The Americans With Disabilities Act Requires Employers to Offer Reasonable Accommodations to Employees with Disabilities
The Americans With Disabilities Act (ADA) and Maryland law require employers to provide reasonable accommodations to qualified employees with disabilities, unless doing so would cause undue hardship to the employer. Navigating requests from employees with disabilities for reasonable accommodations can be complex, but it is a critical responsibility for employers in Maryland. Here’s some of the things that employers need to be aware of to comply with the law and to foster an inclusive workplace.
What Are Reasonable Accommodations?
Reasonable accommodations are adjustments or modifications that enable an employee with a disability to perform the essential functions of his or her job. The required accommodation will be specific to each situation, but some illustrative examples are:
• Providing assistive technology or adaptive equipment;
• Adjusting work schedules to allow for medical appointments;
• Modifying workplace policies or practices; or
• Making physical changes to the workspace, such as installing ramps or ergonomic desks.
When Is an Accommodation “Reasonable”?
Accommodations are considered reasonable if they effectively address the employee’s needs without imposing significant difficulty or expense on the employer. Factors such as the size of the company, the nature of the request, and the cost of implementation are key considerations.
Employer Responsibilities Under the ADA
1. Engage in an Interactive Process: Employers are legally required to engage in a good-faith dialogue with the employee to understand their limitations and determine an appropriate solution.
2. Maintain Confidentiality: All medical information related to the request must remain confidential.
3. Avoid Retaliation: Employers cannot retaliate against employees for requesting accommodations.
Common Mistakes to Avoid
• Delaying the Process: Timely responses to requests are essential. Unreasonable delays can lead to liability.
• Rejecting a Request Without Consideration: Employers must assess all requests thoroughly before deciding if an accommodation is unreasonable.
• Failing to Document the Process: Keeping detailed records of discussions and decisions can protect against claims of noncompliance.
Get Professional Guidance
Navigating accommodation requests can be tricky, especially when determining whether an adjustment constitutes an undue hardship and because there is no one-size-fits-all policy. An attorney can help an employer understand its obligations, minimize legal risks, and ensure compliance with federal and Maryland-specific laws.
If you’re dealing with an accommodation request or need assistance crafting policies to comply with the ADA, contact Lewicky, O’Connor, Hunt & Meiser at (410) 489-1996 or [email protected] today.
Maryland Law Requires Compensation Transparency In Job Postings & Allows Employees To Discuss Their Compensation With Fellow Employees
Effective on and after October 1, 2024, Maryland has updated its Equal Pay for Equal Work Law. The revised statute contains important requirements for companies that employ people in the State of Maryland.
Disclosure of Compensation
Employers may not prohibit their employees in Maryland from inquiring about, discussing, or disclosing their compensation, or the compensation of another employee. Employers cannot take adverse employment action against an employee for asking a fellow employee about compensation, or for disclosing his or her own compensation to others. The law does not require an employee to disclose his or her compensation to anyone, nor does it permit an employee to disclose compensation information to a competitor of the employer.
If an employer knew or reasonably should have known that its actions violate the above requirements, an affected employee can sue the employer for injunctive relief and to recover up to two times the amount of actual damages suffered as a result of the violation. If the employee prevails in the suit, the court is required to also award to the employee a reasonable amount of attorneys’ fees incurred by the employee in bringing the successful legal action. An employee may bring a lawsuit on behalf of the employee and other employees similarly situated. Lawsuits to enforce these provisions may be brought up to three years after the end of an employee’s employment by the company.
Publication of Rates of Compensation in Job Postings; Prohibition Against Requiring Job Applicants to Reveal Past Compensation History
Employers are required to include in all job postings (internal or public), for positions that will physically perform work within the State of Maryland, the compensation range for the position and a general description of benefits or any other compensation offered for the position. An employer may not retaliate against (or refuse to interview or hire) an applicant because the applicant declines to provide his or her compensation history, or asks for the compensation rangeinformation that the employer is required to publish. Only after the employer has made an initial offer of employment (including an offer of compensation) may the employer then seek information about an applicant’s compensation history in order to evaluate whether to negotiate a higher compensation offer based on that history.
