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Friday, October 4, 2019


The new salary thresholds will take effect on January 1.

 Last week, the U.S. Department of Labor issued its Final Rule regarding the salary thresholds that apply to certain exempt white-collar employees.

KEY PROVISIONS

Standard salary levels (Executive, Administrative, and some Professional exemptions)

The salary threshold levels for these exemptions were set at the 20th percentile of earnings of full-time salaried workers in the lowest-wage region (the South) or in the retail industry nationally.

For workers to be exempt from the overtime requirements of the Fair Labor Standards Act based on the executive, administrative, or some professional exemptions, they must be paid at least the amounts indicated below as of January 1:

$684 per week, or $35,568 per year. (The current threshold level is $455 per week, or $23,660 per year.) Because the DOL used the most recent salary data available at the time it drafted the Final Rule (from June 2019), there will be no updating in January 2020 to adjust for inflation.

Employers may count non-discretionary bonuses, incentives, and commissions toward up to 10 percent of the standard salary level as long as the employer pays those amounts at least annually.

Highly compensated employees

The total annual compensation level for the “highly compensated employee” exemption will be set at the 80th percentile of earnings of full-time salaried workers nationally. Under the proposed rule, the exemption would have been set at the 90th percentile.

For workers to be exempt from the FLSA overtime requirements based on their status as highly compensated employees, they must be paid at least the amounts indicated below as of January 1:

$107,432 per year, of which at least $684 per week must be paid on a salary or fee basis. The remaining minimum annual compensation may include commissions, non-discretionary bonuses and other non-discretionary compensation. (The current threshold for highly compensated employees is $100,000 a year.)
Special threshold rates

The final regulations also include special rates that apply in certain circumstances:

$455 per week for workers in Puerto Rico, the Virgin Islands, Guam, and the Commonwealth of the Northern Mariana Islands.
$380 per week for workers in American Samoa.
$1043 per week for workers in the motion picture industry.
The final regulations do not make any changes to the “duties tests,” nor do they include any provision for automatic “adjustment” of the salary thresholds in the future. Regarding the latter, the DOL has said that it will periodically revisit the minimum salary and compensation levels through future notice-and-comment rulemaking.

According to DOL estimates, 1.2 million employees who are currently exempt under the executive, administrative, and professional exemptions will, without some intervening action by their employers, become eligible in 2020 for overtime under these new salary levels. Absent employer action, approximately 101,800 employees who are currently exempt as highly compensated employees are expected to become eligible for overtime in 2020.

ANALYSIS

The most significant differences between the new final regulations and the version issued in 2016 by the Obama Administration (which was invalidated by a court ruling), are that the current increases are more modest, and that there is no mechanism included for automatic adjustments in the future.

Some employee advocacy groups have publicly said that they plan to challenge the new regulations in the courts. Even if their challenges are successful, the effect would almost surely be to leave in place the current (significantly lower) threshold levels, which were set in 2004. Thus, the logic behind a legal challenge by worker advocates is not readily apparent.

Assuming, as we must, that the new regulations will take effect on January 1, employers will need to quickly reassess the exempt classifications of employees who are paid less than the levels mandated in the new regulations. Employers will have to evaluate whether to increase the salaries of those employees to retain the exempt classification, or whether to reclassify the employees as non-exempt (eligible for overtime).

While that reassessment is taking place, it is also an excellent time for employers to evaluate compliance with the job duties requirements applicable to the white-collar exemptions. Although the new regulations did not change the “duties tests,” job duties nonetheless remain requirements that must be satisfied in addition to the salary and compensation requirements.

Friday, September 27, 2019


FMCSA Clearinghouse Ready Top 7 To Do List: - Procrastination is not an option.
By: Tommy Eden, Partner Constangy, Brooks, Smith & Prophete, LLP

As with most mandated Federal Regulations, resistance is futile to the Federal Motor Carrier Safety Administration (FMCSA) Clearinghouse with FMCSA regulated employers and CDL Driver registration opening October 2019. The Clearinghouse is a secure online database that will give employers, the FMCSA, State Driver Licensing Agencies, and State law enforcement personnel real-time access to important information about CDL Driver drug and alcohol program violations.

