Vision Payroll

According to a recent article in the Wall Street Journal, celebrity chef Wolfgang Puck would like to eliminate the minimum wage for waiters. In a story on resolutions for 2009, Puck was asked, “What problem should your industry or professional community tackle more effectively?” Puck responded:

The industry should lobby to establish a federal law that allows restaurants nationwide to exempt waiters who earn tips from the minimum wage. Waiters would not lose money because they could work overtime, and we could use the savings to provide health care or raise the wages of dishwashers.

Currently, tipped employees must be paid a minimum wage of $2.63 per hour in cash wages and with tips must earn at least $6.55 per hour. State laws may provide rules that are more beneficial to the employee and must be followed.

The US Department of Labor recently issued non-Administrator signed Opinion Letter FLSA2008-13NA. Although Opinion Letters only apply to the exact set of facts and circumstances presented in each case, they are a valuable aid in understanding current interpretations of the Fair Labor Standards Act (FLSA). Unlike signed Opinion Letters, unsigned Opinion Letters do not “provide a potential good faith reliance defense for violations of the FLSA.”

This Opinion Letter discusses whether daycare instructors who spend a majority of their time teaching qualify as exempt teachers under the FLSA. The Opinion Letter stated “that the daycare center instructors [spent] a majority of their time teaching children between the ages of three and five a curriculum of basic reading, counting, and social skills.” The relevant State Department of Education did not license the daycare centers where the instructors worked, although they were licensed by the state’s Department of Public Welfare. The implication of this distinction is “that the state does not consider the day care centers to be providing educational services.” The Opinion Letter concludes that the instructors do not qualify for the teacher exemption since they do not provide elementary education under the laws of their state.

State laws may provide rules that are more beneficial to the employee and must be followed. Contact Vision Payroll if you have questions about this Opinion Letter.

The US Department of Labor recently issued non-Administrator signed Opinion Letter FLSA2008-11NA. Although Opinion Letters only apply to the exact set of facts and circumstances presented in each case, they are a valuable aid in understanding current interpretations of the Fair Labor Standards Act (FLSA). Unlike signed Opinion Letters, unsigned Opinion Letters do not “provide a potential good faith reliance defense for violations of the FLSA.”

This Opinion Letter discusses whether Adult Detention Officers may volunteer as Reserve Sheriff Deputies under the FLSA. According to the Opinion Letter “[p]ublic safety employees taking on any kind of security or safety function within the same local government are never considered to be employed in a different capacity.” Therefore, volunteering as deputy sheriffs in the same public agency is not allowed for detention officers under the FLSA. The detention officers may volunteer, however, “[i]f the two employers are not the same public agency”. Opinion Letters FLSA2006-28 and FLSA2006-21NA both discuss how to determine if two employers are the same agency.

State laws may provide rules that are more beneficial to the employee and must be followed. Contact Vision Payroll if you have questions about this Opinion Letter.

Thirty-six delivery men for various Vietnamese restaurants in New York City were awarded more than $4.6 million in back pay and damages in a recent case Ke, et al. v. Saigon Grill, Inc., et al., SDNY, 07cv2329 MHD, 10/21/2008. The court found that the defendants’ testimony was not credible as to hours worked by and wages paid to the plaintiffs. Plaintiffs had testified that they worked hours in excess of forty per week without receiving overtime pay and were not compensated at the minimum wage, both in violation of the Fair Labor Standards Act (FLSA); they stated that unlawful deductions from their pay were made by the defendants as supposed fines for things like late deliveries or failure to complete side work; they claimed entitlement to reimbursement for expenses incurred for bicycles and motorcycles used in the deliveries; they alleged retaliatory terminations for asserting their intention to pursue an FLSA complaint; and they sought additional pay under a New York state law that requires employees whose workday is longer than ten hours to receive “one hour’s pay ‘at the basic minimum hourly wage’”. The court ruled in favor of the plaintiffs on all these arguments and also ruled that the defendants’ failure to post any FLSA notices explaining the provisions of the law and the employees’ rights thereunder resulted in a suspension of the statute of limitations until the plaintiffs received notice of their rights. This equitable tolling doctrine allowed plaintiffs to claim back wages for a period of eight years, not the two or three years ordinarily allowed under the FLSA. Vision Payroll strongly recommends employers consult their labor law attorney to review their minimum wage, overtime, and deduction policies to ensure compliance with all applicable federal and state laws.