Violations of this part of the law may be enforced by the Maryland Commissioner of Labor through the issuance of orders compelling compliance, and at the discretion of the Commissioner also by imposing monetary fines for violations occurring after a first violation.
Equal Pay
Maryland employers are prohibited from paying compensation to employees of one gender at a lower rate than paid to other employees, if they work in the same Maryland county and if they perform work of comparable character. This does not necessarily mean that employees of different genders with similar jobs cannot be paid different rates of compensation in all circumstances. Differences in compensation rates may be permissible if based on a non-discriminatory seniority or merit system, or if the jobs require different abilities or skill sets, or have different duties. Differences in rates of compensation also may be allowed if there are non-discriminatory distinctions between the employees, such as in levels of education, training or experience. An employer that is paying a wage in violation of these provisions is not permitted to reduce another employee’s compensation to comply with these requirements.
If an employer knew or reasonably should have known that its actions violate the above requirements, an affected employee can sue the employer for injunctive relief and to recover the difference between the compensation paid to employees of one gender and the compensation paid to employees of another gender. Here, again, if the employee prevails in the suit, the court is required to award a reasonable amount of attorneys’ fees to the employee.
Maryland Legislature approves tax credit for small business paid sick leave
At the end of its session this month, the Maryland Legislature approved $5 Million in tax credits for those small businesses that provide benefits under the Mandatory Paid Sick Leave Law to employees earning less than earn 250% of the annual federal poverty guideline. A small business may receive a tax credit equal to the lesser of $500 for each qualified employee, or the total amount of paid time off provided in accordance with the Paid Leave Compromise Act (SB 135/HB 98 of 2018) to qualified employees. Only businesses with 14 or fewer employees are eligible for this credit. The credit is to be provided on a first-come-first-credited basis until the $5 Million aggregate credit amount is reached. If signed by Governor Hogan as expected, this law will take effect on July 1, 2018, but will apply retroactively to the entire 2018 tax year.
State of Maryland Issues Guidance on the New Paid Leave Law
The Maryland Department of Labor, Licensing and Regulation (DLLR) updated its official FAQs on March 9, 2018, to guide Maryland employers in implementing the Maryland Healthy Working Families Act (the so-called “Paid Leave Law”). Since February 11, 2018, Maryland employers have been required to provide “sick and safe” leave benefits to their employees under this new law. Companies with 15 or more employees must provide paid leave to their employees. Companies with fewer than 15 employees need only provide unpaid leave.
The new DLLR publication provides guidance on the calculation of the 15-employee threshold, sick and safe leave accrual and tracking requirements, permissible uses of earned sick and safe leave, employer verification of sick and safe leave used, rehire requirements, and specific categories of employees. Here are a few of the new items clarified in the DLLR publication:
Does an employee need to give prior notice to the employer before using sick and safe leave?
DLLR says that, if the need for sick and safe leave is foreseeable, an employer may require its employees to provide up to seven days of notice before taking leave. If the need to use leave is not foreseeable, the employee must provide notice as soon as possible.
Can an employer designate different methods of accruing sick and safe leave for different types of employees?
Yes. DLLR says that “an employer could front-load leave to full-time employees but provide that part-time employees earn leave on an accrual basis.” DLLR recommends that such a policy is in writing and clearly communicated to all employees. Such a policy must be applied consistently with regard to each type of employee.
Do paid holidays count toward earned sick and safe leave? Can an employee accrue earned sick and safe leave while using PTO?
The new guidance directs that an employer cannot deduct holiday hours from an employee’s earned sick and safe leave if the employer’s business does not operate on those holidays, and the employer provides paid time off for those holidays. If an employer’s business operates on holidays and employees work or are expected to work on holidays, however, the employer may deduct from the employee’s accrued sick and safe leave if the employee takes a leave day and does not work on the holiday. The law does not require that an employee accrue sick and safe leave while using paid time off.
What happens in weeks where an employee occasionally works less than 12 hours in a week?
