Tag: Fair Labor Standards Act (FLSA)

Fair Labor Standards Act (FLSA) Overtime Update

The U.S. DOL issued the final rule that will update the overtime provisions of the Fair Labor Standards Act (FLSA) beginning on January 1, 2020. Under the final rule, nearly 1.3 million workers who were previously exempt from overtime pay will now be eligible. These changes, which were initially proposed by the Obama Administration in 2015, were updated under the Trump Administration this year to provide an increase to the minimum salary level under the so called “white collar” exemptions. The minimum salary level will increase from $455 per week to $684 (new level $35,568 annually) for those employees who meet the “white collar” positions as Executive, Administrative, Professional or Computer employees. 

Services are encouraged to conduct an analysis of all positions that they currently pay on an exempt salary basis to ensure that these roles will continue to meet the exemption requirements under the new FLSA provisions. Assistance is available for all AAA members.

Please email info@ambulance.org with any questions.

DOL Issues Long-Awaited Proposed Overtime Rule

On March 7, 2019, the United States Department of Labor (USDOL) issued the long-awaited Notice of Proposed Rule Making (NPRM) which proposes changes to the Fair Labor Standards Act (FLSA) overtime provisions.  These proposed changes, which are detail in the 219-page document, follow nearly three years of legal actions challenging the USDOL’s 2016 proposed FLSA overtime changes.

A quick history on these proposed changes.  On May 23, 2016, the USDOL issued the 2016 FLSA proposed overtime rule changes that would have more than doubled the minimum salary thresholds for the so called “white collar” overtime exemptions.  Under the 2016 proposed rule, the minimum salary threshold would have increased from $455 per week ($23,660 per year) to $913 per week ($47, 476 per year) and the Highly Compensated Employee (HCE) salary level from $100,000 to $134,000 annually.  Just before the changes were about to become effective, the United States District Court for the Eastern District of Texas invalidated the proposed rule stating that the USDOL lacked the authority to propose these changes.  Shortly thereafter, the proposed changes were put on hold.

This latest proposed rule formally rescinds the 2016 proposed rule and would provide for updates to the standard salary level for each exemption.  Under this proposal, the minimum salary threshold would increase from $455 per week ($23,660 per year) to $679 per week ($35,308 per year).  The minimum threshold is based upon the 40th percentile of earnings for full time employees in the lowest wage Census Region.  In addition, the Highly Compensated Employee (HCE) salary level is increasing from $100,000 to $147,413 annually.  Which is based upon the 90th percentile of full-time earnings nationally.  These new salary thresholds utilize the same methodology that was utilized in establishing the 2004 FLSA overtime salary thresholds.  In the proposed rule, the USDOL reasoned that these methodologies must be reasonable as they have sustained since 2004 without any legal challenges.

The proposed rule also permits incentive pay and bonuses to count towards up to 10% of the standard salary level provided it is paid at least annually.  This expands the requirement under the 2016 proposed rule which would have required payment quarterly.  In addition, the USDOL states that they intend to propose additional rules that would provide for an adjustment to the standard salary thresholds every four years.  The NPRM states that any regular adjustments to the standard salary thresholds would be subject to the Notice of Proposed Rule Making process each time any change is proposed.  This is a change from the 2016 proposed rule which provided for automatic adjustments to the salary thresholds every three years to prevent the standard salary threshold from becoming outdated.

Currently, there are three major exemptions from the FLSA overtime Regulations, Executive, Administrative, and Professional.  Each utilize a two-prong test to determine if the employee meets the exemption from overtime protection.  The US Department of Labor has existing resources and tools to assist employers with complying with the FLSA.  These resources can be found on a webpage for employers.  While we recognize that most EMS agencies workforce is paid on an hourly basis and are subject to overtime pay provisions.  However, it is still important to agencies to conduct an FLSA analysis of all positions to ensure compliance with the FLSA.

It does not appear that the Department has issued compliance assistance for employers that specifically addresses the latest proposed rules.  The American Ambulance Association has resources available to assist our members with evaluating how these changes might impact your operation.  We will be sure to provide our members with further information and guidance, as it becomes available, regarding this or any other Human Resource or employment related issue that will impact the ambulance industry.

