Federal
Bi-Partisan Computer Professional
Update Act Introduced (S.1747)
Section 13(a)(17) of the Fair
Labor Standards Act creates overtime and minimum wage exceptions for
computer professionals provided they perform certain duties and receive
a certain minimum salary or hourly wage. Specifically, it exempts
"computer systems analysts, computer programmers, software engineers,
or other similarly skilled workers" who perform certain statutorily-enumerated
"primary duties" and are compensated at least $455 per week on a
salary basis or on an hourly basis at least $27.63. In recent
years, critics have complained this language is too stringent and fails
to reflect recent changes in computer and technology systems and occupations.
A recently-introduced bi-partisan
bill known as the Computer Professionals Update Act (or the "CPU Act")
would amend this exemption to expand the type of work that would qualify,
while leaving unchanged the salary or hourly rate component. As
amended, section 13(a)(17) would apply to "any employee working in
a computer or information technology occupation (including but not limited
to, work related to computers, information systems, components, networks,
software, hardware, databases, security, internet, intranet, or websites)
as an analyst, programmer, engineer, designer, developer, administrator,
other similarly skilled worker whose primary duty is (A) the application
of systems, network or database analysis, techniques and procedures,
including consulting with users, to determine or modify hardware, software,
network, database or system functional specifications; or (B) the design,
development, documentation, analysis, creation, testing, securing, configuration,
integration, debugging, modification of computer or information technology,
or enabling continuity of system and applications; or (C) directing
the work of individuals performing duties described in subparagraphs
(A) or (B), including training such individuals or leading teams performing
such duties; or (D) a combination of duties described in subparagraphs
(A), (B) and (C), the performance of which requires the same level of
skill.
AGENCY
California
Slight Increase in Computer
Professional Salary for Overtime Exemption
Labor Code section 515.5 provides
that certain software employees are exempt from the overtime requirements
in section 510 if certain criteria are met, including the performance
of statutorily-enumerated duties and that the employee's hourly rate
of pay is not less than the statutorily-specified rate. The Division
of Labor Statistics and Research (DLSR) is responsible for annually
reviewing this salary to determine if any adjustments are needed for
the following year, and usually makes these determinations by the end
of October. For the last two years, the DLSR had determined that
no adjustments were needed to this salary level.
However, on October 28, 2011,
the DLSR announced there will be a slight increase effective January
1, 2012 for the computer professional exemption. Specifically,
the minimum hourly rate will increase from $37.94 to $38.89, the minimum
monthly salary exemption from $6,587.50 to $6,752.19, and the minimum
annual salary exemption from $79,050.00 to $81,026.25.
DLSE Promises Wage Theft
Prevention Act Template by Mid-December
As discussed in last month's
newsletter, the Wage Theft Prevention Act (AB 469) takes effect January
1, 2012 and requires covered employers to provide the following information
in writing to new hires: (1) the employee's pay rate and basis for
pay rate (e.g., salary, commission, hourly, etc.); (2) allowances, if
any, claimed as part of the minimum wage, including meal or lodging
allowances; (3) the regular payday designated by the employer; (4) the
name of the employer, including any "doing business as" names used
by the employer; (5) the physical address of the employer's main office
or principal place of business, and a mailing address, if different;
(6) the employer's telephone number; (7) the name, address, and telephone
number of the employer's workers' compensation insurance carrier;
and (8) any other information the Labor Commissioner deems material
and necessary.
This statute requires the Labor
Commissioner to develop and make available a template employers may
use to comply with these requirements. According to the Department
of Labor Standards Enforcement website, this template will be issued
by mid-December.
Federal
DOD, GSA and NASA Adopt
Final Rule Precluding Reimbursement of
"Persuader" Costs
In January 2009, President
Obama issued Executive Order 13494 which stated that the costs of activities
of preparing and distributing materials, hiring or consulting legal
counsel or consultants, or holding meeting and planning activities during
work hours, when undertaken to "persuade" employees to exercise
or not exercise collective bargaining rights, would not be reimbursable
from taxpayer funds. On November 2, 2011, the Department of Defense,
the General Services Administration and the National Aeronautics and
Space Administration published a final rule, effective December 2, 2011,
amending the Federal Acquisition Regulation to implement Executive Order
13494 and preclude reimbursement of "persuader" costs.
This Final Rule does not amend
the cost principle contained in FAR 31.205-21 addressing labor relations
costs, which states that costs incurred in maintaining satisfactory
relations between the contactor and its employees, including costs of
shop stewards, labor management committees, employee publications and
other related activities are allowable costs. Instead, the Final
Rule adds a new provision stating that the costs of any activities undertaken
to "persuade" employees, of any entity, to exercise or not exercise
or concerning the manner of exercising the right to organize and bargain
collectively through representatives of the employees' own choosing
are unallowable. The Final Rule also provides the following specific
examples of activities the costs of which are unallowable when performed
in connection with persuader activities: (1) preparing and distributing
materials; (2) hiring or consulting legal counsel or consultants; (3)
meetings, including paying the salaries or the attendees meetings held
for this purpose; and (4) planning or conducting activities by managers,
supervisors, or union representatives during work hours.
The Final Rule clarifies it
shall only apply to contracts resulting from solicitations issued on
or after the December 2, 2011 effective date. The Final Rule is
available at www.gpo.gov/fdsys/pkg/FR-2011-11-02/pdf/2011-27790.pdf.
