Legislative lowdown: New opinion letters detail how federal laws apply to leave, overtime

The Department of Labor (DOL) explained how federal labor laws apply to different workplace situations in a series of six opinion letters released on Jan. 5.

This recent announcement is part of a broader push by the DOL to guide employers on compliance matters through opinion letters. Such letters lay out how the DOL and its sub-agencies enforce federal law and regulations when considering specific questions regarding the workplace.

The most recent opinion letters address questions concerning the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA). Here’s a quick rundown of what you need to know.

Opinion letters regarding the FLSA

Reclassification. The agency answered a question from a Licensed Clinical Social Worker who wanted to know whether they could be reclassified from an “exempt” to a “non-exempt” employee. The worker believed they continued to satisfy criteria that met the standards of an exempt “learned professional” category under the FLSA due to their educational and job duties.

The DOL said that even if the worker continued to meet the criteria for the learned professional exemption, an employer could nevertheless choose to pay them on an hourly basis and therefore reclassify them as non-exempt. While the letter affirms that employers are able to reclassify employees as non-exempt, HR should carefully communicate why such a decision is being taken. Non-exempt employees are entitled to minimum wage and overtime pay, so reclassifying employees might mean ensuring a timekeeping system is in place or abiding by certain scheduling rules, HR Brew has previously reported.

Bonus payments. The DOL said that certain types of non-discretionary bonuses must be included in an employee’s “regular rate of pay” when calculating overtime.

The bonus in question was granted to an employee of a waste management company if they met certain requirements tied to “safety, job duties, and performance.” If the worker met the criteria laid out by his employer, they earned the bonus automatically. The DOL determined that these payments were incentives, rather than discretionary, and should thus be included in the worker’s regular pay rate.

HR teams may take this letter into account when designing bonus programs that promise additional compensation ahead of time, and tie it to specific metrics, attorneys with law firm Littler noted.

“Roll call” requirements. A 15-minute roll call period should be counted toward a worker’s total hours when determining overtime pay, the DOL said. The letter concerned a collective bargaining agreement between a union and a firm employing emergency dispatch workers that required employees to show up 15 minutes prior to their shifts for a “roll call,” but excluded this period when calculating overtime.

The agency said this 15-minute period should be considered as part of employees’ total workweek calculations under the circumstances the letter writer described, but noted that there are two circumstances under which employees may be partially exempted from overtime when working under a collective bargaining agreement. These partial exemptions apply to employees who don’t work more than a maximum number of hours designated by the federal government over a certain period of time.

State v. federal minimum wage. The agency answered a letter regarding overtime pay requirements for retail and service employees who earn pay based on commission, and are exempt from overtime under section 7(i) of the FLSA.

When determining whether a worker makes enough money to meet the requirements of section 7(i), employers must examine whether their pay exceeds the federal minimum wage, not the higher state minimum wage, the DOL said. Most workers now live in states where the minimum wage is higher than the federal minimum of $7.25, HR Brew recently reported.

Additionally, the agency said part of an employee’s tip-based compensation may count when determining if a worker is paid primarily by commission, even though tips aren’t considered to be a type of commission under section 7(i). Employers should regularly review workers’ pay to ensure they meet the requirements to be overtime-exempt under section 7(i), given their compensation and commission might vary from one pay period to the next, the DOL said.

Opinion letters regarding the FMLA

School closures. If a school closes for less than a week, and an employee of that school uses FMLA leave for part of that week, the days when the school was closed doesn’t count as FMLA leave unless the employee was “scheduled and expected to work,” the DOL wrote. If a school employee was scheduled to take FMLA leave on a Tuesday afternoon for physical therapy, for example, and the school was closed that Tuesday due to snow, those hours shouldn’t be deducted from their FMLA entitlement, the agency said.

This rule doesn’t apply if a school closes for part of a week when an employee is taking a full week of FMLA leave, however.

HR teams may take this letter into account when guiding workers taking intermittent, rather than continuous, FMLA leave, as it indicates these workers shouldn’t see their leave docked during periods when the workplace is closed.

Travel time. An employee may use FMLA leave to account for the time they spent traveling to and from medical appointments for a serious health condition, the DOL said in its final opinion letter. Workers may take FMLA leave inclusive of this commute time regardless of whether a healthcare provider’s certificate addresses it.

This guidance may help employers grant workers’ FMLA requests when questions about the total time needed off arise.