Tag Archives: Department of Labor

Failure of Weil nomination heralds more of the same for federal involvement in workers’ comp.

Posted on April 3, 2022 by Jon Rehm

Democratic Senators Joe Manchin, West Virginia, joined Kyrsten Sinema and Mark Kelley, Arizona, and 50 Republicans to torpedo the nomination of Professor David Weil to the head of the Department of Labor’s Wage and Hour division.

Weil, who held the same position during the Obama administration, was a critic of gig economy firms like Uber who misclassify workers as independent contractors. Independent contractor status exempts companies from having to comply with wage and employment laws such as workers’ compensation.

Readers of this blog, likely know state workers’ compensation laws determine whether a worker is an employee and that is a separate analysis about what constitutes an employee for purposes of federal law. Readers of this blog also know that Weil likely would have ran into a steel re-enforced concrete wall of the federal judiciary in trying to enforce federal wage and hour laws for the benefit of workers.

But the failure of Weil likely signals that there is likely no substantive federal legislation that will address deficiencies in state workers’ compensation laws. In 1970, Congress established OSHA and authorized National Commission on State Workers’ Compensation Laws in response to concerns over the sufficiency of state workers’ compensation laws. The recommendation of the Commission lead many states to improve workers’ compensation laws for the benefit of workers.

But if the Senate can’t even confirm someone like Weill to the Department of Labor, then it seems unlikely that the federal government will do anything to improve state workers’ compensations laws.

Many lawyers who represent injured workers take Ronald Reagan’s adage about the government to heart in their practices when it comes to federal law. Whether it’s the byzantine workers’ compensation laws for federal employees, the difficulties of ERISA liens, headaches with Medicare in settling cases or what Professor Michael Duff describes as empty pre-emptions around nuclear workers and air ambulances, workers’ compensation plaintiff’s lawyers are often among the most vehement supporters of state’s rights.

But as evidenced by OSHA and the National Commission, the federal government can be a positive influence on workers’ compensation. But for most workers’ compensation lawyers in practice today, federal law and federal agencies are just another hurdle to overcome in getting justice for client’s injured at work. Unfortunately, that reality doesn’t look to change anytime soon.

Department of Labor Weighs In on New Age of Salary Servitude for ‘Executives’

Posted on November 10, 2016 by Roger Moore

Most of the U.S. workforce has the right, provided by the Fair Labor Standards Act, to be paid overtime for working more than 40 hours in a week. Before the federal government set rules for overtime, most employees worked longer hours, and millions of Americans worked six or seven days a week, as Chinese factory workers do today. Salaried workers also have the right to be paid a premium for overtime work, unless they fall into an exempt category as a professional, an administrator, or an executive. Exempt employees must be skilled and exercise independent judgment, or be a boss with employees to supervise. However, many companies have worked to get around these overtime rules by classifying employees like cooks, convenience store employees or restaurant workers as “managers,” “supervisors,” or “assistant managers or supervisors,” so that their employer can deny them overtime under this exception.

In May 2016, the Department of Labor issued its final rule establishing a new minimum salary threshold for the white-collar exemptions (executive, administrative and professional) under the Fair Labor Standards Act. This new threshold of $913 per week ($47,476 annualized) more than doubles the current minimum weekly salary threshold of $455 per week ($23,660 annualized). While that may seem like a huge increase, the old threshold level is only $2 a week above the poverty level for a family of four. Twenty-one states have filed suit to challenge this rule, citing the rule will force many businesses, including state and local governments, to unfairly and substantially increase their employment costs.

The old rule allowed companies to put employees on “salary” at a low rate and require them to work sometimes significant overtime. The fact that so many government entities are concerned about this new rule substantially increasing their employment costs underscores the extent to which even government entities have taken advantage of employees in this fashion. Can you imagine earning $25,000/year and having to work 50, 60 or 70 hours a week? Even at 50 hours a week, that equates to an hourly wage of only $8.01!

In the first year, the department estimates that the new rule may affect, in some manner, over 10 million workers who earn between $455/week and the new $913/week threshold.

