Tag: Wage and Hour

Florida’s New $10 Minimum Wage Poster

By Anita Byer, Setnor Byer Insurance & Risk

Florida’s new $10 minimum wage poster is now available! Just in time too, because the largest minimum wage increase in Florida history is here. On September 30, 2021, Florida’s minimum wage will increase to $10 per hour. But that’s not the only thing that’s changing. In addition to making any necessary payroll adjustments, employers must also update their Florida minimum wage posters to reflect the new minimum wage.

Download the Florida Department of Economic Opportunity’s $10 Minimum Wage Poster.

Florida law requires employers to notify employees of their right to be paid no less than the minimum hourly wage and what they can do if their employer fails to do so. Employers can satisfy this notice requirement by posting the Department of Economic Opportunity’s “Notice to Employees – Minimum Wage in Florida.” But this notice can’t just be posted. It must be posted correctly.

  • The poster must be posted prominently in a conspicuous and accessible place in each establishment where minimum wage employees are employed.
  • The poster must be at least 8.5 inches by 11 inches and in a format easily seen by employees.
  • The text in the poster must be of a conspicuous size.
  • The text in the first line must be larger than the text of any other line.
  • The text of the first sentence must be in bold type and larger than the text in the remaining lines.

Remember that $10 per hour is just the first minimum wage increase required by the constitutional amendment approved by Florida voters. It will increase by $1 annually until it reaches $15 per hour on September 30, 2026. The annual adjustments for inflation are scheduled to resume in 2027. Employers must update their minimum wage posters annually to remain compliant with Florida law.

To reduce the likelihood of costly mistakes, employers should provide wage and hour training to managers and supervisors. Employers should also carry Employment Practices Liability Insurance with limited coverage for wage and hour claims. Contact us to learn more about protecting your business with Employment Practices Liability Insurance.

Florida’s Minimum Wage Increasing to $10 Per Hour on September 30

By Anita Byer, Setnor Byer Insurance & Risk

The largest minimum wage increase in Florida history is just weeks away! On September 30th, Florida’s minimum wage will increase to $10 per hour. That’s $1.35 more per hour than the current minimum wage and $1.44 more than last year’s minimum wage. A quick peak at the calendar confirms that employers have plenty of very little time left to prepare for this historic wage increase.

The upcoming increase is required by the $15 Minimum Wage Ballot Initiative (Amendment 2), which was approved by Florida voters in November 2020. Amendment 2 increases Florida’s minimum wage incrementally over a period of years until it reaches $15 per hour. The first (and largest) increase will occur September 30, 2021. It will then increase annually on September 30th per the following schedule.

2021                       $10.00

2022                       $11.00

2023                       $12.00

2024                       $13.00

2025                       $14.00

2026                       $15.00

2027                       Annual adjustments for inflation resume.

As of September 30, 2021, a minimum wage employee working full-time will need to be paid an additional $54 per week. Depending on the workforce make-up, the resulting increase in payroll expense may be minimal for some and substantial for others. Nevertheless, all employers must plan and prepare beforehand to avoid unintentional, unnecessary and costly violations. Employers should also look beyond this year’s record-breaking increase when budgeting for payroll. There will be five more increases under Amendment 2, each of which is large enough to tie the current record for largest single increase in Florida history.

To reduce the likelihood of costly mistakes, employers should provide wage and hour training to managers and supervisors. Employers should also carry Employment Practices Liability Insurance with limited coverage for wage and hour claims. Contact us to learn more about protecting your business with Employment Practices Liability Insurance.

Employment Law Landscape Expected to Change Under Biden Administration

Setnor Byer Insurance & Risk

Shortly after delivering his inaugural address, President Biden began taking steps to push his policy agenda forward. This is particularly true in the employment law context. Step 1, as expected, was to stop any pending regulatory activity initiated under the Trump administration. This president’s Chief of Staff issued a memorandum ordering an immediate regulatory freeze of all non-emergency regulatory activity pending review by the new administration.

