Archive
Biden Administration Announces Public Vaccine Mandates That Require Action by Large Private Employers, Federal Contractors, and Healthcare Employers
By: Matthew Mitchell & Amanda Thibodeau
On September 9, 2021, the Biden Administration announced the Path Out of the Pandemic – a strategic plan to respond to the continued spread of COVID-19 (the “Plan”). In general, the Plan outlines a broad-brush approach to combating the continued ill-effects of the pandemic, including:
- Strategies to increase vaccination rates;
- Strategies to maintain school operations;
- Strategies to implement additional safety regulations; and
- Strategies to implement additional economic stimulus programs.
The widely reported-on, cornerstone of the Plan is a mandate that, when implemented, will require large employers, federal contractors, and healthcare employers to adopt mandatory vaccination policies for their employees (the “Vaccine Mandate”).
The basic elements of the Vaccine Mandate can be found in our COVID-19 Alert.
The CDC Revises COVID-19 Mask Recommendations For Fully Vaccinated Individuals: Implications For Massachusetts Employers
On July 27, 2021, the Centers for Disease Control and Prevention (“CDC”) revised its COVID-19 mask guidance (the “Revised Guidance”), recommending that all individuals, regardless of COVID-19 vaccination status, resume wearing masks in “public indoor settings” in areas of the United States that exhibit “substantial” or “high” COVID-19 transmission rates. This announcement revises the CDC’s May 2021 mask guidance that indicated that fully vaccinated individuals could discontinue mask wearing and social distancing in most settings.
At present, there are five counties in Massachusetts that qualify as “substantial” or “high” transmission areas, under the Revised Guidance:
High Transmission:
- Barnstable County
Substantial Transmission:
- Bristol County
- Dukes County
- Nantucket County
- Suffolk County
The Revised Guidance does not specifically define the types of “public indoor settings” where masks should be worn. As such, it is unclear as to whether the Revised Guidelines are intended to apply to work environments.
Currently, Massachusetts requires masks only in the following settings: Public and Private Transportation; Healthcare Facilities; Congregate Care Facilities; Emergency Shelters; Houses of Correction; Health Care and Day Services Facilities. There is no general mask mandate in Massachusetts, and there are no rules that require masks or social distancing, generally, in work environments. This present Massachusetts standard is expressly based on the CDC’s prior May 2021 mask guidance. However, in recent public remarks, Massachusetts Governor Charlie Baker has indicated that the Commonwealth is now considering new general safety standards in light of the Revised Guidelines.
Employers should continue to monitor applicable regulations and reopening guidance, including masking requirements and recommendations, in jurisdictions where they are located.
See our complete COVID-19 Resource Collection for additional information, or contact a member of the Morse Employment Team.
COVID-19 Alert: OSHA Issues Emergency Temporary Standard for Healthcare Settings
By: Matthew Mitchell & Amanda Thibodeau
On June 10, 2021, the Occupational Safety and Health Administration (“OSHA”) issued an Emergency Temporary Standard (“ETS”) directed at protecting frontline healthcare workers for the duration of the COVID-19 pandemic. As part of the Biden Administration’s directives, OSHA determined that its current standards and regulations, and OSHA’s General Duty Clause, were inadequate to protect workers in the healthcare sector, and issued this ETS. OSHA additionally updated its non-binding guidance for all other industries, which still remain subject only to OSHA’s regular regulations, standards, and General Duty Clause.
THE “NEW” REQUIREMENTS
The main section of the ETS requires employers to develop and implement effective COVID-19 plans, the control strategies of which should be very familiar to most employers at this point in the pandemic. However, now OSHA will require employers to use a number of familiar controls in a layered approach in order to protect employees. The key requirements of the ETS are:
- COVID-19 Plan. OSHA will now require every qualifying employer to develop and implement a COVID-19 plan for each workplace site. If the employer has more than 10 employees, the plan must be in writing. The Plan must be developed in conjunction with management and non-management and must be clearly communicated to employees.
- Patient screening and management. Employers must limit points of entry in direct care patient settings, screen and triage all visitors, clients, patients, and others entering the setting, and encourage telehealth services when appropriate.
