On May 19, 2008, the Department of Labor issued a final rule changing the annual reporting requirements for veterans hiring by federal contractors. The rule was part of the implementing regulations for the Jobs for Veterans Act (”JVA”) (Pub. L. 107-288, 116 Stat. 2033).

Passed in November 2002, the JVA amended the Vietnam Era Veterans’ Readjustment Assistance Act by changing the substantive criteria for determining veterans’ eligibility and by changing the procedural mechanism federal contractors must use to comply with the law. The JVA increased the threshold amount for qualifying contracts from $25,000 to $100,000. In addition, the JVA eliminated presumptive coverage of Vietnam-era veterans and expanded coverage to include (1) “veterans who, while serving on active duty in the Armed Forces, participated in a United States military operation for which an Armed Forces service medal was awarded;” (2) veterans who had been discharged or released from active duty within the past three years; and (3) veterans who were discharged or released from active duty because of a service-connected disability.

Under the new rule, federal contracts entered into on or after December 1, 2003 will be governed by the new 41 C.F.R. § 61-300.  Contracts entered into after that date worth more than $100,000 will require an annual filing of the new VETS-100A form with the DOL’s Veterans’ Employment and Training Service (”VETS”).  Older contracts will continue to be subject to the old 41 C.F.R. § 61-250, which requires filing of the VETS-100 form for any contract of $25,000 or more.

VETS acknowledges that the new rule will require some contractors to file both the old and new forms, but asserts that such a result is mandated by the statutory language.  VETS estimates that less than twenty percent of current contractors will have dual filing requirements.

Federal contractors covered by the JVA must file their first VETS-100A annual report by September 30, 2009.  Because the VETS-100A annual report requires federal contractors to collect data for the preceding 12-month period, covered contractors must start compiling information for the newly covered veterans starting October 1, 2008.

On April 10, 2008, the House Subcommittee on Workforce Protections held a hearing on the FMLA that focused on proposed changes and potential areas of improvement. Chairwoman Woolsey (D-CA) expressed concerns about the Department of Labor’s proposed FMLA regulations, and endorsed two pending pieces of legislation: The Balancing Act of 2007 (H.R. 2392) and The Healthy Families Act of 2007 (H.R. 1542, S. 910).  The Balancing Act of 2007 would provide paid family medical leave, benefits for part-time workers, and additional leave for parental involvement activities. The Healthy Families Act of 2007 would require employers to provide workers with at least seven days of paid sick leave and pro-rated leave for part-time employees. 

Chante Lasco, a recent new mother, testified about the difficulty employees face when attempting to take advantage of the FMLA’s twelve weeks of guaranteed leave because the leave may be unpaid. Lasoc also shared the difficulties of returning to work only twelve weeks after giving birth, including the difficulty in finding and paying for child care for a twelve-week-old infant.

Victoria Lipnic, Assistant Secretary of the Employment Standards Administration division of the Department of Labor, spoke primarily about the Department’s proposed FMLA regulations.  Lipnic asserted that the Department currently has four main rulemaking goals: (1) to address the recently enacted military family leave provisions; (2) to update the regulations to comport with current case law; (3) to foster smoother communications among employees, employers, and health care professionals; and (4) to update and clarify specific problematic areas of the current FMLA regulations without limiting employee access to FMLA leave.

Among other revisions, the proposed rule:

• requires employees to give more advance notice of the intention to take FMLA leave;
• attempts to clarify the medical certification requirements;
• permits an employer to contact an employee’s health care provider directly for purposes of clarification and authentication of the serious health condition;
• imposes increased notice requirements on employers;
• changes the standard for determining the relevant “worksite” for coverage determination purposes in a joint employment situation;
• changes requirements regulating the interaction between FMLA leave and light duty work;
• clarifies that an employee cannot waive prospective rights but may settle claims based on past employer conduct; and
• removes categorical penalty provisions while retaining an employee’s entitlement to remedy for individualized harm.

For more complete coverage of the proposed rulemaking, please see Akin Gump’s recent Employment Alert.

Debra Ness, President of the National Partnership for Women and Families, criticized the proposed regulations. Ness claimed that the proposed changes would make it more difficult for employees to use FMLA leave because of increased notification and certification requirements.  In addition, the new rule would increase direct contact between employers and employees’ health care providers, a matter of concern for employees with serious health conditions that carry social stigma. Ness’s proposals for expanding FMLA included reducing the employer-size threshold, removing job tenure requirements for leave eligibility, extending coverage to include leave to care for all domestic partners and extended family members, and implementing a federal minimum standard of paid sick days for all employees.