The memorandum, which is nearly identical to the one issued on President Trump’s first day in office, specifically instructed the heads of all executive departments and agencies, including the Department of Labor, to:

  • not propose or issue any rule in any manner until a department or agency head appointed or designated by President Biden reviews and approves the rule;
  • immediately withdraw any rules that have not already been published in the Federal Register; and
  • consider postponing by 60 days the effective date of any rules issued in any manner, including those published in the Federal Register, which have yet to take effect for the purpose of reviewing any relevant questions of fact, law and policy.

The scope of this regulatory freeze is quite broad in that it applies to any:

  • regulatory actions;
  • guidance documents;
  • substantive actions by an agency, including notices of inquiry, advance notices of proposed rulemaking and notices of proposed rulemaking;
  • agency statement of general applicability and future effect that sets forth a policy on a statutory, regulatory or technical issue or an interpretation of a statutory or regulatory issue.

Its effects are already being felt. The Department of Labor’s Final Rule for determining independent contractor status under the Fair Labor Standards Act, which was set to take effect March 8, 2021, is expected to be among the more significant casualties of the regulatory freeze. Three FLSA opinion letters issued by the Wage & Hour Division on President Trump’s last full day in office have already been withdrawn by the Biden administration. Employers should expect more of the same in the coming weeks and months. Unfortunately, the uncertainty that always accompanies regulatory changes significantly increase the risk of employment-related claims and lawsuits. The confusion caused by uncertainty creates an environment where mistakes are inevitable. As a result, employers will likely need Employment Practices Liability Insurance to protect against various employment-related claims. Please contact us to learn more about EPLI coverage.

Amendment 2: Florida Voters Approve Ballot Initiative to Increase Minimum Wage

Setnor Byer Insurance & Risk

It was too close to call on election day, but Florida’s minimum wage ballot initiative ultimately received enough votes to pass…barely. Florida requires a 60 percent supermajority to amend its constitution. Amendment 2 received 60.82 percent of the votes cast. Despite being razor-thin, this margin is sufficient to amend Florida’ constitutional minimum wage requirements. So, what’s changing?

Amendment 2 increases Florida’s minimum wage incrementally over a period of years until it reaches $15 per hour. The first annual increase, which will be the largest, is scheduled to occur September 30, 2021. Each September 30th thereafter, it will increase by $1.00 until it reaches $15 per hour in 2026.

January 1, 2021                 $8.65

September 30, 2021        $10.00 (+ $1.35)

September 30, 2022        $11.00

September 30, 2023        $12.00

September 30, 2024        $13.00

September 30, 2025        $14.00

September 30, 2026        $15.00

Annual adjustments for inflation, which have taken place since 2005, are scheduled to resume September 30, 2027. Florida’s constitutional minimum wage requirements remain otherwise unchanged by Amendment 2. Employers, for example, are still prohibited from discriminating or retaliating against employees for exercising their constitutional minimum wage rights. They can still be sued by employees and Florida’s Attorney General for violating these rights. These lawsuits are still expensive.

To reduce the likelihood of costly mistakes, employers should provide wage and hour training to managers and supervisors. Employers should also carry Employment Practices Liability Insurance with limited coverage for wage and hour claims. Contact us to learn more about protecting your business with Employment Practices Liability Insurance.

Florida’s Minimum Wage is Increasing in 2021

Setnor Byer Insurance & Risk

On January 1, 2021, Florida’s minimum wage will increase nine cents to $8.65 per hour. The minimum wage for tipped employees, which must be paid in addition to tips, is also increasing nine cents to $5.63 per hour. Florida’s minimum wage is adjusted annually for inflation. It has gone up $2.50 since 2005. Download Florida’s 2021 Minimum Wage Poster.

Florida’s Minimum Wage Act applies to those employees entitled to receive the federal minimum wage under the Fair Labor Standards Act. Employers must pay no less than the federal minimum wage or their state’s minimum wage, whichever is higher. Florida’s minimum wage in 2021 will remain higher than the current federal minimum hourly wage of $7.25.

Florida employers must make employees aware of their rights by prominently displaying a minimum wage poster in a conspicuous and accessible place wherever minimum wage employees are employed. Employees can sue for violations of Florida’s Minimum Wage Act, but they must first provide their employers written notice of their intent to sue, which must:

Employers then have 15 calendar days to pay all unpaid wages or resolve the claim to the employee’s satisfaction. Otherwise, the employee may file a lawsuit. The Florida Attorney General can also bring a civil action against employers. Each willful violation can result in a $1,000 fine.

