labor lawAdivision of labor law center

Several features of the $780 billion stimulus plan passed this week will affect how Human Resources professionals perform their jobs in 2009 and beyond.

The goal of the law signed by President Barack Obama on February 17, 2009 is to save or create more than 3 million jobs. The bill, H.R. 1, was developed jointly by the House and Senate.

During negotiation, members of the House and Senate removed all mention of the federal government’s E-Verify system. The initial bill passed in the House would have required that any business receiving funds from the federal government under the stimulus bill use that system to verify that all employees are legally authorized to work in the U.S., using that system.

E-Verify is still required by many states and local governments, and is free to all private employers in the country. All federal contractors will be required to implement E-Verify later this year.

In addition, the stimulus bill requires that any employer receiving aid hire U.S. workers who have been laid off before recruiting and hiring workers from other countries on H-1B visas. This measure is expected to have the biggest impact on IT employees. (more…)

An new executive order requires federal contractors to post notices informing employees of their right to form unions and collectively bargain. This requirement must be included in every federal contract along with language giving the government the right to terminate/suspend the contract or even debar the contractor for noncompliance.       

Under Executive Order 13496, every federal contractor is required to post a notice informing employees of their rights to form unions and collectively bargain. This executive order overturns an order signed by President George W. Bush early during his administration.

Under the Executive Order signed by President Barack Obama on Friday, January 30, 2009, this requirement must be included in every federal contract along with language giving the government the right to terminate or suspend the contract if the employer does not comply.

In fact, employers who fail to post the required notice can be debarred for noncompliance.

The Executive Order signed by President Obama focuses specifically on (more…)

The U.S. Department of Labor or DOL announced on January 15, 2009 that Sandia Corp. has agreed to pay more than $2 million in back wages for unpaid overtime.

In an interesting wrinkle, the Albuquerque employer apparently tried to avoid overtime payments for non-exempt employees by setting no fixed payroll week.

Under the federal FLSA or Fair Labor Standards Act, employers must pay an employee overtime when the employee works more than 40 hours in the payroll week.

Information on the FLSA requirements for overtime are included on the federal minimum wage poster that every employer must prominently display in the workplace.

By not having a fixed payroll week, Sandia averaged the employees’ hours over two or more weeks. Under the FLSA, an employer can establish any fixed payroll week that the employer likes. The payroll week can run from Sunday to Saturday, or from Monday to Sunday, or from Thursday to Wednesday. Under some circumstances, an employer can change the payroll week, as long as employees are given advance notice.

However, the employee’s workweek must be a fixed and regularly recurring period of 168 hours, (more…)

According to inside sources at the U.S. Department of Treasury, new federal regulations regarding cafeteria benefit plans are likely to be published within the next 30 to 60 days.

These regulations would be in addition to the regulations already published in the Federal Register. These regulations collect many of the principles and rules that the IRS or Internal Revenue Service has issued formally or informally over the past 20 years.

One aspect of the new regulations will not be finalized until President Barack Obama takes office. That is the controversial non-discrimination clause in the regulations. As soon as more information is available on that regulation, it will be published here.

One change in the new cafeteria benefits plan will allow employers to add COBRA benefits to the options available. This benefit is typically used by employees who become old enough for Medicare. The employee often uses cafeteria funds to pay for COBRA premiums, (more…)

Federal contractors have been given a few more weeks to purchase required supplies and comply with the new E-Verify regulations.

The U.S. Department of Justice recently announced that the deadline has been moved back from January 15, 2009 to February 20, 2009.

This temporary postponement was made to accommodate employers after several business groups, including SHRM, the Society of Human Resource Management and the U.S. Chamber of Commerce objected to the new regulations.

Indications are that the Department of Justice will be strictly enforcing the new regulations, so employers would be wise to have all supplies on hand and implement E-Verify prior to the deadline. This will permit employers to work out any problems with their program, ahead of the deadline. 

The new E-Verify regulations implement an executive order issued by President George W. Bush in June 2008. Under the new regulations, federal contractors must use an electronic system such as E-Verify to ascertain that new employees working on federal contracts are legally permitted to work in the U.S.

E-verify is a joint venture between the Department of Homeland Security and the Social Security Administration to confirm the legal work status of new employees. The program is free for any employer to use.

One of the more controversial portions of the rule would require federal contractors to ascertain the legal work and immigration status of existing employees, working on some sensitive federal projects.

The new regulations require that the government cannot enter into a contract with a company that refuses to check the employees legal work status with E-Verify. However, the rule is not retroactive – it applies only to contracts signed after the new effective date of February 20, 2009.

The new E-Verify regulation, or a similar version, will probably prevail although it has been challenged in court by SHRM. “SHRM supports the use of an electronic employment verification system but E-Verify is far from ready to be mandated on all employers,” said attorney Nancy Hammer. She is the Manager of Regulatory and Judicial Affairs for SHRM. “We are pleased with the Justice Department’s decision to delay the effective date. We want to avoid the problems and confusion that will result if the rules go into effect before the court has a chance to evaluate their legality.”

Both parties must file final motions and briefs on the case in the U.S. District Court in Maryland by February 11, 2009.

Meanwhile, employers can get a jump on this deadline, by implementing E-Verify now. A number of states already require that every employer use E-Verify, while others only recommend it.