February 2020 Legislative Update
After returning from the winter recess, the PA General Assembly only saw a handful of bills related to employment introduced. To learn more about how a bill becomes a law in PA, click here.
Bills Related to Leave:
HB 1878, introduced by Rep. Bullock, D-Philadelphia, on September 26 and referred to the Committee on Labor and Industry would provide for unpaid Parental Involvement Leave. This act would apply to employers with 20 or more employees who are employed at least 6 out of the past 12 months. It would allow for up to 8 hours of unpaid leave in a year with an additional 4 in instances in which there is an Individualized Education Plan (IEP). An employee would have to make the request at least 4 days in advance unless it was an emergency; employers would have to decide within 48 hours and denials must be in writing. No retaliation provisions are included.
HB 2089, introduced by Rep. Mullins, D-Lackawanna, on November 22 and was referred to the Committee on Veterans Affairs and Emergency Preparedness. It would provide for up to 14 days of leave for an employee with a spouse that was called to active duty during a period of military conflict. The bill would apply to employers with 20 or more employees and requires employers to hold the position without retaliation.
Bills Related to Labor:
HB 1865, introduced by Rep. Miller, D-Allegheny, on December 2 and referred to the Committee on Labor and Industry would allow striking workers to collect Unemployment benefits after a 30-day waiting period.
HB 2289, introduced by Rep. Williams, D-Chester, on February 18 and referred to the Committee on Labor and Industry amends the PA Labor Relations Act, strengthening worker collective bargaining rights.
Bills Related to Hiring:
HB 2024, introduced by Rep. Isaacson, D-Philadelphia, on November 14 and referred to the Committee on Labor and Industry would require employers with 15 or more employees to disclose the pay range for each position posted. Where there is no pay range, the employer must post the minimum rate of pay. Additionally, employers would be required to furnish written lists of positions within the organization with similar pay ranges.
HB 2040, introduced by Rep. Harris, D-Philadelphia, referred to the Judiciary Committee and removed from the table on December 16 is known as the Second Chance Employment Opportunities for Ex-Offenders Act. It would create a free website for the posting of positions available to ex-offenders.
HB 2097, introduced by Rep. Rabb, D-Philadelphia, referred to the Committee on Labor and Industry on December 2 amends the Medical Marijuana Act. It would prevent the discharge, threatening, refusal to hire, discrimination or retaliation against someone who fails a drug test as a result of using medical marijuana as a qualified patient. It does not require a violation of federal law or that employees be permitted to use medical marijuana at the workplace. It provides for an exclusion if the position is one in which working wile under the influence creates an unreasonable safety risk or the employee’s conduct falls below the standard of care normally accepted for that position.
Bills Related to Benefits:
SB 939, introduced by Senator Iovino, D-Allegheny, Washington, on November 12 and referred to the Committee on Banking and Insurance known as the Health Insurance Protections Against Limitations Act. It would prohibit individual or group health insurance policies from having annual or lifetime limits.
Bill 200011: This would provide up to 12 weeks of paid family leave for employees who worked at least 1250 hours in the past 12 months. Covered employers would be those with 50 or more employees in the first year, reduced to 25 in the second. It was referred to the Committee on Public Health and Human Services.
Changes to Pennsylvania Background Check Requirements
Effective December 31, 2019 Pennsylvania amended section of the Child Protective Services Law which pertains to background checks for employees who have contact with children. Specifically, the amendment prohibits employers, administrators, supervisors or other persons responsible for employment decisions from employing applicants on a provisional basis absent a waiver from the department. Prior to this amendment, employees could be hired on a 90-day provisional basis.
Federal and Pennsylvania Regulations on Exemption from Overtime
Both the US Department of Labor and the Pennsylvania Department of Labor and Industry have put into effect new regulations that govern the white-collar exemptions from the overtime laws. As with all cases in which there are multiple laws, the aspects most favorable to the employee takes precedent.
