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Global Daily News

  • Jackson Healthcare names former Trump administration cabinet member to advisory board

    Jackson Healthcare, which ranks among the largest US healthcare staffing providers, announced that former US Health and Human Services Secretary Tom Price has been named to its advisory board. Price, who is also a medical doctor, had served as Health and Human Services Secretary in the Trump administration from February through September of last year.Bloomberg Politics reported Price stepped down amid probes of his use of taxpayer-funded jets while in office and that Price was a leading congressional critic of the Affordable Care Act.Price was elected to the US House of Reprsentatives in 2004 and served as a member there from 2005 to 2017. He was chair of the House Budget Committee in 2015 and 2017.“Nobody has as profound an understanding of the national healthcare landscape as Dr. Price,” said Richard Jackson, chairman and CEO of Jackson Healthcare. “Tom has exhibited an unwavering commitment to preserving the patient-physician relationship. That mindset, along with his physician, business and policy experience, will make him an invaluable addition to our board.”Price entered private practice in 1984 and was one of the founders of Resurgens Orthopedics and was later elected to the Georgia Senate, where he served from 1997 to 2005. While he was a member of the state Senate, he became an assistant professor at Emory University, starting in 2002. He was also medical director of the Orthopedic Clinic at Grady Memorial Hospital, overseeing the training of resident doctors. He had received both his bachelor’s and M.D. degrees from the University of Michigan and completed his residency in orthopedic surgery at Emory University.“I am honored to join the advisory board at Jackson Healthcare,” Price said. “Jackson Healthcare’s mission of working to improve patient care is wholly aligned with the work I have done for over four decades, and I look forward to helping them navigate the always changing healthcare environment.&rdquo […]

  • 75% of staffing firms expect more revenue this year, Bullhorn report says

    A new report by staffing software supplier Bullhorn found 75% of staffing and recruiting firms expect more revenue this year than last year.It also found the top three priorities for staffing firms this year were increasing profitability, cited by 45%; driving top line revenue growth, cited by 43%; and improving candidate sourcing, 42%.“The year 2018 holds tremendous opportunities for North American staffing and recruiting firms as they look to continue growing their businesses during a period of relatively strong economic growth,” said Gordon Burnes, Bullhorn’s chief marketing officer.Bullhorn’s report also found 70% expect increases in hiring needs this year, 62% expect increases in billable hours and 59% expect increases in temporary placements in 2018. On the other hand, 55% predicted both bill rates and margins would stay flat or decrease in 2018, and 49% ranked pricing pressures and margin compression as a top-three challenge.The report is called the “2018 North American Staffing & Recruiting Trends Report: The Industry’s Outlook for 2018.”The survey included 1,442 staffing and recruiting professionals and was taken between Sept. 17 and Oct. 7. […]

  • Illinois-based staffing firm sells to Cornerstone Staffing Solutions

    Arlington Resources Inc., a provider of human resources and accounting/finance staffing, was acquired by Cornerstone Staffing Solutions, a Pleasanton, Calif.-based staffing supplier. The deal was announced by De Bellas & Co. Investment Banking.Privately held Arlington Resources is based in Rolling Meadows, Ill., and was founded in 1997 by Patricia Casey. Terms of the transaction were not announced.“Both of our firms, Arlington Resources and Cornerstone Staffing Solutions, exhibit strong core values, have stellar reputations for ‘doing the right thing’ for and with our customers and associates, and our core competencies match well,” Casey said in a statement.She will join Cornerstone’s executive team as president of the Arlington Resources Division of Cornerstone. […]

  • Engineering majors have highest projected starting salary at $66,521

    Engineering majors from the class of 2018 have a projected average starting salary of $66,521, the highest of all majors, according to a report by the National Association of Colleges and Employers. Computer science graduates are projected to receive the second-highest starting salary at $66,005.Both fields are up less than 1% from last year.Data for the report came from NACE’s Winter 2018 Salary Survey, which included 196 survey responses collected between Aug. 9 and Dec. 4 in the US. Broad category 2018 projected average salary 2017 projected average salary Engineering $66,521 $66,097 Computer science $66,005 $65,540 Math & sciences $61,867 $59,368 Business $56,720 $54,803 Social sciences $56,689 $53,459 Humanities $56,688 $48,733 Agriculture & natural resources $53,565 $54,364 Communications $51,448 $51,925 […]

  • Jackson Healthcare names former Trump administration cabinet member to advisory board

    Jackson Healthcare, which ranks among the largest US healthcare staffing providers, announced that former US Health and Human Services Secretary Tom Price has been named to its advisory board. Price, who is also a medical doctor, had served as Health and Human Services Secretary in the Trump administration from February through September of last year.Bloomberg Politics reported Price stepped down amid probes of his use of taxpayer-funded jets while in office and that Price was a leading congressional critic of the Affordable Care Act.Price was elected to the US House of Reprsentatives in 2004 and served as a member there from 2005 to 2017. He was chair of the House Budget Committee in 2015 and 2017.“Nobody has as profound an understanding of the national healthcare landscape as Dr. Price,” said Richard Jackson, chairman and CEO of Jackson Healthcare. “Tom has exhibited an unwavering commitment to preserving the patient-physician relationship. That mindset, along with his physician, business and policy experience, will make him an invaluable addition to our board.”Price entered private practice in 1984 and was one of the founders of Resurgens Orthopedics and was later elected to the Georgia Senate, where he served from 1997 to 2005. While he was a member of the state Senate, he became an assistant professor at Emory University, starting in 2002. He was also medical director of the Orthopedic Clinic at Grady Memorial Hospital, overseeing the training of resident doctors. He had received both his bachelor’s and M.D. degrees from the University of Michigan and completed his residency in orthopedic surgery at Emory University.“I am honored to join the advisory board at Jackson Healthcare,” Price said. “Jackson Healthcare’s mission of working to improve patient care is wholly aligned with the work I have done for over four decades, and I look forward to helping them navigate the always changing healthcare environment.&rdquo […]

  • 75% of staffing firms expect more revenue this year, Bullhorn report says

    A new report by staffing software supplier Bullhorn found 75% of staffing and recruiting firms expect more revenue this year than last year.It also found the top three priorities for staffing firms this year were increasing profitability, cited by 45%; driving top line revenue growth, cited by 43%; and improving candidate sourcing, 42%.“The year 2018 holds tremendous opportunities for North American staffing and recruiting firms as they look to continue growing their businesses during a period of relatively strong economic growth,” said Gordon Burnes, Bullhorn’s chief marketing officer.Bullhorn’s report also found 70% expect increases in hiring needs this year, 62% expect increases in billable hours and 59% expect increases in temporary placements in 2018. On the other hand, 55% predicted both bill rates and margins would stay flat or decrease in 2018, and 49% ranked pricing pressures and margin compression as a top-three challenge.The report is called the “2018 North American Staffing & Recruiting Trends Report: The Industry’s Outlook for 2018.”The survey included 1,442 staffing and recruiting professionals and was taken between Sept. 17 and Oct. 7. […]

  • Illinois-based staffing firm sells to Cornerstone Staffing Solutions

    Arlington Resources Inc., a provider of human resources and accounting/finance staffing, was acquired by Cornerstone Staffing Solutions, a Pleasanton, Calif.-based staffing supplier. The deal was announced by De Bellas & Co. Investment Banking.Privately held Arlington Resources is based in Rolling Meadows, Ill., and was founded in 1997 by Patricia Casey. Terms of the transaction were not announced.“Both of our firms, Arlington Resources and Cornerstone Staffing Solutions, exhibit strong core values, have stellar reputations for ‘doing the right thing’ for and with our customers and associates, and our core competencies match well,” Casey said in a statement.She will join Cornerstone’s executive team as president of the Arlington Resources Division of Cornerstone. […]

  • Engineering majors have highest projected starting salary at $66,521

    Engineering majors from the class of 2018 have a projected average starting salary of $66,521, the highest of all majors, according to a report by the National Association of Colleges and Employers. Computer science graduates are projected to receive the second-highest starting salary at $66,005.Both fields are up less than 1% from last year.Data for the report came from NACE’s Winter 2018 Salary Survey, which included 196 survey responses collected between Aug. 9 and Dec. 4 in the US. Broad category 2018 projected average salary 2017 projected average salary Engineering $66,521 $66,097 Computer science $66,005 $65,540 Math & sciences $61,867 $59,368 Business $56,720 $54,803 Social sciences $56,689 $53,459 Humanities $56,688 $48,733 Agriculture & natural resources $53,565 $54,364 Communications $51,448 $51,925 […]

  • Jackson Healthcare names former Trump administration cabinet member to advisory board

    Jackson Healthcare, which ranks among the largest US healthcare staffing providers, announced that former US Health and Human Services Secretary Tom Price has been named to its advisory board. Price, who is also a medical doctor, had served as Health and Human Services Secretary in the Trump administration from February through September of last year.Bloomberg Politics reported Price stepped down amid probes of his use of taxpayer-funded jets while in office and that Price was a leading congressional critic of the Affordable Care Act.Price was elected to the US House of Reprsentatives in 2004 and served as a member there from 2005 to 2017. He was chair of the House Budget Committee in 2015 and 2017.“Nobody has as profound an understanding of the national healthcare landscape as Dr. Price,” said Richard Jackson, chairman and CEO of Jackson Healthcare. “Tom has exhibited an unwavering commitment to preserving the patient-physician relationship. That mindset, along with his physician, business and policy experience, will make him an invaluable addition to our board.”Price entered private practice in 1984 and was one of the founders of Resurgens Orthopedics and was later elected to the Georgia Senate, where he served from 1997 to 2005. While he was a member of the state Senate, he became an assistant professor at Emory University, starting in 2002. He was also medical director of the Orthopedic Clinic at Grady Memorial Hospital, overseeing the training of resident doctors. He had received both his bachelor’s and M.D. degrees from the University of Michigan and completed his residency in orthopedic surgery at Emory University.“I am honored to join the advisory board at Jackson Healthcare,” Price said. “Jackson Healthcare’s mission of working to improve patient care is wholly aligned with the work I have done for over four decades, and I look forward to helping them navigate the always changing healthcare environment.&rdquo […]

  • 75% of staffing firms expect more revenue this year, Bullhorn report says

    A new report by staffing software supplier Bullhorn found 75% of staffing and recruiting firms expect more revenue this year than last year.It also found the top three priorities for staffing firms this year were increasing profitability, cited by 45%; driving top line revenue growth, cited by 43%; and improving candidate sourcing, 42%.“The year 2018 holds tremendous opportunities for North American staffing and recruiting firms as they look to continue growing their businesses during a period of relatively strong economic growth,” said Gordon Burnes, Bullhorn’s chief marketing officer.Bullhorn’s report also found 70% expect increases in hiring needs this year, 62% expect increases in billable hours and 59% expect increases in temporary placements in 2018. On the other hand, 55% predicted both bill rates and margins would stay flat or decrease in 2018, and 49% ranked pricing pressures and margin compression as a top-three challenge.The report is called the “2018 North American Staffing & Recruiting Trends Report: The Industry’s Outlook for 2018.”The survey included 1,442 staffing and recruiting professionals and was taken between Sept. 17 and Oct. 7. […]

  • Illinois-based staffing firm sells to Cornerstone Staffing Solutions

    Arlington Resources Inc., a provider of human resources and accounting/finance staffing, was acquired by Cornerstone Staffing Solutions, a Pleasanton, Calif.-based staffing supplier. The deal was announced by De Bellas & Co. Investment Banking.Privately held Arlington Resources is based in Rolling Meadows, Ill., and was founded in 1997 by Patricia Casey. Terms of the transaction were not announced.“Both of our firms, Arlington Resources and Cornerstone Staffing Solutions, exhibit strong core values, have stellar reputations for ‘doing the right thing’ for and with our customers and associates, and our core competencies match well,” Casey said in a statement.She will join Cornerstone’s executive team as president of the Arlington Resources Division of Cornerstone. […]