An employee that normally or customarily works less than 12 hours a week is not covered by the law. However, if an employee customarily works 12 or more hours per week but on an isolated week works less than 12 hours, those hours would still count toward the employee’s sick and safe leave.
How does an employer handle the accrual of earned sick and safe leave if the employer advances the leave time at the beginning of the year and the employee is not hired at the beginning of the designated benefit year?
If an employer advances sick and safe leave time on January 1st and an employee is hired later during the year, the employer must ensure that the employee earns sick and safe leave in an amount equal to or greater than the leave provided for under the earned sick and safe leave law, until the beginning of the next benefit year.
Does earned sick and safe leave count toward the fringe benefit amount on a Maryland prevailing wage project?
DLLR says that paid sick and safe leave may be credited toward the fringe benefit requirement on a Maryland Prevailing Wage project.
What pay rate should an employee working on a Maryland Prevailing Wage project be compensated when using earned sick and safe leave?
DLLR says that earned sick and safe leave should be compensated at an employee’s standard rate of pay, at the same rate the employer compensates employees for other paid fringe benefits
Most Maryland employers will be required to provide sick leave in 2018
Most Maryland employers will be required, beginning sometime during the first half of 2018, to provide sick leave to their employees. It’s not entirely clear when this requirement will kick in. Mandatory employee sick leave was enacted by the Maryland Legislature last year but was vetoed by Governor Hogan. The Governor’s veto was overridden by the Legislature, on January 12, 2018. With this veto override, the law is presently scheduled to go into effect on February 11, 2018 (30 days after the override vote).
The main sponsor of the legislation has introduced emergency legislation that would delay implementation of the law for an additional 60 days, to mid-April. Many members wish to allow more time for the Hogan administration to draft implementing rules and regulations. Some Republican members of the Legislature have called for implementation to be delayed further, until July 2018. Unless the Legislature passes emergency legislation before the end of this year’s three-month legislative session, however, Maryland employers will have to provide the required sick leave benefits starting on February 11, 2018. Based on information published by the Legislature, here is a summary of what the law will require, once it goes into effect:
Which employers will be required to provide sick leave?
- Maryland employers with 15 or more employees must provide paid sick leave.
- Maryland employers with fewer than 15 employees also must provide sick leave, but for these employers, the leave may be unpaid.
- To determine the number of employees for these purposes, the law looks to the average monthly number of persons employed during the prior twelve months, including full-time, part-time, temporary, and seasonal employees.
- The following classes of employees are not covered:
- Employees that regularly work fewer than 12 hours a week.
- Construction industry employees who are covered by a collective bargaining agreement that expressly waives the right to leave under this Act.
- Employees that work on an as-needed basis in the health or human services fields, to the extent they (1) can reject a shift offered by the employer, (2) are not guaranteed work by the employer, and (3) are not employed by a temporary staffing agency.
- Independent contractors
- Licensed real estate salespersons or brokers, or those affiliated with a licensed broker by a written agreement, who are paid solely on commission, and who qualify as independent contractors for federal tax purposes.
- Employees that were under the age of 18 before the beginning of the year.
- Agricultural employees processing crops or working for a farmer in the production, harvesting or marketing of the product.
- Temporary staffing agency employees, if the agency does not have day-to-day control over their work assignments and supervision.
- Employment agency employees providing part-time or temporary services to another person.
How does sick leave accrue?
- Sick leave must accrue at a rate of at least 1 hour for every 30 hours worked.
- Exempt employees are assumed to work 40 hours in a workweek unless they are regularly scheduled for fewer hours, in which case their regularly scheduled hours are used.
- Tipped employees receiving paid leave must be compensated at the minimum wage rate, which will be $9.25 at the time that the law becomes effective.
- An employer may choose any 12-month period to constitute a “year” for purposes of accruing leave under the Act.
- The amount of leave that may be earned per year is capped at 40 hours (five 8-hour days).
- The total amount of leave that may be accrued (including carryover, as discussed below) may be capped at 64 hours (eight 8-hour days).