EMS Employer Year-End Wrap-Up and Preview

2017 was a bit of a wild ride in the employment realm.  The Trump Administration worked to change the trajectory set during the eight years of the Obama Administration.  This past year, we saw the undoing or attempts to undo many of the Obama Administration initiatives, including the Fair Labor Standards Act (FLSA) updates, changes to the Persuader Rule, interpretations of Title VII as it relates to transgender protections.  Not to mention the repeated attempts to chip away at the Affordable Care Act (ACA). In addition, there were several new requirements for employers that went into effect in 2017 and a few upcoming in 2018.  Here is a quick review to ensure that your service is up-to-date and compliant.

The Fair Labor Standards Act Changes

These changes, which would have more than doubled the minimum salary levels for those “White Collar” exemptions, were set to go into effect back in 2016.  A Federal Court in Texas enjoined and put on hold these changes until the question of whether the Department of Labor (DOL) had the authority to unilaterally change the Regulations.  In July, 2016, the DOL published an Request For Information (RFI) with responses due in late September, requesting input from stakeholders about what changes to the FLSA might be appropriate.  We are still awaiting the final action.

The Persuader Rule

In 2016, the DOL Office of Labor-Management Standards (OLMS) released its revised interpretation of the rule that seeks to level the playing field between unions and employers.  The new interpretation of the Persuader Rule, which would have taken effect on April 25, 2016, would have required that employers who hire consultants or labor attorneys to counsel them during union organizing campaigns to report if they will undertake “persuader” activities and the cost of those services.  This rule was an attempt to increase transparency for unions with regard to these services. The U.S. District Court for the Northern District of Texas blocked the persuader rule late last year stating it was overly broad, arbitrary and capricious. The DOL published a notice of public rule making in June, 2017 of its intent to rescind the new rule.

Dismantling of the ACA

In a surprising announcement this past October, the Trump Administration, the DOL, the Department of Health and Human Services (HHS) released an interim rule that rolled back the Obama Administration position regarding the requirement of employer sponsored health plans to pay for “preventative services” which included birth control and abortion procedures under religious or moral objections. This would permit employers who object on these grounds to limit or not offer these coverages under their employer sponsored health plan.  There are several lawsuits pending regarding this move, more to come in 2018.

In another October announcement, the Trump Administration stated that the President had signed an Executive Order that directed the Secretary of Labor to consider expanding access to Association Health Plans (AHP) would give employers the right to form groups in multiple states for the purposes of negotiating health care benefits.  This change would require a amenedment to the current interpretation of Employee Retirement Security Act (ERISA). In addition, the Executive Order directed the Departments of the Treasury, Labor, and Health and Human Services to consider changing several ACA restrictions, including low-cost short term limited duration insurance (STDLI) and Health Reimbursement Accounts (HRAs).  The impact of this Executive Order may be an impact to the ACA insurance markets because it may attract the younger and healthier away from current plan groups causing those coverage costs to increase substantially.

Title VII Transgender Protections

In October, Attorney General Jeff Sessions published memo to Federal prosecutors stating that Title VII’s discrimination protections did not include protections on the basis of gender identity or for transgender individuals.  In the memo, Sessions states that this was a conclusion of law, not of policy and that it would be inappropriate for the DOJ to expand the law beyond what Congress provided.  Sessions said that the law provides protections for men and women but not specifically on the basis of gender identity. This goes against current interpretation and is not shared by the Equal Employment Opportunity Commission (EEOC) who enforces Title VII.  Employers need to ensure that they provide a workplace that is inclusive and respectful to all employees.

EEO-1 Pay Reporting

In February 2016, the EEOC published notice that would add pay information to the EEO-1 reporting form in an effort to further identify disparities in pay between different protected groups.  This new reporting requirement was set to go into effect on September 30, 2017. The deadline was pushed back until March 31, 2018.  Under the new pay reporting requirements, employers with 100 or more employees would report W-2 wage information and total hours worked for all employees by race, ethnicity and sex within the 12 proposed pay bands.  In August, the Office of Management and Budget (OMB) announced plans to stay the effective date of the pay-data collection provisions in order to review the appropriateness of the revisions under the Paperwork Reduction Act (PRA).  In the meantime, employers should still observe the March 1, 2018 deadline and prepare the information on the new EEO-1 Form while we await a decision on if this requirement will go into effect.

OSHA Electronic Injury Reporting

OSHA announced in July that it will be launching the new electronic Injury Tracking Application (ITA) on August 1, 2017.  The new rules are an effort to “nudge” employers to improve safety in the workplace by publishing employee injury data, as reported by employers.  OSHA pushed back the electronic reporting deadline until December 15, 2017.  Many ambulance services already report this information electronically to the Bureau of Labor Statistics (BLS), who collects data on behalf of the Department of Labor but the employer specific information is not released publicly.  Under these new rules, employer injury data will be published.