  • Engineering majors have highest projected starting salary at $66,521

    Engineering majors from the class of 2018 have a projected average starting salary of $66,521, the highest of all majors, according to a report by the National Association of Colleges and Employers. Computer science graduates are projected to receive the second-highest starting salary at $66,005.Both fields are up less than 1% from last year.Data for the report came from NACE’s Winter 2018 Salary Survey, which included 196 survey responses collected between Aug. 9 and Dec. 4 in the US. Broad category 2018 projected average salary 2017 projected average salary Engineering $66,521 $66,097 Computer science $66,005 $65,540 Math & sciences $61,867 $59,368 Business $56,720 $54,803 Social sciences $56,689 $53,459 Humanities $56,688 $48,733 Agriculture & natural resources $53,565 $54,364 Communications $51,448 $51,925 […]

Latest Research

  • Legal Calendar 2018: Americas

    Key Findings   Major changes to Canada’s Labour Code, as well as new employee rights to leave in Ontario and Alberta, are expected in 2018. The US Department of Homeland Security’s regulatory agenda for 2018 indicates the administration will pursue plans to terminate work authorization for spouses of H-1B holders, overhaul the H-1B annual allotment process, and revise H-1B eligibility and wage protections. Labor reform is anticipated in Argentina; the law on outsourcing is to be further clarified by the Supreme Court in Brazil. In addition, we highlight developments in legislation on healthcare, paid leave and background checks at federal and state level. To download a pdf copy of this report, click below: Legal Calendar_2018__Americas_20180115 - You do not have permission to view this object. […]

  • SI Report Webinar - January 2018

    In this webinar topics covered include: CWS council insight presented by guest speaker, Bryan Peña, SVP Contingent Workforce Strategies Insight into buyer survey results Gross margin report Industrial staffing growth assessment Blockchain and how it relates to staffing And of course the latest updates on the state of the economy, employment trends and developments in the US staffing industry.Download the presentation slides.Select the play button to begin viewing. […]

  • January US Jobs Report 2018

    Event- On a seasonally adjusted basis, total nonfarm employment rose by 148,000 in December, according to the US Bureau of Labor Statistics (BLS) in its monthly jobs report. Temporary help services employment increased by 0.20% in December, adding 7,000 jobs. The temporary agency penetration rate remained at 2.10%, and the national unemployment rate remained at 4.1%.Background and Analysis- On a year-over-year (y/y) basis (December 2017 over December 2016), total nonfarm employment was up 1.4%, and monthly job gains have averaged approximately 171,000 over the past 12 months. Temporary help employment was up 4.6% y/y, with monthly job gains averaging approximately 11,300 over the past 12 months.The economic sectors that most drove total nonfarm employment growth in December (on a seasonally adjusted basis) include construction (+30,000), healthcare and social assistance (+29,200) and leisure and hospitality (+29,000). Overall, there were 12 sectors that added jobs in December; natural resources/mining was unchanged, and education (-300) and retail trade (-20,300) declined.BLS Revisions- The change in total nonfarm payroll employment for October was revised from +244,000 to +211,000, and the change for November was revised from +228,000 to +252,000. With these revisions, total nonfarm employment gains during the two-month period were 9,000 less than previously reported.The change in temporary help services employment for October was revised from +17,900 to +14,300, and the change for November was revised from +18,300 to +16,900. With these revisions, temporary help employment growth was 5,000 lower than previously reported.Staffing Industry Analysts’ Perspective- The BLS employment report for December was generally tepid, capping an otherwise strong year. Temporary help employment grew every month in 2017, as did total nonfarm employment (continuing a streak of 87 consecutive months for the latter). The decline in the unemployment rate accelerated from 2016 to 2017, and the temporary agency penetration rate broke the 2.1% barrier last year as well.Only two of the fifteen major industry sectors declined in 2017, retail trade (as e-commerce takes share from “big box” retailers) and information, driven by a decline in jobs in print media as well as telecommunications (as telecommunications infrastructure becomes more reliable, fewer workers are needed to make repairs). While the largest three industries in terms of employment gains last year were professional services (excluding temporary help), health and social assistance and leisure and hospitality, employment growth in 2017 was also driven by a turnaround in mining and accelerated gains in manufacturing.As we turn our attention to 2018, this month’s employment numbers beg the question as to whether the weakness in the report is due to choppiness from month-to-month, or the beginning of a reversion to slower growth in the economy. The generally favorable signs from other economic indicators suggest weakness is likely driven more by the former.Members may download our jobs report tool by clicking the link below. Monthly Employment Situation January 2018 - You do not have permission to view this object. […]

