FMLA: Children of Same Sex Partners

November 26, 2012

The U.S. Department of Labor (DOL) issued an Administrator’s Interpretation of the Family and Medical Leave Act’s (FMLA) definition of “son and daughter.” The Interpretation clarifies that an employee who lacks a legal or biological parent-child relationship but provides either day-to-day care or financial support, and intends to assume the responsibilities of a parent with regard to the child, is eligible for parental rights to FMLA leave. 

The Interpretation relies on an expansive reading of “in loco parentis” in the FMLA definition of “son or daughter.” “Son or daughter” is defined to include a biological or adopted child, as well as a foster child, stepchild, legal ward, or child of a person standing “in loco parentis.”

Eligible employees are entitled to take 12 work weeks of leave for the birth or placement of a son or daughter, to bond with a newborn or newly placed son or daughter, or to care for a son or daughter with a serious health condition. 

An example given in the Administrator’s Interpretation is an employee who will share equally in the raising of an adopted child with a same-sex partner, but who does not have a legal relationship with the child. Such an employee would be entitled to leave to bond with the child following placement, or to care for the child if the child had a serious health condition, because the employee stands in loco parentis to the child.

The Interpretation provides another example of the child whose biological parents have divorced, and each parent remarries. Such a child would be the “son or daughter” of both the biological parents and the stepparents, and all four adults would have equal rights to take FMLA leave to care for the child. 

Notably, the Administrator’s Interpretation emphasizes that an employee is not required to provide both day-to-day care and financial support in order to be found to stand in loco parentis. Either day-to-day care or financial support, coupled with an intent to assume the responsibilities of a parent, is sufficient. Neither the statute nor the regulations restrict the number of parents a child may have under the FMLA. 

Where an employer has questions about whether an employee’s relationship to a child is covered under FMLA, the employer may require the employee to provide reasonable documentation or a statement of the family relationship. A simple statement asserting that the requisite family relationship exists is all that is needed where there is no legal or biological relationship.

Although the concept of “in loco parentis” is not new, employers should review their FMLA policies and practices to ensure they account for this new broader interpretation.


The Impact of Obamacare-A Timeline and Available Resources For Complete Explanations

November 19, 2012

Many employers are about to embark on the annual open enrollment period where they modify their health benefits (or at least consider doing so) and undergo the process of enrolling employees for the 2012 calendar year.  Certain provisions of Obamacare (officially known as the Patient Protection and Affordable Care Act or “PPACA” for short), have already taken effect.  Others will come into play over the next 26 months.  This blog does not allow for a comprehensive review of the PPACA.  However, we wanted to provide some resources that are accessible, without cost, to help guide our clients and readers as they approach open enrollment and as we get closer to 2014 when all the Act’s provisions are scheduled to be in place.

1. www.healthcare.ca.gov/priorities/healthbenefitexchange.aspx

The PPACA has provisions that allow states to set up exchanges to make it easier for individuals and small businesses to compare plans and buy health insurance on the private market.  California was one of the first states to begin working on this.  This website provides good information on the California Health Benefit Exchange.

2. www.healthcarelawsuits.org

There have been many challenges to the PPACA in the courts.  If these are successful, the PPACA may not move forward as intended.  Only time will tell whether these challenges will derail the PPACA completely, partially or not at all.  Six writs of certiorari are currently before the United States Supreme Court and the mandates of Obamacare are under attack based on constitutional grounds.  This website provides a good summary of the status of the various lawsuits challenging the PPACA.

3. www.kff.org/healthreform/8061.cfm

On this website, the Henry J. Kaiser Family Foundation provides a good summary of the key provisions of the PPACA and a helpful Implementation Timeline.

4. www.dol.gov/ebsa/healthreform/

This is the United States Department of Labor’s website on the PPACA.  It contains comprehensive information on the Act, including but not limited to access to the proposed DOL regulations related to the Act.

5. http://www.healthcare.gov/law/resources/ca.html

This website provides information on implementation of the PPACA in California.

I hope this information is helpful to you.


Three Important Wage & Hour Changes

November 13, 2012

Uniform and Travel Reimbursements

Last week, a California court affirmed a victory for clothing retailer Wet Seal, who successfully defeated class certification on wage and hour claims for alleged failure to reimburse uniform expenses and alleged failure to compensate employees for expenses associated with using their personal vehicles to travel between store locations.  The plaintiff and proposed class of retail employees alleged that Wet Seal required employees to purchase and wear Wet Seal clothing at work, but failed to reimburse employees for the cost of this alleged “uniform.”  The employees further alleged that Wet Seal at times required them to use their own cars to travel from one store location to another for meetings or other business reasons, but did not reimburse employees for mileage or other travel expense.  In seeking to have a class of some 12,000 employees certified, the plaintiff submitted declarations of several employees stating that they purchased Wet Seal clothing without being reimbursed and used their car to travel to stores without reimbursement.  In opposing the motion, Wet Seal presented its expense reimbursement and work attire policies, which on their face made very clear that employees are entitled to reimbursement for travel expenses in accordance with law and employees are not required to purchase Wet Seal clothing but rather simply expected to dress in the fashion style of the store.  Wet Seal also offered employees a generous discount on the cost of store merchandise.  Wet Seal additionally presented declarations of numerous employees confirming that they understood they did not have to buy or wear Wet Seal clothing, and that they had submitted documentation of travel expense and been reimbursed in accordance with company policy.