Take these Top 7 steps to get your CDL Drivers, Company, City, County, State on the compliance road:
1)      Educate your staff on all the regulatory mandates detailed in the FMCSA Clearinghouse Final Rule (183 Pages) which became effective January 4, 2017, with a mandated Compliance Date of January 6, 2020, when the Clearinghouse database goes live. You can also learn, in a free 60-minute Recorded Webinar from Constangy Partners Tommy Eden and Jonathan Martin, a walk-through of all the new Regulations, the nine landmines they discovered in their study of the regulations and wise counsel on how to avoid each.
·         view the free Constangy Recorded Webinar FMCSA CLEARINGHOUSE GOES LIVE 1.6.2020: POTENTIAL LANDMINES AND HOW TO AVOID THEM and download the resources found in the “Event Resources” tab.
·         Subscribe to receive Clearinghouse email updates directly from the FMCSA
2)      Carefully Select who will enroll your entity in the Clearinghouse and direct your entity’s compliance efforts. Because the Clearinghouse contains multiple prohibitions on the misuse of information in the database, warnings about inaccurate reporting, mandates that all reports be truthful and accurate, criminal and civil penalties for violations, it is advised that all your designated Clearinghouse users (Assistants) sign an access agreement to show good faith compliance. Constangy Specimen FMCSA CLEARINGHOUSE ACCESS CONFIDENTIALITY AGREEMENT AND ACKNOWLEDGMENT
3)      Prepare for those persons you are entrusting with your Clearinghouse access, a Clearinghouse Ready Compliance notebook. It should contain the following (found in the “Event Resources” tab for the Recorded Webinar):
·         Copy of the Clearinghouse Final Rule
·         Copy of the 49 CFR Part 382 (FMCSA regulations)
·         Copy of the Webinar Constangy Slide Deck
·         Copy of the Webinar Constangy Q&As
·         Copy of FMCSA Regulators Q&As compiled from Clearinghouse website
4)      Decide now who will be your certified Medical Review Officer (MRO), Certified Third Party Administrator (C/TPA), Substance Abuse Professional (SAP), so you can select them when your entity enrolls in the Clearinghouse during October 2019. Learn from the FMCSA more about the various Employer, Driver and Service Agents  Reporting Obligations. You should also plan at time of Clearinghouse Registration to purchase by credit card your “Query Plan Bundles” directly from the Clearinghouse at the rate of $1.25 per Driver Query, which can them be used by your C/TPA, or by your entity if your upload your own Annual Query Request. Learn more from the FMCSA Query Factsheet.
5)      Order your customized Clearinghouse Ready FMCSA Policy and Clearinghouse Ready Forms Toolkit, and companion Company Authority policy. Constangy can help with a proposal for an attorney drafted FMCSA Clearinghouse Ready Policy and Clearinghouse Ready Forms Toolkit. For a no obligation flat rate quote fill in the intake questionnaire to help us better understand your compliance needs. The Constangy forms Toolkit is designed for the employer to easily create “legal evidence” supporting a reported Clearinghouse violation as fully discussed in the Constangy Recorded Webinar.
6)      Educate your supervisors and CDL Drivers on the Clearinghouse and encourage Drivers to sign up, otherwise they will not have access to Clearinghouse reports on them. Disturbing this FMCSA Clearinghouse Factsheet will help educate your Drivers FMCSA Driver’s Factsheet and Reporting Obligations.  Use this Constangy Specimen acknowledgement of training of your CDL Drivers FMCSA CLEARINGHOUSE CDL DRIVER ACKNOWLEDGMENT OF TRAINING MATERIALS
7)      After 1.6.2020, the Clearinghouse will contain information on all CDL Driver drug and alcohol program violations. These violations include:
·         Report for duty/remain on duty for safety-sensitive function with alcohol concentration of 0.04 or greater or while using any drug specified in the regulations (Part40), other than those prescribed by a licensed medical practitioner
·         Alcohol use while performing, or within four hours of performing, a safety-sensitive function
·         Alcohol use within eight hours of a post-accident alcohol test
·         Test positive for use of specified drugs
·         Refusing to submit to a required alcohol or drug test
·         Actual Knowledge by an Employer of Driver Substance Abuse
Encourage your CDL Drivers to get help now if they have a substance abuse problem.

Tommy Eden is a partner working out of the Constangy, Brooks, Smith & Prophete, LLP offices in Opelika, AL office and can be contacted at teden@constangy.com or 334-246-2901 and links at www.alabamaatwork.com  On October 9, 2019, EASHRM will host an FMCSA Clearinghouse Ready Breakfast Seminar at Southern Union to learn about this new mandatory national database from Tommy Eden and Dr. Garth Stauffer at EAMC. Registration link: https://eashrm.shrm.org/join-now

Tuesday, June 25, 2019

Is Alabama Ready for "Ban the Box"




Colorado has become the latest jurisdiction to join the “ban the box” movement. The Colorado Chance to Compete Act, signed into law by Gov. Jared Polis (D) on May 28, will take effect September 1, 2019 for employers with 11 or more employees. It will apply to all employers, regardless of size, on September 1, 2021.

