Articles Posted in Wage and Hour Laws

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The federal government’s Equal Employment Opportunity Commission plays a large role in keeping the workplace fair for all workers. In some cases, the EEOC will pick up cases that involve large groups of employees and litigate them on behalf of the aggrieved employees. While the EEOC has a good success rate, it certainly isn’t perfect.

chairs-and-coffee-732128-m.jpgIn a recent case involving the EEOC, the Commission’s case was dismissed because it failed to provide specific information about the jobs of male and female employees when it was making a wage-discrimination claim.

EEOC v. Port Authority of N.Y. and N.J.

In the recent case of EEOC v. Port Authority of N.Y. and N.J., the EEOC claimed that the Port Authority of New York and New Jersey was paying male and female employees differently, although the two groups performed similar work.
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Recently, across the United States, fast food workers who receive the minimum wage have vowed to engage in civil disobedience in order to convince their corporate employers to raise their hourly wage to $15, or a living wage. However, one problem that faced them was corporations like McDonalds insisting that it was the franchise owners, the people who owned and controlled individual stores, who set the wage, not the corporations. If that were truly the case, workers who wanted to organize a union would face the extremely difficult task of organizing each store separately.

burger-1119511-m.jpgFortunately for the workers, the National Labor Relations Board (NLRB) ruled that McDonalds could be considered a joint employer in any complaints against the individual franchises. Therefore, the McDonalds corporation could be exposed to liability for actions taken by the franchises.

Across the country, including in Indiana and Kentucky, the majority of McDonalds’ 14,000 stores are owned and operated by franchisees. This is also true of other fast food chains like Taco Bell, Pizza Hut, and Burger King. The separation has allowed corporate leaders to argue that disgruntled workers should take their complaints to the individual franchise owners. In fact, individual franchise owners have little control over the way they operate the business, due to the strict terms the parent corporation imposes, from the type of menus to available supplies, appropriate uniforms, and training materials.
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The Seventh Circuit declined to rehear the issue of whether employees should be paid for donning and doffing their clothing. In contrast to another Seventh Circuit case involving the issue, eventually decided by the U.S. Supreme Court, this case involved food processors of JCG Industries and Koch Foods.

construction-workers-872475-m.jpgThe more recent case involved a class-action lawsuit by JCG and Koch employees who worked shifts that were 8.5 hours long. They claimed that, as part of their work schedule, they were required to clock in 15 minutes before the start of their shifts in order to don their work clothing. In addition, they were required to remove their clothing before lunch, which was 30 minutes of unpaid time. Because of the time required to don and doff, the employees claimed that they never had a full lunch break and should have been paid overtime for the extra time spent donning and doffing.

However, the Seventh Circuit panel disagreed, prompting the employees to file an appeal for the case to be heard en banc, or by all of the Seventh Circuit judges. In a 6-4 decision, a majority of judges denied a rehearing. They supported the panel’s finding that, rather than a continuous workday, as defined by the Fair Labor Standards Act (FLSA), the lunch break represented the end of the first of two four-hour shifts. The employees therefore were not entitled to overtime pay.
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Recently, fast food workers in Indiana and Kentucky went on strike again — a message that the issue of fair wages will not disappear after the United States Senate failed to pass a bill for a wage increase. That increase would have raised the current federal minimum wage from $7.25 an hour to $10.10 an hour.

burgers-on-the-grill-129504-m.jpgThe U.S. Senate held the vote late last month, with Indiana’s Senators splitting – Senator Donnelly voting in favor and Senator Coats opposing – and both of Kentucky’s Senators voting in opposition. Even though the measure had bipartisan support, it could not get the 60 votes needed to prevent a Republican filibuster. Thus, even though there were more than 50 votes lined up to pass the bill, it failed. Had it succeeded, there is no guarantee that a similar measure would have passed the Republican-led House of Representatives.

Those in favor of the bill, like Senator Donnelly, claimed that it would create more opportunities for families in Indiana and elsewhere. Right now, a parent could work a full-time job and still fall below the poverty line. By contrast, Coats and others who opposed the bill claimed that raising the minimum wage would kill one million jobs and only help 19 percent of those currently in poverty.
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This past month, a federal court in Indiana allowed a class-action employment suit to move forward after affirming in part and denying in part the employer’s motion to dismiss. In Harris v. Reliable Reports, Inc., the named plaintiff, Matthew Harris, claimed that the Fair Labor Standards Act (FLSA) and wage and hour laws in six states had been violated. He sought court certification for a class-action lawsuit.

house-in-field-of-flowers-1440514-m.jpgHarris initially filed a 44-page complaint against Reliable Reports, Inc., for whom he had worked as a field reporting specialist from March 2011 to April 2013. Reliable Reports operated in 22 states, where it employed field reporting specialists to inspect both residential and commercial properties. Part of a field reporting specialist’s job was to log into Reliable Reports’s computer network to download addresses of properties to be inspected; call to arrange inspection appointments and prepare route maps; load coordinates into their GPS units; drive to inspection sites and inspect and photograph the properties; respond to calls and texts from Reliable Reports and other interested parties; contend with traffic delays; and log into the computer network at the end of the day to enter hours worked and miles traveled.