To reduce the likelihood of costly mistakes, employers should provide wage and hour training to managers and supervisors. Employers should also carry Employment Practices Liability Insurance with limited coverage for wage and hour claims. Contact us to learn more about protecting your business with Employment Practices Liability Insurance.

Florida’s Minimum Wage Going Up In 2020

On January 1, 2020, Florida’s minimum wage will increase by ten cents to $8.56 per hour. The minimum wage for tipped employees, which is in addition to tips, will also increase by ten cents to $5.54 per hour. Florida’s Minimum Wage Act applies to those employees entitled to receive the federal minimum wage under the Fair Labor Standards Act. Employers must pay no less than the federal minimum wage or their state’s minimum wage, whichever is higher.

Florida’s minimum hourly wage is adjusted annually for inflation. According to the Florida Supreme Court, only upward adjustments are permitted. Since 2005, Florida’s minimum wage has gone up $2.41. Florida’s 2020 minimum hourly wage remains higher than the current federal minimum hourly wage of $7.25.

Florida employers must make employees aware of their rights by prominently displaying a minimum wage poster in a conspicuous and accessible place wherever minimum wage employees are employed. Employees can sue for violations of Florida’s Minimum Wage Act, but they must first provide their employer written notice of their intent to sue, which must:

  • identify the minimum hourly wage to which the employee claims entitlement;
  • provide the actual or estimated work dates and hours for which payment is sought; and
  • state the total amount of alleged unpaid wages.

Employers then have 15 calendar days to pay all unpaid wages or resolve the claim to the employee’s satisfaction. Otherwise, the employee may file a lawsuit. The Florida Attorney General can also bring a civil action against employers. Each willful violation can result in a $1,000 fine.

Dealing with state and federal wage and hour laws can be hard. To protect against employment practices liability claims, employers should implement a training program and explore their options for insuring against wage and hour claims.

Please contact us for more information about protecting your business from employment-related liabilities.

Fair Labor Standards Act: Wage & Hour Law Update

What is the most recent development involving Fair Labor Standards Act? Here’s a hint. It’s not the highly-publicized rise and fall of those new white-collar overtime exemption regulations. In fact, quite a bit has happened since the Department of Labor officially abandoned its fight for new white-collar regulations in late 2017.

Opinion Letters

In June 2017, the DOL announced that it would reinstate the issuance of written opinion letters to help employers and employees better understand the FLSA. These letters provide the Wage and Hour Division’s official opinion of how the FLSA applies in the specific circumstances described by the person requesting the opinion.

On January 5, 2018, the DOL made good on its promise when it re-issued seventeen FLSA-specific opinion letters, the first in nearly a decade. These letters were originally prepared in 2009 by the departing Bush administration and quickly withdrawn under the new Obama administration. Then, on April 12th, the DOL issued two new FLSA-specific opinion letters.

This new round of opinion letters covers various topics, including:

  • Compensability of frequent rest breaks required by a serious health condition;
  • Compensability of travel time;
  • Calculation of salary deductions;
  • Salary deductions for full-day absences based on hours missed; and
  • Year-end non-discretionary bonuses.

Opinion letters are significant because they can provide an affirmative defense for actions that may otherwise be unlawful under the FLSA. An employer may avoid liability for actions:

  • Taken in good faith; and
  • In conformity with and in reliance on any written regulation, order, ruling, approval or interpretation of the DOL’s Wage and Hour Division.

Tipped Employees

In December 2017, the DOL proposed new tip regulations. Under the FLSA, employers can credit tips toward their minimum wage obligation. This “tip credit” is equal to the difference between the cash wages it pays the employee (which must be at least $2.13 per hour) and the $7.25 per hour Federal minimum wage.

Under current regulations, employees must be allowed to keep all of their tips, except for tips distributed through a tip pool. However, the tip pool must be limited to employees who customarily and regularly receive tips, like servers, bartenders and bussers. This restriction applies regardless of whether an employer claims a tip credit.