  • North America Legal Update Q4 2017

    In this report, we round up the legal developments affecting the workforce solutions ecosystem in North America in Q4 2017:Canada1.    Ontario Bill 148 Introduces Contingent Worker Requirements2.    Changes to Employment Insurance BenefitsUnited States1.    IRS Outlines Employer Shared Responsibility Payment Process2.    Developments in the Joint Employer Standard3.    Common Law Duty to Keep Employees’ Personal Data Safe4.    States and Cities Ban Salary History Inquiries5.    President’s Travel Ban Lifted6.    New York Paid Family leave7.    Employment Provisions in the Tax Bill 8.    FLSA Overtime Rule Increase Declared Invalid9.    Staffing Agency Employer Could Not Rely on DOL Opinion Letter10.  FLSA Wage and Hour Case RoundupLegal Disclaimer: This update is provided solely for the purposes of information, and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action.To download a pdf copy of this update click below: NA_Q4_2017_LegalUpdate_20171229 - You do not have permission to view this object. Canada Ontario Bill 148 Introduces Contingent Worker RequirementsIn our Q3 Legal Update we reported on the passage of Bill 148, the Fair Workplaces, Better Jobs Act, 2017 which received Royal Assent on November 27, 2017. As a result of Bill 148, wide-ranging and significant changes are set to take effect in Ontario workplaces. Among those changes are several provisions relating to contingent workers: Effective immediately, there is a new offence of misclassification of an employee as an independent contractor. The employer will bear the burden of proof in showing that an individual who is the subject of an employment standards investigation or inspection is not an employee. Effective January 1, 2018, temporary work agencies must provide an agency employee with 1 week’s written notice or pay in lieu if an assignment that was estimated to last for 3 months or more is terminated before the end of its estimated term, unless another assignment lasting at least 1 week is offered to the employee. Effective April 1, 2018, casual, part-time, temporary and seasonal employees will be required to be paid the same as full-time employees when performing substantially the same job (but not necessarily identical) for the same employer. Notably, the equal pay for equal work provisions will apply to the agency employees who perform substantially the same work as an employee of the temporary work agency’s client. Agency employees will also be able to request a review of their wages, with protection from reprisal, to which agencies will be required to respond with either an adjustment in pay or a written explanation. The equal pay for equal work rules will be subject to several exceptions including where the wage difference is based on a seniority system, merit system, system that determines pay by quantity or quality of production or “any other factor other than sex or employment status.” Effective January 1, 2019: (1) Subject to some exceptions, new scheduling provisions will entitle employees to (i) a guarantee of 3 hours’ pay if a shift is cancelled with less than 48 hours’ notice, (ii) a minimum of 3 hours’ pay if an employee is required to attend at work, but works less than 3 hours, and (iii) a right to refuse requests or demands to work or be on call on a day that an employee is not scheduled to work, with less than 96 hours’ notice. (2) Employers will be required to provide a minimum of 3 hours’ pay if an employee is on call but is not required to work or if the employee does work but does so for less than 3 hours despite being available for longer (with a limited exception for employees delivering essential public services). Employers will be required to keep records of (i) the dates and times an employee was scheduled to work or be on call and any changes to the on-call schedule, and (ii) the date and time of any cancellations of a scheduled day of work or scheduled on call work. Aside from these specific provisions there are many other changes affecting workplace practices, so employers should ensure that their policies and procedures are updated. Temporary work agencies have three months to establish procedures for dealing with requests for a review of an agency worker’s wages before the equal pay rules come into force. In preparation for the new rules, temporary work agencies should ask their clients if there are any employees performing substantially similar work to placed temporary workers and, if so, whether there might need to be any adjustment in pay for such workers. Changes to Employment Insurance BenefitsEffective December 3, 2017 the federal government introduced changes to the employment insurance program relating to parental, maternity and caregiving benefits. The employment insurance (EI) program provides temporary income support to partially replace lost employment income for individuals who are off work for various reasons.The federal government's changes include: Caregivers who provide care to a critically ill or injured adult family member will have access to a new benefit of up to 15 weeks. Immediate and extended family members of children who are critically ill will, for the first time, have access to a new benefit that was previously available only to parents. It will replace the Parents of Critically Ill Children benefit and continue to provide up to 35 weeks of benefits. Both medical doctors and nurse practitioners will now be able to sign medical certificates for the existing and new family caregiving benefits, making such benefits easier to access. Parents will be able to choose from two options: standard parental benefits - receiving up to 35 weeks of EI parental benefits over a period of up to 12 months, at the current benefit rate of 55 percent of average weekly earnings, to a maximum of $543 per week; or extended parental benefits - receiving up to 61 weeks of EI parental benefits over an extended period of up to 18 months, at a lower benefit rate of 33 percent of average weekly earnings, to a maximum of $326 per week. Eligible pregnant workers will be able to receive EI maternity benefits earlier, up to 12 weeks before their due date, for a total of 15 weeks – previously benefits were only payable 8 weeks before and until 17 weeks after the birth, for a maximum of 15 weeks. The Canada Labour Code has been amended to ensure employees in federally regulated sectors have job protection while they receive maternity, parental and caregiving benefits under the EI program. For employees under provincial or territorial jurisdiction, employment standards vary by province and territory.The changes to EI caregiving benefits will apply to new claims across Canada, while the amendments to maternity and parental benefits offered under the EI program apply only to parents who reside outside of Quebec. The Québec Parental Insurance Plan provides maternity, paternity, parental and adoption benefits to Quebec residents.Employers should review the terms of any collective bargaining agreements, employment contracts and benefit plans they hold or administer, to assess any implications the changes may have for their organization. United States IRS Outlines Employer Shared Responsibility Payment ProcessIn November 2017, the Internal Revenue Service (IRS) released a copy of Letter 226J which the IRS will use to notify an applicable large employer (ALE) that it owes a penalty under Section 4980H, known as a “pay or play” penalty. The IRS plans to issue Letter 226J to an ALE if it determines that, for at least one month in the year, one or more of the ALE's full-time employees was enrolled in a qualified health plan for which a premium tax credit was allowed and the ALE did not qualify for an affordability safe harbor or other relief for the employee.Letter 226J will explain the actions the ALE should take if it agrees or disagrees with the proposed penalty, and provide a description of the actions the IRS will take if the ALE does not respond within 30 days of the response date, which will generally be 30 days from the date of the letter 226J.If the ALE responds to Letter 226J, the IRS will acknowledge the ALE's response with one of five different versions of Letter 227 that, in general, acknowledge the ALE's response to Letter 226J and describe further actions the ALE may need to take. If, after receipt of Letter 227, the ALE disagrees with the proposed or revised employer shared responsibility payment, the ALE may request a pre-assessment conference with the IRS Office of Appeals. The IRS has indicated that they plan to issue Letter 226J to ALEs “in late 2017”. Since attempts to overturn the Affordable Care Act (ACA) failed earlier in the year, the IRS has a statutory responsibility to enforce the employer shared responsibility requirements in the ACA. Employers who receive a Letter 226J and are unsure how to respond should take advice. Developments in the Joint Employer StandardOn December 14, 2017, the National Labor Relations Board (NLRB) overturned its own ruling on the joint employer standard in relation to complaints about unfair labor practices under the National Labor Relations Act (NLRA). The ruling in question was their 2015 decision in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 when the NLRB declared that the right to exercise control over a staffing agency’s workers, even if not actually exercised, was enough to create a joint employment relationship. Previously, joint employment under the NLRA required an employer to exercise direct and significant control over matters such as hiring, firing, discipline, supervision and direction of the employees in question. Browning-Ferris had appealed the 2015 decision of the NLRB to the D.C. Court of Appeals, which started hearing oral argument in the appeal on March 9, 2017.In a 3-2 decision, the NLRB has stated that in all future and pending cases, two or more entities will be deemed joint employers under the NLRA if there is proof that one entity has exercised control over essential employment terms of another entity’s employees (rather than merely having reserved the right to exercise control) and has done so directly and immediately (rather than indirectly) in a manner that is not limited and routine.  Accordingly, under the pre–Browning Ferris standard, proof of indirect control, contractually-reserved control that has never been exercised, or control that is limited and routine will not be sufficient to establish a joint-employer relationship. The Board majority concluded that the reinstated standard adheres to the common law and is supported by the NLRA’s policy of promoting stability and predictability in bargaining relationships. Chairman Philip A. Miscimarra, who dissented in the 2015 decision, was joined by recently-appointed Members Marvin E. Kaplan and William J. Emanuel in the majority opinion.  Members Mark Gaston Pearce and Lauren McFerran dissented in the case.The Republican majority NLRB set out five major reasons why the 2015 decision was flawed, which can be summarised as follows: The Board had exceeded their statutory authority; Their rationale was based on the notion that the standard no longer applied to modern forms of subcontracting, outsourcing and the use of temporary labor, which was flawed; The standard of joint employment is codified in the NLRA and can only be amended by Congress; They replaced a long-standing test that provided certainty and predictability, with a vague and ill-defined standard; and They were attempting to correct a perceived inequality in the competing interests of labor and management, far beyond what Congress intended. It is unclear where this leaves the appeal in the 2015 case, which is yet to be concluded. It also comes after an attempt to clarify the definition of joint employer under the NLRA and the Fair Labor Standards Act, in the form of a bill entitled the Save Local Business Act, which passed a vote in the House of Representatives in November, but is yet to be considered by the Senate. The bill is supported by various business groups who viewed the Browning-Ferris rule as a threat to jobs, entrepreneurship, and local employers who want legislation to “settle once and for all what constitutes a joint employer”. We will continue to monitor developments on this issue. Common Law Duty to Keep Employees’ Personal Data SafeIn a putative class action in the case of Sackin v. TransPerfect Global, Inc., No. 17 Civ. 1469, the federal court in the Southern District of New York held that employers have a common law duty to take reasonable precautions to protect the information that they require from employees. The court reasoned that the employer is in the best position to avoid the harm to employees, and that potential liability to employers provides an economic incentive to act reasonably in protecting employee data from the threat of cyberattack.The class action was filed on behalf of TransPerfect’s employees after personal data, including names, addresses, dates of birth, Social Security numbers, direct deposit bank account numbers and bank routing numbers, was obtained by cyber-criminals. On or about January 17, 2017, at least one TransPerfect employee received a "phishing" email. The email appeared to come from TransPerfect's CEO, but was sent by unidentified hackers. The email asked for the W-2 forms and payroll information of all current and former TransPerfect employees. Because TransPerfect's cyber-security was not up to industry par, at least one TransPerfect employee sent the information to the hackers in an unencrypted format. The court found that TransPerfect did not train employees on data security; did not erect digital firewalls and did not maintain PII (personally identifiable information) retention and destruction protocols.The court held that the plaintiffs had successfully stated claims for compensation in respect of a negligent breach of a statutory duty and breach of an implied term of the employment contract, in addition to breach of their common law duty. The statutory duty arises under New York Labor Law which makes it illegal for an employer to "communicate an employee's personal identifying information to the general public." N.Y. LAB. LAW § 203-d(1)(d). In support of a claim for breach of an implied term, the court stated: “TransPerfect required and obtained the PII as part of the employment relationship, evincing an implicit promise by TransPerfect to act reasonably to keep its employees' PII safe. TransPerfect's privacy policies and security practices manual — which states that the company "maintains robust procedures designed to carefully protect the PII with which it [is] entrusted" — further supports a finding of an implicit promise.”Courts in other cases have reached a different conclusion on an employer’s common law duty to protect employees’ data and on the existence of an implied duty of care in the employment contract. This area of law is evolving as the threats to cybersecurity are mounting. However, it is reasonable to say that as a matter of best practice every employer should take reasonable steps to protect the personal data that they hold by erecting firewalls and training employees on data security. States and Cities Ban Salary History InquiriesSince Massachusetts passed a law in 2016 preventing employers from asking job applicants about their salary history in the interview process, seven other states and cities have passed similar legislation including California, Delaware, Oregon, New York City, Philadelphia, and San Francisco. The motivation behind these laws is to close the gender pay gap between men and women.Although the laws vary, each prohibits an employer from inquiring about an applicant’s current or prior earnings or benefits. Such inquiries are generally prohibited regardless of whether the request is made by the employer or an agent acting on its behalf; or is made to the applicant or others possessing information about the applicant’s current or prior earnings or benefits.Mayer Brown provides a summary of the different laws and makes recommendations for employers on how to comply with these laws including: Removing questions seeking current or prior earnings or benefits from employment applications and new hire paperwork; Training individuals involved in the hiring process, such as hiring managers and recruiting personnel not to ask questions in taking up references or conducting public searches; Developing a set of questions that can be asked, such as “What are your expectations with respect to compensation?”; and Instructing outside search firms, recruitment agents and any outside agents who verify prior employment or perform background checks of applicants not to make inquiries or share information about applicants’ current or prior earnings. President’s Travel Ban LiftedOn December 4, 2017, the Supreme Court stayed the injunctions on President Trump’s revised “travel ban” issued in September 2017. As a result, the Proclamation restricting travel into the United States by nationals of Chad, Iran, Libya, North Korea, Somalia, Syria, Venezuela, and Yemen has gone into full effect until a decision is rendered on pending appeals.In general, the proclamation applies to nationals from the covered countries applying for a U.S. visa, effective immediately for nationals of countries subject to entry restrictions under Executive Order 13780 who lack a bona fide connection to a person or entity in the United States, and 21 days after issuance for all other individuals covered in the proclamation. The proclamation is expressly limited to individuals who do not have a valid visa on the effective date of the proclamation so visas held by nationals of these countries will not be revoked.Employees from the eight countries listed should not undertake unnecessary travel outside of the U.S. and should carry originals or clear copies of their legal authorization to be in the U.S. when travelling around the U.S. New York Paid Family leaveEffective January 1, 2018 the New York Paid Family Leave Program (NYPFL) will provide parents with up to eight weeks of compensation, benefits, and job-protected leave in any 52-week period. All New York employers that have employed one or more individuals for 30 consecutive days are covered by the NYPFL Law. Covered employers are required to maintain family leave insurance, funded by employee payroll deductions. At or around the time of a qualifying event, eligible employees submit claims to their covered employer’s family leave insurance carrier for payment. New York employees who are eligible for the leave are employees who work for a covered employer for 20 hours or more per week for 26 or more consecutive weeks of employment, and to those who have worked on a part-time basis (fewer than 20 hours per week) for 175 days in a consecutive 42-week period.PFL can be used for any of three reasons: To care for a close relative with a serious health condition. “Close relatives” are limited to spouses, domestic partners, children, parents, parents in-law, grandparents, and grandchildren. A “serious health condition” is an illness, injury, impairment, or physical or mental condition that involves either (a) inpatient care or (b) continuing treatment or continuing supervision by a health care provider; To bond with the employee’s newborn, newly adopted, or newly placed child within the first 12 months after child birth, adoption, or placement of an adopted or foster child; or For purposes identified under the federal Family and Medical Leave Act (“FMLA”) when their spouse, child, domestic partner or parent is on active duty or has been notified of an impending call or order to active duty. PFL benefits will increase on January 1 of each year, concluding with a final increase on January 1, 2021. Eligible employees will be entitled to weekly benefit payments up to the applicable maximum percentage of their average weekly wage, capped at the applicable maximum percentage of the State’s average weekly wage. The state’s average weekly wage is set annually by the New York State Department of Labor.The NYPFL Law requires covered employers to provide employees with written notice of their rights under the law, and to maintain Paid Family Leave insurance funded by employee payroll deductions.Employers should update their employee handbooks or the information they provide to their employees and communicate these new rights to their employees. They should also work with their insurance carrier to ensure they have appropriate coverage, and payroll providers to facilitate payroll deductions to fund family leave insurance premiums.Further details of the NYPFL Law are provided by Davis Wright Tremaine LLP. Employment Provisions in the Tax BillOn Wednesday, December 20, 2017 the Senate approved the final version of the first overhaul of the U.S. tax code in more than 30years. The Tax Cuts and Jobs Act (H.R. 1). The bill will now be signed into law by President Trump.The bill includes an employer tax credit for providing paid family and medical leave, elimination of a business expense deduction related to nondisclosure agreements, repeal of the Affordable Care Act’s (ACA) individual mandate, and changes to the tax treatment of certain employer-provided fringe benefits, among others. Further details are provided by Littler.  FLSA Overtime Rule Increase Declared InvalidIn August 2017, the proposed increase in the salary level from USD 23,660 (USD 455 per week) to USD 47,476 (USD 913 per week) was declared invalid by a federal court in Texas. However, the Dept. of Labor has appealed the August injunction, to test the validity of a salary increase in principle and the DOL’s authority to make that increase. The DOL has indicated it may increase the salary level, as it is still set at the 2004 level, and have consulted publicly on the issue of overtime generally ahead of further rulemaking.Based on comments made by Labor Secretary Alexander Acosta, many expect a proposed increase in the minimum salary threshold for the executive, administrative, and professional exemptions to the low USD 30,000 range. But for the moment the level remains at USD 23,660. Staffing Agency Employer Could Not Rely on DOL Opinion LetterIn a case before the Sixth Circuit Court of Appeals,  Perry v. Randstad General Partner, No. 16-1010 (6th Cir. Nov. 20, 2017), Randstad sought to argue that “staffing consultants” and other staff met the criteria to be exempt from overtime pay under the Fair Labor Standards Act (FLSA) as administrative employees, in reliance on an Opinion Letter issued by the Department of Labor (DOL) in 2005.Each of the employee plaintiffs held multiple positions over the course of their employment with Randstad, but their responsibilities generally included marketing and selling Randstad’s services; recruiting and evaluating workers and placing them with clients; overseeing those placements; and various administrative and clerical tasks. The plaintiffs regularly worked significantly more than 40 hours per week, and Randstad managers were aware they did so.When the complaint came before the district court, the court found, based on their testimony, that three of the four plaintiffs exercised discretion and independent judgment, and therefore were covered by the administrative exemption to the FLSA. The court also found that Randstad was insulated from any liability because it relied, reasonably and in good faith, on an Opinion Letter issued by the Department of Labor’s (DOL) Wage and Hour Division (WHD). The plaintiff’s appealed to the Court of Appeals.To fall within the administrative exemption of the FLSA 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 include the exercise of discretion and independent judgment with respect to matters of significance.In 2005, the WHD was asked whether “Staffing Managers” at a particular “temporary staffing agency” qualified for the administrative exemption. Its Opinion Letter (Opinion Letter, 2005 WL 3308616, Oct. 25, 2005) concluded that the Staffing Managers exercised the requisite discretion and independent judgment to qualify for the administrative exemption because it was their job to: “recruit; interview; hire and recommend placement of employees to particular assignments; manage the client’s temporary labor pool; provide advice on personnel issues; handle complaints; resolve grievances; and terminate employees on behalf of the client’s management.” The Portal-to-Portal Act of 1947 “protect[s] employers from liability if they took certain actions on the basis of an interpretation of the law by a government agency, even if the agency’s interpretation later turned out to be wrong.”It was accepted that Randstad had relied on the 2005 Opinion Letter but the issue was whether Randstad acted “in conformity with” the 2005 WHD Letter and in “good faith.” The court found that Randstad’s reliance was not “in conformity with” the 2005 WHD Letter because certain “specified circumstances and facts” cited in the 2005 Opinion Letter were absent because the plaintiffs “did not have the ultimate authority to decide to fire an employee” and worked under supervision. Additionally, Randstad had not shown its reliance was in “good faith” as a matter of law because Randstad arguably had “knowledge of circumstances which ought to” have caused it to inquire further. In particular, Randstad knew that sales activities were typically not covered by the administrative exemption and that the employees’ job duties could vary significantly depending on the client, the market and the regional or branch manager in the area they worked.In a majority decision, the court reversed the district court’s decision in favor of the plaintiffs’ arguments that they were not exempt. The dissenting judges agreed in part but could not agree on whether matchmaking and/or sales duties would fall within the FLSA’s administrative exemption.The court pointed out that exemptions to the Fair Labor Standards Act “are to be narrowly construed against the employers seeking to assert them,” (Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392 (1960)). For staffing agency employers it is difficult to extract any clear guidelines from this case as to how staffing consultants and other employees should be classified, except that assessments should be conducted on a regular basis and at a local level to ensure that the criteria for exemption are generally being satisfied. FLSA Wage and Hour Case Roundup Commissions and Retail or Service ExemptionThe FLSA exempts retail or service employees from the overtime pay requirement but only if (1) “the regular rate of pay of such employee is in excess of one and one-half times the minimum hourly rate applicable” under the FLSA, and (2) “more than half his compensation . . . represents commissions on goods or services.” This exemption does not relieve employers from meeting minimum wage obligations.In the Stein v. hhgregg, Inc. and Gregg Appliances Inc., case (No. 16-3364), the employer argued that the exemption applied. The Sixth Circuit disagreed, pointing to the allegation that the commission policy paid exactly the minimum hourly rate in a normal, non-overtime week, thereby failing to meet the exemption requirement that it be “in excess of one and one-half times the minimum hourly rate.” Because the exemption didn’t apply, hhgregg could not escape overtime pay obligations.The key point here is that for the exemption to apply to those paid on commission, the employee’s regular rate of pay must be “in excess” of one and a half times the applicable minimum hourly rate. FLSA and Rest BreaksFLSA governs “hours worked,” which “is not limited to the time an employee actually performs his or her job duties.” The Third Circuit’s Judge McKee in Secretary United States Department of Labor v. American Future Systems, Inc., d/b/a Progressive Business Publications, No. 16-2685, reasoned that even though the FLSA does not require employers to provide employees with breaks, if an employer does provide a break, the employer must compensate the employee for breaks of up to twenty minutes and view the time as hours worked. The court said that case law and the Department of Labor’s website make it clear that employees must be paid for breaks of twenty minutes or less.Progressive argued that because employees could use the time logged off for their own benefit, the “flex time” should be considered off-duty time and not a rest period. The Court rejected this argument, explaining “that breaks of twenty minutes or less are insufficient to allow for anything other than the kind of activity ... that, by definition, primarily benefits the employer,” id. at 16, and therefore the “flex time” did not constitute off-duty time.Progressive also contended courts should analyze breaks on a case-by-case basis to determine whether a break benefits the employer or benefits the employee. The Third Circuit rejected this argument as well, reasoning that such a scheme would be overly “burdensome and unworkable” to employers as it would require an employer to analyze each and every break an employee took to determine whether the break benefited the employer or benefited the employee. The take-away from this case is that if an employer provides rest breaks, any rest break of twenty minutes or less should be paid. Compensation for Pre-Shift waiting TimeThe FLSA requires an employer to pay its employees minimum wage and overtime compensation for each hour worked over 40 hours in each workweek. The Portal-to-Portal Act was passed to clarify which activities are to be considered compensable under the FLSA and thus, to be included within the 40 hours each workweek.Under the Portal-to-Portal Act, an employer does not have to compensate an employee for the following activities: “(1) walking, riding, or traveling to and from the actual place of performance of the principal activity or activities which such employee is employed to perform, and (2) activities which are preliminary to or post-liminary to said principal activity or activities, which occur either prior to the time on any particular workday at which such employee commences, or subsequent to the time on any particular workday at which he ceases, such principal activity or activities.” 29 U.S.C. § 254(a). In Darwin Keith Bridges, et al., v. Empire Scaffold, L.L.C., No. 16-41493 the Fifth Circuit held that the test for Portal-to-Portal compensability was whether the wait time was integral and indispensable to the principal activities they were employed to perform.  The fact that an employer required an activity and that it may benefit the employer was not enough to make it compensable. Instead, the workers had to show that the preliminary wait time was integral and indispensable to their work, in this case erecting and dismantling scaffolding. The proof did not show that it was, and therefore they were not entitled to compensation for it.For wait time to be compensable it is not enough for it to be a requirement of the employer; it must also be integral and indispensable to the employee’s work for the employer. […]

