Workforce Bulletin

As the New Year began, new minimum wage rates took effect in numerous states and localities nationwide.

Effective January 1, 2026, 18 states, along with many local jurisdictions, raised their minimum wage requirements, and six states adjusted salary thresholds for exempt executive, administrative, and professional employees. Employers should review these changes and ensure ongoing compliance.

With Memorial Day in the rearview mirror and the month of June upon us, many companies and organizations throughout the country are preparing to kick off the summer by welcoming an incoming cohort of summer interns.  Internship programs are a win-win for both employers and students: they enable employers to identify future talent and provide students valuable work experience and training.  That said, employers choosing to offer such programs should take care to structure them properly to avoid any risk of liability under applicable federal and state wage and hour laws.  Keep reading to learn the key wage-hour compliance issues and best practices for hosting interns this summer.

Do I have to pay my interns?

Most likely, yes—at least unless the internship is one where the intern mainly shadows and observes but performs little to no productive work.  At least under U.S. Department of Labor Wage and Hour Division (WHD) guidance, internships generally are presumed to constitute an employment relationship under the federal Fair Labor Standards Act (“FLSA”)—and, therefore, an employer must pay wages to its interns—unless the internship satisfies the “primary beneficiary test.”

Despite Punxsutawney Phil declaring an early spring, employers should continue to prepare for weather-related emergencies and their wage and hour implications.  As with most of wage and hour-related determinations, employers should be mindful of the distinctions between their exempt and non-exempt workforce when assessing their obligations under the Fair Labor Standards Act (FLSA), and state and local laws, to pay employees as a result of weather-related emergencies.

Salaried Exempt Employees

Under the FLSA, employers may not deduct from the salary of an employee classified ...

On January 9, 2024, the United States Department of Labor’s (DOL) Wage and Hour Division (WHD) announced a final rule regarding how to determine whether a worker qualifies as an employee or may be considered an independent contractor under the Fair Labor Standards Act (FLSA).  Designed to combat misclassification, the final rule rescinds DOL’s Trump-era Independent Contractor Rule issued in January 2021 and restores the non-exhaustive six-factor test courts have long used to evaluate whether or not independent contractors were properly classified.  The test considers:

On May 3, 2023, New York Governor Kathy Hochul announced – and then signed into law – the New York Legislature’s 2024 Budget Agreement (“Budget”), which includes increases to the state’s minimum wage.  Effective January 1, 2024, the minimum wage will increase to $16 per hour in New York City and Nassau, Suffolk, and Westchester counties, and to $15 per hour in the remainder of the state.  The minimum wage will then increase by another $.50 each year in 2025 and 2026—reaching $17 per hour in downstate New York by 2026. Subsequent annual increases to the minimum wage will be tied to the inflation rate. The State Department of Labor (DOL) is required to publish future adjusted minimum wage rates by no later than October 1st of each year.

work | \ wərk \ (noun):  activity in which one exerts strength or faculties to do or perform something

In common parlance, the concept of “work” connotes some physical or mental exertion.  The law, however, defines the term more broadly, and properly compensating employees often is not as simple as paying for all time spent performing “work” in the usual sense of that term.  The Fair Labor Standard Act (“FLSA”) and the laws of many states require employers to also pay for certain periods of time during which employees are idle and simply waiting to begin working—even if those employees never become engaged in work. 

In reversing a Nevada district court’s grant of summary judgment, the Ninth Circuit, in Cadena v. Customer Connexx LLC, recently held that the time call center employees spent booting up their computers is compensable. Because a functioning computer was necessary for the call center employees to do their job, the court unanimously agreed that the time required to turn on their computer and log in was “integral and indispensable to their principal activities” and, therefore, compensable, subject to certain limitations.

As COVID-19 restrictions have continued to loosen or be lifted altogether, employees have gradually resumed working in the office—and traveling away from it for work-related reasons.  When it comes to travel time in the employment context, the answer to the question, “Do I need to pay for that?” often has no straightforward answer.  Rather, under the Fair Labor Standards Act (“FLSA”) and U.S. Department of Labor (“DOL”) regulations, whether time an employee spends traveling is compensable depends on the type of travel.  In this month’s Time Is Money segment, we provide a refresher on when and how employers must pay employees for travel time.