- Standard and transmission-based precautions. Employers must develop and implement policies and procedures to adhere to Standard and Transmission-Based precautions based on CDC guidelines.
- PPE. Employers must provide facemasks to be worn by each employee when indoors or when sharing a vehicle for work purposes, with some exceptions.
- Aerosol-generating procedures on a person with suspected or confirmed COVID-19. Employers must limit employees present for the procedure to only those essential, and perform procedures in an airborne infection isolation room, if available; and clean and disinfect surfaces and equipment after the procedure is completed.
- Physical distancing. Employers must keep people at least 6 feet apart when indoors, unless not feasible (such as for hands-on medical care).
- Physical barriers. Employers must install cleanable or disposable barriers installed at fixed work locations in non-patient areas where social distancing is not possible.
- Cleaning and disinfection. Employers must engage in standard practices for cleaning and disinfection for patient care areas, resident rooms, and medical devices and equipment, and in all other high-touch areas, in accordance with CDC guidelines.
- Ventilation. Employers must ensure that all HVAC systems are used in accordance with the manufacturer’s instructions, and that all air filters are rated Minimum Efficiency Reporting Value (MERV) 13 or higher, or the highest compatible with the system.
- Health screening and medical management. Employers must screen each employee daily, which may be done through self-monitoring by the employee. Each employee must report COVID-19 confirmed and suspected illness, or symptoms to the employer. The Employer must also notify all employees who were not wearing respirators and/or required PPE of any COVID-19 exposure at the workplace.
- Vaccination. Employers must provide support and paid leave for employees to receive a COVID-19 vaccination, and to recover from any side effects.
- Training. Employers must train and educate employees on COVID-19 transmittal, hygiene, and other prevention policies and procedures.
- Anti-retaliation. Employers must inform employees of their rights to the protections required by the ETS, and employers must not discharge or discriminate against employees for exercising their rights under the ETS or for engaging in actions required by the ETS.
- Recordkeeping. Employers with more than 10 employees must establish a COVID-19 log of all employee COVID-19 infections and follow requirements for making records available to employees and union representatives.
- Reporting requirements. Employers must comply with OSHA’s reporting requirements for work-related COVID-19 fatalities and in-patient hospitalizations.
Will these changes under OSHA’s new ETS affect your business? Learn more in our COVID-19 Alert.
PPP Loan Program: Analysis of Treasury Department Interim Final Rule on Affiliation; Impact on Portfolio Companies
On April 3, 2020, the United States Treasury Department issued “Interim Final Rules” and a related guideline concerning the Paycheck Protection Program’s “Affiliation Rule.” The Interim Final Rule and guideline may be found here:
- Interim Final Rule on Affiliation (the “Interim Rule”)
- Applicable Affiliation Rule Guideline (the “Guideline”)
The instructions included in the Interim Rule and Guideline significantly limit, by application of the Affiliation Rule, the types of businesses that are eligible to apply for loans under the Paycheck Protection Program. Of particular note: The Interim Rule and Guideline apply the restrictions of the Affiliation Rule to start-up and emerging businesses, likely precluding many such companies from access to PPP loans funds.
The Morse Employment Law team is following this topic closely. Read our latest COVID-19 Alert for more information.
DOL Issues Revised Emergency Paid Sick Leave Guidance; Limits Scope Of Small Business Exemption
As previously reported in an earlier Employment Law Alert, the emergency paid sick leave provisions of the Federal Families First Coronavirus Act (the “FFCA”) take effect April 1, 2020.
In anticipation of that effective date, the federal Department of Labor (the “DOL”) has published a revised and expanded “Questions and Answers” Guidance (the “Guidance”) concerning the FFCA.
This guidance addresses 59 distinct subject matters that relate to the complex application of the FFCA. Of particular note: The Guidance defines the scope of the FFCA exemption that applies to employers with fewer than 50 employees.