Federal: In September, the US DOL released the final regulations amending the overtime exemptions under the FLSA. The regulations went into effect January 1, 2020 and increased the salary requirement from $455 per week to $684 per week, or $35,568. Up to 10% of the minimum salary level may be satisfied with non-discretionary bonuses, commissions and other incentive pay that are paid annually or more frequently.
Additionally, the rule increased the minimum total annual compensation required to qualify for the highly compensated exemption from $100,000 to $107,432, including at least $684 per week paid on a salary basis. Pennsylvania does not currently recognize the highly compensated exemption. The rule does not include any change to the duties tests.
The regulations do not call for automatic increases, and the required updates every four years through notice and comment rulemaking that were in the in proposed rules did not make it to the final regulations.
Pennsylvania: As you are aware from the alert sent out in July, the PA DOL also proposed regulations to the overtime rule. On January 31, 2020, the Pennsylvania Independent Regulatory Review Commission approved the Pennsylvania Department of Labor and Industry’s (DLI) regulations that exempt executive, administrative, and professional (“white collar”) salaried workers from overtime requirements under the Pennsylvania Minimum Wage Act of 1968. The salary thresholds are as follows:
- $684/week ($35,568 annually) effective January 1, 2020
- $780/week ($40,560 annually) effective January 1, 2021
- $875/week ($45,500 annually) effective January 1, 2022
Additionally, effective January 1, 2023 and every 3rd year thereafter, the salary threshold will automatically reset. The final regulations permit employers to satisfy up to 10% of the salary by paying non-discretionary bonuses, incentives or commissions.
The regulations do not provide for any exception for small businesses or non-profits.
Minor changes were made to make the Pennsylvania regulations more closely aligned with the FLSA:
- The requirement that executive exempt employees “customarily and regularly” exercise discretionary powers was eliminated; and
- The requirement that administrative exempt employees “customarily and regularly” exercise discretion and independent judgment was eliminated and replaced with the requirement that their primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.
- The amended regulations eliminate the requirement that exempt white-collar employees not devote more than 20 percent of their hours in a workweek to activities that are not “directly and closely related to” or “an essential part of and necessarily incident to” the exempt duties outlined in the regulations.
- The amended regulations also add new definitions that are nearly identical to definitions in the FLSA, such as the definition of “management” for the executive exemption and the definition for work “directly related to management or general business operations” under the administrative exemption.
However, there are several areas in which the Pennsylvania regulations will continue to differ from the FLSA in that they do not (this list is not all inclusive):
- Allow for “concurrent performance” of exempt and non-exempt work while remaining exempt under the executive exemption;
- Include the FLSA’s regulation extending the administrative exemption to employees whose primary duty is performing administrative functions related to academic instruction or training in an educational institution;
- Include the FLSA’s regulation extending the professional exemption to employees with a primary duty of teaching in an educational institution;
- Include the FLSA’s exemption of teachers, physicians and lawyers or computer professionals who are paid on an hourly basis; and
- Include the FLSA’s highly compensated exemption.
This is a good time to review job descriptions and compensation practices in classifying employees as exempt or non-exempt under Pennsylvania law.
Pending Legislation that will impact the Pennsylvania Regulations: SB 79 was introduced in January 2019 by Senator Tartaglione, D-Philadelphia was passed by the Senate and sent to the House of Representatives where it was referred to the Committee on Labor & Industry November 22, 2019. This bill is a compromise bill amends the PA Minimum Wage Act (PMWA) and will increase the minimum wage in Pennsylvania and, in exchange, repeal the PA DOL regulations that would increase the threshold for exemption from minimum wage and adopt the provisions of the FLSA. It is currently stalled.
Specifically, the bill would increase the minimum wage in PA from $7.25/hour as follows:
- July 1, 2020: $8.00/hour
- January 1, 2021: $8.50/hour
- July 1, 2021: $9.00/hour
- January 1, 2022: $9.50/hour
The bill also requires employers who permit customers to pay gratuities by credit card to pay the tipped employees the full amount of the gratuity indicated on the charge slip by the customer no later than the next scheduled payday without any deductions for credit card processing fees or costs.
