The Ever-Changing Workplace

One-Two Punch

March 21, 2014
With less than a quarter of 2014 under our belts, employment law changes are rampant! Last week President Obama announced that he was planning to make some changes under the Fair Labor Standards Act (FLSA). These changes could be considerable for employers. One of the main changes would be to limit the use of the "white collar exemption." Under this exemption, employees who do executive, administrative, or professional work that make at least $455 a week, are exempt from mandatory overtime pay. Obama could potentially raise the baseline amount which has been the same for about a decade. He could also require that a high percentage of time has to be done actually doing "executive" work to qualify under the exemption. This change would influence employees who currently split their time between executive work and other tasks. These recent developments are just one more shot aimed at businesses for the current year. As employers endeavor to figure out the nuances of the ACA, changes to DOMA and safeguard against an increase in employment suits, these changes are inevitably going to cause more havoc for owners and HR departments. 

Large business took an immediate hit last week with the filing of multiple class action lawsuits against corporate giant, McDonald's. Attorneys promised more lawsuits to follow for alleged wage and hour violations. These lawsuits raise continuing concern for all employers and are of exceptional interest to any franchise operation. Both corporate franchisors and franchisees, both large and small, should be wary of what these suits could mean for both sides going forward. Not only do franchisors/franchisees have to worry about how FLSA changes will further affect their operations, but they also should be wary of how their liability in these wage and hour claims could play out. Franchisors may find that they are not allowed to take a "hands-off" approach and be safe from obligation. Businesses should develop a plan for resolving issues internally and make sure they are being proactive in handling wage issues. 

Nicole Crump, JD, CIC
Director of Employment ADR
EDR Systems 

This information is the opinion of the writer and is not meant to be construed as creating an attorney-client relationship or as legal advice to an individual or business. Please consult your attorney if you need legal advice on the issues above.