The text of FFCA implies a general exemption, from the paid sick leave requirements of the FFCA, for employers with fewer than 50 employees, that are experiencing economic hardships as a result of the coronavirus outbreak. Through the Guidance, the DOL adopts a narrowed interpretation of this small business exemption:
“A small business is exempt from certain paid sick leave and expanded family and medical leave requirements if providing an employee such leave would jeopardize the viability of the business as a going concern. This means a small business is exempt from mandated paid sick leave or expanded family and medical leave requirements only if the:
- employer employs fewer than 50 employees;
- leave is requested because the child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and
- an authorized officer of the business has determined [certain financial exigencies exist.]”
Guidance, Q&A 59.
As such, unlike previous reports, small businesses are not broadly exempt from FFCA emergency paid leave requirements, and must provide employees with emergency paid leave benefits absent the limited exceptions described above. For example, under the Guidance, a small business is required to provide 80 hours of emergency paid sick leave to an employee that is absent from work as a result of a COVID-19 related illness.
In addition to the Guidance, in the coming days, the Internal Revenue Services is expected to publish instructions related to tax credits available to employers that incur expenses related to FFCA emergency leaves.
The rules and guidelines that relate to the FFCA, and to the other federal and state coronavirus relief programs, are moving targets. The Morse Employment Law team is following these, and other matters related to COVID-19 responses, and will continue to report as appropriate.
Read our latest COVID-19 Alert.
Equal Opportunity Commission Issues Updated Guidance Related to COVID-19 Preparedness for “Essential Businesses”
The federal Equal Employment Opportunity Commission (the “EEOC”) has issued revised guidelines that define Americans with Disabilities Act (“ADA”) compliance standards for employers operating under current COVID-19 pandemic conditions.
In general, the ADA broadly restricts business decisions that consider employee health or medical conditions. Through the guidelines, the EEOC has temporarily suspended certain ADA restrictions in an effort to permit “Essential Businesses” – businesses that are exempted from various shelter-in-place and business restrictions order now in effect in several regions – to adopt practical strategies to maintain safe business operations.
Several of the key concepts are below:
- With respect to employee inquiries regarding COVID-19 symptoms: “An employer may send home an employee with COVID-19 or symptoms associated with it. Employers may ask employees who report feeling ill at work, or who call in sick, questions about their symptoms to determine if they have or may have COVID-19.”
- With respect to workplace infection control strategies: “Because the CDC and state/local health authorities have acknowledged community spread of COVID-19 and issued attendant precautions as of March 2020, employers may measure employees’ body temperature. As with all medical information, the fact that an employee had a fever or other symptoms would be subject to ADA confidentiality requirements. Similarly, with respect to the current COVID-19 pandemic, employers may follow the advice of the CDC and state/local public health authorities regarding information needed to permit an employee’s return to the workplace after visiting a specified location, whether for business or personal reasons.”
- With respect to reasonable accommodation requests by employees that are unrelated to COVID-19: “The rapid spread of COVID-19 has disrupted normal work routines and may have resulted in unexpected or increased requests for reasonable accommodation. Although employers and employees should address these requests as soon as possible, the extraordinary circumstances of the COVID-19 pandemic may result in delay in discussing requests and in providing accommodation where warranted. Employers and employees are encouraged to use interim solutions to enable employees to keep working as much as possible.”
- With respect to hiring practices during COVID-19 pandemic: “An employer may screen job applicants for symptoms of COVID-19 after making a conditional job offer, as long as it does so for all entering employees in the same type of job. This ADA rule allowing post-offer (but not pre-offer) medical inquiries and exams applies to all applicants, whether or not the applicant has a disability.”
The Morse Employment Law team is following this, and other matters related to COVID-19 responses, and will continue to report as appropriate.
Massachusetts Governor Orders “Non-Essential” Businesses To Close Physical Workplaces By Tuesday, March 24
On March 23, 2020, Massachusetts Governor Charlie Baker issued an Emergency Order requiring all businesses and organizations that do not provide “COVID-19 Essential Services” to close their physical workplaces and facilities to workers, customers and the public.
The Emergency Order goes into effect on Tuesday, March 24th at noon, and remains in effect until Tuesday, April 7th, or until otherwise ordered.