Image result for ban the box
The Act, which aims to give applicants with criminal records a more meaningful chance to compete for jobs, limits an employer’s ability to ask about criminal history at the application stage and also limits statements about criminal history on job applications and advertisements. Key provisions of the Act “Criminal history” is defined in the Act as “the record of arrests, charges, pleas, or convictions for any misdemeanor or felony at the federal, state or local level.” Specifically, under the Act: 

  • Employers may not state that a person with a criminal history may not apply for a position in an advertisement for employment or on any application, and 
  • Employers may not ask about an applicant’s criminal history on the initial application. However, employers may obtain publicly available criminal background reports of an applicant at any time.

The above-described prohibitions do not apply if: 
  • A federal, state, or local law or regulation prohibits employing a person with a specific criminal history in the position being offered or advertised, or 
  • The employer has designated the position to participate in a government program to encourage the employment of individuals with criminal histories, or 
  • The employer is required by law or regulation to conduct a criminal history check for the position.
  • The Act does not apply to state or local governments, or to quasi-governmental entities or political subdivisions of the state. 


The Act does not confer a private right of action or create a protected class. If an employer violates the Act, the affected individual may file a complaint with the state Colorado Department of Labor and Employment within a year of the claimed violation. If the Department finds that the complaint has merit, the employer will be directed to comply within 30 days. 

Other penalties, which are in addition to the order, vary depending on the number of violations by the employer. For a first violation, the employer receives a warning. For a second violation, the employer may be assessed up to $1,000. For a third or subsequent violations, the employer may be assessed up to $2,500. 

Employers with 11 or more employees in the state of Colorado should immediately review and, if necessary, revise their application forms and job advertisements to comply with the new legal requirements. In the context of criminal background information, the U.S. Equal Employment Opportunity Commission says that it is not unusual for such policies to result in the disproportionate exclusion of African-American or Hispanic males. It is a defense to a disparate impact claim if the employer can show that the requirement was justified by business necessity, but the plaintiff can still prevail if he or she can show that there were effective alternatives that would have lessened the disparate impact. 

Common Sense Counsel: If one of the solutions to overcrowded Alabama Prisons is an Alabama Blue Print to Getting Talent Back to Work (OA News May 5, 2019), then securing ex-offenders good paying skilled jobs in the private sector can help accomplish that goal. However, there may need to be consideration for Alabama employer’s application and hiring process to be modified much like Colorado has done. Maybe even make it part of the Alabama Corrections Reforms discussions. 

Tommy Eden is a partner working out of the Constangy, Brooks, Smith & Prophete, LLP office in Opelika, AL and can be contacted at teden@constangy.com or 334-246-2901. He thanks Jessica Tsuda of Denver Office for her Constangy Blog Post on the subject. 

Friday, May 3, 2019

Alabama Blue Print to Getting Talent Back to Work


The Labor Shortage and Untapped Supply Chain - an Alabama Solution

Following the nationwide trend, there is a labor shortage in the State of Alabama and in as much an emergent window of opportunity.  Comparable to many other states, the State of Alabama, in the aggregate, is at full-employment.  In fact, despite more rural regions of the state experiencing double digit unemployment rates, there are other regions that are projected to soon reach negative employment.  What if this issue was tackled vertically and could result in an Alabama Solution not only Alabama’s labor shortage, but also favorably respond to a multitude of societal crisis in Alabama? Does this seem too good to be true?  The real answer lies in the fact that underutilized talent pools exist in Alabama and they span across several populations of viable and job ready workers. There are two primary questions to consider:
  • How can the State of Alabama address the crisis in the Department of Corrections with overcrowding, mounting suicide levels, and ex-con unemployment?
  • Can there be a solution that the State of Alabama can implement that can confront both the critical shortage of skilled labor (and non-skilled labor) in an era of economic boom and as it continues to recruit new industries, and while expanding other industries, all while unemployment rates plunge to historic lows?