- The total amount of leave that may be used by an employee may be capped at 64 hours per year.
- An employer is not required to allow accrual of leave: (1) during a two-week pay period in which the employee worked fewer than 24 hours; (2) during a one-week pay period in which the employee worked fewer than 24 hours in the current and immediately preceding pay period; or (2) during a semi-monthly pay period in which the employee worked fewer than 26 hours.
- An employee starts accruing sick leave immediately upon hire, but an employer may prohibit the use of leave during the initial 106 calendar days of employment.
Does sick leave carry over from year to year?
- Employers are allowed to make available to employees the full annual allotment of leave at the beginning of the year. If an employer does so, then it is not required to permit carry-over from year to year
- If an employer does not make the full annual allotment available at the beginning of the year, however, the employer must permit carryover of the balance of any unused leave to the next year, up to a maximum of 40 hours.
May an employee use his or her sick leave to care for family members?
- Yes, and there is a broad definition of family members for these purposes, including:
- Spouse.
- Child, including biological, foster, adopted, or step, as well as one for whom the employee has legal or physical custody or guardianship, or stands in loco parentis (i.e. acts as the parent, regardless of the legal relationship).
- Parent, including biological, foster, adopted, or step for the employee or the employee’s spouse, as well as one who was the legal guardian of or stood in loco parentis to the employee or employee’s spouse.
- Grandparent, including biological, foster, adopted, or step, of the employee.
- Grandchild, including biological, foster, adopted, or step, of the employee.
- Sibling, including biological, foster, adopted, or step, of the employee.
May an employee use leave before it has accrued?
- An employer may, but is not required to, permit an employee to “borrow” leave that has not yet been accrued.
- If the employee terminates employment before the borrowed leave has been accrued (and therefore paid back), the employer may deduct the advanced amount of leave from the employee’s final paycheck only where there is a written, signed authorization by the employee to allow the employer to do so.
- If an employee is rehired within 37 weeks, the employer must reinstate the bank of unused leave unless it was paid out upon termination.
- If an employer acquires another company and retains employees from that company, the employees retain the leave accrued under the prior company.
Does an employee receive payment for accrued but unused sick leave, at the end of employment?
- An employer is not required to pay out accrued but unused leave upon termination of employment.
Does an employee need to give prior notice to the employer, before using sick leave?
- If the need for sick leave is foreseeable, an employer may require its employees to provide up to seven days of notice before taking leave.
- If the need is not foreseeable, the employee must provide notice of the need for such leave as soon as practicable, and must comply with the employer’s notice requirements for absences, as long as those requirements do not interfere with the ability to use leave.
- The employer may deny the use of leave if the employee fails to provide the required notice, and the absence will cause a disruption.
- An employer is not allowed to require an employee to look for or find a replacement worker, as a prerequisite to taking sick leave.
Can an employer require proof of proper use of sick leave?
- Yes. An employer may request verification of the appropriate use of leave if an employee uses more than two consecutive scheduled shifts of leave.
- Verification may also be required if the employee uses leave between the 107th through 120th calendar days after beginning employment, on terms that the employee agreed to at the time of hire.
- If the employee fails to provide the verification, subsequent requests to take leave for the same reason may be denied.
Are their record-keeping requirements?
- Of course, there are! Each time wages are paid, an employer must provide a written statement of available leave. This requirement may be satisfied through an electronic system where the employee can access their leave balances.
- Employers must maintain records, for at least three years, of leave accrued and used by each employee. Failure to keep these records creates a rebuttable presumption that the employer has violated the Act. These records must be available for inspection by the DLLR.
It’s important for all Maryland employers to examine their leave policies before the present effective date of the law (February 11, 2018) to ensure compliance. After the law goes into effect, employees will have the right to file complaints about violation of the law with the commissioner of the DLLR.
This summary is not legal advice, and should not be used for this purpose. Please contact the Law Office of Steven J. Lewicky with any questions about these new requirements.