The median worker has seen a wage increase of just 5 percent between 1979 and 2012, despite overall productivity growth of 74.5 percent (Mishel and Shierholz, 2013), according to the Economic Policy Institute. One reason Americans’ paychecks are not keeping pace with their productivity is that millions of middle-class and even lower-middle-class workers are working overtime and not getting paid for it. Before this rule change, the federal wage and hour law was out of date. This change purports to correct this modern day servitude that the law – for the last 30 years – has carved out a huge exception, allowing workers to be taken advantage of simply by assigning them a title and paying them a salary.

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Post-Injury Drug Test? OSHA Says Not So Fast

Posted on October 17, 2016 by Jon Rehm

Workers who report an on-the-job injury may not be subject to mandatory drug testing if a new rule from the Occupational Safety and Health Administration that prohibits blanket post-injury drug tests withstands a court challenge from employers.

In May, OSHA published a rule prohibiting employers from having policies that force employees hurt on the job to take drug tests because of concerns about retaliation. This blog has long recognized the potential for retaliation that mandatory drug tests pose and supports the proposed rule by OSHA. OSHA’s new rule was drafted at roughly the same time as the release of the U.S. Department of Labor report that was critical of the shortcomings in state workers’ compensation systems.

Though OSHA implemented the limits on drug testing to limit retaliation, the rules limiting drug testing also help preserve employee doctor choice, which is an integral part of workers’ compensation law in Nebraska and other states. Many employers will inform employees that they must get drug tested at an occupational medicine clinic if they have a work injury even if workers have a right to see their own doctor. This can lead to employees being forced back to work too soon and or not receiving sufficient treatment for their work injuries. Both the fear of retaliation and the circumvention of doctor choice rules lead the costs of work injuries to be borne by employees, which is a major concern of the Department of Labor.

Due to push back from employers, the rule’s enforcement will be postponed until Nov. 1 and will likely be delayed longer due to a court challenge to the rule. A challenge to a Labor Department rule deeming that home health aides were employees for the purposes of the Fair Labor Standards Act took over a year to work its way through the federal courts, until it was upheld by a federal circuit court in June.

Even if the rule is implemented, post-injury drug testing will not disappear from the workplace. Employers can still test if they have a reasonable suspicion of intoxication or drug use. Most federal and defense contractors will be exempt from the OSHA rule, as well as truckers and railroad employees. Furthermore, in states with drug-free workplace laws, mandatory post-injury testing may still be permitted, depending on the language of the statute. Nebraska allows employers to fire an employee who refuses a lawful request for a drug test. If the new OSHA rule is ultimately upheld by the federal courts, I would expect a push by employers to amend drug-free workplace laws.

Overtime and Minimum Protections Laws Upheld for Home Health Aides

Posted on June 29, 2016 by Jon Rehm

On Monday, the U.S. Supreme Court refused to review a federal circuit court’s decision upholding a rule by the U.S. Department of Labor that would extend overtime and minimum wage protections to home health aides. This decision is a win for workplace fairness and safety.

This blog has been following this issue since a federal district court struck down this rule early in 2015. Though this rule may not have an impact on workers’ compensation directly, the fact that home health aides are covered by wage and hour laws would make it more likely that they would be treated as employees and more likely to be covered by workers’ compensation laws as employees.

The fact that home health aides appear poised to gain overtime and minimum wage protections should also improve pay and benefits for Certified Nursing Assistants (CNAs) who perform similar to work to home health aides. Higher pay for CNAs could lead to better patient care and fewer injury claims.

The Supreme Court’s refusal to hear the appeal relieves uncertainty over whether the rule applies or not. The U.S. Labor Department declared the rule was effective on Oct. 13, 2015. Since the court challenge failed, the rule should be effective. If you have questions as to whether you are covered by the rule or not, please visit the Labor Department’s site about wage and hour protections for home care workers.

Increase in Wage Theft Claims

Posted on September 15, 2014 by Rod Rehm

Today’s blog post was written by guest author Leonard Jernigan from The Jernigan Law Firm in North Carolina. Firm associate Brody Ockander also brought The New York Times story to my attention that Mr. Jernigan references. Here’s the link to the original story from the Times: More Workers Are Claiming ‘Wage Theft’. The firm’s blog has also included previous stories about wage theft, specifically Wage Theft Is Illegal And Immoral, written by Mr. Jernigan, and Wage Theft Another Assault on Workers’ Compensation, which was shared by Gelman on Workplace Injuries. As Mr. Jernigan uses North Carolina as an example, pretty much every state has a version of a Department of Labor that handles wage-theft issues. Here is a link to Nebraska’s form: Filing a Wage Complaint. In addition, many attorneys can be a resource for a person in this situation so please contact an experienced attorney, including those at our firm, if you have questions about a specific situation.