In exchange for agreeing to increase the minimum wage, the bill amends the PMWA to state that its minimum wage and overtime requirements must be applied in the same manner as the FLSA, except when a higher standard is specified under the PMWA or its regulations. This change would be significant for employers, as it would eliminate much ambiguity and the differences between the PMWA and FLSA on issues like overtime exemption requirements. In other words, Pennsylvania employers would have one set of requirements to follow in this area, rather than two often vague and conflicting sets of rules. This amendment would make all overtime exemptions currently available under the FLSA now also apply to the PMWA, including the highly compensated and computer professionals. Additionally, it would provide clear guidance that, in areas where the PMWA and its regulations are silent, federal law would apply and provide the necessary guidance for compliance. This change would be particularly timely, as the Pennsylvania Supreme Court issued a decisionon November 20 holding that the fluctuating work week method of paying salaried non-exempt employees, which is expressly permitted by the FLSA’s regulations, violates the PMWA, because the PMWA’s regulation do not mention or address the fluctuating work week method. Conflicts and uncertainty like this due to silence in the PMWA and its regulations would go away if the Senate bill becomes law.
Like the FLSA regulations, the bill allows up to 10% of the salary of an exempt employee to be comprised of non-discretionary bonuses, incentives and commissions.
However, the PA legislation does allow the DOL to update the salary basis from time to time beginning January 1, 2023 if the FLSA is not updated to reflect any increases.
Getting Talent Back to Work
With the First Step Act having been signed into law, SHRM has joined a coalition of groups working to improve rehabilitation and re-entry opportunities for incarcerated men and women. In recognition of the barriers that currently exist, the goal is to give opportunities to qualified people with a criminal background who deserve a second chance. The official website to learn more about this is www.GettingTalentBackToWork.org.
There are many incentives to employers including the Work Opportunity Tax Credit, Federal Bonding Program, local Workforce Development programs and local community and faith-based organizations that offer re-entry programs.
At the SHRM Employment Law and Legislative Conference we heard from Joe Phelps of Johns Hopkins Health Systems who has developed a process for hiring hundreds of people with records and auditing accidents and other major negative events and found that not one has been caused by an employee with a record. To date he has achieved a 64% placement of those with a criminal background. We also heard from several other employer representatives who have modeled this practice, finding that formerly incarcerated employees aren’t just “nonproblems”; they are role models in terms of performance, attendance and teamwork. They have seen the alternative and, in the overwhelming majority of cases, they deliver and are highly motivated.
SHRM is encouraging employers to take the Getting Talent Back to Work Pledge: https://www.gettingtalentbacktowork.org/#pledge
Check out the SHRM toolkit: https://www.gettingtalentbacktowork.org/resources/
SHRM Advocacy at Work Conference: March 15-17, 2020
The Employment Law and Legislative Conference has been replaced with the Advocacy at Work Conference. This event will focus on a few key issues relevant to employers such as workplace equity, healthcare, paid family leave and immigration as well as provide for Hill visits on March 17. Training and preparation for the Hill visits are built into the schedule. For more information, please use this link:https://events.shrm.org/ehome/488163.
Join the Legislative Affairs Committee
Help our Chapter members stay informed about key pending legislation and hot issues. Become part of the Legislative Affairs Committee! Much of the work is self-paced as we analyze bills and draft alerts for our members. It’s a chance to learn more about the legislative process and directly apply your activities for the committee to your workplace. For more information, please contact:
Join the A-Team
As HR professionals we are the experts when it comes to understanding the impact of policy and legislation on the workplace and lives of our employees. Consider applying that knowledge as an influencer of key decisions by joining the SHRM A-Team: http://www.advocacy.shrm.org/app/register?7&m=21248.
For more information, contact your Advocacy Captain at email@example.com.
DOWNLOAD THE "SHRM ADVOCACY" APP!