New Yorkers who employ of domestic workers should note two recent amendments to the New York State Human Rights Law (“NYSHRL”) that went into effect on December 31, 2021, which together extend full protection of the NYSHRL to individuals employed in domestic service in New York.  In addition, beginning on March 12, 2022, employment protections afforded by the New York City Human Rights Law (“NYCHRL”) will apply to all domestic workers.

The first amendment to the state law removed language from the definition of “employee” under section 292(6), which had previously excluded domestic workers from most of the NYSHRL’s protections. Now, the only category of persons excluded from the definition of “employee” are those individuals employed by their parents, spouse, or child. The second amendment repealed section 296-b, which had protected domestic workers from harassment, but not other types of discrimination.

Employers grappling with the many questions related to bringing employees back into the workplace safely in the midst of the COVID-19 pandemic should pay close attention to the potential wage-and-hour risks attendant to doing so—including whether to pay employees for time spent waiting in line for a temperature check, verifying vaccination status, or completing other health screening inquiries.

Given the growing trend of COVID-19 lawsuits, ignoring these risks could leave employers vulnerable to costly class and collective action litigation.

What the Law Requires

Under ...

The Wage and Hour Division of the U.S. Department of Labor (“WHD”) issued six opinion letters in January 2021.[1]  They address a number of important issues under the Fair Labor and Standards Act (“FLSA”).  To ensure wage and hour compliance, we recommend reviewing these letters closely and consulting counsel with any questions as to how they may apply to a specific business situation.

FLSA2021-1

In FLSA2021-1, the WHD addressed whether account managers employed by a life science products manufacturer were properly classified as exempt from the FLSA minimum wage and ...

Many employers may be eager to put 2020 in the rearview mirror.  But before ringing in the New Year, employers should carefully evaluate whether they need to make any changes to their current practices to ensure that they remain in compliance with state and local laws, including those relating to minimum wage.

As reflected in the chart below, in 2021, minimum wage will increase in more than two dozen states, with most of the changes set to take effect on January 1.  Minimum wage will also increase at the local level in a number of counties and cities.  Accordingly, employers with minimum wage ...

At the end of August, the U.S. Department of Labor’s Wage and Hour Division (“WHD”) issued four new opinion letters addressing various issues arising under the Fair Labor Standards Act (“FLSA”).  The topics covered include the retail or service establishment, highly compensated employee, and professional exemptions; reimbursing non-exempt employees for required use of a personal vehicle; and the fluctuating workweek method of calculating overtime pay.  These opinion letters offer a helpful overview of key FLSA principles and may answer fact-specific questions ...

With summer rapidly approaching and COVID-19 shelter-in-place orders still in effect, many companies face an important and difficult decision of canceling this year’s summer programs, delaying start dates or conducting programs virtually. This ultimately will be a business decision with no one-size-fits-all answer.

A good first step is to assess whether the influx of new summer workers will help or hinder current operations. Are temporary summer interns a boost to productivity or a drag on experienced employees who may be called upon to train and mentor them? Will the employer expect to offer employment to these summer recruits following the internship?

In addition, given the seismic nature of COVID-19 that has indiscriminately shaken businesses in most industries, can an employer’s business afford to bring on temporary summer workers and, if so, does the business have the literal and figurative bandwidth to support these workers, especially if they will be teleworking for at least part of the summer?

Below are five compliance and management issues employers should consider for their upcoming summer programs.

Onboarding

Typically employers have a pre-employment screening process in place for summer interns/analysts/associates, which may include, among other things, screening for illegal drugs and controlled substances; investigating and verifying criminal history; and verifying education and prior employment history. Many steps in the screening process take place in person. However, even where new hires may be asked to commence employment remotely, including an incoming summer class, compliance is still possible.

Since the start of COVID-19 pandemic, the federal government has relaxed many of the regulatory requirements for onboarding new hires. On March 20, the U.S. Department of Homeland Security announced that for the next 60 days or for the duration of the National Emergency (whichever is sooner), employers with staff teleworking due to COVID-19 can obtain and inspect new employees’ identity and employment authorization documents remotely rather in the employee’s physical presence, as long as they provide written documentation of their remote onboarding and teleworking policy for each employee.

