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Nicholas J. Kromka

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First Up: DOL Expands Overtime Exemption for Commission-based Retail and Service Workers

We all know that retail has been hit hard by the pandemic. When retail employees paid on a commission basis do go back to work, fewer of them will qualify for overtime, thanks to a Department of Labor (DOL) rule promulgated on Monday, May 18, 2020. While this sounds like a bad deal for employees, there’s a silver lining: the DOL issued another rule just today that will make compensating employees for staggered shifts and fluctuating workweeks easier—practices that are likely going to be critical components of a safe COVID-19 return-to-work plan in retail.

Monday’s final rule withdraws 60-year-old interpretive rules that limited employers’ ability to invoke Section 7(i) of the FLSA, which exempts certain commission-based employees in “retail or service establishments” from overtime eligibility. To qualify for the exemption, a business needs to show: (i) it is a retail or service establishment, as defined by the regulations; (ii) the employee’s regular rate of pay exceeds one and one-half times the applicable minimum wage for every hour worked in a workweek in which overtime hours are worked; and (iii) more than half the employee’s total earnings in a representative period must consist of commissions.

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On April 1, 2020, the Department of Labor (“DOL”) posted a temporary rule issuing regulations for implementing the Families First Coronavirus Response Act (“FFCRA”), which became effective the same day. We reported on the DOL’s other recent efforts to flesh out the new law through its FAQ section, which included some much needed guidance…

The Families First Coronavirus Response Act (“FFCRA”) is effective today, April 1. In honor of this undoubtedly daunting occasion for employers with less than 500 employees, we analyze the most significant provisions from the Department of Labor’s updated FAQs, which fill in gaping holes in the legislation that left employers (and counsel) puzzled.  For employers with fewer than 50 employees, we also examine recent DOL guidance on the “small business exemption” and identify the ways in which employers can qualify for this exemption.

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Ah, summer: less-demanding schedules, lighter workloads, and a more relaxed work wardrobe. In keeping with the professional reputation of lawyers as killjoys, however, we recommend that HR professionals act more like Aesop’s ants—using the summer to prepare for fall—than the grasshopper, who was so busy partying that he failed to prepare at all. So listen, Grasshopper: savvy HR leaders know to use their summer downtime to set themselves up for success when we all go “back to school.”

Here are seven suggestions of what New York HR professionals can get ahead of over the summer:

1. Coordinate Sexual Harassment Prevention Training – Under New York State law, all employers must provide annual sexual harassment prevention training that satisfies the State’s training requirements by October 9, 2019 (NYC has its own requirements, as we describe here). An employer can satisfy these requirements by either adopting the State’s model training documents or by providing live or interactive online/video training which meets or exceeds the State’s minimum standards. With a mid-fall deadline quickly approaching, summer is the perfect time to think about, and possibly complete, your workforce’s first annual training.

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