Late last week, the Appellate Division, Fourth Department, which is the intermediate appellate court over New York lawsuits that begin in Buffalo, ruled on an employment law case involving the Buffalo Bills.
It ruled that members of the Buffalo Jills cheerleading squad can proceed with a class action claim that the team underpaid them for years. The claim is that they were improperly classified as independent contractors rather than employees and thus denied adequate compensation.
Practice Pointer: While interesting because it involves an NFL team, the important lesson behind the lawsuit is that companies must carefully classify their workers. While it’s too early to tell if the Jills will be successful, we’re reminded that there’s a legal standard to measure whether a worker must be classified as a W-2 employee or may be an independent contractor. Your employment lawyer can help with these tricky questions.
There’s a strict rule about enforcing a meal period for New York’s workers. The law mandates that in most cases, an employee who works more than six hours that begins before 11 a.m. and ends after 2:00 p.m. must be given at least 30 minutes of uninterrupted time for a meal break.
The employer need not pay the employee for this break.
However, employers are required by law to police the break to ensure it is being taken. Except in very limited circumstances, that means New York employers must consistently require their employees take a half hour sometime between 11 and 2 and not perform work during this time.
Can the employee sit at her desk during the 30 minutes? Of course she can. At least under the law, there’s no requirement that employees move away from their desks or sit only in a kitchen area. What’s clear, however, is that if employees spend their meal period at their desk, they shouldn’t be permitted to work at the same time, or else the 30-minute meal period hasn’t occurred.
For most New York employers, this means having a policy requiring that employees stop working and take their 30-minute meal break before returning to work or face disciplinary action. Routinely shaving time off the beginning or end of the workday simply doesn’t cut it. It may seem counter-intuitive to insist that employees stop working for 30 minutes, but the law requires it. And even longer work days may require additional breaks; do consult with your employment attorney to ensure your policies comply with the law.
Last week, the New York State Department of Taxation issued a so-called N-Notice about Paid Family Leave (PFL) which was directed to New York’s employers.
In consultation with the IRS, the New York Tax Department advises employers that:
• Benefits paid to employees will be taxable non-wage income that must be included in
federal gross income;
• Taxes will not automatically be withheld from benefits, but employees can request
voluntary tax withholding;
• Premiums should be deducted from employees’ after-tax wages;
• Employers must report employee contributions on Form W-2 using Box 14 which is for State
disability insurance taxes withheld; and
• Benefits paid to an employee should be reported by the State Insurance Fund on Form 1099-G and by all other payers (including self-insured employers) on Form 1099-MISC.
As expected, the State Tax Department reminded employers that its publication is only advisory and that employers have a continuing obligation to work with their own consultants and tax advisors in order to comply with the law.
This advisory from the Tax Department reminds us that PFL’s reach is wide and it’s up to each employer to ensure that its policies and procedures adhere to the law, which becomes effective January 1, 2018.
While life is unpredictable and situations may arise that can’t be planned for, New York’s Paid Family Leave (PFL) law requires that employees be proactive. If an employee wants to take PFL that’s foreseeable, they’re required to give their employer at least 30 days’ advance notice.
Foreseeable qualifying events include situations such as an expected birth, placement for adoption or foster care, a family member’s planned medical treatment, planned medical treatment for a serious injury or illness of a covered service member, or another known military exigency.
Employers may deny PFL for up to 30 days if the employee knows about the underlying circumstance necessitating PFL but doesn’t provide timely notice to the employer.
On the other hand, if 30 days’ advance notice isn’t possible due to an employee’s not knowing when his leave will be needed or because an emergency arises, the law still requires him to provide notice as soon as possible and practical. What’s possible and practical depends on the facts and circumstances surrounding the event.
When revising employment policies to account for the January 1st effective date for PFL, make sure your employees know you’ll require them to plan ahead and give adequate notice or they may be denied PFL, at least for some length of time.
We recently described the military-leave component of New York’s Paid Family Leave (PFL) law which becomes effective January 1, 2018. But how does this differ from the federal law called FMLA? Turns out there are pretty big differences for New York employers, and the consequences require careful planning.
Simply put, military-related PFL will create new burdens for employers. While everyone invariably agrees that respect and gratitude is due to those who serve our country, New York’s private employers will now shoulder a greater burden because PFL has a far broader reach than FMLA when it comes to military-related leave.
Under FMLA, a New York employer must provide leave only if:
Immediate family members are a spouse, child, or parent of the employee only.
In contrast, PFL places a greater burden on NY employers and requires coverage for more employees:
As a result, then, a full-time employee whose granddaughter becomes deployed likely is entitled to PFL. Likewise, an employee whose grandfather is deployed likely qualifies for PFL. In short, PFL will require more New York employers to provide coverage to more employees than under FMLA.
Even very small employers will face new burdens and should start to plan accordingly. Handbooks and employee policies must be modified to reflect the new law starting January 1st.
