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As businesses reopen and employees begin returning to work, employers will have to navigate complex wage and hour issues they may have never considered before. Employers will need to adapt to a “new normal” of major workplace changes, including increased teleworking, social distancing, and new health and safety measures.

Wage and hour issues for employees returning to the workplace

Whether an employer must compensate an employee for the time they spend complying with new workplace protocols, like screening and safety measures, will require a fact-intensive, state-specific analysis.  The following are just a sampling of some wage and hour issues employers must consider (under both federal and state laws) as employees start coming back to work:
Continue Reading Wage and hour considerations in the post-COVID-19 era

In the first phase of an effort to restart parts of Texas’ economy, on April 27, Texas Governor Greg Abbott issued an executive order allowing certain businesses – retail establishments, restaurants, movie theaters, shopping malls, museums, libraries, golf courses, and services provided by an individual working alone in an office – to reopen on May 1, 2020, with most subject to certain restrictions regarding occupancy.  Governor Abbott’s order, Executive Order GA-18, supersedes his prior executive stay-at-home order (Executive Order GA-16) and any conflicting local order, including, as discussed below, such orders that impose a civil or criminal penalty for failure to wear a face covering.

Executive Order GA-18 continues to allow business providing “essential services” to operate.  “Essential services” continues to include everything listed by the U.S. Department of Homeland Security in its Guidance on the Essential Critical Infrastructure, Version 3.0 or any subsequent version, plus religious services conducted in churches, congregations, and houses of worship.
Continue Reading Texas partially reopens businesses effective May 1st

The Fair Labor Standards Act (FLSA) exempts certain highly-compensated employees (HCEs) from the requirement that they receive overtime pay for hours worked over 40 in a workweek.  To be considered highly compensated, the employee must receive both (1) at least $684 per week paid on a salary or fee basis; and (2) at least $107,432 in total annual compensation.  To satisfy the HCE exemption, the employee must also (1) customarily and regularly perform any one or more of the exempt duties or responsibilities of an executive, administrative or professional employee; and (2) perform office or non-manual work as part of his or her primary duties.

In a recent opinion, the Fifth Circuit examined the job duties required to satisfy the HCE  exemption.  Smith v. Ochsner Health Sys., No. 18-31264, — F.3d –, 2020 WL 1897186 (5th Cir. Apr. 17, 2020).  Smith, a former organ procurement coordinator for Ochsner, sued for overtime pay under the FLSA.  In response, Ochsner asserted the HCE exemption, arguing that Smith performed one or more administrative duties and received the required level of compensation.  Smith did not contest that he met the compensation requirements, but argued that he did not perform the duties required to satisfy the HCE exemption because he was required to follow exact procedures in performing his organ procurement work and, thus, did not exercise discretion and independent judgment as required to establish the administrative exemption.
Continue Reading Fifth Circuit examines the job duties required for the highly-compensated employee exemption from overtime pay under the FLSA

Recently, additional action has been taken at both the state and county levels in Texas to prevent the spread of COVID-19. At the state level, Governor Greg Abbott has issued three executive orders mandating both roadway and air travelers originating at certain locations to self-quarantine for a period of 14 days upon their arrival in Texas. Governor Abbott has also issued an executive order instructing all individuals in Texas, except where necessary to provide or obtain essential services, to minimize social gatherings and minimize in-person contact with people who are not in the same household. At the county level, the shelter in place orders issued last week by Dallas, Harris, and Travis counties have all been amended or clarified.
Continue Reading Texas update: Governor Abbott issues statewide executive orders while counties amend stay-at-home orders

The Families First Coronavirus Response Act (FFCRA) and the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), both enacted last week, provide significant new federal benefits to small businesses and their employees. Critically, both statutes target smaller employers. To that end, they each contain provisions that are only applicable to employers with fewer than 500 employees. However, each statute counts employees differently. This distinction in counting methods between the statutes presents a dangerous compliance trap for the unwary.
Continue Reading Counting employees under FFCRA and the CARES Act is not necessarily as easy as 1-2-3

Texas is taking a localized approach in trying to slow the spread of COVID-19. Since Monday, March 23, 2020, county and city governments from some of Texas’s largest metropolitan areas have issued “stay home-work safe” orders. This includes Dallas County, Harris County (where Houston is located), and Travis County (where Austin is located).

Each of the three orders affecting Dallas, Houston, and Austin allow “Essential Businesses” to remain open. While each order has a slightly different definition of “Essential Businesses,” all three orders include in their definitions of essential businesses the 16 critical infrastructure sectors identified by the Cybersecurity and Infrastructure Security Agency (CISA). “Non-essential businesses” are allowed to continue operations on a limited basis in varying degrees under each of the three orders. More detail on each of the orders is below.