The electronic reporting requirements are based on the size of employer.  For the purposes of determining employer size, employers must count each individual employed at any time during the calendar year as one employee.  This includes full-time, part-time, seasonal, and temporary workers.  All employers with 250 or more employees in industries covered by the recordkeeping regulation must electronically submit to OSHA injury and illness information from OSHA Forms 300, 300A, and 301.  Employers with 20-249 employees must electronically submit information from OSHA Form 300A only.

If you have not already submitted your data, you need to do so immediately.

New Form I9

Starting this past January 22, 2017, employers were required to begin using the new Form I9.  The old Form I9 expired on August 31, 2017.  The new form can be found on the US Citizenship and Immigration Services (USCIS) website.  To be certain that you are utilizing the correct form, ensure the expiration date of August 31, 2019 is in the top right hand corner of the form. Last year, several ambulance services were audited by the USCIS and fined for technical form violations.  The easiest way to ensure that you are using the correct form and filling it out correctly is to utilize the comprehensive online training resources available on the USCIS website.

Summary of State Law Changes

Ban the Box

Currently 29 states and over 150 local municipalities have enacted criminal background inquiry limitations in an effort to give individuals with criminal histories a fair chance to become employed.  Several of the states that had already enacted these laws have passed additional provisions in 2017 and 2018 that expand the application to smaller employers.

Most of the laws regarding the “ban the box” movement require the removal of criminal history inquiries on the job application.  Others require that no criminal history inquiries can be made until after a conditional job offer is made to the candidate.  If you have not done so already, please remove any criminal history questions from your pre-offer process.  For those ambulance providers that are in states that specifically permit EMS agencies from inquiring prior to a job offer, I strongly recommend that any criminal history inquiries occur after a conditional job offer is made.  State laws permissions do not prevent an employer from being liable for disparate impact discrimination.

Paid Sick Time

Multiple states (AZ, CA, CT, MA, OR, VT, DC) and municipalities already have or have enacted paid sick time laws or ordinances prior to this year.  Joining them in 2017 are Federal Contractors and the states of Arizona, Vermont, and Washington.  Each of these laws share similar provisions.  Employees earn an hour of paid sick leave after having worked a certain number of hours.  Most provide for a 90 day period of employment before an employee can utilize the accrued sick time. For the purposes of calculating working hours, the hours are counted across weeks.  Most of the laws provide for some carry-over of unused time from year to year.

Several other states have enacted or will be expanding existing paid sick time provisions which will take effect in 2018. (CA, RI, WA, VT).  The state of Oregon passed an amendment to the paid sick time law that was enacted in 2016 that permits employers to limit the accrual of sick time to 40 hours per year. In addition, the amendment permit employers to not count certain individuals in the employee count for the purposes of the application of this law.

Parental Leave

California has enacted the New Parent Leave Act which takes effect on January 1, 2018.  The Act requires employers with 20 to 49 workers to offer 12 weeks of job-protected leave to mothers and fathers for the purposes of bonding with newborn or newly adopted children, or foster care placement. The employer also must maintain the employees’ health insurance and reinstate them at the end of their leave period. The law includes a strong anti-retaliation provision for employees who take leave under this law.

Paid Family Medical Leave

Currently three states (CA, NJ, RI) provide for some form of paid Family & Medical Leave.  Starting on January 1, 2018 private employers in New York must provide their employees who regularly work at least 20 hours a week the eligibility to collect paid-family-leave benefits after 26 weeks of employment, and employees who work fewer than 20 hours a week will be eligible after 175 work days. The leave can be used to after the birth, adoption, or placement of a foster child for up to one year.  Additionally, the leave can be used to care for the serious illness of a family member or a qualifying reason an employees’ spouse, domestic partner, child, or parent being on active military duty.

The Act will be phased in over the next few years.  Providing 8 weeks of leave in 2018 paid at 50% os the state’s average weekly was (SAWW).  In 2019, the leave time extends to 10 weeks at 55% of SAWW, 2020 maintains 10 weeks of leave paid at 60% of SAWW, to full implementation in 2021 when an employee can take up to 12 weeks of leave paid at 67% SAWW.

The State of Washington has passed a paid FMLA law that will start collecting premiums from employers in 2019 for enactment in 2020.  Washington DC also enacted paid FMLA that will begin in 2020 as well.