In March 2020, as the severity of the COVID-19 pandemic in the United States began to emerge, state and local governments took historic steps to shut down all nonessential activity in their jurisdictions.  As of April 20, “at least 316 million people in at least 42 states, three counties, 10 cities, the District of Columbia and Puerto Rico” were subject to some form of a government order or proclamation calling for all nonessential workers to stay-at-home (except for necessary trips to places such as pharmacies and grocery stores).  Whereas these critical shelter-in-place ...

On April 14, 2020, exactly two weeks after the Families First Coronavirus Response Act (“FFCRA” or “Act”), went into effect and the U.S. Department of Labor (“DOL”) issued a temporary rule (“Rule”) interpreting the paid sick leave and emergency family and medical leave provisions of the Act, the Attorney General for the State of New York, Letitia James (“AG”), filed a legal challenge to that Rule. [1] In the lawsuit against the DOL, the AG alleges that various provisions of the Rule violate both the statutory language and the intent of the FFCRA.

As we previously ...

The U.S. Department of Labor has again updated its compliance assistance for the Families First Coronavirus Response Act (“FFCRA”), in the form of “Questions and Answers.”  This post summarizes the most recent Questions and Answers.  Previous summaries can be found here and here.

Some of the newest answers include the following:

• Question 60: Clarifies that shelter-in-place and stay-at-home orders can qualify as federal, state, or local quarantine or isolation orders for purposes of leave under FFCRA.
• Question 61: Clarifies that an individual is eligible for paid sick ...

The U.S. Department of Labor (“DOL”) continues to update its compliance assistance for the Families First Coronavirus Response Act (“FFCRA”), in the form of “Questions and Answers.”  The DOL posted a temporary rule issuing regulations pursuant to the FFCRA on April 1, 2020; while we are digesting the temporary rule and preparing a forthcoming advisory, we wanted to highlight some of the important insights of the updated FAQs. The DOL published its initial guidance on March 24, 2020, summarized in a previous post, covering the FFCRA’s paid sick and paid family leave ...

In addition to its recent, exigent responsibility of preparing guidance on the protections and relief offered by the Families First Coronavirus Response Act, the U.S. Department of Labor’s Wage and Hour Division (“WHD”) has issued three new opinion letters addressing the excludability of certain types of payments from the regular rate of pay under the Fair Labor Standards Act (“FLSA”).  While these opinion letters do not tread new ground, they are useful reminders of important regular rate principles and merit careful review.

As background, under the FLSA, an employer ...

On March 24, 2020, the Wage and Hour Division (“WHD”) of the U.S. Department of Labor (“DOL”) issued initial guidance (“Guidance”) on the Families First Coronavirus Response Act (“FFCRA” or the “Act”), which we detailed in a previous Advisory.  In short, the Act requires private employers with fewer than 500 employees (“covered employers”) to provide paid sick and family leave for certain COVID-19 related absences and includes a tax credit for employers for the cost of the paid leave.

The Guidance comprises (i)  a Fact Sheet for Employers, (ii) a Fact Sheet ...

With the March 16, 2020 effective date of the new rule interpreting joint employer status under the Fair Labor Standards Act (“FLSA”) almost upon us, employers should brush up on the updated guidance and review their relationships with workers to ensure compliance.  Otherwise, they may face the expensive possibility of being held jointly and severally liable under the FLSA for all of the hours the individuals worked in the workweek, including hours worked for a different company.

The New Rule

A joint employment relationship may arise under two potential scenarios.

Scenario 1:  ...

On December 6, 2019, the Second Circuit Court of Appeals held that judicial approval is not required for offers of judgment to settle Fair Labor and Standards Act (“FLSA”) claims made pursuant to Federal Rule of Civil Procedure 68(a). This development may provide employers with a valuable strategic tool for use in FLSA cases, at least in the Second Circuit, allowing the parties to include terms in offers of judgment that the courts might disallow were court approval required.

Generally speaking, Rule 68 offers of judgment are a pre-trial mechanism whereby defendants can cap their ...

In the first meaningful revision of its joint employer regulations in over 60 years, on Monday, April 1, 2019 the Department of Labor ("DOL") proposed a new rule establishing a four-part test to determine whether a person or company will be deemed to be the joint employer of persons employed by another employer. Joint employer status confers joint and several liability with the primary employer and any other joint employers for all wages due to the employee under the Fair Labor Standards Act ("FLSA"), and it’s often a point of dispute when an employee lodges claims for unpaid wages or ...