Please refer to the list of “COVID-19 Essential Services” that are exempted from the Emergency Order.
Businesses that are designated as “Essential” are directed to follow social distancing protocols for workers in accordance with guidance from the Massachusetts Department of Public Health, as aggregated at the following sites:
COVID-19 Prevention and Treatment
COVID-19 Guidance and Directives
Businesses and organizations not on the list of essential services are encouraged to continue operations through remote means that do not require workers, customers, or the public to enter or appear at workplace premises impacted by the Emergency Order.
Information concerning this Emergency Order is developing.
The Morse Employment Law team is following this, and other matters related to COVID-19 responses, and will continue to report as appropriate.
Congress Adopts Emergency Paid Family Medical Leave and Sick Time Standards; Contemplates Payroll Tax Deductions and Cash Payments to Offset Employer Costs
By: Matthew Mitchell
Governor Issues Emergency Orders that Require Most MA Employers to Modify Business Operations
On Sunday, March 15, 2020, Massachusetts Governor Charlie Baker announced emergency orders in response to the Coronavirus outbreak, that directly affect Massachusetts employers.
Specifically, the Governor directed, in material part:
- A suspension of educational operations at all public and private elementary and secondary schools in the Commonwealth;
- A prohibition of gatherings of over 25 people, including, but not limited to, community, civic, public, leisure, faith-based events, sporting events with spectators, concerts, conventions, fundraisers, parades, fairs, festivals, and any similar event or activity that brings together 25 or more persons in a single room or single space. (This prohibition expressly prohibits gatherings of more than 25 people in open work spaces, such as conference rooms.)
The Governor’s emergency orders take effect on Tuesday, March 17, 2020, and are scheduled to remain in place through April 5, 2020, unless otherwise ordered.
Read the following Employment Law Alert for more information.
Read the following article on Force Majeure in Light of the Coronavirus Outbreak.
Coronavirus Response Update – March 13, 2020
By: Matthew Mitchell
The Coronavirus outbreak is creating unprecedented challenges for employers. Existing employment law standards and structures do not contemplate our present circumstances, and employers are increasingly faced with novel questions with respect to employee relations.
We are beginning to see some clarity on the subject, however. As government and organizational actors begin to deploy response strategies, best employment practices regarding Coronavirus concerns are emerging.
Matthew Mitchell provides answers to several common questions regarding the Coronavirus in the following COVID-19 Client Alert.
The Morse Employment Law Team is following this topic closely. Please contact us should you have any questions.
Coronavirus Response Update – March 11, 2020
By: Matthew Mitchell
In response to increased incidents of COVID-19 infections in the Commonwealth, on Tuesday, March 10, 2020, Governor Charlie Baker declared a State of Emergency in Massachusetts. The State of Emergency declaration is, in essence, an activation of the Governor’s emergency powers – meaning that the Governor may now order certain directives and allocate certain resources, to respond to the Coronavirus outbreak, outside of regular legislative processes.
The Governor has issued a directive that applies to the Commonwealth’s Executive Branch. Matthew Mitchell explains what this directive to public-sector employers entails in the following client alert.
The Morse Employment Law Team is following this topic closely. Please contact us should you have any questions.
A New Year’s Reminder: Discretionary, End-Of-Year Bonuses and the Massachusetts Equal Pay Act
By: Matthew Mitchell
The discretionary, end-of-year bonus is the most common form of incentive compensation. When executed well, the discretionary bonus provides employers with the opportunity to reward employee success. However, when executed poorly, even a well-intentioned discretionary bonus may result in significant employment law liability.
The recent passage of the Massachusetts Equal Pay Act, M.G.L. c. 149, §105A (the “Act”), complicates the compliance landscape that applies to discretionary bonuses. As January bonus season kicks off, employers are well-served to understand the restrictions that the Act imposes on discretionary bonuses.
Review our Employment Team’s recent Employment Law Alert to learn how the Act regulates the type of compensation structures employers may apply to their Massachusetts employees.
For more information, please contact Matthew Mitchell or Amanda Thibodeau.