Supreme Court hears arguments on whether employers can require employees to waive right to class action lawsuits, and mandate arbitration of disputes
On the first day of its term earlier this month, the Supreme Court took up the very important question of whether employers may require, in employment contracts, that any controversy between the employer and its employees be decided through arbitration, instead of in court. Employers have increasingly been including in written employment contracts a requirement that employees arbitrate any disputes with the company individually, and waive their rights to resolve disputes through class action lawsuits.
This exposes a tension between federal laws — the Federal Arbitration Act on the one hand, and the National Labor Relations Act, which guarantees employees a right to engage in “concerted activities” for “mutual aid or protection.” In the pending cases before the Supreme Court, employers have argued that the Federal Arbitration Act is unequivocal and that contractual arbitration provisions must be enforced. The employers also argue that the National Labor Relations Act does not expressly prohibit waivers of class action lawsuits. The employees in these pending cases and the National Labor Relations Board, however, argue that there is no need for the justices to harmonize the National Labor Relations Act and the Federal Arbitration Act because arbitration agreements cannot be enforced by courts when they are illegal. They argue that the National Labor Relations Act’s reference to the right of employees to engage in “concerted activities” for “mutual aid or protection” has long been interpreted by courts to include the right of employees to pursue joint legal claims, which should include class action lawsuits. Contractual limits on asserting class-action lawsuits, therefore, should be seen as illegal and unenforceable. Twenty-eight amicus curia briefs were filed by non-parties in these cases, suggesting how important this issue is to both employers and employees.
Amy L. Howe of SCOTUSblog.com reports that, during the Supreme Court’s oral arguments on October 2, a majority of the justices appeared inclined to come down on the side of employers, and uphold employment agreements that require an employee to resolve a dispute through individual arbitration, waiving class action lawsuits. Chief Justice Roberts, in a back-and-forth with a law professor representing one of the employees in the case, observed that a decision in favor of the employees would invalidate employment agreements covering 25 million people – a step that several of the justices would be reluctant to take, particularly given the court’s strong support of arbitration in recent years. Justice Breyer, on the other hand, told an attorney representing employers that he did not see a path for the employers to win without “undermining and changing radically” the labor laws that are the “entire heart of the New Deal.” An attorney representing employers was pressed repeatedly by the court’s four more liberal justices to explain how the employers’ position could be reconciled with the National Labor Relations Act, but the attorney argued that the NLRA was only intended to protect collective action in the workplace, and to allow employees to get to a forum in which to raise their grievances with employers. Once an employee arrives at that forum, the attorney argued, the employer can raise any defenses that it may have, such as the fact that the employee had agreed to arbitrate any disputes individually. Justice Kagan pointed out that another federal statute, the Norris-La Guardia Act, in her view bars courts from enforcing any waiver of an employee’s right to concerted activity.
The U.S. Government initially filed a brief with the National Labor Relations Board asking the justices to review these cases, but with the change of administrations, the Government thereafter sided with the employers in briefs and argument. Based on questioning during argument, Ms. Howe of SCOTUSblog believes that employers can be assured of the votes of Justices Roberts, Kennedy and Alito, but the two remaining conservative justices – Thomas and Gorsuch – were silent during oral argument and gave no indication of their thinking. Justice Thomas has voted in favor of a broader reading of the Federal Arbitration Act, however, and Justice Gorsuch generally interpreted arbitration clauses broadly while he was a judge prior to appointment to the Supreme Court. Both sides now wait with anticipation for the Supreme Court’s ruling, which will probably be handed down next spring.
More details of the briefs and oral arguments in these cases may be read at SCOTUSblog.
Maryland employers may need to provide accommodation to employees with disabilities by offering alternative job postings
The Maryland Fair Employment Practices Act (“MFEPA”) makes it unlawful for an employer to refuse to make reasonable accommodation for an employee that has a disability known to the employer. Regulations implementing the Act provide that an employer may not deny an employment opportunity to an employee with a disability, if the basis for the denial is a need to accommodate the individual’s physical or mental limitations, and the accommodation would be reasonable.