For specific information on your city or business, employers should review the relevant order and its impact with the assistance of counsel to determine whether their operations are “Essential Businesses.” Determining whether your operations are essential businesses is highly fact specific, and companies should exercise caution when making that determination. Those businesses deemed “non-essential” should also consult their attorneys to assess next steps allowed under the applicable order.Continue Reading Texas metro areas issue shelter-in-place orders to slow the spread of COVID-19

The Fair Labor Standards Act (FLSA) exempts employees with certain executive, administrative, or professional job duties from the requirement that they receive overtime pay for hours worked over 40 in a workweek. Determining whether one or more of these “white collar” exemptions apply to a particular employee requires a fact-intensive analysis of the employee’s job duties. But there is another, sometimes overlooked, requirement: the employee must be compensated on a “salary basis” at a rate of not less than $684 per week. 29 C.F.R. § 541.600(a). An employee is paid on a salary basis if the employee regularly receives, on a weekly or less frequent basis, a predetermined amount which “is not subject to reduction because of variations in the quality or quantity of the work performed.” 29 C.F.R. § 541.602(a). Employers who make improper deductions from their employees’ salaries will lose the ability to claim that the executive, administrative, and professional exemptions apply if the facts demonstrate that they did not pay the employee on a salary basis. 29 C.F.R. § 541.603.

There has been a substantial amount of litigation regarding the types and frequency of deductions from an otherwise exempt employee’s salary that will cause an employer to lose the ability to claim that the white collar exemptions apply. One area of contention has been whether an employer’s policy stating that it will make improper deductions from an employee’s salary is sufficient to defeat exempt status, or whether there must be an actual practice of making such deductions for the employer to lose the exemption. Previously, courts followed the Secretary of Labor’s view that, if an employer’s policy created a “significant likelihood” of improper salary deductions, this could result in a loss of exempt status. Auer v. Robbins, 519 U.S. 452 (1997). But the Department of Labor has since promulgated regulations stating that the focus is on “an actual practice of making improper deductions.” 29 C.F.R. § 541.603.
Continue Reading Fifth Circuit clarifies when improper pay deductions make an employee ineligible for exemptions from overtime under the FLSA

Employers in three major cities in the Lone Star State should begin preparing for compliance with paid sick leave ordinances. Joining a number of other states and cities to have enacted paid sick leave laws, the cities of San Antonio, Austin, and Dallas passed ordinances requiring private employers to provide employees with paid sick leave. While the Austin ordinance has been blocked due to litigation regarding its constitutionality, which is now before the Texas Supreme Court, the San Antonio and Dallas ordinances are set to go into effect on August 1, 2019 (except as to employers with five or fewer employees in the preceding year, for which paid sick leave obligations will not go into effect until August 1, 2021).

The paid sick leave ordinances – which largely mirror each other – require all private employers to provide employees who perform at least 80 hours of work per year in the applicable city with one hour of paid sick leave for every 30 hours worked. Employees working for employers with 15 or more employees may accrue a maximum of 64 hours of paid sick leave annually. Employees who work for employers with fewer than 15 employees at all times during the preceding 12 months may accrue a maximum of 48 hours. Employees may carry over accrued, unused paid sick leave up to the maximum except where the employer makes sick leave equal to the maximum amount available to employees at the beginning of the year.Continue Reading Paid sick leave to take effect soon for employers in three cities in the Lone Star State

The Texas Citizens Participation Act, Tex. Civ. Prac. & Rem. Code §§ 27.001 et seq. (the TCPA), Texas’ anti-SLAPP statute, is likely to receive a much needed overhaul after the Texas Senate unanimously passed H.B. 2730 on May 17, 2019. If the Texas governor signs it into law, as expected based on the bill’s broad bipartisan support in the Texas House and Senate, the revisions will take effect on September 1, 2019, and will clarify – and significantly narrow – the types of claims to which the TCPA applies. Also, importantly for companies seeking to protect their trade secrets and enforce their restrictive covenants, the changes to the TCPA would exempt such claims from its purview.

The TCPA was originally enacted in 2011 to protect citizens who exercise their First Amendment rights from retaliatory legal actions that seek to intimidate or silence them. Specifically, the TCPA allows a party to file a motion to dismiss within 60 days of service of a lawsuit if it can establish that the legal action is based on, relates to, or is in response to the party’s exercise of the right of free speech, the right to petition, or the right of association. If the party-defendant meets this burden, the plaintiff must then establish “by clear and specific evidence a prima facie case for each essential element of the claim in question.” If the defendant is ultimately successful on its motion to dismiss, the defendant is entitled to recover its attorneys’ fees.

Importantly, while a TCPA motion to dismiss is pending – and during any subsequent appeal of the trial court’s ruling on the motion – discovery and all other proceedings at the trial court are stayed. This stay can result in significant delay, which can be particularly harmful in cases in which an employer seeks emergency injunctive relief to prevent the irreparable harm associated with the use and disclosure of misappropriated trade secrets or the violation of restrictive covenants by former employees.Continue Reading Texas Legislature takes aim at Anti-SLAPP challenges

On March 21, 2019, the full en banc U.S. Court of Appeals for the Eleventh Circuit clarified that in order to establish a prima facie case of workplace discrimination through alleged preferential treatment of a comparator outside the plaintiff’s protected class, a plaintiff must show that the alleged comparator is “similarly situated in all material respects.” The opinion clarifies the “similarly situated” standard in discrimination cases and may assist employers in obtaining summary judgment, particularly in cases in courts located in the Eleventh Circuit, which includes Florida, Georgia, and Alabama.

In Lewis v. Union City, Georgia (Case No. 15-11362), an African-American woman sued her former employer for race and gender discrimination. In support of her claim, she identified two white men who she alleged were treated more favorably. The district court granted summary judgment to the employer, concluding that the two white men were not proper comparators, but a panel of the Eleventh Circuit reversed.Continue Reading Eleventh Circuit holds that comparators in discrimination cases must be “similarly situated in all material respects”