holding that six unpaid interns were not “employees” for purposes of the Fair Labor Standards Act (FLSA). See Wang v. Hearst Corp. To reach its conclusion, the court used the flexible “primary beneficiary test” it first promulgated in Glatt v. Fox Searchlight Pictures. The court’s application of the test in Wang created some confusion for employers.

WPI Wage Watch: Minimum Wage & Overtime Updates (February Edition)

February may be the shortest month of the year, but what it lacked in days it made up with minimum wage and overtime developments at the federal, state, and local levels.

Not All Deductions Are "Uniform" Under The FLSA

The federal Fair Labor Standards Act (FLSA) establishes minimum wage and overtime requirements, period. The FLSA does not explicitly require that employers cover all work-related costs, nor, does it do so by specifically prohibiting employers from imposing work-related costs on employees. Indeed, the FLSA permits an employer to impose these costs in their entirety on non-exempt employees. In other words, at least for FLSA purposes, it is not a matter of whether the employer can impose a cost, but the extent to which it can be imposed at one time depending on an employee's wages.

You're Gonna Need A Bigger Boat: Pay Equity Initiatives Flood the State Legislatures

In 2017, legislatures in more than 40 jurisdictions across the United States considered more than 100 bills intended to narrow the lingering pay gap between men and women. While only a handful of those proposals ultimately became law, this wave shows no signs of subsiding. Most state legislatures are back in session, and lawmakers are quickly picking up where they left off.

Fisher Phillips | California | California Supreme Court Embraces Employee-Friendly Formula For Calculating OT Pay (March 05, 2018)

Fisher Phillips | California | FEHC Proposes Regulations to Implement California’s New “Ban the Box” and “New Parent Leave” Laws (March 04, 2018)

Fisher Phillips | California | Your Comprehensive Guide to 2018 Proposed California Legislation (February 28, 2018)

FordHarrison LLP | California | California Supreme Court's Recent Overtime Ruling Likely to Cause Payroll Problems (March 07, 2018)

Jackson Lewis P.C. | California | California Court of Appeals Holds Labor Code § 558 Claims Are Indivisible Claims and Not Arbitrable (February 28, 2018)

Jackson Lewis P.C. | California | Calculating Overtime Value of Flat-Sum Bonus Must Be Based on Actual Non-Overtime Hours Worked, California High Court Holds (March 11, 2018)

Fisher Phillips | California | The Plot Thickens: Trump Administration Sues California Over New Immigration Laws, Including AB 450 (March 09, 2018)

Jackson Lewis P.C. | California | Pending California Legislation Alert! Recently Introduced Bill Seeks to Protect Medicinal Marijuana Users from Employment Discrimination in California (February 27, 2018)

Jackson Lewis P.C. | California | California Transportation Industry Waives Goodbye to Enforcement of Federal Arbitration Act Provisions in Employment Contracts (March 07, 2018)

Carothers DiSante & Freudenberger LLP | California | California Proposes New Regulations on Parent Leave and Criminal History Inquiries (March 14, 2018)