Earlier this year, in Townes v. Md. Dept. of Juvenile Services, the U.S. District Court in Maryland had an opportunity to apply this law to a government employee who was diagnosed with bipolar disorder. The employee’s treating psychiatrist recommended that she work from a different office location within the state-wide department, in order to reduce travel. The employee contended that there were open positions within the department that would require her to engage in less travel, but the department declined to consider her for any of those jobs when she returned from disability leave. She further alleged that her employer failed to perform an individual assessment to determine whether she was qualified for another job, beyond her current position. The employer filed a motion for summary judgment, arguing that it was entitled to a favorable judgment as a matter of law on the facts as alleged by the employee, without need to proceed to trial on those facts.
The employee argued that the MFEPA is similar to the Americans with Disabilities Act (“ADA”) in requiring an interactive process by which an employer conducts an individualized assessment for an employee with a disability. She pointed to an earlier decision by the Maryland Court of Appeals, in which that court broadly interpreted the phrase “job in question.” The court also looked to a Maryland state regulation that requires an employer to consider an employee’s request for another job position if she becomes disabled.
The question in the summary judgment motion came down to whether a Maryland employer is required by the MFEPA to assess whether an employee with a disability can perform the essential functions of any job opening within the organization, or only those that are located in the employee’s existing work location. While the employer did not dispute that it was required to perform a review to determine whether a reasonable accommodation was available to allow the disabled employee to perform essential job duties, it questioned whether it had to assess whether the employee can perform job functions at any job posting within a multi-site organization. In ruling on this pre-trial motion, the court found that the MFEPA statute does not preclude a jury from finding that there is such an obligation, and therefore the court allowed the case to proceed toward trial.
This ongoing case suggests that federal courts in Maryland may be inclined to interpret the MFEPA in a similar manner as the Americans With Disabilities Act (“ADA”) and the Rehabilitation Act. If so, then upon learning of an employee’s request for a transfer to another job location due to a claim of disability, an employer should engage in good faith interactions with the employee (and an individualized assessment), and try to find an appropriate job posting for the employee elsewhere within the organization. As noted, this case has not yet reached trial, and the plaintiff still must prove her case to a jury in order to prevail on her theory.
For information about employment law claims, please contact the Law Office of Steven J. Lewicky.
Maryland court clarifies the burden of proof to be applied in defamation lawsuits
People often think that any false statement asserted about a person is defamatory. In fact, the law of defamation is complicated, and different standards apply to public figures and to private citizens outside of public life.
To successfully make a case of defamation in Maryland, you must establish that the accused defendant made a defamatory statement to a third person, that this statement was false, that the defendant was legally at fault in making the statement, and that the plaintiff suffered harm as a result of the statement’s publication. A statement is only “defamatory” if it tends to expose a person to public scorn, hatred, contempt, or ridicule, and thereby discourages the community from having a good opinion of, or associating with, the person that was the subject of the statement. Even if a statement is defamatory, a defendant still may raise what is known as a “qualified” or “conditional” privilege from being held responsible and thereby be excused for the defamation if the defense is proven.
One form of conditional privilege is the First Amendment privilege. The U.S. Supreme Court established decades ago that statements pertaining to public figures on matters of public concern are excepted from defamation liability, unless the speaker or writer had actual knowledge that the statement was false, or acted with reckless disregard for the truth. This is a very high standard of proof and makes it very difficult for a public figure to win a defamation action.
Private citizens that are not public figures do not have to overcome this First Amendment privilege to prevail in a defamation action, but there are other privileges, arising under the common law, that may derail a defamation action brought against a private person. There is a “public interest” privilege, for example, permitting persons to communicate to public officials about matters that are within their public responsibility. There is a privilege to communicate with someone who shares a common interest or to make statements in defense of oneself, or in the interest of others. There is a “fair comment” privilege, and a privilege to make a fair and accurate report of public proceedings. The breadth of these common-law privileges is not precisely defined by case law.
