Wage & Hour Counsel : Wage & Hour Lawyer & Attorney : Littler Mendelson Law Firm : Employment Law, Labor Relations

A court recently held that the Massachusetts overtime law, Mass. Gen. Laws Ch. 151 § 1A, may apply to work performed outside of Massachusetts by employees of a Massachusetts company. This is a significant ruling, given that the overtime law provides for mandatory awards of treble damages and attorneys’ fees to successful plaintiffs.

The plaintiff in Gonyou v. Tri-Wire Engineering Solutions, Inc. (pdf) lived in Massachusetts. He worked as a “technician supervisor” at the company’s facility in Danbury, Connecticut. After the company terminated his employment, the plaintiff sued, alleging that the company failed to pay him overtime while he worked in Connecticut.

After removing the case to federal court in Massachusetts, Tri-Wire moved to dismiss the plaintiff’s claim under the Massachusetts overtime law. Specifically, Tri-Wire argued that there is a presumption against extra-territorial application of statutes and the place of employment is the crucial factor in determining which state’s law is applicable. The plaintiff responded by arguing that nothing in the language of the statute compels such a result and that his proposed approach “does no more than ask this employer to stay abreast of the employment laws of its own home state.”

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On June 16, 2010, Nancy J. Leppink, Deputy Administrator of the U.S. Department of Labor, Wage and Hour Division, issued the second in her inaugural series of Administrator's Interpretations. Unfortunately, this newest interpretation (pdf), like the first, seems to reflect a continued effort by the Wage and Hour Division to reject certain key interpretations of the Fair Labor Standards Act (FLSA) issued during the Bush Administration.

In the latest interpretation, the Administrator examines whether protective equipment worn by union employees can be considered "clothes" for purposes of section 203(o) of the FLSA and whether clothes changing covered by section 3(o) constitutes a principal work activity. Section 203(o) provides that time spent “changing clothes or washing at the beginning or end of each workday” is excluded from compensable time under the FLSA if the time is excluded from compensable time pursuant to “the express terms or by custom or practice” under a collective bargaining agreement. 29 U.S.C. § 203(o).

This is not the first time the Administrator has examined this issue. In fact, since 1997 the Administrator has issued a series of conflicting opinion letters. In 1997, 1998 and 2001 opinion letters the DOL concluded protective equipment was not "clothes." In contrast, in 2002 and again in 2007, the Administrator found that "clothes" included protective equipment. The newest letter reaffirms the narrow interpretation of "clothes" found in the 1997, 1998 and 2001 opinion letters and rejects the interpretation contained in the 2002 and 2007 letters that protective equipment constitutes clothes for purposes of Section 203(o).

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The Oregon Bureau of Labor and Industries (BOLI) has amended its administrative rules pertaining to minimum wage, overtime, and working conditions effective June 1, 2010. Generally speaking, the amendments (pdf) conform Oregon’s minimum wage and overtime exemptions to federal law and clarify the rules for meals and rest periods.

First, the amended rules provide that individuals employed in domestic service positions who provide companionship services for individuals who are elderly or infirm (and therefore unable to care for themselves), are not required to be employed by the individual for whom they provide such services in order to be exempt from minimum wage.

Second, under the amendments, Oregon law is consistent with federal law by providing that certain computer system analysts, computer programmers, software engineers, or other similar skilled workers must be paid the equivalent of $27.63 per hour for each hour worked (although not necessarily on an hourly basis).

Third, the amendments state that, except as otherwise provided in the administrative rules, employees who are not relieved of all duties for 30 continuous minutes during their meal period must be paid for the entire 30-minute meal period.

These rules became effective as of June 1, 2010.

This entry was written by Janice Kim.

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As of May 21, 2010, Vermont joins a growing number of states who now allow employers to pay employee wages with payroll debit cards. The new law, Act 115 (S.58), amends Vermont State Code §§ 342 and 343 to permit an employer to credit an employee’s wages to a “payroll card account directly or indirectly established . . . in a federally insured depository institution.” Before the employer can do so, however, it must obtain the employee’s written consent, and fully disclose the terms and conditions of the payroll card account option. Furthermore, the employer may not pass on any of the expenses associated with the payroll card account to the employee nor may the employer receive any remuneration for using the card at the employee’s expense. Also, Vermont’s Department of Banking, Insurance, Securities, and Health Care Administration, the agency charged with regulating the Act, may impose additional obligations on employers who utilize payroll debit cards.

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Employers who conduct business in Maryland recently received good news when the Maryland court of appeals overturned the lower court decision in Catalyst Health Solutions, Inc. v. Magill (pdf) and held that unvested stock options are not wages under the Maryland Wage Payment and Collection law. The court reasoned that the unvested stock options at issue were not wages because the employee “did not fulfill the continued service condition,” as set forth in the stock option agreement.

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