DOD, GSA and NASA Adopt
Final Rule Regarding Federal Contractor Posting Requirement
The DOD, GSA and NASA have
also adopted as final, without change, an interim rule amending the
Federal Acquisition Regulation to implement the DOL's regulation implementing
Executive Order 13496. This final rule is effective as of November
2, 2011.
Executive Order 13496 requires
covered federal contractors to display a notice for employees of their
rights under federal labor law, and the DOL has determined that the
notice shall include employee rights under the National Labor Relations
Act. The DOL previously issued its Final Rule regarding Executive
Order 13496 in May 2010 and it took effect on June 21, 2010. With
this agency final rule now effective, covered contractors must post
the required poster, but need not use the DOL-issued version provided
their own version includes the requisite information and specifications
(e.g., the DOL's size, form and content requirements). This
final rule is available at www.gpo.gov/fdsys/pkg/FR-2011-11-02/pdf/2011-27779.pdf.
OSHA Issues Interim Final
Rule Amending Sarbanes-Oxley Regulations
The Occupational Health and
Safety Administration (OSHA) has issued interim final rules revising
regulations to reflect the 2010 Dodd-Frank statutory amendments to the
Sarbanes-Oxley Act of 2002. Amongst other things, the revised regulations
would adopt Dodd-Frank's provision protecting employees from retaliation
by "nationally recognized statistical rating organizations" as defined
in the amendments. Secondly, the revised regulations clarify
that the term "company" under Sarbanes-Oxley whistleblower provisions
includes any subsidiary or affiliate whose financial information is
included in the consolidated financial statements of a company.
Third, the revised regulations adopt Dodd-Frank's extension from 90
to 180 days the period to file a retaliation complaint after the violation
occurs or after the date on which the employee becomes aware of the
violation.
OSHA will accept comments on
the proposed interim final rule until January 3, 2012, through www.regulations.gov.
The full text of the interim final rule is available at: http://www.osha.gov/pls/oshaweb/owadisp.show_document?
p_table=FEDERAL_REGISTER&p_id=22220
JUDICIAL
California
California Supreme Court
Declines to Review Appellate Court Decision Invalidating Arbitration
Agreement Waiving PAGA Representative Actions
As discussed in the August
newsletter, a California court of appeal held the United States Supreme
Court decision in AT&T would not preclude employees from
pursuing a representative action under California's Private Attorney
General Act (PAGA), and that any arbitration agreement provision waiving
the right to maintain a PAGA claim would be unenforceable. (Brown
v. Ralphs Groc. Co. (2011) ___ Cal.App. ___, 2011 Cal.App.LEXIS
902.) In recent months, there had also been conflicting federal
court decisions concerning the enforceability of so-called PAGA waivers
in arbitration agreements, and this legal uncertainty suggested the
California Supreme Court may attempt to resolve this issue. However,
the California Supreme Court recently denied review in Brown,
meaning it remains good law and indicates how at least one California
appellate court views the enforceability of PAGA waivers in arbitration
agreements.
Several Sexual-Related Comments
over Lengthy Period Insufficient for a Hostile Work Environment
A female executive sued her
former employer for FEHA sexual harassment based upon an e-mail she
inadvertenedly received commenting on her breasts, several incidents
directed at others she observed, and several offensive e-mails she discovered
while investigating her potential claim. The jury awarded her
$250,000 on her sexual harassment claim, but the trial court and the
appellate court reversed the verdict finding as a matter of law that
there was insufficient evidence of severe or pervasive sexual conduct
to create a hostile work environment.
Relying heavily on the California
Supreme Court decision in Lyle v. Warner Bros. Television Productions
(2006) 28 Cal.4th 264, the appellate court observed a hostile work environment
exists only when the harassing behavior is pervasive or severe, and
not when harassment is only occasional, isolated, sporadic or trivial.
It also observed that conduct that is aimed at persons other than the
plaintiff is generally considered less severe and offensive than conduct
that is directed at the plaintiff. While a plaintiff may maintain
a harassment claim based upon conduct she observed towards others, the
plaintiff must demonstrate such conduct "permeated her direct environment"
meaning that it was directed at others in her immediate work environment
and that she personally witnessed it.
The court first concluded plaintiff's
evidence (an e-mail commenting on her breasts which she received accidentally
and several comments she observed towards others) did not constitute
"severe" conduct, which generally involves unwelcome physical contact,
or threats, propositions or sexually explicit language directed at the
complaining party. The court also concluded the one e0mail to
her and the several comments she observed towards others were unprofessional,
but not pervasive since spread over a period of several years.
The court also downplayed the significance of the other emails making
negative sexual references to third-parties that plaintiff found during
her investigation, on the grounds these e-mails had been sent long before
her discovery and therefore did not permeate her work environment.
Lastly, the court also downplayed the fact her supervisor had discussed
plaintiff's personal life with her, noting the plaintiff had initiated
some of these discussions and had not demonstrated these conversations
were unwelcome. (Brennan v. Townsend & O'Leary
(2011) ___ Cal.App.4th ___, 2011 Cal.App.LEXIS 1309.)
(NOTE: While a
favorable result for this employer, the jury had initially ruled in
the employee's favor and it undoubtedly cost the employer substantial
attorneys' fees and costs to ultimately prevail. Thus, this
case is a good reminder about the importance of having a sexual harassment
policy and avoiding sexually-related conversations in the workplace.)