California

Starting in 2018, the State of California will require that employers with 50 or more employees include additional training information fo its employees on gender identity, gender expression and sexual orientation. The training must include practical examples of harassment. The new law also requires employers to post a poster, developed by the California Department of Fair Employment and Housing, on transgender rights.  In addition, the currently mandated two hour supervisor training must also include this new information and provide for annual updates to training programs.

That’s a Wrap

For many employers 2017 proved to be an unusual and challenging year. Aside from the changes details above, it is uncertain what lies on the horizon for EMS employers in 2018. As always, the American Ambulance Association will keep you posted on the important employment and human resources developments that may impact you.

Employee Wage Deduction Restrictions

I often get questions from ambulance services regarding the things that employers can deduct from an employee’s wage. Many year ago, it was commonplace for employers to deduct the cost of uniforms or vehicle accident repairs if they were found “at fault” for the accident from employee wages. The Fair Labor Standards Act (FLSA) is the Federal law that restricts or governs the deductions an employer may take from an employee’s paycheck. The HR Daily Advisor published a great article about the restrictions surrounding deductions from an employee’s paycheck. As always, contact the AAA with any questions regarding this or any other Human Resource or employment law compliance question.

FLSA Salary Threshold Rule Delayed Again

There has been a great deal of discussion over the last few months about the new Fair Labor Standards Act (FLSA) rule changes that were due to be implemented on December 1, 2016.  We informed members that an injunction had been issued by a federal judge delaying the implementation of the changes that would more than double the salary thresholds for those who are eligible to earn overtime under the “white collar” exemptions.  The USDOL has requested further 60 day delay to allow them to file their brief in the injunction hearing.  Learn more about this delay and our prior AAA Advisories on FLSA and we will continue to keep members posted about any future movement with regard to this issue.

HR Wrap-Up: A Look Back at 2016

As we wind up 2016 I thought it would be a good idea to review the year’s human resource and legal developments to ensure that our members are compliant and prepared for what faces them in 2017.  We knew that this was going to be an interesting year as we experienced the most unusual Presidential Election in our history.  It overshadowed everything else that occurred in 2016.  As the Obama administration comes to its final days, employers and ambulance providers saw some of the most sweeping regulatory changes.

Fair Labor Standards Act (FLSA)

The biggest change facing employers in 2016 was the Fair Labor Standards Act (FLSA) overtime changes.  The Department of Labor (DOL) issued updated regulations which were to become effective December 1, 2016, raising the minimum salary thresholds for the so called “white collar” exemptions.  Under the new regulations, the minimum salary would increase from $455 to $970 per week.  For those employees earning under the new amount, employers would need to decide if they are going to raise the salary level or pay the employee overtime for hours worked over 40 in one week.  The changes have not gone into effect yet as a 5th Circuit Judge issued an injunction on the implementation of the new Regulations until the question of their legality is determined.

Most employees in the ambulance industry are hourly paid employees and the Regulatory changes are will not affect their overtime eligibility.  However, ambulance providers should take these changes as an opportunity to evaluate each position within their organization and ensure that any exempt position is appropriately classified.

Civil Penalty Changes

This past August the Department Of Labor published two interim final rules that adjusted the penalties for enforcement actions by several of its agencies.  The penalties increased because Congress passed the Federal Civil Penalties Inflation Adjustment Act in 2015 last November with the intent of improving the effectiveness of civil monetary penalties and hopes of maintaining their deterring effect.  Many agency penalties had not been adjusted since 1990.

The new penalties will only be applicable to penalties assessed after August 1, 2016 for violation that occurred after November 2, 2015.  The DOL posted a chart detailing all of the penalty increases.

Posting Changes

Many of the mandated employer postings also experienced a change this year as a result of the FLSA Regulation updates and because of the Civil Penalty increases.  Employers need to be sure to update the required Federal employment postings in their workplaces.  The new postings are available on the Department of Labor’s website free of charge.  Alternatively, many employers purchase the all-in-one combination Federal and State posters from third party vendors.  Whether obtained from the DOL or from a vendor, the postings need to be updated to reflect these new changes.

Fair Labor Standards Act (FLSA)

The required FLSA posting will reflect the change to the classification of employees, requirements for nursing mothers, and updated enforcement section.  The new posting also removes the prior reference to a specific penalty amount as the penalties will adjust at regular intervals under the penalty adjustment changes.