Round Up of Noncompete Reform Coming to New England
Noncompete reform is taking over the country as more and more states – including four in New England – are making the decision to enact new laws restricting the use of noncompetition agreements by employers. Maine, New Hampshire, and Rhode Island all recently passed legislation that is expected to take effect soon, and a similar bill is pending in Vermont as well. Dates of note include:
- In June 2019, Maine’s governor signed into law LD 733: An Act To Promote Keeping Workers in Maine. This new law took effect September 18, 2019.
- On July 11, 2019, New Hampshire’s governor signed S.B. 197 into law, which amends New Hampshire’s previous statute governing the use of noncompetition agreements. The amended law took effect on September 8, 2019.
- On July 15, 2019, Rhode Island’s governor signed RI H6019 – the Rhode Island Noncompetition Agreement Act, which will go into effect on January 1, 2020.
- In January 2019, H.1 was introduced in the Vermont legislature. The bill was referred to the Vermont House Committee on Commerce and Economic Development, where it remains as of today.
Noncompete reform is gaining popularity, with more states likely to join in soon. Similar legislation has been proposed on the federal level as well, although the current federal bill, the Federal Freedom to Compete Act, has not gained much support yet and is currently sitting in the Senate Health, Education, Labor, and Pensions Committee.
Our Employment Law Alert explains the full extent of the bills and how they may affect you.
UPDATED: Federal District Court Reinstates EEO-1 Pay Data Reporting Requirements (For Now)
By: Amanda Thibodeau
As we previously reported, in March 2019 the U.S. District Court for the District of Columbia issued a ruling concluding that the White House Office of Management and Budget (“OMB”) did not have a sufficient basis to stay pay reporting data requirements (known as “Component 2”) previously announced by the U.S. Equal Employment Opportunity Commission (“EEOC”).
On April 3, 2019 the OMB filed a brief with the U.S. District Court for the District of Columbia proposing a September 30, 2019 deadline for the EEOC to complete the Component 2 pay data collection, which was approved by the Court later that month.
On May 1, 2019, the EEOC announced it expects to begin collecting the Component 2 pay data for both 2017 and 2018 calendar years in mid-July 2019 in anticipation of the September 30, 2019 deadline. The EEOC expects to open a submission portal for employers to submit that data this summer. A copy of the published announcement can be found here.
Employers are still expected to submit their 2018 Component 1 data by the May 31, 2019 deadline.
The Morse Employment Law Group will continue to monitor this issue and provide updates as they become available.
For more information, please contact Matthew Mitchell or Amanda Thibodeau.
Massachusetts Paid Family and Medical Leave Update: Department EXTENDS Deadlines for Employee Notice and Private Plan Compliance Obligations
By: Matthew Mitchell
As we have reported, although the employee benefits provisions of the Massachusetts Paid Medical and Family Leave Law (the “PFML”) do not go into effect until 2021, employer compliance obligations under the PFML were scheduled to start as early as the spring of 2019. In an effort to address employer concerns related to the roll-out of the PFML, on May 1, 2019, the Massachusetts Department of Family and Medical Leave (the “Department”), the state agency charged with administering the PFML, extended employer deadlines with respect to two key compliance hurdles: (i) Private Plan Exemption Applications; and (ii) Employee Notice Requirements.
A description of these specific compliance obligations, and the new deadlines that apply to them, are as follows:
Private Plan Exemptions
As we have previously reported, the PFML establishes a publically-administered, paid family and medical leave benefits program in Massachusetts (the “Program”). Commencing in 2021, workers who qualify for PFML leave are entitled to certain insurance payments, distributed from a state-administered Family and Employment Security Trust Fund (the “Fund”), and financed through payroll tax contributions. In order to “pre-finance” the Program, on July 1, 2019, employers must begin to make contributions to the Fund, through payroll deductions, at certain defined rates.
The PFML does, however, provide to carve to the payroll contribution requirement: Employers that offer a private medical and family leave plan to their employees, with the same or greater benefits as the PFML, may apply for an exemption from the payroll contribution requirements of the Program. The Department, through MassTaxConnect, began accepting private plan exemption applications on April 21, 2019.