On March 6, 2019, the 20-year business partnership between celebrity chef Mario Batali and the Bastianich family of restaurateurs, Batali & Bastianich Hospitality Group, was formally dissolved following allegations by several women more than a year ago that he sexually assaulted and harassed them at his restaurants years earlier. Tanya Bastianich Manueli and her brother Joe Bastianich have bought all of Mr. Batali’s shares in the restaurants. As a result, Mr. Batali has been fully divested and will no longer profit from his former restaurant group, and his name already has been ...

We published an article in Club Director, titled “Harassment and the #MeToo Movement in the Private Club Industry.” Following is an excerpt:

The recent heightened awareness to sexual harassment issues affects a wide range of industries, and has prompted employers to consider ways to get ahead of the problem. In order to reduce the risk of such complaints, private clubs may take a number of proactive steps.

Anti-Harassment Policy: Clubs should develop a zero-tolerance policy against harassment that includes, at a minimum, the following elements:

• Expressly prohibit any ...

Depending on the jurisdictions within which they operate, certain employers and their counsel will soon see a significant change in early mandatory discovery requirements in individual wage-hour cases brought under the Fair Labor Standards Act (“FLSA”).

A new set of initial discovery protocols recently published by the Federal Judicial Center (“FJC”), entitled Initial Discovery Protocols For Fair Labor Standards Act Cases Not Pleaded As Collective Actions (“FLSA Protocols”), available here, expands a party’s initial disclosure requirements to include ...

Chipotle recently obtained decertification of a conditionally certified collective action of salaried “apprentices” under Section 216(b) of the Fair Labor Standards Act (“FLSA”) in Scott et al. v. Chipotle Mexican Grill, Inc. et al., Case No. 12-CV-8333 (S.D.N.Y. Mar. 29, 2017), a case in New York federal court involving claims of unpaid overtime based on misclassification.  In that case, Chipotle effectively leveraged disparities between the job duties and activities of putative class and collective action members across six states to show that they were not ...

Employers often struggle to provide employees with their requested accommodations and to comply with disability laws while still effectively running their business. This struggle has been compounded with the Equal Employment Opportunity Commission’s aggressive pursuit of litigation in this area in recent years.  A New York federal court recently weighed in on the issue in Kelly v. Starwood Hotels & Resorts Worldwide, Inc., 15 Civ. 6309 (DLC), 2017 U.S. Dist. LEXIS 43485 (S.D.N.Y. Mar. 24, 2017), holding that an employer is only required to provide an employee with a “plainly ...

A New York federal court recently declined to certify under Rule 23 of the Federal Rules of Civil Procedure (“Rule 23”) six classes of salaried “apprentices” at Chipotle restaurants asserting claims for overtime pay under New York Labor Law (“NYLL”) and parallel state laws in Missouri, Colorado, Washington, Illinois, and North Carolina, on the theory that they were misclassified as exempt executives in Scott et al. v. Chipotle Mexican Grill, Inc. et al., Case No. 12-CV-8333 (S.D.N.Y. Mar. 29, 2017).  The Court also granted Chipotle’s motion to decertify the ...

As we previously discussed here, acting on behalf of the Department of Labor (“DOL”), the U.S. Department of Justice (“DOJ”) urged
the Fifth Circuit Court of Appeals to expedite briefing on its interlocutory appeal of a Texas district court’s nationwide preliminary injunction barring implementation and enforcement of the new overtime rule that would double the minimum salary threshold for white-collar exemptions, among other things. The injunction was issued just days before the rule was to go into effect on December 1, 2016.

The DOJ obtained a fast-tracked briefing ...

In a split decision, the Ninth Circuit Court of Appeals has declined to adopt a bright-line rule to assess whether a managerial employee has filed a complaint for the purposes of § 215(a)(3) of the Fair Labor Standards Act (“FLSA”), the statute’s anti-retaliation provision.  The decision, Rosenfield v. GlobalTranz Enterprises, appears to highlight a disagreement among the Circuits.

At least four Circuit Courts – the First, Fifth, Sixth and Tenth – have adopted a manager-specific legal standard:  in order to engage in protected activity under § 215(a)(3), the employee ...