Attorney General Maura Healey has certified a petition to put a question on the November 2018 ballot that would raise the current minimum wage of $11 to $12 in 2019, $13 in 2020, $14 in 2021, and $15 in 2022. The proposed law would also increase the current minimum wage of $3.75 per hour for tipped employees to $5.05 in 2019, $6.35 in 2020, $7.64 in 2021, and $9.00 in 2022.

In Massachusetts, one can file an initiative petition with the Office of the Attorney General to put questions on the ballot. Attorney General Maura Healey must review and certify that a petition complies with the constitutional guidelines for it to move through the rest of the process. Filing the petition and having it certified is one step of several to achieve getting a question on the ballot. Your PS&A team will keep you apprised of any new developments on this important issue.

Governor Baker signed the An Act to Establish Pay Equity (S. 2119) on August 1, 2016, which amended the current Massachusetts Equal Pay Act to ensure equal pay for comparable work for virtually all Massachusetts employees. The new law is intended to help close the wage gap between men and women performing comparable work. Although the new law is not effective until July 1, 2018, it is important to understand now how the law impacts your business so that you can plan and budget accordingly. Our newest issue of HR Insights provides an overview of the law, discusses HR practice implications, and provides a checklist of action items for consideration.

Be sure to check out our HR at Work Job Aid, Compensation and Benefits by the Numbers -2018 Changes. The job aid is a one-page reference tool that lists and compares all the limits, thresholds, and other compensation and benefits requirements for 2018 and 2017, including Massachusetts and federal minimum wage requirements, Social Security and Medicare tax rates, Health Savings Accounts, high deductible plans, Affordable Care Act, flexible spending accounts, commuter benefits, adoption assistance programs, and retirement plans.

On August 31, 2017, a U.S. District Court in Texas granted a summary judgment against the Department of Labor (DOL) in the consolidated cases challenging the increase in the salary threshold to $47,476 for classifying certain positions as exempt from overtime. The court held that the DOL exceeded its authority and concluded that the final rule is invalid. This same court had issued a temporary injunction in November of 2016 that blocked the increase from taking effect on December 1, 2016.

What’s next? As reported in our last month’s newsletter, the DOL is currently accepting comments on its Request for Information (RFI) through September 25, 2017. At this point, DOL has received over 124,000 comments. The purpose of the RFI is to ask the public for information that will help DOL in formulating a proposal to revise the FLSA regulations. The RFI asks for feedback on questions pertaining to the minimum salary threshold as well as to the duties test, verifying cost-of-living in different parts of the U.S., inclusion of non-discretionary bonuses and incentive payments for satisfying part of the minimum salary threshold, the salary test for highly compensated employees, and automatic updating of the minimum salary threshold. DOL Secretary Acosta has said that the salary threshold should be increased, but not to the $47,476 level. During confirmation hearings, DOL Secretary Acosta discussed the low $30,000’s as a possibility.

The PS&A team will keep you informed as developments on this important topic occur.

The Office of Management and Budget (OMB) informed the Equal Employment Opportunity Commission (EEOC) on August 29th that it was “initiating a review and immediate stay of the effectiveness of the pay data collection aspects” of the previously approved EEO-1 form requiring pay data be reported.

For many years, employers with 100 or more employees and certain other employers have been required to file EEO-1 reports annually that show their number of employees by job category and then for each category, the number of employees by gender, ethnicity, and race. Starting with the 2017 EEO-1 report, the report would have required summary pay data by gender, ethnicity, and race within each job category. The pay data requirement was highly controversial. Many questioned the validity of the data that would have been provided for purposes of identifying pay discrimination. In addition, many expressed concerns about the significant administrative challenges the new form created. Because of the new pay data requirement, EEOC also moved the filing deadline from September 30, 2017, to March 31, 2018.

Given the suspension, EEOC says that employers should use the previously approved EEO-1 form to report the data on race, ethnicity, and gender by job category (i.e., the data reporting requirements that will remain in effect). In addition, employers should file their reports by the previously set filing deadline of March 31, 2018.

On August 1, 2017, Gov. Baker signed into law $200 million in new fees and fines on Massachusetts employers to help pay for employees who receive health insurance coverage through MassHealth or subsidized coverage through the Massachusetts Health Connector.

The new law, effective for a two-year period starting January 1, 2018, applies to employers with more than five employees. For every employee who has coverage through MassHealth or subsidized coverage through the Massachusetts Health Connector instead of coverage through the employer’s plan, the employer must pay a fine equal to five percent of the employee’s “wages” up to $750. Wages are defined as the “unemployment insurance taxable wage base,” which is $15,000 for 2017. Thus, the maximum fine is $750 ($15,000 times five percent equals $750).