According to a recent article in The New York Times (Sept. 1, 2014), more workers are claiming wage theft by their employers. Worker advocates assert that violations of minimum wage and overtime laws, erasure of work hours and wrongful takings of employees’ tips are increasing in volume.

David Weil is the director of the federal Labor Department’s wage and hour division. Since 2010, Mr. Weil’s agency has uncovered almost $1 billion in illegally unpaid wages, with a disproportionate amount of immigrant victims. Weil believes the surge in wage theft is due to underlying changes in the national business structure. As large employers increase franchise operations as well as use of subcontractors and temp agencies, these companies deny any knowledge of wage violations.

A federal appeals court in California recently ruled that FedEx committed wage theft by labeling its drivers as independent contractors to avoid having to pay them overtime. New York’s attorney general, Eric T. Schneiderman, has recovered $17 million in wage claims over the past three years and in Nashville last February nine Doubletree hotel housekeepers were paid $12,000 in back wages owed by the hotel’s subcontractor. Wage theft is prevalent in North Carolina as well. According to the N.C Department of Labor 2012-13 Wage and Hour Bureau Annual Report, 4,244 complaints were investigated. Out of an estimated $2.4 million due, almost 73% of unpaid wages (over $1.79 million) were recovered for 2,168 workers. To file a wage dispute claim in North Carolina, contact the Department of Labor’s Wage and Hour Bureau at 919-807-2796 or 1-800-NC-LABOR.

Misclassification – Department of Labor Recovery

Posted on August 19, 2013 by Rod Rehm

Today’s post comes from guest author Leonard Jernigan, from The Jernigan Law Firm in North Carolina. Employer fraud happens more than businesses would like folks to think, and Mr. Jernigan writes a “Top 10” list at the end of each year talking about this problem. His list in 2012 was called “$97 Million In Fraud: 2012′s Top 10 Workers’ Compensation Fraud Cases.” That blog post includes an example of labor violations when a company in Massachusetts misclassified employees as subcontractors. The article that was the focus in last Monday’s blog post, “Connecticut Employers Shut Down For Not Paying Workers’ Compensation Insurance,” also talked about misclassification as a form of employer fraud. Although it appears to happen in construction a lot, this type of fraud can occur in other industries, too. And as can be seen in just the article below, misclassification fraud isn’t limited to specific states but can happen anywhere. It is helpful to see some action occurring, both in the courts and legislatively.

The U.S. Department of Labor has recovered more than $1 million in back wages and liquidated damages for 196 employees of Bowlin Group LLC and Bowlin Services LLC out of Ohio and Kentucky. Bowlin Services installed cable for Insight Communications, a cable, telephone and Internet provider in Kentucky. The defendants misclassified 77 employees as independent contractors and violated the Fair Labor Standards Act (FLSA) by denying these workers access to critical benefits, including minimum wage, overtime, family and medical leave, unemployment insurance, workers’ compensation and failing to maintain accurate payroll records.

Misclassifying employees negatively impacts our economy, generating losses to the U.S. Treasury, Social Security and Medicare funds, state unemployment insurance, and state workers’ compensation funds. It also leads to unfair competition because businesses that play by the rules are at a disadvantage.

This problem has become so acute in Tennessee that last month the legislature passed Senate Bill 833, which has been signed into law and imposes penalties on construction companies for misclassifying workers in an attempt to evade workers’ compensation premiums. A Tennessee study in 2012 revealed losses of up to $91.6 million in workers’ compensation premiums. North Carolina has identified the problem but has yet to take any action. Until states aggressively prosecute misclassification, this fraud will continue.

Workers' Compensation Watch

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Tag Archives: Department of Labor

Failure of Weil nomination heralds more of the same for federal involvement in workers’ comp.

Department of Labor Weighs In on New Age of Salary Servitude for ‘Executives’

Post-Injury Drug Test? OSHA Says Not So Fast

Overtime and Minimum Protections Laws Upheld for Home Health Aides

Increase in Wage Theft Claims

Misclassification – Department of Labor Recovery

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