North Carolina and others ask the US Supreme Court to protect employees’ fundamental rights

North Carolina state government joined several other states last week in throwing its weight behind an important effort to defend basic protections for working people.

The right of workers to join together to enforce workplace laws is the cornerstone of national labor policy. Federal law gives employees the right to engage in “concerted” – or group – activities for their “mutual aid or protection” and prohibits employers from interfering with this right. Unfortunately, this cornerstone is under attack.

There is a growing trend among employers of requiring employees to waive this right by forcing them to agree to arbitrate any workplace disputes as a condition of employment. These mandatory arbitration clauses bar employees from bringing their wage and hour, discrimination, and other employment claims as class or collective actions or from obtaining relief on behalf of a group of workers. Instead, employees must pursue their claims in closed-door individual arbitrations—an expensive process that has been shown to favor corporations over individuals. In a trio of cases which have been consolidated together, the U.S. Supreme Court is going to weigh in on whether this practice is legal. Read more

Workers left high and dry in salaried overtime decision

Typical workers impacted by overtime rule

Image: U.S. Department of Labor

December 1, 2016 was supposed to be a great day for an estimated 156,000 salaried workers in North Carolina. But thanks to a recent federal court order, yesterday instead brought disappointment and confusion for most of them.

For nearly seven months, thousands of North Carolinians have been anticipating an increase in their pay due to the Obama Administration’s new overtime rule for salaried workers.  The rule, which was announced on May 18, 2016 and set to take effect yesterday, would have raised the salary threshold for overtime eligibility from $23,660 per year to $47,476 per year, effectively raising the amount you must be paid in order for your employer not to have to pay you overtime. That means that *most* workers making less than $47,476 per year (or $913 per week) would have to be paid overtime for each hour over 40 in one workweek in addition to their salary. (This rule only changes one of the exemptions from overtime and does not apply in all workplaces and to all types of jobs. It has to do with what are often referred to as white-collar jobs, or the Executive, Administrative, Professional exemption.) The new rule also includes a mechanism to automatically update the salary threshold every three years.

But last week a judge in Texas blocked the new rule from taking effect.

Read more

Congress, North Carolina should put more money into fighting wage theft

Photo: NC State AFL-CIO

Photo: NC State AFL-CIO

Too many workers in North Carolina are suffering from wage theft—when employers refuse to pay their employees all the money they have earned and are owed.

A recent op-ed in the Washington Post (via the N&O) rightfully called on Congress to give the US Department of Labor (USDOL) the funding it needs to better fight this problem. Wage theft comes in many forms: refusing to pay the required or agreed upon wage, refusing to pay one and a half the regular rate for overtime hours, misclassifying workers as exempt from overtime, treating workers as independent contractors when they are really employees, requiring tipped employees to participate in a tip pool with non-tipped workers, making unlawful deduction from pay and not compensating workers for all the time they are working.

“Enforcement should be a bipartisan issue. If politicians truly care about inequality and fairness, reducing reliance on public assistance, making sure that the system isn’t ‘rigged’ against the little guy, and, for that matter, ‘law and order,’ they should start by enforcing the laws already on the books – and by making sure hard-working Americans get every cent to which they are entitled.”

But, that isn’t the case. “In each of the past three years, the Obama administration has requested funding for more investigators; each time, Congress has denied the request.”

The good news is that USDOL has still managed to play an active role in enforcing wage and hour laws.  Read more

USDOL’s new overtime rule restores overtime protections to middle class workers

Yesterday the US Department of Labor published a long overdue update to the salary threshold for overtime exemption.  The simplified explanation of the new rule is this: if you are paid on a salary basis and make less than $47,476 per year or $913 per week your employer has to pay you overtime in addition to your salary for every hour worked over 40 in one work week.  Under the old rule, the salary threshold was $23,660 per year or $455 per week. The new rule takes effect on December 1, 2016.

The more co8 HOURS graphicmplicated explanation of the new rule involves understanding the reason for requiring overtime pay in the first place and why some people are exempt from that requirement.  The purpose of the overtime requirement- or rather, maximum hours requirement- was to bring employees a better work-life balance by discouraging employers from requiring their employees to work long hours.  The Fair Labor Standards Act sets the maximum hours for a workweek at 40, but allows employers to require additional hours as long as they pay more for that time. Some higher status employees were exempted from that requirement because, presumably, their decent salaries already compensated them for the extra time.  In 1975 the salary threshold was updated by the Ford administration to be 1.6 times the median wage, ensuring that those employees who were not entitled to overtime were still being fairly compensated.

USDOL used to periodically update the salary threshold, but since 1975 it has only been updated once, in 2004.  The value of the threshold has eroded over time due to inflation and efforts by business groups to keep it low so that it no longer serves its purpose of ensuring that exempt employees are getting fairly compensated for extra work. Instead of providing an incentive to limit hours to 40, employers had an incentive to pay everyone on a salary and increase their responsibilities so they could have them work well over 40 hours and not have to pay overtime.  At $455 per week, you could be earning barely above a poverty wage for a family of four and not be entitled to overtime. That simply is not how the law was intended to work.

That is why the Obama administration called for USDOL to increase the salary threshold – because it was violating the spirit of the overtime requirement.   Under the new rule, the salary threshold is pegged to the 40th percentile of the poorest census region (the south) and will be automatically updated every 3 years.  This is particularly good news for the middle class- a group that has seen long term wage stagnation even as the economy has grown.  Now, being a salaried manager at a restaurant or retail store will mean you are actually getting paid a middle class wage.  In North Carolina, an estimated 156,000 salaried workers will now be entitled to overtime or get a raise- putting money into hard working North Carolinians’ pockets.

HB2 blocks access to court for victims of workplace discrimination

By now hopefully you’ve heard that HB2 wasn’t just about the right of transgender individuals to use the bathroom that corresponds with their gender identity. Among other things, HB2 also eliminated important protections for employees who are fired for a discriminatory reason– based on race, religion, sex, disability or age. An opinion piece in Raleigh’s N&O over the weekend by Durham attorney and life-long Tar Heel Stewart Fisher explains just how devastating that change will be to North Carolina workers. Fisher shares examples of the kind of discrimination his clients have experienced recently:

For the past 34 years I have represented employees who have been mistreated at work. Discrimination on the basis of race, gender, sexual orientation, national origin, religion, disability and age occurs every day in our state. In just the past year, I have represented:

A black plumber who left his job after protesting that he was being paid less than his white co-workers and found a noose in his work truck.

A gay truck driver fired after complaining that his trainer used a slur and said he “acted like a girl.”

A marketing professional fired at age 60, shortly after the vice president of his company announced that they needed “more young people” and “more people with blue hair and tattoos.”

A Native American employee who resigned after the owner of his company repeatedly taunted him by saying white people took his land and his women.

A Muslim computer programmer fired after he took time to attend a service at his mosque in honor of the Muslims who were shot in Chapel Hill.

A female property manager fired less than two weeks after telling her boss she had been diagnosed with breast cancer.

A black factory worker fired after being told “you are just as much a (racial slur) today as you were yesterday.”

Now, thanks to HB2, every one of those workers who was fired for a discriminatory reason will have a much more difficult time enforcing their rights, Fisher explains. Its infuriating that instead of enhancing protections for people who are discriminated against in North Carolina, the General Assembly held a special session to roll back those protections – protections that have been in place for 35 years.

Here’s hoping that Governor McCrory and the NCGA are starting to regret the impact of HB2. The North Carolina Justice Center is one of many organizations calling for Governor McCrory and state legislators to end workplace discrimination rather than expanding it. You can learn more about these efforts by clicking here.