The Washington Department of Labor and Industries announced recently that pursuant to Revised Code of Washington §49.46.020, the minimum wage for the state of Washington will increase to $8.55 per hour effective January 1, 2009. The law requires an adjustment to the minimum wage be calculated each year. The adjustment is tied to the change in the federal Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the 12 months ending in August. The 5.9% increase in the CPI-W will result in an increase of $0.48 for 2009. Contact Vision Payroll if you have any questions on the Washington minimum wage increase or visit our Minimum Wage Chart.

Vermont Governor James H. Douglas announced recently that pursuant to Title 21 of the Vermont Statutes, Annotated §384, the minimum wage for the state of Vermont will increase to $8.06 per hour effective January 1, 2009. The law requires an adjustment to the minimum wage be calculated each year. The adjustment is tied to the change in the federal Consumer Price Index, US city average, not seasonally adjusted (CPI-U) for the 12 months ending in August and cannot increase more than five percent per year. The 5.4% increase in the CPI-U will result in an increase of the statutory maximum of five percent or $0.38 for 2009. Contact Vision Payroll if you have any questions on the Vermont minimum wage increase or visit our Minimum Wage Chart.

Under the Fair Labor Standards Act (FLSA), employees must be paid a minimum hourly wage and an overtime premium of one and one-half times the regular rate of pay for hours worked in excess of forty per week. This is the one of a continuing series that discusses FLSA exemptions. The administrative exemption allows employees who qualify as “administrative employees” to be exempted from both minimum wage and overtime requirements. Earlier posts discussed the definition of an administrative employee. The following are examples of specific jobs that generally either qualify or don’t qualify the employee under the administrative exemption:

• Insurance claims adjusters qualify whether they work for an insurance or other type company.
• Financial services employees who analyze information, advise customers, market, service or promote the products qualify, but not those whose primary duty is selling.
• Employees who lead a team of employees “assigned to complete major projects for the employer”, even those without direct supervisory authority should qualify.
• Executive assistant or administrative assistant to a business owner or senior executive will qualify if the assistant has been delegated authority over significant matters.
• Human resources mangers who “formulate, interpret or implement employment policies” do qualify. Personnel clerks who screen applicants for minimum acceptable standards as set by others generally do not qualify.
• Management consultants who propose changes in a business’s operation qualify.
• Purchasing agents with authority to make significant purchases qualify even if the agents need consultation for unusually large commitments.
• Inspectors “along standardized lines involving well-established techniques and procedures” and those doing other ordinary inspection work do not qualify.
• Examiners or graders do not qualify, even if the employee has progressed to a point that reference to written standards is unnecessary because of acquired knowledge.
• Comparison shoppers who report prices to a retail stores buyer do not qualify, but the buyer who evaluates the information to set the prices does qualify.
• Inspectors and investigators in the public sector, including those involved in “fire prevention or safety, building or construction, health or sanitation, environmental or soils specialists” among others do not qualify.

Note that merely giving someone a title does not qualify the employee as exempt unless the duties and responsibilities that the job encumbers are also designated. State laws may provide rules that are more beneficial to the employee and must be followed. Contact Vision Payroll if you have questions about the administrative exemption.

The Labor Department of the Arizona Industrial Commission announced recently that pursuant to Arizona Revised Statutes §23-363, the minimum wage for the state of Arizona will increase to $7.25 per hour effective January 1, 2009. The law requires an adjustment to the minimum wage be calculated each year. The adjustment is tied to the US All-Urban Consumer Price Index (CPI) for the 12 months ending in August. The 5.4% increase in the CPI will result in an increase of $0.35 for 2009. Contact Vision Payroll if you have any questions on the Arizona minimum wage increase or visit our Minimum Wage Chart.

The Montana Department of Labor and Industry announced recently that pursuant to Montana Code Annotated 39-3-409, the minimum wage for the state of Montana will increase to $6.90 per hour. The law requires an adjustment to the minimum wage that must be calculated no later than September 30 of each year. The adjustment is tied to the US City Average Consumer Price Index (CPI) for All Urban Consumers for All Items for the 12 months ending in August. The 5.4% increase in the CPI will result in an increase of $0.35 for 2009. Contact Vision Payroll if you have any questions on the Montana minimum wage increase or visit our Minimum Wage Chart.

Todd Smith, Director of the Missouri Department of Labor and Industrial Relations (DOLIR), recently announced that the Missouri minimum wage will increase $0.40 effective January 1, 2009. Under Section 290.502.2, RSMo (Missouri Revised Statutes), the DOLIR director must calculate an adjustment to the minimum wage based on changes to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from July to July. Changes are rounded to the nearest 5¢ and take effect the following January. This year’s change will increase the minimum wage from $6.65 to $7.05 per hour for covered workers. Contact Vision Payroll if you have any questions on the Missouri minimum wage increase or visit our Minimum Wage Chart.