As originally instructed by the Department, in order to be relieved from the payroll contribution requirement for the initial July 2019 – September 2019 quarter, employers were required to obtain private plan exemption approval before June 30, 2019. In order to permit employers additional time to explore private plan options, the Department has extended the date to apply for a private plan exemption for this initial quarter to September 20, 2019.
The Department will continue to accept applications, on a rolling basis, after the September 20, 2019 deadline. However, if an exemption application is approved after September 20, 2019, the employer will remain responsible for remitting payroll contributions for the July 2019 – September 2019 quarter, with the exemption becoming effective in calendar quarter after the application is approved.
Employee Notice Requirements
The PFML requires that employers provide clear and advance notice, to their workforces, of the rights provided under the law. This requirement includes: (a) providing employees and independent contractors with so-called “Written Information Notices;” and (b) posting approved Workplace Posters.
On April 17, 2019, the Department published template Written Information Notices and Workplace Posters forms here (https://www.mass.gov/info-details/informing-your-workforce-about-paid-family-and-medical-leave). A deadline for distributing Written Information Notice and Workplace Posters to employees was set for May 31, 2019.
In response to employer concerns, the Department has extended the deadline for the Written Information Notices (and presumably the Workplace Poster deadline) to June 30, 2019. In extending the deadline, the Department also emphasized the following details with respect to the compliance requirements related to the Written Information Notices:
- The Written Information Notice must be provided to all employees and independent contractors, engaged by the employer as of June 30, 2019.
- The Written Information Notice may be provided electronically, but must include the opportunity for an employee or independent contractor to acknowledge receipt or decline to acknowledge receipt of the information. The employer can receive these acknowledgments in paper form or electronically.
- In the event that an employee or independent contractor fails to acknowledge receipt, the Department shall consider an employer to have fulfilled its notice obligation if it can establish that it provided to each member of its current workforce notice and the opportunity to acknowledge or decline to acknowledge receipt.
- With respect to providing Written Information Notices to W2 employees:
– The Employer must issue a Written Information Notice to each employee within 30 days of their first day of employment. The Written Information Notice must be written in the employee’s primary language.
– Employers may use the Department template or create a customized Written Information Notice for distribution to employees. If an employer elects to customize a Written Information Notice, the custom notice must contain:
– An explanation of the availability of family and medical leave benefits
– The employee’s contribution amount and obligations
– The employer’s contribution amount and obligations
– The employer’s name and mailing address
– The employer identification number assigned by the Department
– Instructions on how to file a claim for family and medical leave benefits
– The mailing address, email address, and telephone number of the Department.
- With respect to providing Written Information Notices to Independent Contractors:
– The Employer must issue a Written Information Notice to each independent contractor, when the employer enters into the contract for services. The Written Information Notice must be written in the independent contractor’s primary language.
– Employers may use the Department template or create a customized Written Information Notice for distribution to independent contractors. If an employer elects to customize a Written Information Notice, the custom notice must contain:
– An explanation of the availability of family and medical leave benefits, and the procedures for independent contractors to become covered individuals under the PFML.
– The independent contractor’s contribution amount and obligations if they were to become a “covered” individual under the PFML.
– The employer’s contribution amount and obligations.
– The employer’s name, mailing address, and email address.
– The employer’s identification number assigned by the Department.
– Instructions on how to file a claim for family and medical leave benefits.
– The address and telephone number of the Department.
Failure to provide these required notifications may result in fines of up to $300 per violation.
For more information on the PFML, please contact Matthew Mitchell or Amanda Thibodeau.
SUMMER IS COMING: Massachusetts Compliance Requirements with Respect to Summer Internship Programs
By: Matthew Mitchell
For the Morse Employment Law Group, the arrival of spring is marked, not by the blooming of vernal flowers, but, rather, by the steady increase of inquiries related to summer interns.
A summer internship program is often an important component of an employer’s annual business cycle: internships help connect an employer to its surrounding academic communities; internships can facilitate an employer’s civic engagement; and such programs can serve as an efficient recruitment tool, particularly in tight job markets. Despite the prevalence and value of such programs, some employers tend to see their summer interns as “casual” or “unregulated” employees. It should be noted, however, that the employment of summer interns, particularly with respect to interns who are under age 18, is a highly regulated area of Massachusetts law.
