There are few forces in nature like the wind blowing across the Texas plains. Just ask those who survived the recent outbreak of severe weather that brought 2015 to a close. For Texas employers, another kind of wind may soon be blowing across the Lone Star State: the winds of change, in the form of new overtime and paid sick time standards.
A nationwide movement gathering steam
Workers across the country are more aware and informed than ever about their wage and hour rights. With the help of advocacy groups and lawyers, they’re pressuring legislators and filing lawsuits, with wage and hour litigation on the rise every year. The firm of Seyfarth Shaw, citing federal judiciary data, reports that 8,781 cases were filed in 2015, up 7.6% over 2014.
Two developments that will likely impact Texas employers in the future:
- New overtime rules. In June 2015, the Obama administration announced that the Department of Labor (DOL) will propose extending overtime pay to nearly 5 million workers. The proposal would raise the threshold at which certain professionals qualify for overtime under the Fair Labor Standards Act (FLSA), more than doubling the cut-off from $455 a week to $970 a week. That would guarantee overtime pay to most salaried workers earning less than an estimated $50,440 in 2016. Labor advocates are also pushing for revisions to overtime criteria to discourage employers from classifying higher-ranked workers as managers to avoid overtime obligations
NOTE: In May 2016, President Obama announced the DOL’s final rule updating overtime regulations. Please see What will new overtime rules mean for your Texas business? for more information.
- Paid sick time standards. According to PaidSickDays.org, nearly four in 10 private sector workers, and 80 percent of the lowest-wage workers, don’t have access to paid sick days for themselves. Millions more don’t have paid sick time available to take care of a sick child. The Institute for Women’s Policy Research estimates that 44.9 percent of the workforce in Texas cannot earn paid sick days. That means when these workers need time off for a personal illness, they’re forced to make a tough choice between their health and their financial security, possibly even jeopardizing their job security. That’s why workers and advocacy groups are calling on Congress to pass the Healthy Families Act, which would set a national paid sick days standard. According to a May 2015 national telephone poll conducted by the New York Times and CBS news, 85 percent of voters want employers to provide paid sick time. And paid sick day laws have been – or soon will be – enacted in 23 jurisdictions across the country, including four states, the District of Columbia, and numerous cities and counties. At least 26 other states and many other cities either have pending legislation or a campaign to enact legislation to adopt a sick days standard. Although Texas doesn’t currently have pending legislation or an official campaign, advocacy groups are hard at work to change that.
Is your business prepared?
With the way things are trending across the country, it’s almost inevitable that Texas will eventually establish new overtime and paid sick time rules. Take time now to review your current policies and procedures, and stay current on which way the wind is blowing. With wage and hour litigation on the rise, it’s also a good time to make sure you have adequate Employment Practices Liability Insurance.
When you need a risk management partner who can help you weather the changing Texas employment practices, see our business insurance experts at Higginbotham.