In the Workplace 2016: LGBT Rights and Exempt Employees
LGBT Employee Rights in the Workplace
This year brought significant developments in several laws that affect LGBT employees. Most widely reported was the U.S. Supreme Court’s ruling that same-sex couples have a constitutional right to marry.
Notwithstanding the antics of a Kentucky court clerk, it is now clear that all states must allow same-sex couples to marry. Naturally, this ruling impacts employee benefits, such as the Family Medical Leave Act, retirement plans and medical insurance. Many employers have had to revise their employee benefit plan documents to comply with current law.
Of particular importance to employers, the Equal Employement Opportunity Commission now takes the position that Title VII’s prohibition against gender discrimination includes discrimination on the basis of sexual orientation and gender identity.
In fact, the EEOC has identified such discrimination as an enforcement priority for the agency. Going forward, the EEOC will investigate charges alleging workplace discrimination that is based on sexual orientation or transgender status (i.e., the employee identifies with a different gender than the gender assigned to them at birth).
EEOC data shows that the number of charges alleging sexual orientation and gender identity discrimination has increased substantially in the last couple of years.
Transgender employees’ restroom access is another area where the law has been clarified. In April, the EEOC ruled that a transgender employee cannot be denied access to common restrooms used by employees of the same gender identity. In other words, a person who identifies a woman must be permitted to use women’s restrooms.
The same reasoning likely applies to locker rooms and similar facilities. OSHA’s guidance provides that while a single-occupancy gender-neutral facility can be offered to transgender employees (and may be a welcome alternative for safety or privacy reasons), transgender employees cannot be required to use the alternative facility in lieu of common, gender-specific restrooms.
Rulings that change or clarify laws tend to raise as many questions as they answer. We expect questions relating to these issues to keep employers and employment attorneys busy in the coming years.
Get Ready for the New Rules on Exempt Employees
The train is coming. At some point in mid-to-late 2016, the new Department of Labor rules on exempt employees will go into effect, and a lot of employers (especially in the hospitality and restaurant businesses) will be scrambling. Right now, it looks like the minimum salary for most exempt employees will increase dramatically to just shy of $1,000 per week, and that number may be automatically readjusted each year. Additionally, be ready for the tests used to determine whether an employee is exempt to be strengthened, making it even harder to correctly classify an employee as exempt.
So what should employers do? Options include:
- Biting the bullet and significantly increasing the pay of those exempt employees making less than the new standard;
- Continuing to pay now-exempt employees the same amount, but limiting their time to 40 hours a week or less (a dangerous strategy in our view);
- Considering the use of the "fluctuating workweek" method of calculating overtime, which results in half-time overtime instead of time-and-a-half;
- Converting previously exempt employees to non-exempt status, and paying overtime to those who work more than 40 hours in a week.
Employers should also take a hard look at their job descriptions to ensure they in fact accurately reflect the job responsibilities today and make sure their handbooks clearly state that off-the-clock work is prohibited and provide an easy-to-follow procedure for correcting time clock errors.
While there is always the chance that:
- The Department of Labor might include a transition period for employers in which the exempt salary level is gradually raised;
- The new rule would allow the partial inclusion of frequent (monthly or more often) discretionary bonuses tied to productivity or profitability when determining an employee’s total pay for purposes of an exemption; or
- The administration of President Obama’s successor might move to revoke the rule.
Don’t count on any of these. Start thinking now how you are going to handle those employees who were considered exempt prior to the new rule going into effect.