Below are a few key concepts to keep in mind:
Paid versus Unpaid Interns
Massachusetts employers must compensate their interns – at, at least, a minimum wage rate – for work performed, unless the internship program qualifies as a “training program in a charitable, educational or religious institution.” The Massachusetts Attorney General and the Massachusetts Department of Labor Standards have interpreted this standard, narrowly, to mean that an employer may not engage an intern on an unpaid basis, unless the following factors are strictly met:
- The internship is tied to the intern’s formal education program by integrated coursework, or the receipt of academic credit.
- The intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
- The internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
- The internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
- The internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
- The intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
- The intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.
As such, absent very limited circumstances, Massachusetts employers must pay their interns.
School-Aged Interns
Offering internship opportunities to minor children adds another layer of regulatory complexity:
- Massachusetts child labor laws limit the hours a worker who is under age 18 may work, and limit the types of job functions such workers may perform. In fact, there are at least 49 discrete laws that define and limit, very specifically, the type of work employees under age 18 may engage in. For example: workers under age 18 may not be employed in jobs that require the operation of electrical machinery; workers under age 16 may not be employed in a manufacturing facility.
- Massachusetts law requires employers to obtain Youth Employment Permits (work permits) for all workers under 18. In Massachusetts, children under 14 may not work at all, except in very limited cases.
- In Massachusetts, workers under 18 may not enter into contractual restrictions (such as non-disclosure or assignment of invention clauses), without parental consent, and may not be subject to non-competition agreements at all.
- There may be enhanced workers’ compensation premium obligations and benefit protections for workers under age 18, depending on the circumstances.
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To the extent that you are considering engaging summer interns this year, we recommend a brief consultation with a member of the Morse Employment Law Group. As with all matters related to Wage and Hour laws, a non-compliant summer internship program may result in significant penalties and litigation liability.
For more information, please contact Matthew Mitchell or Amanda Thibodeau.
Department of Labor Proposes New Interpretation of Joint Employer Status Under The Fair Labor Standards Act
By: Amanda Thibodeau
On April 9, 2019, the United States Department of Labor (“DOL”) published a notice of proposed rulemaking (the “NPRM”) to amend its existing regulations regarding so-called “joint employer” status under the federal Fair Labor Standards Act (the “FLSA” or the “Act”).
The FLSA requires covered “employers” to pay nonexempt employees at least the federal minimum wage for all hours worked and overtime for all hours worked over 40 hours in a workweek. The Act also contemplates scenarios in which other “persons,” in addition to the nominal employer, may be jointly liable for wages due to an employee under the Act. This concept is generally known as joint employer wage liability (although the term “joint employer” is not specifically used in the language of the FLSA). Joint employer status under the FLSA implicates questions such as:
- Is a franchiser liable for the wage obligations of its franchisees?
- Is an institutional investor liable for the wage obligations of its portfolio businesses?
- Is a parent corporation liable for the wage obligations of its subsidiaries?
In 1958, the DOL issued regulations interpreting joint employer status under the Act. Those regulations instructed that multiple persons or entities may be jointly liable for wage obligations due to an employee if they are “not completely disassociated with” respect to the employment of an employee. This open-ended standard, which remains the current DOL benchmark on the subject, has been the subject to debate for nearly sixty years.
The DOL indicates that the purpose of the NPRM is to make the determination of joint employer status under the FLSA “simpler and more consistent.”
A New Test For Joint Liability Status
The NPRM proposes a four-factored test to determine when a person or entity shares wage liability for an employee with the nominal employer. The four factors are whether the person or business entity:
- hires or fires the employee;
- supervises and controls the employee’s work schedule or conditions of employment;
- determines the employee’s rate and method of payment; and
- maintains the employee’s employment records.