The proposed regulations remove this restriction for employers that do not take a FLSA tip credit and pay a direct cash wage of at least the full Federal minimum wage. The proposed regulations do not change the rules for employers that do claim a tip credit.

Under the proposed regulations, employers who do not take a tip credit would be allowed to share tips with back-of-house workers and other employees who do not customarily and regularly receive tips. According to the DOL, this lets employers reduce wage disparities among employees who all contribute to a customer’s experience, and also incentivizes all employees to improve customers’ experience.

The period for public comment on the proposed regulations ended February 5, 2018, so we can only wait to see what the DOL does next.

The rapidly changing FLSA can put employers at serious risk. Adjusting to change takes time, but violations can happen in the blink of an eye. Employers should consider Employment Practices Liability Insurance to protect against various employment-related claims, including limited coverage for wage and hour claims.

Please contact us if you would like to learn more about protecting your business with employment practices liability insurance.

To receive regular updates about developments which may affect your business, subscribe to Setnor Byer Insurance & Risk’s weekly risk management news brief.

Are the New White-Collar Overtime Exemption Rules Finally Dead?

Can you believe it’s been nearly three and a half years since President Obama first directed the Secretary of Labor to update the white-collar overtime exemption regulations? Since then, employers endured the uncertainty of not knowing if, when or how they would be affected by the new overtime rules.

But now, at long last, it looks like employers can stop thinking and worrying about the 2016 white-collar overtime exemption regulations. Finally.

Recall that under the new regulations, which were published May 23, 2016, the minimum salary level for exempt white-collar employees increased from $455 per week ($23,660 annually) to $913 per week ($47,476 annually). The new regulations also created an automatic updating mechanism that adjusts the minimum salary level every three years, starting January 1, 2020.

Shortly after the new regulations were published, two federal lawsuits challenging their validity were filed, one by a group of states and the other by a group of national business organizations. These two cases were later consolidated into a single case.

On November 22, 2016, the court in the consolidated case issued a temporary injunction blocking the new white-collar regulations from going into effect on December 1, 2016. The Department of Labor (Department) immediately appealed the injunction and requested expedited briefing. Though progress slowed when control over the Department passed from the Obama administration to the Trump administration, the appeal process continued.

Then, on August 31, 2017, the lower court essentially rendered the appeal moot when it ruled that the new white-collar overtime exemption regulations were invalid. According to the court, the new regulations were inconsistent with Congress’s unambiguous intent, which was to define the white-collar exemptions with regard to duties. As such, the Department exceeded its authority by essentially rendering an employee’s duties irrelevant when it more than doubled the previous minimum salary level.

“[T]the Department creates a Final Rule that makes overtime status depend predominately on a minimum salary level, thereby supplanting an analysis of an employee’s job duties. The Department estimates 4.2 million workers currently ineligible for overtime, and who fall below the minimum salary level, will automatically become eligible under the Final Rule without a change to their duties.”

Having determined that the Department lacks the authority to use a salary-level test that will effectively eliminate the duties test required by the Fair Labor Standards Act, the court deemed the Department’s new white-collar overtime exemption regulations invalid. Five days later, the Department voluntarily dismissed the appeal regarding the November 2016 injunction that prevented the new regulations from ever becoming effective.

For the time being, it looks like the prospect of new overtime exemption rules is gone. Since the new regulations never went into effect, the manner in which employers must evaluate and apply the white-collar overtime exemptions has not changed. Neither has the need for employers to consider Employment Practices Liability Insurance to protect against various employment-related claims, including limited coverage for wage and hour claims.

Please contact us if you would like to learn more about protecting your business with employment practices liability insurance.

To receive regular updates about developments which may affect your business, subscribe to Setnor Byer Insurance & Risk’s weekly risk management news brief.

Now What? Preparing for the New FLSA White Collar Overtime Exemptions

On December 1, 2016, it will be more expensive for employers to take advantage of the Fair Labor Standards Act’s (FLSA) so-called white collar overtime exemptions. Since FLSA violations have always been expensive, employers should begin the process of determining whether and to what extent they will be affected by the new overtime exemption regulations .