The Department of Unemployment Insurance (DUI), in consultation with the Division of Medical Assistance and Health Insurance Connector Authority, is responsible for providing regulations for implementing the new law and once provided, employers must pay the fines in accordance with the regulations. Among many details the regulations will address are the number of days an individual must have MassHealth or subsidized coverage to trigger a fine.

The DUI will notify employers of any fines they must pay. Once notified, an employer may request a hearing provided the request is made within 10 days of receiving the notice.

Unfortunately, there is not much time between now and January 2018 for employers to plan for the new law and its potential impact on their budgets. Employers such as retail, hospitality, human services, and other industries employing a significant number of lower wage workers are likely to be most impacted.

The PS&A team will inform you when the regulations are published. Also, feel free to contact us with any questions or help needed.

Governor Baker signed the Massachusetts Pregnant Workers Fairness Act into law on July 27, 2017.  The new law, effective April 1, 2018, expands the Massachusetts’ nondiscrimination law covering private employers with six or more employees to prohibit discrimination based on pregnancy or based on a condition related to pregnancy such as lactation.

For an overview of the new law, be sure to read Issue 4, HR Insights by clicking here.

The U.S. Department of Labor (DOL) published a request for information (RFI) on July 26, 2017, regarding the overtime rule for determining whether employees are exempt or non-exempt under the Fair Labor Standards Act (FLSA).  The purpose of the RFI is to ask the public for information that will help DOL in formulating a proposal to revise the FLSA regulations.

Under the Obama administration, the minimum salary threshold for treating an employee as exempt from overtime under the so called FLSA white collar exemptions was increased from $455 per week ($23,660 annualized) to $913 ($47,475 annualized), effective December 1, 2016.  The increase in the threshold was highly controversial and within two weeks of the effective date, a federal district court in Texas issued a nationwide preliminary injunction, effectively putting the increase on hold.  Since then, an appeals court granted the DOL three extensions in defending their case as a new Secretary of Labor had not been confirmed following Trump becoming President.  Alex Acosta, the new Secretary of Labor, was ultimately confirmed on April 27.  Of note is that during the confirmation hearing, Acosta indicated that DOL will review and possibly revise the FLSA regulations and stated that he believed the minimum salary threshold should be around $33,000.

The RFI asks for feedback on questions pertaining to the minimum salary threshold as well as to the duties test, verifying cost-of-living in different parts of the U.S., inclusion of non-discretionary bonuses and incentive payments for satisfying part of the minimum salary threshold, the salary test for highly compensated employees, and automatic updating of the minimum salary threshold.  All comments must be received by September 25, 2017.   Comments may be submitted electronically at http://www.regulations.gov, or mailed to Melissa Smith, Director of the Division of Regulations, Legislation, and Interpretation, Wage and Hour Division, U.S. Department of Labor, Room S-3502, 200 Constitution Avenue NW, Washington DC 20210.  The DOL prefers to receive comments electronically.  To date, there are over 35,000 who have submitted comments.  To view the RFI, visit the Federal Register website at

https://www.federalregister.gov/documents/2017/07/26/2017-15666/request-for-information-defining-and-delimiting-the-exemptions-for-executive-administrative.

The PS&A team will keep you apprised of new developments.

The United States Citizenship and Immigration Services (USCIS) published a new revised Form I-9 on July 17, 2017 (revision date of 7/17/17 N) that employers must start using no later than September 18, 2017.  The Form was last revised November 14, 2016, which all employers had to start using no later than January 22 of this year.

The changes, which are not extensive, primarily impact the list of acceptable documents for verifying identity and authorization to work in the U.S.  They include the following:

  • USCIS added the Consular Report of Birth Abroad (Form FS-240) to List C of Acceptable Documents.
  • USCIS combined all the certifications of report of birth issued by the Department of State (Form FS-545, Form DS-1350, and Form FS-240) into List C.
  • USCIS renumbered all List C documents except the Social Security card.

These changes are also reflected in the instructions for completing Form I-9 as well as in the Handbook for Employers: Guidance for Completing Form I-9 (M-274) available at https://www.uscis.gov/i-9-central/handbook-employers-m-274.  To view the revised Form I-9 and instructions, visit our Resource Page, Legislation, Regulations, and Other Government Issued Materials.  

CapeSpace in Hyannis, Massachusetts, has announced its new Ask the Experts program through which CapeSpace members and visitors can ask burning questions on the topics of the day at no cost. Each week, CapeSpace will feature different CapeSpace members with expertise in a variety of topics, including social media, website development and SEO, money management, payroll, group benefits, and human resources management. Pamela Sande & Associates is thrilled to be a part of this great group of experts. For more information about the program, the experts participating in the program, and schedule, visit CapeSpace’s website at https://www.capespace.com/news-and-events/ask-the-experts/.