Occupational Health & Safety Act (OSHA)

In May, the AAA published an advisory notifying members about upcoming changes to the reporting requirements under OSHA, including provisions regarding the notification to employees of non-retaliation for those who file work injury or illness claims.  The non-retaliation notice provisions became effective November 1, 2016.  The new OSHA posting reflects the notice to employees regarding the non-retaliation provisions.

Employee Polygraph Protection Act (APPA)

Like the FLSA posting, the Employee Polygraph Protection Act (EPPA) posting has changed to reflect the removal of a specific penalty amount.  The new EPPA posting can be found on the DOL’s website.

Transgender

One of the more active debates during the end of 2015 and for most of 2016 was an issue not directly related to employers but that had significant impacts on employers was the North Carolina House Bill 2.  HB 2 was sweeping legislation that required restroom and locker room facilities be utilized by individuals based upon the gender listed on their birth certificate.

In May, the Department of Justice filed a Civil Rights suit against the State of North Carolina and its Governor stating that the legislation was “state sanctioned discrimination” and was illegal.  After several legal challenges it appears that the legislation will be repealed by the new North Carolina administration.  Even without the repeal of the legislation employers were on notice that all Federal regulatory agencies included transgender rights as protected under Title VII and subject to the law.

This is notice to employers that they need to allow all employees to utilize the restrooms and changing facilities that are consistent with their gender identity.  The best practice for employers is to provide privacy for all individuals, whether or not they are in a gender specific facility.  This means that restroom and shower facilities should provide as much privacy as possible.  This could include installing privacy strips to restroom stalls, large partitions between urinals, and privacy curtains for showers.  Employers should not assume that individuals born the same gender are comfortable with or do not seek the same privacy in these setting as do individuals of different genders.  The message should be to respect the privacy of all individuals regardless of their gender or gender identity.

Affordable Care Act (ACA) Section 1557 Rules

This past July new Regulations, which implement Section 1557 of the Affordable Care Act (ACA), became effective.  The provisions of Section 1557 build off of existing Title VII and other discrimination laws that extend protections to previously underserved or under-represented groups of people with regard to healthcare.  The new Regulations prohibit discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs or activities.  In addition, the Regulations provide discrimination protections on the basis of pregnancy, gender identity, and sex stereotyping.  The Final Rule also requires that “covered entities” make available assistance for individuals with Limited English Proficiency (LEP) and those with disabilities, including communications related disabilities.

The new Regulations require that covered entities have a Compliance Coordinator and a Grievance Procedure.  The Compliance Coordinator is to monitor and coordinate compliance with the provisions of the Final Rule.  The Grievance Procedure has to provide the appropriate due process standards that would allow for the prompt and equitable resolution of complaints concerning actions prohibited by Section 1557.  HHS has included a sample Grievance Procedure in Appendix C to Part 92—Sample Section 1557 of the Affordable Care Act Grievance Procedure  to assist covered entities in meeting this requirement.

In addition, the Regulations require that all covered entities post notices assuring patients that the covered entity does not discriminate on the basis of race, color, national origin, sex, age, or disability and that auxiliary aides and services for individuals with Limited English Proficiency (LEP) and Communication related disabilities.  To alert these individuals, ambulance providers must post a notice regarding the availability of these aids and services in the top 15 languages spoken in the state of operation.

A Look Ahead to 2017

OSHA

Starting in 2017, employers will be required to electronically report work related injuries to OSHA.  The AAA posted information about this new requirement last week.  Employers should anticipate increased OSHA investigatory activity following this first year of injury reporting.  Currently, OSHA obtains the majority of their injury data from employee complaints or on site visits.  These new reporting requirements are intended to persuade employers to be more proactive with regard to workplace safety.  As we learn more about the tools OSHA will utilize to collect this information, we will notify members.

EEO-1 Pay Reporting

The Equal Employment Opportunity Commission (EEOC) and the Office of Federal Contract and Compliance Programs (OFCCP) have approved a new EEO-1 Form that will be used starting with the 2017 report, which will be due on March 31, 2018.  The new report requires private employers, including federal contractors and subcontractors, with 100 or more employees to submit summary pay data on the EEO-1 Form.  Federal contractors and subcontractors with 50-99 employees will not submit summary pay data but will continue to report demographic data (sex and race or ethnicity) on the EEO-1 as they did before.  Also, Federal contractors and subcontractors with 49 or fewer employees, and companies without federal contracts with 99 or fewer employees, will not be required to complete the EEO-1 report.  The goal is to remove the pay inequities amongst different protected classes.