In concluding that class certification was not appropriate on these claims, the court explained that Wet Seal’s policies were facially lawful and thus could not supply the necessary “common policy” or “common method of proof” needed to support a determination of liability on a class wide basis. 

Minimum Wage Going Up

For those California employers with employees in the cities of San Francisco and San Jose should take note of minimum wage increases for these cities taking effect in 2013.  San Francisco passed its minimum wage ordinance a few years ago, but the minimum wage is subject to adjustment each year based on the cost of living.  Effective January 1, 2013, the minimum wage for employees who perform at least two hours of work per week in the City of San Francisco is $10.55 per hour (up from $10.24/hour in 2012).

This week, San Jose voters approved a local minimum wage for the City of San Jose as well.  With the passage of Measure D, the minimum wage for employees working in San Jose will be $10.00 per hour.  The new San Jose minimum wage takes effect 90 days after the election results are certified, which means approximately March 2013.

The state minimum wage otherwise remains at $8.00 per hour. 

Computer Professionals & Licensed Physicians

California Labor Code sections 515.5 and 515.6 provide an overtime exemption for certain computer professionals and licensed physicians/surgeons who meet specified criteria for exemption.  One of those criteria is that they earn specified minimum pay, the amount of which is subject to annual adjustment by California’s Department of Industrial Relations (DIR).  The DIR has announced increases to the minimum pay for these workers as follows:

  • The DIR has increased the computer software employee’s minimum hourly rate of pay for exempt status from $38.89 to $39.90, the minimum monthly salary from $6,752.19 to $6,927.75, and the minimum annual salary from $81,026.25 to $83,132.93, effective January 1, 2013; and
  • The DIR has increased the licensed physicians and surgeons employee’s minimum hourly rate of pay for exempt status from $70.86 to $72.70, effective January 1, 2013.

Employers relying on these exemptions for exempt computer professionals and licensed physicians/surgeons will want to take note of these changes and adjust their pay practices accordingly.


Time Clock Rounding Off Policy Finally Clarified By The Court

November 5, 2012

A California court recently issued its decision in Silva v. See’s Candy, holding that California employers may lawfully use rounding policies–policies that round an employee’s time worked to the nearest tenth of an hour worked (or other similar increment) for purposes of calculating pay.  This is the first published California decision holding that rounding policies are permitted under California law, though such policies are permitted under federal law and California’s Department of Labor Standards Enforcement previously has opined that such policies are also permitted under California law. 

In the See’s Candy case, See’s employees were required to use a timekeeping system known as Kronos to record their start and end times of work.  See’s had a rounding policy indicating that these times would be rounded to the nearest tenth of an hour (up or down) for purposes of payroll.  A former See’s employee filed a class action claiming the rounding policy resulted in underpayment of wages to employees.  The trial court ultimately granted class certification.  See’s defended the case by arguing, among other things, that its’ rounding policy was lawful.  The plaintiff employee moved for summary adjudication of See’s rounding defense, asking the court to rule as a matter of law that See’s rounding policy was unlawful.  The trial court ultimately granted the motion, precluding See’s from relying on its rounding defense. 

A California court of appeal overturned the trial court’s ruling and reinstated See’s rounding defense.  Critically, the court held that “the rule in California is that an employer is entitled to use the nearest-tenth rounding policy if the rounding policy is fair and neutral on its face and it is used in such a manner that it will not result, over a period of time, in failure to compensate the employees properly for all the time they have actually worked.”  Thus, the legality of a rounding policy depends on whether it, in practice, operates over time to pay employees for all time worked and not to short employees.  In the See’s case, there was an expert report before the court analyzing the impact of See’s rounding policy over time and concluding that the policy actually had a net effect of slightly overpaying employees.  The plaintiff in the case did not present evidence sufficient to rebut this expert report or to demonstrate that the rounding policy actually underpaid employees.  As a result, the appellate court held that the trial court erred in disposing of See’s rounding defense.

The See’s case is an important one for California employers because it is the first published California decision to uphold the use of rounding policies under California law.  Employers should understand, however, that this does not mean that all rounding policies will hold up in court.  In the See’s case, the employer did not win the case (yet).  The court simply ruled that See’s must be permitted to prove its rounding defense at trial and that this defense should not have been precluded.  Ultimately, the legality of a rounding policy depends on whether the policy operates, on average and over time, to properly compensate employees for hours worked or whether it results in a net underpayment to employees.  Without such analyses, rounding policies continue to present some level of risk and class action exposure to California employers.