  • Legal Calendar 2018: Americas

    Key Findings   Major changes to Canada’s Labour Code, as well as new employee rights to leave in Ontario and Alberta, are expected in 2018. The US Department of Homeland Security’s regulatory agenda for 2018 indicates the administration will pursue plans to terminate work authorization for spouses of H-1B holders, overhaul the H-1B annual allotment process, and revise H-1B eligibility and wage protections. Labor reform is anticipated in Argentina; the law on outsourcing is to be further clarified by the Supreme Court in Brazil. In addition, we highlight developments in legislation on healthcare, paid leave and background checks at federal and state level. To download a pdf copy of this report, click below: Legal Calendar_2018__Americas_20180115 - You do not have permission to view this object. […]

  • SI Report Webinar - January 2018

    In this webinar topics covered include: CWS council insight presented by guest speaker, Bryan Peña, SVP Contingent Workforce Strategies Insight into buyer survey results Gross margin report Industrial staffing growth assessment Blockchain and how it relates to staffing And of course the latest updates on the state of the economy, employment trends and developments in the US staffing industry.Download the presentation slides.Select the play button to begin viewing. […]

  • January US Jobs Report 2018

    Event- On a seasonally adjusted basis, total nonfarm employment rose by 148,000 in December, according to the US Bureau of Labor Statistics (BLS) in its monthly jobs report. Temporary help services employment increased by 0.20% in December, adding 7,000 jobs. The temporary agency penetration rate remained at 2.10%, and the national unemployment rate remained at 4.1%.Background and Analysis- On a year-over-year (y/y) basis (December 2017 over December 2016), total nonfarm employment was up 1.4%, and monthly job gains have averaged approximately 171,000 over the past 12 months. Temporary help employment was up 4.6% y/y, with monthly job gains averaging approximately 11,300 over the past 12 months.The economic sectors that most drove total nonfarm employment growth in December (on a seasonally adjusted basis) include construction (+30,000), healthcare and social assistance (+29,200) and leisure and hospitality (+29,000). Overall, there were 12 sectors that added jobs in December; natural resources/mining was unchanged, and education (-300) and retail trade (-20,300) declined.BLS Revisions- The change in total nonfarm payroll employment for October was revised from +244,000 to +211,000, and the change for November was revised from +228,000 to +252,000. With these revisions, total nonfarm employment gains during the two-month period were 9,000 less than previously reported.The change in temporary help services employment for October was revised from +17,900 to +14,300, and the change for November was revised from +18,300 to +16,900. With these revisions, temporary help employment growth was 5,000 lower than previously reported.Staffing Industry Analysts’ Perspective- The BLS employment report for December was generally tepid, capping an otherwise strong year. Temporary help employment grew every month in 2017, as did total nonfarm employment (continuing a streak of 87 consecutive months for the latter). The decline in the unemployment rate accelerated from 2016 to 2017, and the temporary agency penetration rate broke the 2.1% barrier last year as well.Only two of the fifteen major industry sectors declined in 2017, retail trade (as e-commerce takes share from “big box” retailers) and information, driven by a decline in jobs in print media as well as telecommunications (as telecommunications infrastructure becomes more reliable, fewer workers are needed to make repairs). While the largest three industries in terms of employment gains last year were professional services (excluding temporary help), health and social assistance and leisure and hospitality, employment growth in 2017 was also driven by a turnaround in mining and accelerated gains in manufacturing.As we turn our attention to 2018, this month’s employment numbers beg the question as to whether the weakness in the report is due to choppiness from month-to-month, or the beginning of a reversion to slower growth in the economy. The generally favorable signs from other economic indicators suggest weakness is likely driven more by the former.Members may download our jobs report tool by clicking the link below. Monthly Employment Situation January 2018 - You do not have permission to view this object. […]