Recently, the United States Justice Department found that “Alabama prisons are so dangerous [due to overcrowding and growing suicide rates] that there is reasonable cause to believe that the State is in violation of the U.S. Constitution.”  Similarly, on May 4, 2019, a Montgomery Federal Judge issued a 210-page ruling ordering a number of sweeping directives and notably expressing doubt at the Alabama Department of Corrections ability to enforce its own policies after 15 male prisoners died by suicide in a 15-month period of time in 2018 and 2019. The irony is that the prisons are filled with re-offenders who in many cases due to lack of ability to find work re-offend to provide for themselves and their families, or because of a drug addiction which they cannot afford treatment because they are jobless.  It becomes a vicious cycle, yet actionable steps could be taken to break this chain. 

Why is this segment of unemployed ex-convicts not more actively pursued to fill job vacancies that many argue are impossible to fill?  While this opportunity is broad-based, the cornerstone of this article will unpack the dilemma of mass numbers of unemployed ex-convicts in the State of Alabama who have paid their debt to society, yet face such strict scrutiny in the employment process, including intensive background checks that surface their past, and result in their exclusion from being even considered by employers that so desperately could use their knowledge, skills, and abilities.  

National Second Chance Survey Results

In a recently conducted survey, the Society of Human Resource Management (SHRM) focused on human resource practitioner perception of employing individuals with criminal records.  Funded by the Charles Koch Institute, the Second Chance Survey findings revealed 74 percent of managers and 84 percent of HR professionals nationwide said they were willing or amenable to the idea of hiring individuals with a criminal record. In fact, only a small minority were unwilling to make the hire or work alongside these individuals.

In January 2019, SHRM announced its GettingTalentBackToWork Pledge initiative in which businesses are committing to give the same opportunity to qualified applicants with a criminal background as they do to those who do not. As of March 2019, more than 700 companies, associations and nonprofits had taken the pledge.  At a time when the national unemployment rate is 3.8%, SHRM purports that nationally more than 7.8 million jobs need to be filled by 2020. With 650,000 people being released from jail and prison every year, the time is ripe for employers to be more open to those with a criminal history.

Keys to Re-entry to Reduce Recidivism

Numerous re-entry studies have shown that the key to reducing recidivism, and improving public safety, is properly preparing the offenders for release into a free society and helping them locate a well-paying job. This includes (1) the selection of offenders who are truly motivated to make a change for good; (2) upgrading their educational skills and industrial certificates to deliver what business and industry are searching for; (3) sharing with offenders, pre-release while inside of prison walls, certain coping, dispute resolution, and critical thinking skills so that they can be successful in a free society; (4) upon re-entry helping them with critical bridging infrastructure of housing, transportation, and pro-social faces and places often found within relationships in the faith-based community; (5) access to empathetic and resourceful mentors upon re-entry; (6) drug treatment and strict drug testing accountability plans; and (7) most importantly, finding the ex-offender stable well-paying employment with employers who have taken the Second Chance GettingTalentBackToWork Pledge.

Alabama Success Story

In the State of Alabama there have been limited organized employer efforts to reemploy offenders.  However, the West Alabama Works Prisoner Re-Entry Ready to Work Initiative at Bibb Correctional offers great promise in its collaboration with the non-profit LifeLink CORE, the Alabama Department of Corrections, the Tuscaloosa Chamber of Commerce, Shelton State Community College, Church of the Highlands and multiple businesses and industry in West Alabama area who currently hiring ex-offenders who graduate the two-year certified program.

Tuscaloosa Chamber of Commerce website link to Press Release:

Links to LifeLink CORE videos:



Business executives, HR professionals, and other employees can help break these individuals out of this cycle by considering this source of untapped talent for open roles and encouraging others to do the same. At its meeting on May 2, 2019, the Board of Directors of the East Alabama Chapter of the Society of Resources Managers took the national SHRM GettingTalentBackToWork Pledge and will make the entire GettingTalentBackToWork Toolkit of forms and guidance available to all of its members and all employers in the East Alabama Community.  There is clearly a systematic process to protect employers, while still giving a fair and unbiased opportunity for those with a criminal background to enjoy the freedom to work.

Alabama Small Business Works to Provide Corrections Solution

In Georgia, UnicusID’s Shepherd System, with its offices located in Auburn Research Park located on the Auburn University campus, is offering a Corrections is currently being used in judicial diversion (as an alternative to jail) allowing a judge to release an offender under supervision while being able to biometrically authenticate the offender’s identification and location, set "no-go zones," allow the victim third-party access to the offenders location, and determine the offender's compliance with the judge's order, all from the comfort of a computer screen or mobile device. Company founder Patrick Taylor described the Shepherd System as “a technology revolution in evidence-based offender re-entry programs, and court supervised release, with unlimited future functional upgrades to the Shepherd System as mobile device technology continues to advance. The UnicusID Shepherd System allows for a true collaboration of judges, correction officers, the faith-based community, nonprofits, industrial partners and trainers, educators, and drug testing and treatment providers, to holistically support the ex-offenders who are motivated to change and willing to demonstrate to all stakeholders that they can be trusted.”