Brenda Cossette testified on behalf of the Society for Human Resource Management, a professional association representing more than 225,000 HR professionals who administer FMLA leave on a daily basis. Cosette praised the FMLA generally, but warned that unintended consequences require regulatory clarification in areas not addressed by the proposed rule.  Cossette recounted common challenges HR professionals encounter, including administering unscheduled intermittent leave and interpreting the definition of a “serious health condition.”  Cossette reported that employers are facing habitual employee absenteeism or tardiness with limited tools for determining when the leave is legitimate. Furthermore, the availability of intermittent leave for chronic conditions, which allows leave to be taken in unpredictable, unscheduled, and small increments of time, poses significant challenges in the reallocation of absent employees’ work. Cossette also warned that proposals to expand FMLA without first addressing its flawed framework, including paid leave mandates, would be ill-advised.

The DOL has published a Notice of Proposed Rulemaking under the FMLA and is now encouraging interested parties to submit comments on the proposed regulations by midnight, April 11, 2008. A copy of the Federal Register Notice, instructions for submitting comments and related documents are available at Wage and Hour’s FMLA Notice of Proposed Rulemaking Web site.

Employers who are interested in commenting on the new FMLA regulations can contact Bob Lian at Akin Gump Strauss Hauer & Feld LLP for guidance on crafting a regulatory comment that best protects employer interests.

The Wage and Hour Division of the Department of Labor (DOL) has published a new update poster for the expanded Family and Medical Leave Act (FMLA) coverage for American servicemen. Amended in the January 28, 2008 National Defense Authorization Act for FY 2008, the FMLA now permits a spouse, son, daughter, parent or next of kin of a service member to take up to 26 workweeks of leave to care for a “member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness.”

Employers should immediately post the new poster, which is available on the DOL’s Web site at http://www.dol.gov/esa/whd/fmla/NDAAAmndmnts.pdf. While numerous private vendors have begun offering revised FMLA compliance posters, these private-sector posters are not required for FMLA compliance. Rather, employers need only post the free poster available through the DOL Web site.

Enacted in 1993, the federal Family and Medical Leave Act (FMLA) provides that covered employers must grant eligible employees up to 12 weeks of unpaid leave within a 12-month period for (1) the birth and care of a newborn child, (2) the adoption of a child, (3) the care of an immediate family member with a serious health condition or (4) medical leave when the employee himself or herself is unable to work due to a serious health condition.

Recently President Bush signed into law the National Defense Authorization Act of 2008 (NDAA), which extends the FMLA to allow leave in certain circumstances to care for a family member who has served in the Armed Forces. Some of the provisions of the NDAA are effective immediately, and employers should amend their policies to reflect these new provisions.

In addition, as the result of complaints from both employers and employees, the Department of Labor (DOL) has recently begun the process of making substantial revisions to the FMLA’s implementing regulations for the first time since the FMLA was enacted. The DOL recently issued a Notice of Proposed Rulemaking proposing numerous changes to the FMLA’s implementing regulations, and calling for public comment before the regulations become final. In addition to certain minor changes and general reorganization of the regulations for ease of reference, the draft regulations propose numerous substantive changes to the current regulations, the most pertinent of which are summarized and contained in the chart, which is available if you follow the link below.

The DOL’s proposed regulations also leave certain major issues unaddressed. Most significantly, with respect to intermittent FMLA leave, numerous comments were generated during the comment period on the issue of whether an entire shift should be chargeable as FMLA leave to an employee who takes intermittent leave and has a job that precludes commencing work midway through a shift (e.g., a flight attendant who takes one hour of leave, causing that employee to miss a 12-hour scheduled flight assignment). While the DOL has proposed no changes to the current regulations at this time, it seeks additional comment from the public on this issue and what language should be included in the final rule, if any. 

Please Click here to read the full text of this Akin Gump Client Alert.

After vetoing the National Defense Authorization Act for FY 2008 (NDAA) earlier this month because of concerns over an unrelated provision dealing with Iraqi liability, President George W. Bush signed a revised NDAA into law on January 28, 2008. Section 585 of the NDAA amends the FMLA to permit a “spouse, son, daughter, parent, or next of kin” to take up to 26 work weeks of leave to care for a “member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness.”

Employers should immediately advise their human resources department about this expanded scope in coverage. The FMLA amendment in the NDAA providing this leave is effective immediately. While the Department of Labor is currently in the process of preparing better guidance regarding rights and responsibilities under the new legislation, employers will still be liable for any violations of the new laws in the absence of comprehensive guidance.

The new amendment allows an employee to take FMLA leave for “any qualifying exigency (as the Secretary [of Labor] shall, by regulation, determine) arising out of the fact that the spouse, or a son, daughter, or parent of the employee is on active duty (or has been notified of an impending call or order to active duty) in the Armed Forces in support of a contingency operation.” By its express terms, this provision of the NDAA is not effective until the secretary of Labor issues final regulations defining “any qualifying exigency.”

