DOL at it Again: New Proposed Rules Published to Clarify Regular Rate

Proposed

On March 28, 2019, the U.S. Department of Labor (DOL) announced a new proposed rule that would clarify that certain payments and benefits provided by employers do not factor in to employees’ “regular rate,” which is used to calculate overtime pay.

This latest announcement is on top of a flurry of recent activity from DOL in March 2019, including another proposed rule to increase the minimum salary threshold required for most “exempt” employees and three opinion letters on family and medical leave and wage and hour issues.

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Extortion vs. Settlement Negotiations

Extortion

The criminal complaint filed against Michael Avenatti is an interesting reminder that the line between extortion and settlement negotiations is a thin one. In a federal court complaint filed in the Southern District of New York, the government accuses Avenatti of extortion by threatening to publicly release, through a press conference and otherwise, damaging information about the misconduct of Nike employees unless Nike made multimillion dollar payments to Avenatti and a significant payment to his client. According to the complaint, he demanded that the monies be paid quickly, and announced a press conference on his Twitter feed at which time he would expose Nike. Among even more colorful and profane language, according to the complaint, Avenatti allegedly stated, “I’ll go and I’ll go take 10 billion dollars off your client’s market cap… I’m not [bleeping] around.” One of the alleged extortion methods was an unsolicited offer that Avenatti and an unnamed co-conspirator would conduct an “internal investigation” for which Avenatti and his co-conspirator would be paid $15 to 25 million. If the demands were met, he promised confidentiality and that his client would “ride off into the sunset.” Federal prosecutors called this conduct “an old-fashioned shakedown.”

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DOL Publishes Guidance On H-1B Requirements

DOL

On March 15, 2019, the Wage and Hour Division of the U.S. Department of Labor (DOL) issued a Field Assistance Bulletin (Bulletin) for all DOL District Directors providing guidance on how U.S. petitioners of H-1B visas must comply with mandatory posting requirements related to petitioners’ H-1B petitions. See Bulletin here. H-1B employment visa petitions are those petitions annually filed by U.S. employers seeking to employ foreign national specialty occupation workers. Such petitions require U.S. employers to notify affected U.S. workers of the employer’s intent to hire an H-1B worker. This requirement, referred to as the “notice” or “posting requirement,” mandates that affected workers be advised of the terms of employment including salary of an H-1B worker, the right of U.S. workers to examine documents related to the formulation of that salary determination and of the U.S. workers’ ability to file complaints with any DOL Wage and Hour Division office.

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EEO-1 Report – Will Employers Need to Include Compensation Data or Not?

EEO

Short Answer: Currently, no. But first, some background.

Generally, employers with 100 or more employees, and certain federal contractors and subcontractors, are required to file an Employer Information Report EEO-1 each year. The EEO-1 is a report of the employer’s work force by job category, sex, race, and ethnicity. In 2016, then-President Obama announced a plan to use the EEO-1 to assist in ending the gender wage gap.

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New Excise Tax Reporting Obligation For Tax-Exempt Entities

Tax

Attention tax-exempt entity employers: Starting with tax filings this year (for your taxable year that began in 2018), you will need to make a special report to the IRS and pay an excise tax if you provided certain current or former highly compensated employees more than $1 million in compensation or paid part of a severance package that was worth more than three times their average compensation over the five years prior to their separation from employment.

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