  • North America Legal Update Q4 2017

    In this report, we round up the legal developments affecting the workforce solutions ecosystem in North America in Q4 2017:Canada1.    Ontario Bill 148 Introduces Contingent Worker Requirements2.    Changes to Employment Insurance BenefitsUnited States1.    IRS Outlines Employer Shared Responsibility Payment Process2.    Developments in the Joint Employer Standard3.    Common Law Duty to Keep Employees’ Personal Data Safe4.    States and Cities Ban Salary History Inquiries5.    President’s Travel Ban Lifted6.    New York Paid Family leave7.    Employment Provisions in the Tax Bill 8.    FLSA Overtime Rule Increase Declared Invalid9.    Staffing Agency Employer Could Not Rely on DOL Opinion Letter10.  FLSA Wage and Hour Case RoundupLegal Disclaimer: This update is provided solely for the purposes of information, and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action.To download a pdf copy of this update click below: NA_Q4_2017_LegalUpdate_20171229 - You do not have permission to view this object. Canada Ontario Bill 148 Introduces Contingent Worker RequirementsIn our Q3 Legal Update we reported on the passage of Bill 148, the Fair Workplaces, Better Jobs Act, 2017 which received Royal Assent on November 27, 2017. As a result of Bill 148, wide-ranging and significant changes are set to take effect in Ontario workplaces. Among those changes are several provisions relating to contingent workers: Effective immediately, there is a new offence of misclassification of an employee as an independent contractor. The employer will bear the burden of proof in showing that an individual who is the subject of an employment standards investigation or inspection is not an employee. Effective January 1, 2018, temporary work agencies must provide an agency employee with 1 week’s written notice or pay in lieu if an assignment that was estimated to last for 3 months or more is terminated before the end of its estimated term, unless another assignment lasting at least 1 week is offered to the employee. Effective April 1, 2018, casual, part-time, temporary and seasonal employees will be required to be paid the same as full-time employees when performing substantially the same job (but not necessarily identical) for the same employer. Notably, the equal pay for equal work provisions will apply to the agency employees who perform substantially the same work as an employee of the temporary work agency’s client. Agency employees will also be able to request a review of their wages, with protection from reprisal, to which agencies will be required to respond with either an adjustment in pay or a written explanation. The equal pay for equal work rules will be subject to several exceptions including where the wage difference is based on a seniority system, merit system, system that determines pay by quantity or quality of production or “any other factor other than sex or employment status.” Effective January 1, 2019: (1) Subject to some exceptions, new scheduling provisions will entitle employees to (i) a guarantee of 3 hours’ pay if a shift is cancelled with less than 48 hours’ notice, (ii) a minimum of 3 hours’ pay if an employee is required to attend at work, but works less than 3 hours, and (iii) a right to refuse requests or demands to work or be on call on a day that an employee is not scheduled to work, with less than 96 hours’ notice. (2) Employers will be required to provide a minimum of 3 hours’ pay if an employee is on call but is not required to work or if the employee does work but does so for less than 3 hours despite being available for longer (with a limited exception for employees delivering essential public services). Employers will be required to keep records of (i) the dates and times an employee was scheduled to work or be on call and any changes to the on-call schedule, and (ii) the date and time of any cancellations of a scheduled day of work or scheduled on call work. Aside from these specific provisions there are many other changes affecting workplace practices, so employers should ensure that their policies and procedures are updated. Temporary work agencies have three months to establish procedures for dealing with requests for a review of an agency worker’s wages before the equal pay rules come into force. In preparation for the new rules, temporary work agencies should ask their clients if there are any employees performing substantially similar work to placed temporary workers and, if so, whether there might need to be any adjustment in pay for such workers. Changes to Employment Insurance BenefitsEffective December 3, 2017 the federal government introduced changes to the employment insurance program relating to parental, maternity and caregiving benefits. The employment insurance (EI) program provides temporary income support to partially replace lost employment income for individuals who are off work for various reasons.The federal government's changes include: Caregivers who provide care to a critically ill or injured adult family member will have access to a new benefit of up to 15 weeks. Immediate and extended family members of children who are critically ill will, for the first time, have access to a new benefit that was previously available only to parents. It will replace the Parents of Critically Ill Children benefit and continue to provide up to 35 weeks of benefits. Both medical doctors and nurse practitioners will now be able to sign medical certificates for the existing and new family caregiving benefits, making such benefits easier to access. Parents will be able to choose from two options: standard parental benefits - receiving up to 35 weeks of EI parental benefits over a period of up to 12 months, at the current benefit rate of 55 percent of average weekly earnings, to a maximum of $543 per week; or extended parental benefits - receiving up to 61 weeks of EI parental benefits over an extended period of up to 18 months, at a lower benefit rate of 33 percent of average weekly earnings, to a maximum of $326 per week. Eligible pregnant workers will be able to receive EI maternity benefits earlier, up to 12 weeks before their due date, for a total of 15 weeks – previously benefits were only payable 8 weeks before and until 17 weeks after the birth, for a maximum of 15 weeks. The Canada Labour Code has been amended to ensure employees in federally regulated sectors have job protection while they receive maternity, parental and caregiving benefits under the EI program. For employees under provincial or territorial jurisdiction, employment standards vary by province and territory.The changes to EI caregiving benefits will apply to new claims across Canada, while the amendments to maternity and parental benefits offered under the EI program apply only to parents who reside outside of Quebec. The Québec Parental Insurance Plan provides maternity, paternity, parental and adoption benefits to Quebec residents.Employers should review the terms of any collective bargaining agreements, employment contracts and benefit plans they hold or administer, to assess any implications the changes may have for their organization. United States IRS Outlines Employer Shared Responsibility Payment ProcessIn November 2017, the Internal Revenue Service (IRS) released a copy of Letter 226J which the IRS will use to notify an applicable large employer (ALE) that it owes a penalty under Section 4980H, known as a “pay or play” penalty. The IRS plans to issue Letter 226J to an ALE if it determines that, for at least one month in the year, one or more of the ALE's full-time employees was enrolled in a qualified health plan for which a premium tax credit was allowed and the ALE did not qualify for an affordability safe harbor or other relief for the employee.Letter 226J will explain the actions the ALE should take if it agrees or disagrees with the proposed penalty, and provide a description of the actions the IRS will take if the ALE does not respond within 30 days of the response date, which will generally be 30 days from the date of the letter 226J.If the ALE responds to Letter 226J, the IRS will acknowledge the ALE's response with one of five different versions of Letter 227 that, in general, acknowledge the ALE's response to Letter 226J and describe further actions the ALE may need to take. If, after receipt of Letter 227, the ALE disagrees with the proposed or revised employer shared responsibility payment, the ALE may request a pre-assessment conference with the IRS Office of Appeals. The IRS has indicated that they plan to issue Letter 226J to ALEs “in late 2017”. Since attempts to overturn the Affordable Care Act (ACA) failed earlier in the year, the IRS has a statutory responsibility to enforce the employer shared responsibility requirements in the ACA. Employers who receive a Letter 226J and are unsure how to respond should take advice. Developments in the Joint Employer StandardOn December 14, 2017, the National Labor Relations Board (NLRB) overturned its own ruling on the joint employer standard in relation to complaints about unfair labor practices under the National Labor Relations Act (NLRA). The ruling in question was their 2015 decision in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 when the NLRB declared that the right to exercise control over a staffing agency’s workers, even if not actually exercised, was enough to create a joint employment relationship. Previously, joint employment under the NLRA required an employer to exercise direct and significant control over matters such as hiring, firing, discipline, supervision and direction of the employees in question. Browning-Ferris had appealed the 2015 decision of the NLRB to the D.C. Court of Appeals, which started hearing oral argument in the appeal on March 9, 2017.In a 3-2 decision, the NLRB has stated that in all future and pending cases, two or more entities will be deemed joint employers under the NLRA if there is proof that one entity has exercised control over essential employment terms of another entity’s employees (rather than merely having reserved the right to exercise control) and has done so directly and immediately (rather than indirectly) in a manner that is not limited and routine.  Accordingly, under the pre–Browning Ferris standard, proof of indirect control, contractually-reserved control that has never been exercised, or control that is limited and routine will not be sufficient to establish a joint-employer relationship. The Board majority concluded that the reinstated standard adheres to the common law and is supported by the NLRA’s policy of promoting stability and predictability in bargaining relationships. Chairman Philip A. Miscimarra, who dissented in the 2015 decision, was joined by recently-appointed Members Marvin E. Kaplan and William J. Emanuel in the majority opinion.  Members Mark Gaston Pearce and Lauren McFerran dissented in the case.The Republican majority NLRB set out five major reasons why the 2015 decision was flawed, which can be summarised as follows: The Board had exceeded their statutory authority; Their rationale was based on the notion that the standard no longer applied to modern forms of subcontracting, outsourcing and the use of temporary labor, which was flawed; The standard of joint employment is codified in the NLRA and can only be amended by Congress; They replaced a long-standing test that provided certainty and predictability, with a vague and ill-defined standard; and They were attempting to correct a perceived inequality in the competing interests of labor and management, far beyond what Congress intended. It is unclear where this leaves the appeal in the 2015 case, which is yet to be concluded. It also comes after an attempt to clarify the definition of joint employer under the NLRA and the Fair Labor Standards Act, in the form of a bill entitled the Save Local Business Act, which passed a vote in the House of Representatives in November, but is yet to be considered by the Senate. The bill is supported by various business groups who viewed the Browning-Ferris rule as a threat to jobs, entrepreneurship, and local employers who want legislation to “settle once and for all what constitutes a joint employer”. We will continue to monitor developments on this issue. Common Law Duty to Keep Employees’ Personal Data SafeIn a putative class action in the case of Sackin v. TransPerfect Global, Inc., No. 17 Civ. 1469, the federal court in the Southern District of New York held that employers have a common law duty to take reasonable precautions to protect the information that they require from employees. The court reasoned that the employer is in the best position to avoid the harm to employees, and that potential liability to employers provides an economic incentive to act reasonably in protecting employee data from the threat of cyberattack.The class action was filed on behalf of TransPerfect’s employees after personal data, including names, addresses, dates of birth, Social Security numbers, direct deposit bank account numbers and bank routing numbers, was obtained by cyber-criminals. On or about January 17, 2017, at least one TransPerfect employee received a "phishing" email. The email appeared to come from TransPerfect's CEO, but was sent by unidentified hackers. The email asked for the W-2 forms and payroll information of all current and former TransPerfect employees. Because TransPerfect's cyber-security was not up to industry par, at least one TransPerfect employee sent the information to the hackers in an unencrypted format. The court found that TransPerfect did not train employees on data security; did not erect digital firewalls and did not maintain PII (personally identifiable information) retention and destruction protocols.The court held that the plaintiffs had successfully stated claims for compensation in respect of a negligent breach of a statutory duty and breach of an implied term of the employment contract, in addition to breach of their common law duty. The statutory duty arises under New York Labor Law which makes it illegal for an employer to "communicate an employee's personal identifying information to the general public." N.Y. LAB. LAW § 203-d(1)(d). In support of a claim for breach of an implied term, the court stated: “TransPerfect required and obtained the PII as part of the employment relationship, evincing an implicit promise by TransPerfect to act reasonably to keep its employees' PII safe. TransPerfect's privacy policies and security practices manual — which states that the company "maintains robust procedures designed to carefully protect the PII with which it [is] entrusted" — further supports a finding of an implicit promise.”Courts in other cases have reached a different conclusion on an employer’s common law duty to protect employees’ data and on the existence of an implied duty of care in the employment contract. This area of law is evolving as the threats to cybersecurity are mounting. However, it is reasonable to say that as a matter of best practice every employer should take reasonable steps to protect the personal data that they hold by erecting firewalls and training employees on data security. States and Cities Ban Salary History InquiriesSince Massachusetts passed a law in 2016 preventing employers from asking job applicants about their salary history in the interview process, seven other states and cities have passed similar legislation including California, Delaware, Oregon, New York City, Philadelphia, and San Francisco. The motivation behind these laws is to close the gender pay gap between men and women.Although the laws vary, each prohibits an employer from inquiring about an applicant’s current or prior earnings or benefits. Such inquiries are generally prohibited regardless of whether the request is made by the employer or an agent acting on its behalf; or is made to the applicant or others possessing information about the applicant’s current or prior earnings or benefits.Mayer Brown provides a summary of the different laws and makes recommendations for employers on how to comply with these laws including: Removing questions seeking current or prior earnings or benefits from employment applications and new hire paperwork; Training individuals involved in the hiring process, such as hiring managers and recruiting personnel not to ask questions in taking up references or conducting public searches; Developing a set of questions that can be asked, such as “What are your expectations with respect to compensation?”; and Instructing outside search firms, recruitment agents and any outside agents who verify prior employment or perform background checks of applicants not to make inquiries or share information about applicants’ current or prior earnings. President’s Travel Ban LiftedOn December 4, 2017, the Supreme Court stayed the injunctions on President Trump’s revised “travel ban” issued in September 2017. As a result, the Proclamation restricting travel into the United States by nationals of Chad, Iran, Libya, North Korea, Somalia, Syria, Venezuela, and Yemen has gone into full effect until a decision is rendered on pending appeals.In general, the proclamation applies to nationals from the covered countries applying for a U.S. visa, effective immediately for nationals of countries subject to entry restrictions under Executive Order 13780 who lack a bona fide connection to a person or entity in the United States, and 21 days after issuance for all other individuals covered in the proclamation. The proclamation is expressly limited to individuals who do not have a valid visa on the effective date of the proclamation so visas held by nationals of these countries will not be revoked.Employees from the eight countries listed should not undertake unnecessary travel outside of the U.S. and should carry originals or clear copies of their legal authorization to be in the U.S. when travelling around the U.S. New York Paid Family leaveEffective January 1, 2018 the New York Paid Family Leave Program (NYPFL) will provide parents with up to eight weeks of compensation, benefits, and job-protected leave in any 52-week period. All New York employers that have employed one or more individuals for 30 consecutive days are covered by the NYPFL Law. Covered employers are required to maintain family leave insurance, funded by employee payroll deductions. At or around the time of a qualifying event, eligible employees submit claims to their covered employer’s family leave insurance carrier for payment. New York employees who are eligible for the leave are employees who work for a covered employer for 20 hours or more per week for 26 or more consecutive weeks of employment, and to those who have worked on a part-time basis (fewer than 20 hours per week) for 175 days in a consecutive 42-week period.PFL can be used for any of three reasons: To care for a close relative with a serious health condition. “Close relatives” are limited to spouses, domestic partners, children, parents, parents in-law, grandparents, and grandchildren. A “serious health condition” is an illness, injury, impairment, or physical or mental condition that involves either (a) inpatient care or (b) continuing treatment or continuing supervision by a health care provider; To bond with the employee’s newborn, newly adopted, or newly placed child within the first 12 months after child birth, adoption, or placement of an adopted or foster child; or For purposes identified under the federal Family and Medical Leave Act (“FMLA”) when their spouse, child, domestic partner or parent is on active duty or has been notified of an impending call or order to active duty. PFL benefits will increase on January 1 of each year, concluding with a final increase on January 1, 2021. Eligible employees will be entitled to weekly benefit payments up to the applicable maximum percentage of their average weekly wage, capped at the applicable maximum percentage of the State’s average weekly wage. The state’s average weekly wage is set annually by the New York State Department of Labor.The NYPFL Law requires covered employers to provide employees with written notice of their rights under the law, and to maintain Paid Family Leave insurance funded by employee payroll deductions.Employers should update their employee handbooks or the information they provide to their employees and communicate these new rights to their employees. They should also work with their insurance carrier to ensure they have appropriate coverage, and payroll providers to facilitate payroll deductions to fund family leave insurance premiums.Further details of the NYPFL Law are provided by Davis Wright Tremaine LLP. Employment Provisions in the Tax BillOn Wednesday, December 20, 2017 the Senate approved the final version of the first overhaul of the U.S. tax code in more than 30years. The Tax Cuts and Jobs Act (H.R. 1). The bill will now be signed into law by President Trump.The bill includes an employer tax credit for providing paid family and medical leave, elimination of a business expense deduction related to nondisclosure agreements, repeal of the Affordable Care Act’s (ACA) individual mandate, and changes to the tax treatment of certain employer-provided fringe benefits, among others. Further details are provided by Littler.  FLSA Overtime Rule Increase Declared InvalidIn August 2017, the proposed increase in the salary level from USD 23,660 (USD 455 per week) to USD 47,476 (USD 913 per week) was declared invalid by a federal court in Texas. However, the Dept. of Labor has appealed the August injunction, to test the validity of a salary increase in principle and the DOL’s authority to make that increase. The DOL has indicated it may increase the salary level, as it is still set at the 2004 level, and have consulted publicly on the issue of overtime generally ahead of further rulemaking.Based on comments made by Labor Secretary Alexander Acosta, many expect a proposed increase in the minimum salary threshold for the executive, administrative, and professional exemptions to the low USD 30,000 range. But for the moment the level remains at USD 23,660. Staffing Agency Employer Could Not Rely on DOL Opinion LetterIn a case before the Sixth Circuit Court of Appeals,  Perry v. Randstad General Partner, No. 16-1010 (6th Cir. Nov. 20, 2017), Randstad sought to argue that “staffing consultants” and other staff met the criteria to be exempt from overtime pay under the Fair Labor Standards Act (FLSA) as administrative employees, in reliance on an Opinion Letter issued by the Department of Labor (DOL) in 2005.Each of the employee plaintiffs held multiple positions over the course of their employment with Randstad, but their responsibilities generally included marketing and selling Randstad’s services; recruiting and evaluating workers and placing them with clients; overseeing those placements; and various administrative and clerical tasks. The plaintiffs regularly worked significantly more than 40 hours per week, and Randstad managers were aware they did so.When the complaint came before the district court, the court found, based on their testimony, that three of the four plaintiffs exercised discretion and independent judgment, and therefore were covered by the administrative exemption to the FLSA. The court also found that Randstad was insulated from any liability because it relied, reasonably and in good faith, on an Opinion Letter issued by the Department of Labor’s (DOL) Wage and Hour Division (WHD). The plaintiff’s appealed to the Court of Appeals.To fall within the administrative exemption of the FLSA 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 include the exercise of discretion and independent judgment with respect to matters of significance.In 2005, the WHD was asked whether “Staffing Managers” at a particular “temporary staffing agency” qualified for the administrative exemption. Its Opinion Letter (Opinion Letter, 2005 WL 3308616, Oct. 25, 2005) concluded that the Staffing Managers exercised the requisite discretion and independent judgment to qualify for the administrative exemption because it was their job to: “recruit; interview; hire and recommend placement of employees to particular assignments; manage the client’s temporary labor pool; provide advice on personnel issues; handle complaints; resolve grievances; and terminate employees on behalf of the client’s management.” The Portal-to-Portal Act of 1947 “protect[s] employers from liability if they took certain actions on the basis of an interpretation of the law by a government agency, even if the agency’s interpretation later turned out to be wrong.”It was accepted that Randstad had relied on the 2005 Opinion Letter but the issue was whether Randstad acted “in conformity with” the 2005 WHD Letter and in “good faith.” The court found that Randstad’s reliance was not “in conformity with” the 2005 WHD Letter because certain “specified circumstances and facts” cited in the 2005 Opinion Letter were absent because the plaintiffs “did not have the ultimate authority to decide to fire an employee” and worked under supervision. Additionally, Randstad had not shown its reliance was in “good faith” as a matter of law because Randstad arguably had “knowledge of circumstances which ought to” have caused it to inquire further. In particular, Randstad knew that sales activities were typically not covered by the administrative exemption and that the employees’ job duties could vary significantly depending on the client, the market and the regional or branch manager in the area they worked.In a majority decision, the court reversed the district court’s decision in favor of the plaintiffs’ arguments that they were not exempt. The dissenting judges agreed in part but could not agree on whether matchmaking and/or sales duties would fall within the FLSA’s administrative exemption.The court pointed out that exemptions to the Fair Labor Standards Act “are to be narrowly construed against the employers seeking to assert them,” (Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392 (1960)). For staffing agency employers it is difficult to extract any clear guidelines from this case as to how staffing consultants and other employees should be classified, except that assessments should be conducted on a regular basis and at a local level to ensure that the criteria for exemption are generally being satisfied. FLSA Wage and Hour Case Roundup Commissions and Retail or Service ExemptionThe FLSA exempts retail or service employees from the overtime pay requirement but only if (1) “the regular rate of pay of such employee is in excess of one and one-half times the minimum hourly rate applicable” under the FLSA, and (2) “more than half his compensation . . . represents commissions on goods or services.” This exemption does not relieve employers from meeting minimum wage obligations.In the Stein v. hhgregg, Inc. and Gregg Appliances Inc., case (No. 16-3364), the employer argued that the exemption applied. The Sixth Circuit disagreed, pointing to the allegation that the commission policy paid exactly the minimum hourly rate in a normal, non-overtime week, thereby failing to meet the exemption requirement that it be “in excess of one and one-half times the minimum hourly rate.” Because the exemption didn’t apply, hhgregg could not escape overtime pay obligations.The key point here is that for the exemption to apply to those paid on commission, the employee’s regular rate of pay must be “in excess” of one and a half times the applicable minimum hourly rate. FLSA and Rest BreaksFLSA governs “hours worked,” which “is not limited to the time an employee actually performs his or her job duties.” The Third Circuit’s Judge McKee in Secretary United States Department of Labor v. American Future Systems, Inc., d/b/a Progressive Business Publications, No. 16-2685, reasoned that even though the FLSA does not require employers to provide employees with breaks, if an employer does provide a break, the employer must compensate the employee for breaks of up to twenty minutes and view the time as hours worked. The court said that case law and the Department of Labor’s website make it clear that employees must be paid for breaks of twenty minutes or less.Progressive argued that because employees could use the time logged off for their own benefit, the “flex time” should be considered off-duty time and not a rest period. The Court rejected this argument, explaining “that breaks of twenty minutes or less are insufficient to allow for anything other than the kind of activity ... that, by definition, primarily benefits the employer,” id. at 16, and therefore the “flex time” did not constitute off-duty time.Progressive also contended courts should analyze breaks on a case-by-case basis to determine whether a break benefits the employer or benefits the employee. The Third Circuit rejected this argument as well, reasoning that such a scheme would be overly “burdensome and unworkable” to employers as it would require an employer to analyze each and every break an employee took to determine whether the break benefited the employer or benefited the employee. The take-away from this case is that if an employer provides rest breaks, any rest break of twenty minutes or less should be paid. Compensation for Pre-Shift waiting TimeThe FLSA requires an employer to pay its employees minimum wage and overtime compensation for each hour worked over 40 hours in each workweek. The Portal-to-Portal Act was passed to clarify which activities are to be considered compensable under the FLSA and thus, to be included within the 40 hours each workweek.Under the Portal-to-Portal Act, an employer does not have to compensate an employee for the following activities: “(1) walking, riding, or traveling to and from the actual place of performance of the principal activity or activities which such employee is employed to perform, and (2) activities which are preliminary to or post-liminary to said principal activity or activities, which occur either prior to the time on any particular workday at which such employee commences, or subsequent to the time on any particular workday at which he ceases, such principal activity or activities.” 29 U.S.C. § 254(a). In Darwin Keith Bridges, et al., v. Empire Scaffold, L.L.C., No. 16-41493 the Fifth Circuit held that the test for Portal-to-Portal compensability was whether the wait time was integral and indispensable to the principal activities they were employed to perform.  The fact that an employer required an activity and that it may benefit the employer was not enough to make it compensable. Instead, the workers had to show that the preliminary wait time was integral and indispensable to their work, in this case erecting and dismantling scaffolding. The proof did not show that it was, and therefore they were not entitled to compensation for it.For wait time to be compensable it is not enough for it to be a requirement of the employer; it must also be integral and indispensable to the employee’s work for the employer. […]