On February 11, 2008, the Department of Labor (DOL) issued a Notice of Proposed Rulemaking, proposing numerous changes to the Family and Medical Leave Act (FMLA) regulations, and calling for public comment before the regulations become final. The draft regulations would change employers’ and employees’ responsibilities under the FMLA and would also change the procedure for taking FMLA leave. While there are numerous changes to the current regulations, employers should take special note of several new issues discussed below. For a more in-depth discussion of the proposed changes, please watch for a comprehensive analysis we will be distributing in the coming days.

Intermittent leave. Despite the fact that most employers consistently identified intermittent leave as the most troublesome part of the FMLA, the DOL has proposed no change to the current regulation allowing workers to take leave in the smallest increment of time permitted under the employer’s timekeeping system for intermittent leave. Instead, the DOL has tried to assuage employers’ concerns over intermittent leave by requiring employees to follow the workplace call-in procedures if they want to take unscheduled, intermittent leave. Currently, employees can take leave and then designate it as FMLA-qualifying leave within two days of the absence. The proposal only allows such an approach in the case of emergencies.

Employee notice requirement. The proposed regulations clarify past ambiguities and impose two notice timeframes: (1) for non-emergency situations, the new regulations would retain the old regulations’ 30-days notice, and (2) for emergency situations, the new regulations would require employees to inform the employer the same day they learn of the need for FMLA leave (if the employee learns of the infirmity during work hours) or the next day (if the employee learns after work hours).

Employer notification process. Proposed § 825.300(b) would give employers five days to inform employees that they are eligible for FMLA leave after an employee has informed the employer of circumstances suggesting that the employee would need FMLA leave. This extends the previous two-day requirement.

Medical certification process. Under the proposed regulations, employers would be able to contact medical providers directly to obtain clarification or authentication of documentation. Under the current rule, that communication may take place only between a health care provider who works for the employer and the employee’s health care provider. This proposal complies with the Health Insurance Portability and Accountability Act’s (HIPAA) privacy rule because a health care provider would still need permission from the patient in order to talk to the employer. If the patient does not give permission, the draft regulations would view that failure to give permission as a failure to provide proper certification if concerns arise about the certification.

“Light-duty.” The proposed regulations clarify that workers on “light-duty” after returning from FMLA-qualifying leave should not have the time count against the employee’s 12 weeks of FMLA leave.

The Wage and Hour Division (WHD) recently released and posted its first opinion letters since May 2007. The first two opinion letters construed the executive and professional overtime exemptions and the third opinion letter clarified how volunteers can receive limited compensation.In its August 23, 2007 letter, the WHD determined that court reporters are not exempt from overtime under the Fair Labor Standards Act (FLSA). See DOL, Wage & Hour Div., Op. Letter 2007-2NA (Aug. 23, 2007). Court reporters do not qualify for the executive exemption because they do not supervise two or more full-time employees and they do not qualify for the professional exemption because their work does not require advanced knowledge “customarily acquired by a prolonged course of specialized intellectual instruction.” The WHD explained that “[w]ork that can be performed by employees with education and training that is less than a required bachelor’s degree in a particular discipline generally does not qualify as learned professional work under the regulations.”

In its September 17, 2007 letter, the WHD further refined the executive exemption by finding that field inspectors for a membership-based cattle producers association were exempt executives. See DOL, Wage & Hour Div., Op. Letter 2007-11 (Sept. 17, 2007). The association had requested guidance on whether its field inspectors, who oversee subordinate market inspectors, were non-exempt under 29 C.F.R. § 541.3(b)(1), which states that the overtime exemptions “do not apply to … inspectors … who perform work such as … conducting investigations or inspections for violations of law; performing surveillance; pursuing, restraining and apprehending suspects; … preparing investigative reports; or other similar work.” The WHD stated that the field inspectors in question “differ from the inspectors described in § 541.3(b)(2), because the Field Inspectors’ primary duty is management of a customarily recognized department, not duties related to investigations.” The WHD emphasized the importance of the inspectors’ primary duty in making the determination.

Finally, on September 17, the WHD clarified what kind of compensation volunteer firefighters could receive under the FLSA. See DOL, Wage & Hour Div., Op. Letter 2007-3NA (Sept. 17, 2007). The WHD found several kinds of compensation valid, including: (1) tuition to pay for the Fire Academy and Fire School; and (2) life insurance, a disability policy, and a monthly contribution of $100 to the state-created retirement fund. However, the WHD opined that a $550 stipend for income lost from regular employment is probably invalid because “the purpose of this payment is specifically to compensate the firefighters for their lost days of paid work.” Additionally, the WHD expressed doubt as to whether a $19.72 per call stipend, ostensibly paid to cover volunteers’ incidental costs, constitutes a “nominal payment” under the regulations. Under the WHD’s 20 percent rule, “the Department will presume the fee paid is nominal as long as it does not exceed 20 percent of what the public agency would otherwise pay to hire a full-time … advisor for the same services.” However, the WHD could not apply the 20 percent rule to the firefighters because it did not have sufficient knowledge of what paid-firefighters received.