Another part of New York’s Paid Family Leave law pertains to individuals with family members in the military. Employers certainly empathize with staff who have a family member in the military. It’s important to prepare for situations where an employee needs time off because he or she has a family member called up for active military duty.
The PFL law comes into play where there’s a qualifying exigency arising from the service of a family member in the armed forces. What does this mean? An employees may take leave when a spouse, child, domestic partner, or parent is on active duty or has been notified of an impending call or order of active duty.
In order to meet the law’s requirements, the employee must provide reasonable notice (unless impossible) along with a copy of their loved one’s active duty orders and/or other documentation supporting the leave.
If the employee qualifies, PFL guarantees his or her ability to return to the job as well as to maintain healthcare coverage in the interim. Companies are well advised to review their employee leave policies before PFL takes effect on January 1st. Our attorneys can help make this job easier for you.
New York’s Paid Family Leave (PFL) benefit that becomes effective January 1, 2018 is on everyone’s mind. Although we’ve blogged about it this spring, the final regulations are out, so we’ll have a few more updates with information to help clarify the final regulations.
This update relates to PFL for an individual seeking to care for a child after birth or placement for adoption or foster care.
The timeframe for taking leave in all these situations is only within the first 12 months of birth or placement. Employers should require appropriate documentation as well.
The birth mother must provide a birth certificate or documentation of pregnancy or birth from a health care provider including the mother’s name and birth or due date.
A second parent must provide a birth certificate, documentation from a health care provider, voluntary acknowledgment of paternity or court order proving parenthood.
An adoptive parent must submit documentation showing an adoption is in process or documentation illustrating the leave is to further the adoption.
A foster parent must submit a letter from the county or city department of social services or local volunteer agency.
If spouses or family members work for the same company, an employer is entitled to deny PFL to more than one employee at the same time to care for the same family leave recipient or to bond with a child. Employee handbooks should be updated to account for these changes in New York law.
When a contract dispute arises and you have to bring a lawsuit against the other party, who’s responsible for the legal fees? Many clients are surprised to find that the general rule in New York is that you’re responsible for your own attorneys’ fees unless there’s a law that applies to the situation, which isn’t terribly common.
As a result, even where the other party clearly violates the contract, you’ll generally be responsible for the cost of pursuing the wrongdoer and any associated fees. This upsets many clients because, honestly, who wants to pay the costs of a lawsuit to recover something to which you’re already entitled?
And what happens when the proceedings drag on and the fees pile up? Isn’t there anything to do?
One way to protect yourself or your company is to include a contract clause that awards reasonable attorneys’ fees to the prevailing party in a dispute. In New York, this sort of language must make it unmistakably clear that the prevailing party is entitled to receive legal fees and expenses. Attorneys familiar with contract litigation can draft this and put you in the best position to protect yourself in case of a dispute. It’s a precautionary measure that can be a great bargaining chip if a dispute arises and ultimately can help to offset the costs of litigation.
Entering into a contract sometimes creates risk. One way to limit that risk is to have a well-drafted indemnification or hold harmless provision. The words indemnification and hold harmless essentially mean the same thing, so you may see them both ways in contracts.
This language shifts responsibility for damages from one of the contracting parties to another. Say, for example, there’s a construction project, and the general contractor requires its subcontractor to provide indemnification for any loss arising out of the work. This incredibly wide hold harmless net may very well result in the subcontractor’s having to step up to the plate if a worker employed by almost anyone on the project is injured and then sues the GC. The GC uses this language to shift responsibility to its subcontractor.
As you can see, it’s better to get hold harmless language to favor you. If your bargaining power isn’t strong enough, though, one way to limit exposure is by agreeing to cover only damages that you cause instead of being more broadly responsible for any damages relating to the contract or arising out of the work.
An effective way to limit risk is to have your attorney include a hold harmless provision in your favor that creates protection for circumstances that may crop up down the road.
On June 1, 2017, the Insurance Department issued its final regulations on the Paid Family Leave law which is scheduled to become effective January 1, 2018. Regulations by an agency are a common way for a statute to be implemented. Stated differently, regulations provide the details we need in order to know how to comply with laws.
One important aspect we’ve been waiting for is how much will this benefit cost? This is an expense that’s appropriate to pass along to employees via payroll deduction.
We now know the answer. The rate is based on a percentage of an employee’s compensation and is set at 0.126% of the weekly wage. Total cost is capped by reference to New York State’s current average weekly wage which is $1,305.92. So it becomes a simple math problem: at most the cost per employee will be $1,305.92 x 0.126%.
Practical Pointer: This translates into a maximum employee contribution of $1.65 per week.
In the coming months, we’ll be revisiting the regulations to provide useful information for New York employers who are updating their policies and procedures in order to prepare for the January 1st implementation date. As always, we welcome your comments and questions.