On November 22, 2016, the Maryland Court of Appeals issued a decision clarifying one aspect of defamation law: In cases of private defamation, the plaintiff has the burden of proving the falsity of the allegedly defamatory statement. If the defendant asserts a common law conditional privilege, the plaintiff also bears the burden of overcoming that privilege. The Court, in this recent case, has now clarified that the standard of proof that the plaintiff must meet in overcoming a conditional privilege is proof by a preponderance of the evidence. This decision establishes that a plaintiff in such a case need not meet the higher standard of overcoming a conditional privilege by clear and convincing evidence, which is required in some other states.
Confusion reigns as new overtime rule is placed in limbo
Maryland employers and workers have reason to be confused about an anticipated expansion of eligibility for overtime pay. In May, the U.S. Department of Labor issued a regulation that would have doubled (to $47,476) the salary threshold at which many workers have a right to receive time-and-a-half pay, for workweeks that exceed 40 hours. The rule also would have indexed to inflation future increases in this threshold. The rule was to have taken effect on December 1, but a few days ago a U.S. District Court judge in Texas issued an injunction barring the rule’s implementation, holding that the Department of Labor may have exceeded its authority in issuing the rule.
The court’s ruling was handed down as Congressional leaders were giving consideration to adjourning earlier than Congress otherwise would have, to preserve the incoming Republican Congress’ ability to legislatively block the new rule in January 2017. Under the Congressional Review Act, adjourning the current Congress early would stop the clock for legislative review until the new Congress convenes. Congress might still go forward with this blocking action in January, despite the Texas court’s injunction, since the injunction could prove to be temporary. In addition, Congressional action would have a nation-wide effect, while the impact of court action could eventually become regionally fractured if some federal Circuit Courts continue to block the regulation, while other Circuits uphold the regulation (should Congress fail to act in January). As long as the ninth seat on the Supreme Court remains vacant, anticipated splits between the Circuit Courts of Appeal on this issue would remain in place, if Congress does not legislatively block the regulation.
Many employers have already informed their employees of pay increases that would take categories of their workers above the regulation’s $47,476 threshold. This new threshold now no longer is legally binding – as long as the Texas injunction remains in place, and/or if Congress blocks the rule in January – yet employers fear an adverse impact on employee morale should they rescind previously-awarded pay increases. On the other hand, honoring previously-announced increases that are no longer necessary in order to keep an employee under the applicable salary threshold would mean incurring salary costs that are not legally required.
Confusion reigns as new overtime rule is placed in limbo
Maryland employers and workers have reason to be confused about an anticipated expansion of eligibility for overtime pay. In May, the U.S. Department of Labor issued a regulation that would have doubled (to $47,476) the salary threshold at which many workers have a right to receive time-and-a-half pay, for workweeks that exceed 40 hours. The rule also would have indexed to inflation future increases in this threshold. The rule was to have taken effect on December 1, but a few days ago a U.S. District Court judge in Texas issued an injunction barring the rule’s implementation, holding that the Department of Labor may have exceeded its authority in issuing the rule.
The court’s ruling was handed down as Congressional leaders were giving consideration to adjourning earlier than Congress otherwise would have, to preserve the incoming Republican Congress’ ability to legislatively block the new rule in January 2017. Under the Congressional Review Act, adjourning the current Congress early would stop the clock for legislative review until the new Congress convenes. Congress might still go forward with this blocking action in January, despite the Texas court’s injunction, since the injunction could prove to be temporary. In addition, Congressional action would have a nation-wide effect, while the impact of court action could eventually become regionally fractured if some federal Circuit Courts continue to block the regulation, while other Circuits uphold the regulation (should Congress fail to act in January). As long as the ninth seat on the Supreme Court remains vacant, anticipated splits between the Circuit Courts of Appeal on this issue would remain in place, if Congress does not legislatively block the regulation.
Many employers have already informed their employees of pay increases that would take categories of their workers above the regulation’s $47,476 threshold. This new threshold now no longer is legally binding – as long as the Texas injunction remains in place, and/or if Congress blocks the rule in January – yet employers fear an adverse impact on employee morale should they rescind previously-awarded pay increases. On the other hand, honoring previously-announced increases that are no longer necessary in order to keep an employee under the applicable salary threshold would mean incurring salary costs that are not legally required.