Pending Government Initiatives Raise Concern

Posted March 28, 2016

The Chamber's Public Affairs Council (PAC) recently discussed three government initiatives which can dramatically affect business - federal Overtime Regulations, state and federal Minimum Wage Mandates, and state Paid Family Leave. In addition the the April edition of Today's CHAMBER newsletter article, the following supporting documents will provide useful information to member firms.

Overtime Regulations. In March, the federal Department of Labor (USDOL) proposed new regulations significantly increasing the number of employees who will be entitled to the Fair Labor Standards Act's overtime pay regulations. It is anticipated that these regulations will go into effect in September of this year. The Chamber will be hosting educational seminars to assist members in preparing for compliance with the new regulations. For a quick overview of how your business will be affected, please reference the U.S. Chamber of Commerce's Questions to Guide Analysis of Proposed Overtime Regulation Impact.

Minimum Wage. On both the state and federal level there is a push towards a phased-in minimum wage of $15 per hour.  The New York State Wage Increases and Proposals graphic has more information on the phased-in schedule and wages. Members are encouraged to voice their concerns regarding the proposed $15 minimum wage by electronically submitting a form on the Take Action page through the Minimum Wage Reality Check Coalition. Immediate access to the form may be found at www.minimumwagerealitycheck.com/take-action/.

Paid Family Leave. For the second time in recent sessions, the New York State Assembly has passed a Paid Family Leave bill. For more information on the bill, please reference the Business Council of New York State's (BCNYS) 2016 Family Leave Comparison. The specifics of the bill that passed in the Assembly, S.3004-A (Addabbo)/ A.3870-A (Nolan), may be referenced on page 2. For more information on reasons for opposition to the bill, please reference the BCNYS Legislative Memo on Mandated Paid Family Leave.


UPDATES 4/1/16:
Gov. Andrew Cuomo and legislative leaders reached a compromise on Minimum Wage and Paid Family Leave. For details, please see this Star-Gazette article

The following information was also released by The Business Council of New York State, Inc.:

Minimum Wage 
After much debate, the Legislature adopted a new minimum wage for New York State that includes different scheduled increases for different parts of the state.  The schedule is as follows: 

For New York City, large employers (defined as employers of eleven or more): 
$11.00 per hour on and after December 31, 2016
$13.00 per hour on and after December 31, 2017
$15.00 per hour on and after December 31, 2018
 For New York City, small employers (defined as employers of ten or less):
$10.50 per hour on and after December 31, 2016
$12.00 per hour on and after December 31, 2017
$13.50 per hour on and after December 31, 2018
$15.00 per  hour on and after December 31, 2019
 For the downstate counties of Nassau, Suffolk, and Westchester: 
$10.00 per hour on and after December 31, 2016
$11.00 per hour on and after December 31, 2017
$12.00 per hour on and after December 31, 2018
$13.00 per hour on and after December 31, 2019
$14.00 per hour on and after December 31, 2020
$15.00 per hour on and after December 31, 2021
For the remainder of the State (Outside of the city of New York and the counties of Nassau, Suffolk, and Westchester):
$9.70 on and after December 31, 2016,
$10.40 on and after December 31, 2017
$11.10 on and after December 31, 2018
$11.80 on and after December 31, 2019
$12.50 on and after December 31, 2020
Thereafter, on each following December 31st, a wage will be published by the Commissioner of Labor determined by the Director of the Budget in consultation with the Commissioner, totaling no more than fifteen dollars, where the percentage increase shall be based on a variety of indices selected to determine the state of the economy and the appropriateness of subsequent minimum wage increases. 

In addition, the wage for an employee who is a food service worker receiving tips shall be a cash wage of at least two-thirds of the minimum wage rates in effect for each region.
 
As part of this agreement, the Governor is precluded from using wage board authority to implement a higher minimum wage than provided for in this implementation schedule; the agreement also authorized the Department of Labor to modify the fast food wage order to conform with this minimum wage schedule.
 
Paid Family Leave
New York State has adopted the most expansive paid family leave policy of any state.  Amending Section 200 of the state’s worker’s compensation/disability law, effective January 2018, employees will be eligible for paid time off to care for the birth or adoption of a child, serious health condition of a family member, or a qualified military exigency as interpreted under the Family and Medical Leave Act.  Key provisions of the act include: 
 
The act applies to all private sector employers of one or more employees;
Leave may be taken to participate in providing care, including physical or psychological care for a family member, to bond with the employee’s child during the first twelve months after the child’s birth, or the first twelve months after the placement of the child for adoption or foster care; or for a qualified military exigency as defined by the FMLA;
Family member is defined as child, parent, grandparent, grandchild, spouse, or domestic partner;
Employees must be employed for 26 weeks before they are eligible for paid family leave; (175 days for part-time employees);
Employees returning from leave are entitled to return to their same or comparable position without loss of benefits they would have accrued otherwise;
Employers must continue the employees’ health insurance during leave as if they were not on leave;
Benefit amounts shall be: 
o January 1, 2018; up to 8 weeks of leave at 50% of the employees average weekly wage to a maximum of 50% of the state’s average weekly wage;
o January 1, 2019; up to 10 weeks of leave at 55% of the employees average weekly wage to a maximum of 55% of the state’s average weekly wage;
o January 1, 2020; up to 10 weeks of leave at 60% of the employees average weekly wage to a maximum of 60% of the state’s average weekly wage;
o January 1, 2020 and thereafter; up to 12 weeks of leave at 67% of the employees average weekly wage to a maximum of 67% of the state’s average weekly wage.
Income replacement will be paid for by an insurance policy procured by the employer on behalf of the employee, the full cost of which will be paid by payroll contributions of the employee;
When practicable, the employee should provide 30-days’ notice of intent to take paid family leave;
An employer may offer an employee who has accrued but unused vacation/personal leave to choose whether to charge all or part of the family leave time to this unused time and receive full salary; or, to not charge benefit time and receive the benefit provided.  
 
Despite promises that there would be no cost to employers, the budget allowed for the transfer of $10 million from money already paid by employers, specifically assessed for the purpose of running the Workers’ Comp Board, to the paid family leave program.

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