Navigating Labor Law Changes in 2016

The New Year is in full swing and a record number of companies are planning to augment their workforce by at least 30% in coming months. But with the prospect of increased hiring inevitably comes the labor laws changes in 2016 that companies should be aware of. Employment law changes exist at every level, from local to state to federal, complicating the administrative side of hiring for employers everywhere.

Fair Labor Standards Act

The Department of Labor last updated regulations regarding minimum wage and overtime back in 2004, which means there could be significant changes coming this year. While these decisions are not yet finalized, the implications are large. The DOL is proposing an increase in minimum weekly wages to “the 40th percentile of weekly earning for full-time salaried workers ($921 per week, or $47,892 annually).” It is currently unclear whether the DOL will allow bonuses to be included in this proposed salary requirement.

The other major implication of this change is that the Fair Labor Standards Act exempts “white collar” professionals from overtime pay requirements, provided they fulfill certain duties and earn a particular weekly salary level. With the weekly minimum wage increases, this will likely affect which employees will be considered exempt. Employers should keep an eye out for the final decisions from the Department of Labor later this year.

Other Minimum Wage Hikes

Another minimum wage change, made effective January 1, 2016, is that for federal contractors, to $10.15 per hour. The minimum for tipped employees has also increased to $5.85 per hour. This change is in line with a previous Executive Order signed by the President in February, 2014.

Outside of federal contractors, several states have also pushed laws to increase minimum wages for all workers. Effective in January, these included Alaska, Arkansas, California, Connecticut, Hawaii, Massachusetts, Michigan, Nebraska, New York, Rhode Island, Vermont and West Virginia. These additions make a total of 29 states that require a higher minimum wage than the current federal minimum of $7.25.

Pregnant Workers Fairness Act

The Pregnant Workers Fairness Act has been sitting before congress for several months, and legal experts expect to see a decision early this year. This law will set in place guidelines for employers to better accommodate employees coping with the realties associated with pregnancy and childbirth.

Essentially, this bill is designed to protect pregnant employees in their careers, without having to be forced into a decision between pregnancy and employment. This results from numerous anecdotes and statistics of women who have been terminated or injured on the job as a result of pregnancy-related medical conditions. These guidelines include factors such as lifting heavy objects, standing for long periods of time, and workplace food-and-drink policies, as well as overall discriminatory acts.

Federal Fair Chance Act

More and more states have been passing “Ban the Box” laws that establish official guidelines for when employers are allowed to ask about and screen a candidate’s criminal history. The debate centers around statistics that show that job applicants with previous convictions are frequently discriminated against, despite the fact that they’ve already paid the price and dealt with the consequences. This appears to particularly be the case for minorities and low income citizens.

These laws require employers to remove any questions on employment applications that ask if the applicant has ever been convicted of a crime. Similarly, background screening of their criminal history must wait until later in the hiring process. Late last year, the President issued an executive order to sign this into federal law; namely, the Federal Fair Chance Act. Employers should be aware of if and when this becomes a reality, as it will likely affect established background screening policies.

Increased OSHA Violation Fines

In an effort to improve health and safety in the workplace, the Occupational Safety and Health Administration will soon be able to increase its fines up to 80%. Violation fines have not been increased since 1990, and this new increase will go into effect on August 1, 2016. This is a result of a bipartisan bill from the President in November, 2105, and the primary goal of this increase is to reduce workplace injuries and deaths. Employers should review their health and safety regulations in order to avoid violations and improve workplace safety.

Tackling These Changes

This slew of changes is significant to many employers across the nation, especially those planning to hire this year. Employee administration is complex enough as it is and requires a high level of expertise to avoid negligence and meet compliance. If this is a burden you’d rather hand off, let us know. We let our clients get back to what they do best while we take care of the complexities of employee administration and all other HR-related tasks.

Need more detailed information? Request a consultation and download our complimentary Ultimate HR Compliance Guide today.