  • Legal Calendar 2018: Americas

    Key Findings   Major changes to Canada’s Labour Code, as well as new employee rights to leave in Ontario and Alberta, are expected in 2018. The US Department of Homeland Security’s regulatory agenda for 2018 indicates the administration will pursue plans to terminate work authorization for spouses of H-1B holders, overhaul the H-1B annual allotment process, and revise H-1B eligibility and wage protections. Labor reform is anticipated in Argentina; the law on outsourcing is to be further clarified by the Supreme Court in Brazil. In addition, we highlight developments in legislation on healthcare, paid leave and background checks at federal and state level. To download a pdf copy of this report, click below: Legal Calendar_2018__Americas_20180115 - You do not have permission to view this object. […]

  • SI Report Webinar - January 2018

    In this webinar topics covered include: CWS council insight presented by guest speaker, Bryan Peña, SVP Contingent Workforce Strategies Insight into buyer survey results Gross margin report Industrial staffing growth assessment Blockchain and how it relates to staffing And of course the latest updates on the state of the economy, employment trends and developments in the US staffing industry.Download the presentation slides.Select the play button to begin viewing. […]

  • January US Jobs Report 2018

    Event- On a seasonally adjusted basis, total nonfarm employment rose by 148,000 in December, according to the US Bureau of Labor Statistics (BLS) in its monthly jobs report. Temporary help services employment increased by 0.20% in December, adding 7,000 jobs. The temporary agency penetration rate remained at 2.10%, and the national unemployment rate remained at 4.1%.Background and Analysis- On a year-over-year (y/y) basis (December 2017 over December 2016), total nonfarm employment was up 1.4%, and monthly job gains have averaged approximately 171,000 over the past 12 months. Temporary help employment was up 4.6% y/y, with monthly job gains averaging approximately 11,300 over the past 12 months.The economic sectors that most drove total nonfarm employment growth in December (on a seasonally adjusted basis) include construction (+30,000), healthcare and social assistance (+29,200) and leisure and hospitality (+29,000). Overall, there were 12 sectors that added jobs in December; natural resources/mining was unchanged, and education (-300) and retail trade (-20,300) declined.BLS Revisions- The change in total nonfarm payroll employment for October was revised from +244,000 to +211,000, and the change for November was revised from +228,000 to +252,000. With these revisions, total nonfarm employment gains during the two-month period were 9,000 less than previously reported.The change in temporary help services employment for October was revised from +17,900 to +14,300, and the change for November was revised from +18,300 to +16,900. With these revisions, temporary help employment growth was 5,000 lower than previously reported.Staffing Industry Analysts’ Perspective- The BLS employment report for December was generally tepid, capping an otherwise strong year. Temporary help employment grew every month in 2017, as did total nonfarm employment (continuing a streak of 87 consecutive months for the latter). The decline in the unemployment rate accelerated from 2016 to 2017, and the temporary agency penetration rate broke the 2.1% barrier last year as well.Only two of the fifteen major industry sectors declined in 2017, retail trade (as e-commerce takes share from “big box” retailers) and information, driven by a decline in jobs in print media as well as telecommunications (as telecommunications infrastructure becomes more reliable, fewer workers are needed to make repairs). While the largest three industries in terms of employment gains last year were professional services (excluding temporary help), health and social assistance and leisure and hospitality, employment growth in 2017 was also driven by a turnaround in mining and accelerated gains in manufacturing.As we turn our attention to 2018, this month’s employment numbers beg the question as to whether the weakness in the report is due to choppiness from month-to-month, or the beginning of a reversion to slower growth in the economy. The generally favorable signs from other economic indicators suggest weakness is likely driven more by the former.Members may download our jobs report tool by clicking the link below. Monthly Employment Situation January 2018 - You do not have permission to view this object. […]