Giving Ex–Offenders a Second Chance Opportunity is Right for Alabama Business

On March 28, 2019, Governor Kay Ivey issued a Proclamation which designated April 2019 as Second Chance Month, “to increasing public awareness about the need for closure for those who have paid their debt, and opportunities for individuals, employers, congregations and communities to extend second chance.”

In Closing - Alabama’s Collaborative Opportunity

This article has comprehensively laid out a workable solution to the current corrections and workforce development crisis, which brings together Alabama State Government, industrial trainers and educators, institutions of higher education, faith and nonprofit communities, and emerging technology to collaboratively solve two of Alabama’s most critical emergencies:  1) the evolving labor shortage, and 2) the Alabama Department of Corrections crisis.  There is an existing opportunity and the timing is right through such a collaborative model linked through emerging technology.  The labor shortage problem is clear, but the critical path lies in the concerted and intentional focus on returning ex-convicts to work, where possible.  With these aforementioned described approaches, organizations have the opportunity to utilize this population of workers to solve not only their labor shortage, but enable this group to make important contributions to productivity and high impact deliverables in the workplace, as well as create a better quality of life for themselves and their families.  It’s time for Alabama to explore how to safely Get Its Talent (that is currently behind bars) Back to Work.


Tommy Eden is a management labor attorney with the law firm of Constangy, Brooks, Smith & Prophete, LLP, in Opelika, AL, and serves in the correctional ministry of The Church of the Highlands. He also serves on the Board of Directors of the East Alabama Society of Human Resources Managers (EASHRM) Chapter, and is outside Counsel to UnicusID.

Tuesday, April 2, 2019

How Not to Terminate




March 1, 2019: The Supreme Court of Alabama affirmed a $1.26 million retaliatory discharge verdict consisting of $314,862.88 in compensatory damages and $944,588.64 in punitive damages in Rice v. Merchants FoodService. Denny Rice was one of eight drivers delivering food to the Mobile County School System when he suffered an on-the-job injury that forced him out of work for almost six months. Upon returning to work from workers’ compensation leave, Rice was immediately terminated and told his position had been filled while he was on leave, so no work was available.
Image result for workers comp

Rice testified at trial that he was devastated by the termination and feared and anguished over how he would be able to cope financially without a job. He testified that he postponed a planned wedding, withdrew $20,000 from his 401(k) and applied for and took a commercial driving test in order to enhance his commercial drivers’ license. He eventually found a position with a trucking company where his annual salary slightly exceeded his former salary, but only because he was forced to work over 900 hours more per year. At trial Rice requested damages for mental anguish and emotional distress and for his lost wages between his termination and locating his new job. He also requested “front pay” damages, which is his lost future earnings until he turned 65, based on the difference in pay between his old job and new job. At trial, Merchants FoodService argued that such front pay damages were not recoverable since he made more money at his new job than he did at his old job. The Mobile County trial judge allowed the claim to proceed to the jury as a fact question, however, because his new job paid more on annual basis only because Rice was forced to work over 900 more hours per year.

On appeal, Merchants FoodService actually conceded liability on the retaliatory discharge claim and contested only the amount of compensatory and punitive damages awarded. The termination clearly violated its personnel manual which required the company to attempt to find another position for the employee returning from workers’ comp leave. In addition, there was evidence the employer was in the midst of an operational expansion at the time and a job opening for a similar position was posted only 11 days after the termination. During trial, Rice presented evidence from another employee who was also terminated on the day he returned from workers’ comp leave as well as an internal company email that acknowledged that the termination of Plaintiff was improper (“this one will probably come back to bite us, so stay tuned”).

Common Sense Counsel: This case appears to be an outlier of “how not to terminate” an employee who has taken work comp leave. It should also serve as a strong reminder to Alabama employers to take great care in understanding and complying with its own employment manual and established company policies when an injured employee returns from a workplace injury. Prior to terminating an employee who has recently returned from work comp leave it is advisable that employers review their personnel manuals and contact trusted legal counsel before terminating the employee.

Tommy Eden is a partner working out of the Constangy, Brooks, Smith & Prophete, LLP office in Opelika, AL and can be contacted at teden@constangy.com or 334-246-2901.