Employers will have some time to make the necessary changes to their systems to ensure that their systems can collect and report this data.

Minimum Wage Increases

There are 21 states that are going to have a minimum wage increase in 2017.  While most of our industry pay rates are above the minimum wage amounts.  Services should check their state minimum wage to ensure that their mandated minimum wage pay and postings are up to date.

New Form I9

Just a reminder that employers will be required to use the new Form I9 for all employees hired on or after January 22, 2017.  The USCIS announced last month that it has updated the Form I9 and for employers to begin utilizing these forms no later than January 22, 2017.  For more information on the new Form I9, view the IRS Press Release announcement posted last month.

New W2 Reporting Requirements

Employers need to be aware that the Internal Revenue Service (IRS) has moved up the date that employers have to file their Form W2 with the IRS.  Previously, employers had until the end of February to file their Form W2s with the IRS.  Under the new deadline, employers must file all Form W2 by January 31, 2017.  The January 31st deadline has long applied to furnishing of the Form W2s to their employees.  For more details on the new filing deadline, read the IRS Announcement.

Signing Off for 2016

This has proven to be an incredibly busy year for all employers, including ambulance providers.  AAA Members should remember that there are numerous resources available through the AAA in the Member Area on the website, through AAA Staff and Consultants, and also with the hundreds of members who are all working together to care for the patients and communities we serve.  Do not face the challenges in your organization alone.  Your membership brings with it a great deal of tools and resources so that you can focus on providing your patient with outstanding service.  Happy New Year.

 

Federal Judge Hold Implementation of New Overtime Regulations

Just a few days before the new Fair Labor Standards Act (FLSA) Regulations were set to become effective, a 5th Circuit Federal Judge issued a ruling placing an injunction on the implementation of those Regulations which were estimated to effect nearly 4.2 million American workers.  The new Regulations nearly doubled the minimum salary level for those who would be exempt from the overtime provisions of the FLSA and provide for adjustments every three years.  21 States filed an emergency motion for an injunction in October stating the Department of Labor had exceeded its authority with these new provisions.

For now, employers can hold any adjustments that they were going make relative these new Regulations on December 1 while the question of their legality is resolved.  To get more details on the specifics and to catch up on the Member Advisories relative to these new Regulations, log into the AAA website.

Required Employment Posting Changes

Over the last few months we notified AAA members of several changes to employment laws that ambulance providers need to be aware of.  In early May we published advisories to members regarding upcoming changes to the Fair Labor Standards Act (FLSA) and the Reporting Requirements under the Occupational Safety and Health Act (OSHA).  In July, we notified members that the United States Department of Labor (DOL) would be increasing the civil penalties for violations of the laws that they enforce in an effort to update the penalty amounts to provide for adjustment due to inflation and to maintain the penalty’s deterring effect.

These changes require that employers update the required Federal employment postings in their workplaces.  The new postings are available on the Department of Labor’s website free of charge.  Alternatively, many employers purchase the all-in-one combination Federal and State posters from third party vendors.  Whether obtained from the DOL or from a vendor, the postings need to be updated to reflect these new changes.

Fair Labor Standards Act (FLSA)

The changes to the FLSA that were detailed during a AAA Webinar in June will become effective this coming December 2016.  While there was no change to the Federal Minimum Wage, there were substantial changes to the overtime exemption criteria effecting those who are currently characterized as exempt that will transition to non-exempt and eligible for overtime pay.  The required FLSA posting will reflect the change to the classification of employees, requirements for nursing mothers, and updated enforcement section.

Occupational Health & Safety Act (OSHA)

The AAA published an advisory in May notifying members about upcoming changes to the reporting requirements under OSHA, including provisions regarding the notification to employees of non-retaliation for those who file work injury or illness claims.  The non-retaliation notice provisions become effective November 1, 2016.  The new OSHA posting reflects the notice to employees regarding the non-retaliation provisions.

Civil Penalty Increases

The increases to the civil monetary penalties are reflected in the changes to both new FLSA and OSHA postings.  In addition, the Employee Polygraph Protection Act (EPPA) posting has changed to reflect the removal of a specific penalty amount.  The new EPPA posting can be found on the DOL’s website.

There has been a flurry of activity with regard to changes to laws that impact employees and employers over the last year with more on the horizon.  The AAA will continue to monitor those changes and provide guidance to ambulance providers on the best way to stay compliant.