  • North America Legal Update Q4 2017

    In this report, we round up the legal developments affecting the workforce solutions ecosystem in North America in Q4 2017:Canada1.    Ontario Bill 148 Introduces Contingent Worker Requirements2.    Changes to Employment Insurance BenefitsUnited States1.    IRS Outlines Employer Shared Responsibility Payment Process2.    Developments in the Joint Employer Standard3.    Common Law Duty to Keep Employees’ Personal Data Safe4.    States and Cities Ban Salary History Inquiries5.    President’s Travel Ban Lifted6.    New York Paid Family leave7.    Employment Provisions in the Tax Bill 8.    FLSA Overtime Rule Increase Declared Invalid9.    Staffing Agency Employer Could Not Rely on DOL Opinion Letter10.  FLSA Wage and Hour Case RoundupLegal Disclaimer: This update is provided solely for the purposes of information, and should not be considered legal advice. It is always recommended to seek the advice of qualified legal counsel before taking action.To download a pdf copy of this update click below: NA_Q4_2017_LegalUpdate_20171229 - You do not have permission to view this object. Canada Ontario Bill 148 Introduces Contingent Worker RequirementsIn our Q3 Legal Update we reported on the passage of Bill 148, the Fair Workplaces, Better Jobs Act, 2017 which received Royal Assent on November 27, 2017. As a result of Bill 148, wide-ranging and significant changes are set to take effect in Ontario workplaces. Among those changes are several provisions relating to contingent workers: Effective immediately, there is a new offence of misclassification of an employee as an independent contractor. The employer will bear the burden of proof in showing that an individual who is the subject of an employment standards investigation or inspection is not an employee. Effective January 1, 2018, temporary work agencies must provide an agency employee with 1 week’s written notice or pay in lieu if an assignment that was estimated to last for 3 months or more is terminated before the end of its estimated term, unless another assignment lasting at least 1 week is offered to the employee. Effective April 1, 2018, casual, part-time, temporary and seasonal employees will be required to be paid the same as full-time employees when performing substantially the same job (but not necessarily identical) for the same employer. Notably, the equal pay for equal work provisions will apply to the agency employees who perform substantially the same work as an employee of the temporary work agency’s client. Agency employees will also be able to request a review of their wages, with protection from reprisal, to which agencies will be required to respond with either an adjustment in pay or a written explanation. The equal pay for equal work rules will be subject to several exceptions including where the wage difference is based on a seniority system, merit system, system that determines pay by quantity or quality of production or “any other factor other than sex or employment status.” Effective January 1, 2019: (1) Subject to some exceptions, new scheduling provisions will entitle employees to (i) a guarantee of 3 hours’ pay if a shift is cancelled with less than 48 hours’ notice, (ii) a minimum of 3 hours’ pay if an employee is required to attend at work, but works less than 3 hours, and (iii) a right to refuse requests or demands to work or be on call on a day that an employee is not scheduled to work, with less than 96 hours’ notice. (2) Employers will be required to provide a minimum of 3 hours’ pay if an employee is on call but is not required to work or if the employee does work but does so for less than 3 hours despite being available for longer (with a limited exception for employees delivering essential public services). Employers will be required to keep records of (i) the dates and times an employee was scheduled to work or be on call and any changes to the on-call schedule, and (ii) the date and time of any cancellations of a scheduled day of work or scheduled on call work. Aside from these specific provisions there are many other changes affecting workplace practices, so employers should ensure that their policies and procedures are updated. Temporary work agencies have three months to establish procedures for dealing with requests for a review of an agency worker’s wages before the equal pay rules come into force. In preparation for the new rules, temporary work agencies should ask their clients if there are any employees performing substantially similar work to placed temporary workers and, if so, whether there might need to be any adjustment in pay for such workers. Changes to Employment Insurance BenefitsEffective December 3, 2017 the federal government introduced changes to the employment insurance program relating to parental, maternity and caregiving benefits. The employment insurance (EI) program provides temporary income support to partially replace lost employment income for individuals who are off work for various reasons.The federal government's changes include: Caregivers who provide care to a critically ill or injured adult family member will have access to a new benefit of up to 15 weeks. Immediate and extended family members of children who are critically ill will, for the first time, have access to a new benefit that was previously available only to parents. It will replace the Parents of Critically Ill Children benefit and continue to provide up to 35 weeks of benefits. Both medical doctors and nurse practitioners will now be able to sign medical certificates for the existing and new family caregiving benefits, making such benefits easier to access. Parents will be able to choose from two options: standard parental benefits - receiving up to 35 weeks of EI parental benefits over a period of up to 12 months, at the current benefit rate of 55 percent of average weekly earnings, to a maximum of $543 per week; or extended parental benefits - receiving up to 61 weeks of EI parental benefits over an extended period of up to 18 months, at a lower benefit rate of 33 percent of average weekly earnings, to a maximum of $326 per week. Eligible pregnant workers will be able to receive EI maternity benefits earlier, up to 12 weeks before their due date, for a total of 15 weeks – previously benefits were only payable 8 weeks before and until 17 weeks after the birth, for a maximum of 15 weeks. The Canada Labour Code has been amended to ensure employees in federally regulated sectors have job protection while they receive maternity, parental and caregiving benefits under the EI program. For employees under provincial or territorial jurisdiction, employment standards vary by province and territory.The changes to EI caregiving benefits will apply to new claims across Canada, while the amendments to maternity and parental benefits offered under the EI program apply only to parents who reside outside of Quebec. The Québec Parental Insurance Plan provides maternity, paternity, parental and adoption benefits to Quebec residents.Employers should review the terms of any collective bargaining agreements, employment contracts and benefit plans they hold or administer, to assess any implications the changes may have for their organization. United States IRS Outlines Employer Shared Responsibility Payment ProcessIn November 2017, the Internal Revenue Service (IRS) released a copy of Letter 226J which the IRS will use to notify an applicable large employer (ALE) that it owes a penalty under Section 4980H, known as a “pay or play” penalty. The IRS plans to issue Letter 226J to an ALE if it determines that, for at least one month in the year, one or more of the ALE's full-time employees was enrolled in a qualified health plan for which a premium tax credit was allowed and the ALE did not qualify for an affordability safe harbor or other relief for the employee.Letter 226J will explain the actions the ALE should take if it agrees or disagrees with the proposed penalty, and provide a description of the actions the IRS will take if the ALE does not respond within 30 days of the response date, which will generally be 30 days from the date of the letter 226J.If the ALE responds to Letter 226J, the IRS will acknowledge the ALE's response with one of five different versions of Letter 227 that, in general, acknowledge the ALE's response to Letter 226J and describe further actions the ALE may need to take. If, after receipt of Letter 227, the ALE disagrees with the proposed or revised employer shared responsibility payment, the ALE may request a pre-assessment conference with the IRS Office of Appeals. The IRS has indicated that they plan to issue Letter 226J to ALEs “in late 2017”. Since attempts to overturn the Affordable Care Act (ACA) failed earlier in the year, the IRS has a statutory responsibility to enforce the employer shared responsibility requirements in the ACA. Employers who receive a Letter 226J and are unsure how to respond should take advice. Developments in the Joint Employer StandardOn December 14, 2017, the National Labor Relations Board (NLRB) overturned its own ruling on the joint employer standard in relation to complaints about unfair labor practices under the National Labor Relations Act (NLRA). The ruling in question was their 2015 decision in Browning-Ferris Industries of California, Inc., 362 NLRB No. 186 when the NLRB declared that the right to exercise control over a staffing agency’s workers, even if not actually exercised, was enough to create a joint employment relationship. Previously, joint employment under the NLRA required an employer to exercise direct and significant control over matters such as hiring, firing, discipline, supervision and direction of the employees in question. Browning-Ferris had appealed the 2015 decision of the NLRB to the D.C. Court of Appeals, which started hearing oral argument in the appeal on March 9, 2017.In a 3-2 decision, the NLRB has stated that in all future and pending cases, two or more entities will be deemed joint employers under the NLRA if there is proof that one entity has exercised control over essential employment terms of another entity’s employees (rather than merely having reserved the right to exercise control) and has done so directly and immediately (rather than indirectly) in a manner that is not limited and routine.  Accordingly, under the pre–Browning Ferris standard, proof of indirect control, contractually-reserved control that has never been exercised, or control that is limited and routine will not be sufficient to establish a joint-employer relationship. The Board majority concluded that the reinstated standard adheres to the common law and is supported by the NLRA’s policy of promoting stability and predictability in bargaining relationships. Chairman Philip A. Miscimarra, who dissented in the 2015 decision, was joined by recently-appointed Members Marvin E. Kaplan and William J. Emanuel in the majority opinion.  Members Mark Gaston Pearce and Lauren McFerran dissented in the case.The Republican majority NLRB set out five major reasons why the 2015 decision was flawed, which can be summarised as follows: The Board had exceeded their statutory authority; Their rationale was based on the notion that the standard no longer applied to modern forms of subcontracting, outsourcing and the use of temporary labor, which was flawed; The standard of joint employment is codified in the NLRA and can only be amended by Congress; They replaced a long-standing test that provided certainty and predictability, with a vague and ill-defined standard; and They were attempting to correct a perceived inequality in the competing interests of labor and management, far beyond what Congress intended. It is unclear where this leaves the appeal in the 2015 case, which is yet to be concluded. It also comes after an attempt to clarify the definition of joint employer under the NLRA and the Fair Labor Standards Act, in the form of a bill entitled the Save Local Business Act, which passed a vote in the House of Representatives in November, but is yet to be considered by the Senate. The bill is supported by various business groups who viewed the Browning-Ferris rule as a threat to jobs, entrepreneurship, and local employers who want legislation to “settle once and for all what constitutes a joint employer”. We will continue to monitor developments on this issue. Common Law Duty to Keep Employees’ Personal Data SafeIn a putative class action in the case of Sackin v. TransPerfect Global, Inc., No. 17 Civ. 1469, the federal court in the Southern District of New York held that employers have a common law duty to take reasonable precautions to protect the information that they require from employees. The court reasoned that the employer is in the best position to avoid the harm to employees, and that potential liability to employers provides an economic incentive to act reasonably in protecting employee data from the threat of cyberattack.The class action was filed on behalf of TransPerfect’s employees after personal data, including names, addresses, dates of birth, Social Security numbers, direct deposit bank account numbers and bank routing numbers, was obtained by cyber-criminals. On or about January 17, 2017, at least one TransPerfect employee received a "phishing" email. The email appeared to come from TransPerfect's CEO, but was sent by unidentified hackers. The email asked for the W-2 forms and payroll information of all current and former TransPerfect employees. Because TransPerfect's cyber-security was not up to industry par, at least one TransPerfect employee sent the information to the hackers in an unencrypted format. The court found that TransPerfect did not train employees on data security; did not erect digital firewalls and did not maintain PII (personally identifiable information) retention and destruction protocols.The court held that the plaintiffs had successfully stated claims for compensation in respect of a negligent breach of a statutory duty and breach of an implied term of the employment contract, in addition to breach of their common law duty. The statutory duty arises under New York Labor Law which makes it illegal for an employer to "communicate an employee's personal identifying information to the general public." N.Y. LAB. LAW § 203-d(1)(d). In support of a claim for breach of an implied term, the court stated: “TransPerfect required and obtained the PII as part of the employment relationship, evincing an implicit promise by TransPerfect to act reasonably to keep its employees' PII safe. TransPerfect's privacy policies and security practices manual — which states that the company "maintains robust procedures designed to carefully protect the PII with which it [is] entrusted" — further supports a finding of an implicit promise.”Courts in other cases have reached a different conclusion on an employer’s common law duty to protect employees’ data and on the existence of an implied duty of care in the employment contract. This area of law is evolving as the threats to cybersecurity are mounting. However, it is reasonable to say that as a matter of best practice every employer should take reasonable steps to protect the personal data that they hold by erecting firewalls and training employees on data security. States and Cities Ban Salary History InquiriesSince Massachusetts passed a law in 2016 preventing employers from asking job applicants about their salary history in the interview process, seven other states and cities have passed similar legislation including California, Delaware, Oregon, New