For this, field reporting specialists were paid at a piece rate, which meant that they received a set fee for every report of the inspection completed and passed, as opposed to a standard hourly rate. Harris claimed that despite traveling hundreds of miles from home each day, field reporting specialists were not compensated for that time. Nor did they receive a true lunch break, being required to drive to appointments, get gas, or respond to calls during that time. Overall, though Harris claimed to have worked 60 to 65 hours per week, he had just $21,334.19 to show for it. Reliable Reports allegedly told employees that they must not report their actual hours and miles. The company also failed to fully compensate employees for mileage, despite claiming that it would in the employee manual.
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This month, President Obama issued an executive order that would increase the minimum wage for federal contract employees from the current $7.25 per hour to $10.10 per hour beginning next year. While the number of employees affected is small, the gesture could have wider implications across the United States, including in Kentucky and Indiana.

million-buck-cheque-1-531970-m.jpgPresident Obama first announced the executive order during his State of the Union address in January. When he signed the order, he did so surrounded by employees who could possibly benefit. Even so, both the President and supporters of the executive order acknowledged that the number of employees it would help was just a drop in the bucket compared to the number of employees who were not earning sufficient income despite working full time. The executive order would apply only to a small percentage of the two million federal contractors across the country.

However, both President Obama and supporters of the executive order hope that it creates momentum both in the states and in Congress to raise the minimum wage. President Obama pressed Congress to pass legislation that would raise the minimum wage for all workers, calling it “the right thing to do.” That said, Congress has shown little willingness to pass minimum wage legislation, though the President and allies are working on strategies to convince both houses.
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Workers across the country, including in Kentucky and Indiana, organized to go on strike, this time to protest the low wages paid at fast food restaurants. The strikes come during a time when studies have shown that more than half of fast food workers make so little money that they use public assistance.

burger-1097100-m.jpgAlthough in Indiana the percentage of fast food workers on public assistance is less than 50% — 45% to be exact — the result still costs the state an estimated $131 million each year. Many workers hope to change that, such as Nicholas Williams, a cook at a McDonalds in Indianapolis. He notes that while McDonalds makes $6.5 billion each year, he makes only $7.35 an hour and cannot afford many basic things. He and others hope to see the minimum wage raised to $15 per hour.

Supporters state that when fast food workers make so little, it hurts their entire family, because the parents then need to work two or three jobs to support their families and are never home. Furthermore, these jobs typically lack health care that would benefit the family if someone got sick. In fact, forcing fast food workers to work all the time to make ends meet prevents them from participating in the community at large.
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The United States Supreme Court will soon determine whether time spent putting on and removing — or “donning” and “doffing” — protective clothing for work should count as paid time. Workers at an Indiana steel mill, U.S. Steel’s Gary Works, claim that it should. They spend considerable time donning jackets, pants, work gloves, steel-toed boots, eye protection, hard hats, and ear plugs before they start their work. The clothing protects them from the fire and molten steel from the mill’s blast furnaces and coke ovens. However, 800 former and current workers claim that they have not been compensated for their time, and have filed a class action suit against their employer as a result. Meanwhile, U.S. Steel claims that the time the workers spend changing does not count as part of a day’s work, as defined by the workers’ union contract dating back to 1947.

worker-and-the-excavator-1170139-m.jpgWhether time for donning and doffing equipment should be compensated is a question that has frequently appeared in the lower courts. Many collective bargaining agreements even include provisions as to whether donning and doffing time is covered. Before a case on the issue can go through the courts, the workers involved must typically exhaust the remedies of the collective bargaining agreement, if there is one. If they fail to do so, the court will usually dismiss their case, stating that the workers may come back only after they have followed collective bargaining procedures.

The situation also highlights the changing nature of work, the difficulty with determining when a work week begins, and ways in which the federal Fair Labor Standards Act — intended to address these issues — is behind the times.
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In a move that will affect home health care workers in Kentucky and the other states, the Department of Labor recently announced the enactment of a new rule that will give them minimum wage and overtime protections.

wheelchair-945156-m.jpgWhile most hourly workers are protected by the Fair Labor Standards Act (FLSA), there are some exceptions, thanks to a “companionship exemption” enacted in 1975. The companionship exemption applies to workers who provided companionship services for individuals who were unable to care for themselves. Since that time, the home health care industry has grown at a fast pace and is expected to grow 70% bigger by 2020, but in the process, home health care workers have woefully low yearly incomes — the median annual income was just over $20,000 per year in 2010. This is despite the fact that home health care workers may work up to 60 hours per week, including overnight stays.

Now thanks to the rule, which takes effect in January 2015, all home health care workers will need to be paid 1.5 times their hourly rate for every hour they work beyond 40 in a week, or eight in a day. It will be a life changer, given that even with their long hours, many home health care workers must still work one or two other jobs to make ends meet. The move was applauded by President Obama, who claimed that it would rectify an injustice for those who did “heroic, hard work.”
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When employees discover that their wages have been illegally withheld, or that their employers have committed other acts that would be illegal under state or federal law, it is often months or years after the injury first occurred. Whether an employee can get relief, and how much, depends upon whether the statute of limitations has run. The statute of limitations acts as a time limit for which an injured party can file a lawsuit from the date of the injury. This time limit may vary by state, type of injury, or statute. In Kentucky, the statute of limitations for labor law claims is five years, while it is two years for Indiana. The statute of limitation may also specify that the clock starts running only after the injured party “should have known” about the injury, rather than when the injury actually occurred.

copy-cat-295013-m.jpgMany employers have sought to circumvent the statute of limitations by placing language in employment contracts that shortens the amount of time employees have to file a claim. They argue that these clauses are valid, as the employee agrees to them when he or she signs the contract. However, this past month, the Sixth Circuit Court of Appeals disagreed.

In Boaz v. FedEx, the Sixth Circuit held that a contract clause mandating that a suit must be filed within six months of the injury was invalid. The case began in 2009, when FedEx employee Margaret Boaz sued her employer for wage and hour and Equal Pay Act violations between 2004 and 2008. Boaz had taken over a higher position with many more responsibilities, but her pay reflected her original low-level status. Boaz argued that she should have been paid what the previous male employee in that position was paid. FedEx, in turn, argued that Boaz’s lawsuit should be dismissed because under her contract, she had only six months to file from the time the pay disparity last occurred.
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