FLSA – New Overtime Rule Takes Effect December 2016

Last October, the American Ambulance Association published an article notifying its members about the proposed changes to the Fair Labor Standards Act (FLSA). Employers have been waiting anxiously for the Final Regulation to be published. On May 17, 2016, the White House published a Fact Sheet regarding changes to the Regulations that will become effective December 1, 2016. As a result, overtime protections are being extended to 4.2 million workers who are currently exempt. The new rule, which will be published May 18, 2016 will bring the first updates to the FLSA since 2004. There will be significant changes, including increasing the threshold salaries levels for both the standard and highly compensated employees (HCE) and includes regular automatic adjustments to those levels every three years thereafter.

The impetus of the changes to the law were prompted by President Obama in March 2014 when he directed the Secretary of Labor to Update and Modernize Overtime Regulations for the Fair Labor Standards Act (FLSA). The FLSA provides basic rights and wage protections for American workers, including Federal minimum wage and overtime requirements. Specifically the memorandum stated that the “regulations regarding exemptions from the Act’s overtime requirement, particularly for executive, administrative, and professional employees (often referred to as “white collar” exemptions) have not kept up with our modern economy. Because these regulations are outdated, millions of Americans lack the protections of overtime and even the right to the minimum wage.”

On July 6, 2015, the Department of Labor posted Notice of Proposed Rulemaking (NPRM) for their suggested changes to the Regulations, giving 60 days for comment. The comment period ended on September 4, 2015. The Department received 270,000 public comments to the proposed changes, including concerns from employers, trade associations, and lawyers on the impacts the proposed changes would have on their business, members, and clients.

While most of the employees who work in the ambulance industry are paid hourly and currently receive overtime for hours worked over 40, there are still many non-field and administrative personnel who may be impacted by this change. Ambulance providers need to conduct an analysis of the upcoming changes to make adjustments so that they will be in compliance by December 1, 2016.

The first Regulatory change is an adjustment of the standard salary level for each exemption which is increasing from $455 per week ($23,660 per year) to $913 per week ($47, 476 per year). This is based upon the 40th percentile of earnings for full time employees in the lowest wage Census Region. In addition, the Highly Compensated Employee (HCE) salary level is increasing from $100,000 to $134,000 annually, which is based upon the 90th percentile of full time earnings nationally. The last major change provides for an automatic adjustment to both of these salary levels every three years to prevent the Regulations from becoming outdated. The first adjustment will occur in 2020.

Currently, there are three major exemptions from the FLSA overtime Regulations, Executive, Administrative, and Professional. Each utilize a two-pronged test to determine if the employee meets the exemption from overtime protection. The Department of Labor has issued separate Technical Guidance to both Private Employers and Non-Profit Employers to assist them in determining exemption compliance under the new Regulations. The DOL has published a Quick Reference Table detailing a comparison of the current and upcoming FLSA changes.

The American Ambulance Association has resources available to assist our members with evaluating how these changes might impact his or her particular operation. We will be sure to provide our members with further information as it becomes available regarding this or any other Human Resource or employment related issue that will impact the ambulance industry.

Upcoming Changes to the FLSA

Updated October 7, 2015 | By Scott Moore, JD, of EMS Resource Advisors

On March 13, 2014 President Obama sent a memorandum to the Secretary of Labor to update and modernize the Overtime Regulations found in the Fair Labor Standards Act (FLSA).  The FLSA provides basic rights and wage protections to American workers, including Federal minimum wage and overtime requirements.  Specifically, the memorandum stated that “regulations regarding exemptions from the Act’s overtime requirement, particularly for executive, administrative, and professional employees (often referred to as “white collar” exemptions) have not kept up with our modern economy. Because these regulations are outdated, millions of Americans lack the protections of overtime and even the right to the minimum wage.”[i]

On July 6, 2015 the Department of Labor (DOL) posted a Notice of Proposed Rule Making (NPRM) outlining their proposed changes to the Overtime Regulations.  The NPRM gave lawyers, employers, and interest groups 60 days (until September 4, 2015) to comment on these proposed changes.  The NPRM makes it clear that many employers will need to begin preparing now for likely changes to who receives overtime pay expected sometime in 2016.

The changes proposed by the Department of Labor to the FLSA are expected to impact 4.6 million workers in the U.S. who are currently exempt from overtime pay but will transition to non-exempt under the new rules.  While most of the employees in the ambulance industry are paid hourly, many non-field personnel may be impacted by this change. Ambulance providers should conduct an analysis of the proposed changes to assess the impact it may have on their organization.

