As a follow-up to Aronson’s webinar on Service Contract Act Compliance in Real Business Government Contractor Environments, we provided answers to several attendee questions below.
On Nov. 22, 2016, a federal district judge in Texas enjoined the U.S. Department of Labor’s (DOL) final rule increasing the minimum salary level threshold to qualify for an exemption from the overtime requirements of the Fair Labor Standards Act (FLSA). Prior to the entry of the nationwide preliminary injunction, the new rule was scheduled to take effect on Dec. 1, 2016, and expected to expand overtime coverage to roughly 5 million employees.
Currently, based on regulations from 2004, in order for white-collar employees to be exempt from overtime requirements, they must meet certain job duties-related tests and, with few exceptions, be paid on a salary basis at a rate of at least $455 per week ($23,660 per year). The new rule nearly doubles the weekly guaranty threshold to $914 per week ($47,500 per year). The highly compensated employee exemption minimum annual salary requirement was set to increase from $100,000 to $134,004 per year. The new rule also included an automatic update to the annual salary thresholds every three years based on changes in the consumer price index.
The Fair Pay and Safe Workplaces final rule going into effect in October will require contractors to potentially shed light on labor law skeletons in the closet when submitting Federal bids. A contractor’s history of compliance with several labor laws will now come into play in the determination of contractor responsibility prior to award of a federal contract.
What do contractors need to report? For the 14 federal labor laws listed below, as well as equivalent state laws (currently only OSHA-approved State Plans), prime contractors and subcontractors will be required to disclose civil judgements, administrative merits determinations, and arbitral awards including awards that are not final or are subject to court review.
September 30th marks the end of the government fiscal year and also the annual filing deadline for two important government-required reports that apply to many employers – the EEO-1 and the VETS-4212 reports.
Private sector employers with 100 or more employees and Federal contractors with 50 or more employees and a contract, subcontract, or purchase order of more than $50,000 are required to file an annual Employer Information Report EEO-1, otherwise known as the EEO-1 Report, with the U.S. Equal Employment Opportunity Commission (EEOC)’s EEO-1 Joint Reporting Committee.
On August 25, the final rule and guidance implementing the Fair Pay and Safe Workplaces Executive Order 13673 was published in the Federal Register. The final rule implements significant changes from the proposed rule including a phase-in process for revealing labor law violations. This rule will go into effect on October 25, 2016 impacting solicitations issued on or after this date. Be on the lookout for a future blog post in early September detailing the final rule as well as significant changes to the proposed rule impacting nearly all prime and subcontractors.