The new rules focus primarily on the minimum salary and compensation levels needed to qualify for the FLSA’s executive, administrative, professional, and computer employee overtime exemptions. Employers can ask the following questions to determine the potential impact of the new overtime rules.

Are there any employees classified as exempt under one of the FLSA’s white collar overtime exemptions? If no, you should not be affected by the higher standard salary levels under the new rules. If yes, move on to the next question.

Do any of these employees ever work more than 40 hours in a workweek? If no, you should not be affected by the higher standard salary levels under the new rules. If yes, move on to the next question.

Do any of these employees earn a salary of less than $913 per week? (This works out to $1,826 biweekly, $1,978 semimonthly, $3,956 monthly or $47,476 annually.) If no, you should not be affected by the higher standard salary levels under the new rules. If yes, exemption classifications and compensation practices will need to be adjusted before December 1, 2016 to avoid violating the new rules.

Various adjustments can be made to ensure compliance under the new rules. However, the most appropriate adjustment(s) will likely depend on each employer’s specific circumstances, such as the number of newly-nonexempt employees, their salaries, how often they work overtime and how much overtime they work.

Depending on their circumstances, employers may implement one or more of the following adjustments.

Increase Salaries. The obvious adjustment, and the one likely envisioned by those enacting the new rules, would be to increase the salaries of exempt white collar employees to no less than $913 per week. Though this may be the simplest and least disruptive adjustment, it may also be the most unrealistic. Though salary increases for some employees may be nominal, they can be more than double for others.

[Remember, employees are not exempt simply because their salaries satisfy the increased salary levels under the new rules. Their primary job duties must also involve the kind of work associated with the specific white collar exemption. Employees must satisfy the minimum salary level requirement and the applicable “standard duties test” to be exempt.]

Pay Newly-Nonexempt Employees Overtime Compensation. The alternative to increasing salaries is to re-classify these exempt white collar employees as overtime-eligible employees. If they work more than 40 hours in a workweek, they must be paid one and a half times their regular rate. As with other nonexempt employees, employers must track the number of hours worked each day and the total hours worked each workweek by newly-nonexempt employees. For many, this will be an entirely new experience and will take some getting used to.

This may not be a problem for employees who rarely work or who work very little overtime. These employees can continue working the same number of hours. Though employers will pay more for occasional overtime work, they may still be paying substantially less than $913 per week. The same cannot be said about employees who regularly work or who work a lot of overtime. The cost of paying time and a half to these employees could be very high, and may even approach $913 per week.

Prohibit Overtime. Newly-nonexempt employees can be prohibited from working overtime. If no overtime is worked, no overtime compensation is required. This option may be simple, but it may not be easy. Exempt employees typically work more than 40 hours in a workweek because they have more than 40 hours of work to do. This work must still get done, but someone else will have to do it.

Adjust Personnel, Schedules or Assignments. Those who prohibit overtime may have to make various operational adjustments. For example, workload distribution and workforce scheduling may need to be adjusted to compensate for the loss of overtime work. In some cases, new employees may need to be hired to make up for any lost productivity.

Adjust Wages. If newly-nonexempt employees are allowed to continue working overtime as always, employers will end up paying more money for the same amount of work. Reallocating regular wages and overtime compensation is a way to keep the hours worked by and the amount paid to newly-nonexempt employees largely the same. However, employers may not reduce an employee’s hourly wage below the highest applicable minimum wage (federal, state, or local) or continually adjust wages each workweek in order to manipulate the regular rate.

Employers cannot wait too long to begin planning for the upcoming change. It takes time to properly implement organizational adjustments to exemption classifications and compensation practices, particularly if they are substantial or complex. With all the publicity surrounding the new white collar overtime exemption rules, it’s probably safe to assume that violations will be noticed not only by those employees who are affected by the new rules, but by the Department of Labor too.

Since the Final Rule is sure to bring a level uncertainty and confusion, employers may benefit from having Employment Practices Liability Insurance to protect against various employment-related claims. Limited coverage for wage and hour claims may be available.

Please contact us if you would like to learn more about complying with the FLSA’s new white collar overtime exemption rules.

To receive regular updates about developments which may affect your business, subscribe to Setnor Byer Insurance & Risk’s weekly risk management news brief.