Currently, there are four major exemptions from the FLSA overtime regulations: Executive, Administrative, Professional, and Computer Professional.  Each category utilizes a two prong test to determine if an employee meets one of these exemptions.  The current regulatory test criteria are:

Executive Exemption:

Duties test for the Executive Exemption is if the employee earns at least $455 per week ($23,660 per year) and:

  • The employee’s primary duty must be managing the enterprise, or managing a department or subdivision of the enterprise
  • The employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent
  • The employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.

Administrative Exemption:

To qualify for the Administrative Exemption the employee must earn at least $455 per week ($23,660 per year) and:

  • The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
  • The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.

Professional Exemption:

To qualify for the Professional Exemption the employee must earn at least $455 per week ($23,660 per year) and:

  • The employee’s primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment
    • The advanced knowledge must be in a field of science or learning
    • The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual

Computer Exemption:

The employee must be compensated either on a salary or fee basis at a rate no less than $455 per week or, if compensated on an hourly basis, at a rate no less than $27.63 an hour. Additionally:

  • The employee must be employed as a computer systems analyst, computer programmer, software engineer or other similarly skilled worker in the computer field performing the duties described below
  • The employee’s primary duty must consist of:
  • The application of systems analysis techniques and procedures, including consulting with users to determine hardware, software or system functional specifications
  • The design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications
  • The design, documentation, testing, creation or modification of computer programs related to machine operating systems
  • A combination of the aforementioned duties, the performance of which requires the same level of skills.

Proposed Changes to the Regulations

The major change to the Regulations is the salary thresholds which have only been updated only once since 1970.[ii]  Currently, the salary threshold is $23,660 ($455 per week), which is below the poverty threshold for a family of four. In fact, only 8 percent of full-time salaried workers fall below the poverty line.[iii]  The proposed changes would more than double the minimum salary threshold for exempt workers, requiring compensation of $50,440 per year ($970 per week).  This new salary threshold is based on the 40th percentile of weekly earnings for full-time salaried workers nationally.  Also, the proposed changes would identify a mechanism for adjusting that figure annually.

In addition to that change, there is also a proposal to adjust the threshold for “Highly Compensated Employees” from $100,000 to $122,148 annually. This new salary threshold is based on the 90th percentile of weekly earnings for full time salaried workers nationally.  While this does not impact the majority of individuals working in the ambulance industry, there may still be an impact on senior management or executive teams.

In the NPRM, the Department of Labor requested input on whether the Duties test should also be changed and if so, what those changes should be. Currently, it does not appear that there will be any changes to that prong of the exemption test.  It is suggested however, that services examine positions deemed exempt within their organization to determine the extent or percentage to which those positions perform “executive” or “administrative” functions.  If that percentage is 50% or less, an assessment of whether that position ought to be moved to a non-exempt status should be performed.

There is no indication from the DOL as to when any changes to the Overtime Regulations will occur.  The DOL will be reviewing comments from the NPRM and it is not anticipated that they will issue a final ruling prior to the end of the year.  Once the Final Rule is published, it generally cannot go into effect sooner than 30 days after its publication.  In the interim, organizations should be conducting an analysis of their job descriptions and duties to determine if they might be impacted.  The AAA will continue to provide further updates as they become available.


 

[i] The White House, Office of the Press Secretary, Presidential Memorandum-Updating and Modernizing Overtime Regulations,  March 13, 2015.  https://www.whitehouse.gov/the-press-office/2014/03/13/presidential-memorandum-updating-and-modernizing-overtime-regulations

[ii]The White House, Office of the Press Secretary, FACT SHEET: Middle Class Economics Rewarding Hard Work by Restoring Overtime Pay, June 30, 2015.  https://www.whitehouse.gov/the-press-office/2015/06/30/fact-sheet-middle-class-economics-rewarding-hard-work-restoring-overtime

[iii] The White House, Office of the Press Secretary, FACT SHEET: Middle Class Economics Rewarding Hard Work by Restoring Overtime Pay, June 30, 2015.  https://www.whitehouse.gov/the-press-office/2015/06/30/fact-sheet-middle-class-economics-rewarding-hard-work-restoring-overtime


AAA members, ask author Scott Moore, JD, questions about FLSA, FMLA, hiring, firing, and more! Submit a question.