The NPRM clarifies that that “the potential joint employer must actually exercise . . . one or more of these indicia of control to be jointly liable under the Act.” (Emphasis supplied). The reserved, but unexercised, contractual right to act in relation to an employee “is not relevant for determining joint employer status.” In addition, the NPRM provides a set of examples that illustrate the limits of the four-factor test:
- The potential joint employer’s business model—for example, operating as a franchisor—does not make joint employer status more or less likely under the Act.
- The potential joint employer’s contractual agreements with the employer requiring the employer to, for example, set a wage floor, institute sexual harassment policies, establish workplace safety practices, require morality clauses, adopt similar generalized business practices, or otherwise comply with the law, do not make joint employer status more or less likely under the Act.
- The potential joint employer’s practice of providing a sample employee handbook, or other forms, to the employer; allowing the employer to operate a business on its premises (including “store within a store” arrangements); offering an association health plan or association retirement plan to the employer or participating in such a plan with the employer; jointly participating in an apprenticeship program with the employer; or any other similar business practice, does not make joint employer status more or less likely under the Act.
What’s Next?
It should be noted that NPRM is a proposal. The DOL is now soliciting comments from interested parties with respect to the NPRM, and will begin the process of developing a final rule on the subject. Whether the DOL ultimately adopts the rules proposed in the NPRM is unclear. What is clear is that the DOL is focused on clarifying standards with respect to this contentious area of employment law. Morse will continue to monitor, and report on this subject.
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Morse’s Employment Law Group regularly advises clients with respect to compliance with the Fair Labor Standards Act and its developments.
For more information, please contact Amanda Thibodeau or Matthew Mitchell.
U.S. Department of Labor Proposes Significant Changes to FLSA Overtime Regulations
By: Matthew Mitchell
On March 7, 2019, the U.S. Department of Labor announced a long-awaited Notice of Proposed Rulemaking (“NPRM”) that proposes new regulations that relate to overtime and minimum wage exemptions under the Fair Labor Standards Act (“FLSA”). The FLSA requires that most employees in the United States be paid at least the federal minimum wage for all hours worked, and overtime pay at time and one-half the regular rate of pay for all hours worked over 40 hours in a workweek.
Read about the proposed changes, including how they could change employee exempt or nonexempt status in our Employment Law Alert.
Federal District Court Reinstates EEO-1 Pay Data Reporting Requirements (For Now)
By: Matthew Mitchell
In September 2016, the U.S. Equal Employment Opportunity Commission (“EEOC”) announced plans to collect employee compensation data as a component to its annual EEO-1 employer information reporting requirement. This pay data reporting requirement – known as “Component 2” – was slated to go into effect in March 2018, and would have required all private employers with over 100 employees, and certain smaller, government contractors, to report W-2 wage information and total hours worked, for all employees, by race, ethnicity, and sex, within 12 proposed pay bands. Component 2 was an aspect of Obama-era reforms aimed at strengthening EEOC capacity to identify and prevent pay discrimination.
In August 2017, the White House Office of Management and Budget (“OMB”), under the Trump Administration, stayed the implementation of Component 2, indicating that Component 2 disclosure requirements were unreasonably burdensome for employers – the U. S. Chamber of Commerce estimated that Component 2 would result in $400 million in additional administrative costs to employers. That action by the OMB prompted a lawsuit by the National Women’s Law Center and the Labor Counsel for Latin American Advancement against the OMB and the EEOC.
On March 4, 2019, the U.S. District Court for the District of Columbia issued an opinion reinstating Component 2, concluding that the OMB did not have a sufficient basis to support its decision to stay Component 2. The Court’s decision may have significant implications for employers. The current EEO-1 Report filing deadline is on May 31, 2019, and it is unclear whether Component 2 pay data disclosures will be required for the May 31 reporting cycle.
It remains to be seen whether the ruling is appealed, whether the EEOC issues any special instructions in light of the ruling, or whether the EEOC takes steps to revise its EEO-1 reporting guidelines (although the EEOC does not presently have a quorum to effect such a change). Morse Barnes-Brown Pendleton’s Employment Law Group will continue to monitor this issue, and will provide updates as they become available.
For more information, please contact Matt Mitchell.
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