Articles Posted in Construction Generally

Today, Pillsbury attorneys Julia Judish and Erica Turcios published their client alert titled Department of Labor Says Most Workers Are Employees Under FLSA: Ultimate Test is Economic Dependence. The Alert discusses the recent Wage and Hour Division of the U.S. Department of Labor’s Administrator’s Interpretation No. 2015-1.  The Administrator’s Interpretation adopts a very expansive interpretation of the definition of “employees” under the Fair Labor Standards Act (FLSA).  Many workers currently treated as independent contractors will need to be reclassified as employees. The Administrator’s Interpretation identifies the issue of a worker’s economic dependence as the most important factor in distinguishing between employees and independent contractors. It puts employers on notice that “the FLSA covers workers of an employer even if the employer does not exercise the requisite control over the workers, assuming the workers are economically dependent on the employer.”

Pillsbury attorneys Julia Judish and Osama Hamady recently published their client alert titled Second Circuit Develops “Primary Beneficiary” Test to Evaluate Unpaid Internships. The Alert discusses the Court of Appeals for the Second Circuit’s adoption of a “primary beneficiary” test for evaluating whether unpaid interns are employees for purposes of the Fair Labor Standards Act (FLSA). Rejecting a six-factor test that the U.S. Department of Labor has used for over forty-five years, the Second Circuit, in held “the proper question is whether the intern or the employer is the primary beneficiary of the relationship.” The Second Circuit’s decision in Glatt, et al., v. Fox Searchlight Pictures, Inc., et al., Case Nos.13-4478-cv, 13-4481-cv, decided on July 2, 2015, vacated a district court judgment that two interns on the movie Black Swan had been improperly classified as unpaid interns rather than employees. The Second Circuit also held that, under the “primary beneficiary” standard, “the question of an intern’s employment status is a highly individualized inquiry,” and therefore vacated the district court’s orders conditionally certifying a nationwide FLSA collective action and certifying a class of New York interns.

Today, Pillsbury attorneys Jon Russo, Peter Hunt and Matthew Kane, and summer associate Royce Liu published their client alert titled SEC Proposes Broad Executive Compensation Clawback Rules in Connection with Accounting Restatements. The Alert discusses the SEC’s proposed recovery provisions that would apply on a no-fault basis to executive officers of virtually all exchange-listed companies who received incentive-based compensation during the 3 fiscal years preceding an accounting restatement to correct a material error. The Alert encourages issuers to consider how the proposed rules may affect their executive compensation policies and plans, clawback policies, employment agreements and indemnification arrangements.

Today, Pillsbury attorneys Julia Judish, John Scalia and Paula Weber published their client alert titled The U.S. Department of Labor Moves to More Than Double Minimum Salary Levels. The Alert discusses the U.S. Department of Labor’s (DOL) long-awaited Notice of Proposed Rulemaking to amend the Fair Labor Standards Act regulations implementing the exemption from minimum wage and overtime pay for executive, administrative, professional, outside sales and computer employees (known as the “white collar” or “EAP” exemptions). The proposed rule would more than double the minimum salary level required to meet the executive, administrative, or professional exemption to $50,440 annually with automatic increases every year. The DOL estimates that 21.4 million currently exempt EAP employees would become eligible for overtime payments if the proposed rule goes into effect.

On July 2, 2015, in the case of Gate Guard Services, L.P., v. Perez, Secretary of Labor, the U.S. Court of Appeals for the Fifth Circuit held that the Department of Labor’s (DOL) prosecution of a Fair Labor Standards Act (FLSA) case was so egregious, in both the investigation, processing and, finally, in the defense of its actions in court, that the DOL was ordered to pay Gate Guard’s attorney’s fees–which may be as much as $1 million.

The DOL cited Gate Guard, a small company which contracts with oil companies to provide them with gate attendants at remote drilling sites, with mischaracterizing their employees’ employment status as independent contractors. The initial demand from the DOL was $6 million in back wages and unpaid overtime, and the matter was eventually litigated when Gate Guard sought a declaratory ruling, and attorney’s fees, that it was in compliance with the FLSA.

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Confined spaces refers to such spaces as manholes, crawl spaces, and tanks, and other spaces that are not designed for continuous occupancy and are often difficult to exit in the event of an emergency. These spaces can present life-threatening hazards including exposure to toxic substances, electrocution, explosions and asphyxiation. These hazards can be safeguarded against if addressed prior to entering the confined space to perform work. OSHA has added a new subpart to its regulations to provide protection for construction workers working in confined spaces, replacing its one training requirement for confined space work with a comprehensive standard that includes a permit program that was designed to protect workers from exposure to many hazards associated with work in confined spaces. OSHA’s Final Rule, 80 Fed. Reg. 25366 (May 4, 2015) (codified at 29 C.F.R. Part 1926), incorporates several provisions to address construction-specific hazards, accounts for advancements in technology, and improves enforceability of the requirements. The Final Rule is effective on August 3.

Today, Pillsbury attorneys Julia Judish and Ken Taber published their client alert titled New York City Bars Employers From Considering Criminal History Before Extending A Job Offer. This Alert discusses Mayor de Blasio’s recent approval of the Fair Chance Act, a new law that generally prohibits New York City employers from discriminating against job applicants with a criminal record and prohibits inquiries about job applicants’ criminal records before a job offer is extended. This new law applies to all private-sector New York City employers with 4 or more employees and, for or purposes of calculating coverage, the Act includes individual independent contractors performing work for the employer if those individuals do not themselves have employees. The new law is effective on October 27, 2015.

Today, Cal/OSHA issued a high heat advisory urging all employers and, in particular, employers in the Sacramento Valley and adjacent foothills to protect their outdoor workers from heat illness. It advised that temperatures are expected to rise to highs of 115 degrees through Friday morning. Information is available online (Heat Illness Prevention and Water. Rest. Shade. Campaign) on the heat illness prevention requirements and training materials. A Heat Illness Prevention e-tool is also available on Cal/OSHA’s website.

Cal/OSHA issued its first high heat advisory for 2015 on June 16, 2015 for Southern California.

The Washington State Department of Labor & Industries (L&I) recently posted on its L&I Blog a blog titled “I survived,” a cautionary tale about how fall protection saved a construction work from a 30′ plunge. In early May, Apollo, Inc. employee Tanner Kane was using a bar to pop forms off the top of a retaining wall. Suddenly, he was catapulted over a 30′ retaining wall. According to his work partner, Carrie Johnson, “It was crazy; one minute he was there, and in a blink of an eye he was gone.” Because Tanner was using a fall protection system and was tied off to the horizontal lifeline installed for the job, he survived the potential 30′ fall with no significant injuries. Tanner’s coworkers activated the rescue plan and Tanner was able to self-rescue with help from Johnson.

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