York City, Philadelphia, and San Francisco. The motivation behind these laws is to close the gender pay gap between men and women.Although the laws vary, each prohibits an employer from inquiring about an applicant’s current or prior earnings or benefits. Such inquiries are generally prohibited regardless of whether the request is made by the employer or an agent acting on its behalf; or is made to the applicant or others possessing information about the applicant’s current or prior earnings or benefits.Mayer Brown provides a summary of the different laws and makes recommendations for employers on how to comply with these laws including: Removing questions seeking current or prior earnings or benefits from employment applications and new hire paperwork; Training individuals involved in the hiring process, such as hiring managers and recruiting personnel not to ask questions in taking up references or conducting public searches; Developing a set of questions that can be asked, such as “What are your expectations with respect to compensation?”; and Instructing outside search firms, recruitment agents and any outside agents who verify prior employment or perform background checks of applicants not to make inquiries or share information about applicants’ current or prior earnings. President’s Travel Ban LiftedOn December 4, 2017, the Supreme Court stayed the injunctions on President Trump’s revised “travel ban” issued in September 2017. As a result, the Proclamation restricting travel into the United States by nationals of Chad, Iran, Libya, North Korea, Somalia, Syria, Venezuela, and Yemen has gone into full effect until a decision is rendered on pending appeals.In general, the proclamation applies to nationals from the covered countries applying for a U.S. visa, effective immediately for nationals of countries subject to entry restrictions under Executive Order 13780 who lack a bona fide connection to a person or entity in the United States, and 21 days after issuance for all other individuals covered in the proclamation. The proclamation is expressly limited to individuals who do not have a valid visa on the effective date of the proclamation so visas held by nationals of these countries will not be revoked.Employees from the eight countries listed should not undertake unnecessary travel outside of the U.S. and should carry originals or clear copies of their legal authorization to be in the U.S. when travelling around the U.S. New York Paid Family leaveEffective January 1, 2018 the New York Paid Family Leave Program (NYPFL) will provide parents with up to eight weeks of compensation, benefits, and job-protected leave in any 52-week period. All New York employers that have employed one or more individuals for 30 consecutive days are covered by the NYPFL Law. Covered employers are required to maintain family leave insurance, funded by employee payroll deductions. At or around the time of a qualifying event, eligible employees submit claims to their covered employer’s family leave insurance carrier for payment. New York employees who are eligible for the leave are employees who work for a covered employer for 20 hours or more per week for 26 or more consecutive weeks of employment, and to those who have worked on a part-time basis (fewer than 20 hours per week) for 175 days in a consecutive 42-week period.PFL can be used for any of three reasons: To care for a close relative with a serious health condition. “Close relatives” are limited to spouses, domestic partners, children, parents, parents in-law, grandparents, and grandchildren. A “serious health condition” is an illness, injury, impairment, or physical or mental condition that involves either (a) inpatient care or (b) continuing treatment or continuing supervision by a health care provider; To bond with the employee’s newborn, newly adopted, or newly placed child within the first 12 months after child birth, adoption, or placement of an adopted or foster child; or For purposes identified under the federal Family and Medical Leave Act (“FMLA”) when their spouse, child, domestic partner or parent is on active duty or has been notified of an impending call or order to active duty. PFL benefits will increase on January 1 of each year, concluding with a final increase on January 1, 2021. Eligible employees will be entitled to weekly benefit payments up to the applicable maximum percentage of their average weekly wage, capped at the applicable maximum percentage of the State’s average weekly wage. The state’s average weekly wage is set annually by the New York State Department of Labor.The NYPFL Law requires covered employers to provide employees with written notice of their rights under the law, and to maintain Paid Family Leave insurance funded by employee payroll deductions.Employers should update their employee handbooks or the information they provide to their employees and communicate these new rights to their employees. They should also work with their insurance carrier to ensure they have appropriate coverage, and payroll providers to facilitate payroll deductions to fund family leave insurance premiums.Further details of the NYPFL Law are provided by Davis Wright Tremaine LLP. Employment Provisions in the Tax BillOn Wednesday, December 20, 2017 the Senate approved the final version of the first overhaul of the U.S. tax code in more than 30years. The Tax Cuts and Jobs Act (H.R. 1). The bill will now be signed into law by President Trump.The bill includes an employer tax credit for providing paid family and medical leave, elimination of a business expense deduction related to nondisclosure agreements, repeal of the Affordable Care Act’s (ACA) individual mandate, and changes to the tax treatment of certain employer-provided fringe benefits, among others. Further details are provided by Littler.  FLSA Overtime Rule Increase Declared InvalidIn August 2017, the proposed increase in the salary level from USD 23,660 (USD 455 per week) to USD 47,476 (USD 913 per week) was declared invalid by a federal court in Texas. However, the Dept. of Labor has appealed the August injunction, to test the validity of a salary increase in principle and the DOL’s authority to make that increase. The DOL has indicated it may increase the salary level, as it is still set at the 2004 level, and have consulted publicly on the issue of overtime generally ahead of further rulemaking.Based on comments made by Labor Secretary Alexander Acosta, many expect a proposed increase in the minimum salary threshold for the executive, administrative, and professional exemptions to the low USD 30,000 range. But for the moment the level remains at USD 23,660. Staffing Agency Employer Could Not Rely on DOL Opinion LetterIn a case before the Sixth Circuit Court of Appeals,  Perry v. Randstad General Partner, No. 16-1010 (6th Cir. Nov. 20, 2017), Randstad sought to argue that “staffing consultants” and other staff met the criteria to be exempt from overtime pay under the Fair Labor Standards Act (FLSA) as administrative employees, in reliance on an Opinion Letter issued by the Department of Labor (DOL) in 2005.Each of the employee plaintiffs held multiple positions over the course of their employment with Randstad, but their responsibilities generally included marketing and selling Randstad’s services; recruiting and evaluating workers and placing them with clients; overseeing those placements; and various administrative and clerical tasks. The plaintiffs regularly worked significantly more than 40 hours per week, and Randstad managers were aware they did so.When the complaint came before the district court, the court found, based on their testimony, that three of the four plaintiffs exercised discretion and independent judgment, and therefore were covered by the administrative exemption to the FLSA. The court also found that Randstad was insulated from any liability because it relied, reasonably and in good faith, on an Opinion Letter issued by the Department of Labor’s (DOL) Wage and Hour Division (WHD). The plaintiff’s appealed to the Court of Appeals.To fall within the administrative exemption of the FLSA 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 include the exercise of discretion and independent judgment with respect to matters of significance.In 2005, the WHD was asked whether “Staffing Managers” at a particular “temporary staffing agency” qualified for the administrative exemption. Its Opinion Letter (Opinion Letter, 2005 WL 3308616, Oct. 25, 2005) concluded that the Staffing Managers exercised the requisite discretion and independent judgment to qualify for the administrative exemption because it was their job to: “recruit; interview; hire and recommend placement of employees to particular assignments; manage the client’s temporary labor pool; provide advice on personnel issues; handle complaints; resolve grievances; and terminate employees on behalf of the client’s management.” The Portal-to-Portal Act of 1947 “protect[s] employers from liability if they took certain actions on the basis of an interpretation of the law by a government agency, even if the agency’s interpretation later turned out to be wrong.”It was accepted that Randstad had relied on the 2005 Opinion Letter but the issue was whether Randstad acted “in conformity with” the 2005 WHD Letter and in “good faith.” The court found that Randstad’s reliance was not “in conformity with” the 2005 WHD Letter because certain “specified circumstances and facts” cited in the 2005 Opinion Letter were absent because the plaintiffs “did not have the ultimate authority to decide to fire an employee” and worked under supervision. Additionally, Randstad had not shown its reliance was in “good faith” as a matter of law because Randstad arguably had “knowledge of circumstances which ought to” have caused it to inquire further. In particular, Randstad knew that sales activities were typically not covered by the administrative exemption and that the employees’ job duties could vary significantly depending on the client, the market and the regional or branch manager in the area they worked.In a majority decision, the court reversed the district court’s decision in favor of the plaintiffs’ arguments that they were not exempt. The dissenting judges agreed in part but could not agree on whether matchmaking and/or sales duties would fall within the FLSA’s administrative exemption.The court pointed out that exemptions to the Fair Labor Standards Act “are to be narrowly construed against the employers seeking to assert them,” (Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 392 (1960)). For staffing agency employers it is difficult to extract any clear guidelines from this case as to how staffing consultants and other employees should be classified, except that assessments should be conducted on a regular basis and at a local level to ensure that the criteria for exemption are generally being satisfied. FLSA Wage and Hour Case Roundup Commissions and Retail or Service ExemptionThe FLSA exempts retail or service employees from the overtime pay requirement but only if (1) “the regular rate of pay of such employee is in excess of one and one-half times the minimum hourly rate applicable” under the FLSA, and (2) “more than half his compensation . . . represents commissions on goods or services.” This exemption does not relieve employers from meeting minimum wage obligations.In the Stein v. hhgregg, Inc. and Gregg Appliances Inc., case (No. 16-3364), the employer argued that the exemption applied. The Sixth Circuit disagreed, pointing to the allegation that the commission policy paid exactly the minimum hourly rate in a normal, non-overtime week, thereby failing to meet the exemption requirement that it be “in excess of one and one-half times the minimum hourly rate.” Because the exemption didn’t apply, hhgregg could not escape overtime pay obligations.The key point here is that for the exemption to apply to those paid on commission, the employee’s regular rate of pay must be “in excess” of one and a half times the applicable minimum hourly rate. FLSA and Rest BreaksFLSA governs “hours worked,” which “is not limited to the time an employee actually performs his or her job duties.” The Third Circuit’s Judge McKee in Secretary United States Department of Labor v. American Future Systems, Inc., d/b/a Progressive Business Publications, No. 16-2685, reasoned that even though the FLSA does not require employers to provide employees with breaks, if an employer does provide a break, the employer must compensate the employee for breaks of up to twenty minutes and view the time as hours worked. The court said that case law and the Department of Labor’s website make it clear that employees must be paid for breaks of twenty minutes or less.Progressive argued that because employees could use the time logged off for their own benefit, the “flex time” should be considered off-duty time and not a rest period. The Court rejected this argument, explaining “that breaks of twenty minutes or less are insufficient to allow for anything other than the kind of activity ... that, by definition, primarily benefits the employer,” id. at 16, and therefore the “flex time” did not constitute off-duty time.Progressive also contended courts should analyze breaks on a case-by-case basis to determine whether a break benefits the employer or benefits the employee. The Third Circuit rejected this argument as well, reasoning that such a scheme would be overly “burdensome and unworkable” to employers as it would require an employer to analyze each and every break an employee took to determine whether the break benefited the employer or benefited the employee. The take-away from this case is that if an employer provides rest breaks, any rest break of twenty minutes or less should be paid. Compensation for Pre-Shift waiting TimeThe FLSA requires an employer to pay its employees minimum wage and overtime compensation for each hour worked over 40 hours in each workweek. The Portal-to-Portal Act was passed to clarify which activities are to be considered compensable under the FLSA and thus, to be included within the 40 hours each workweek.Under the Portal-to-Portal Act, an employer does not have to compensate an employee for the following activities: “(1) walking, riding, or traveling to and from the actual place of performance of the principal activity or activities which such employee is employed to perform, and (2) activities which are preliminary to or post-liminary to said principal activity or activities, which occur either prior to the time on any particular workday at which such employee commences, or subsequent to the time on any particular workday at which he ceases, such principal activity or activities.” 29 U.S.C. § 254(a). In Darwin Keith Bridges, et al., v. Empire Scaffold, L.L.C., No. 16-41493 the Fifth Circuit held that the test for Portal-to-Portal compensability was whether the wait time was integral and indispensable to the principal activities they were employed to perform.  The fact that an employer required an activity and that it may benefit the employer was not enough to make it compensable. Instead, the workers had to show that the preliminary wait time was integral and indispensable to their work, in this case erecting and dismantling scaffolding. The proof did not show that it was, and therefore they were not entitled to compensation for it.For wait time to be compensable it is not enough for it to be a requirement of the employer; it must also be integral and indispensable to the employee’s work for the employer. […]