Know What’s Coming in 2020: Staying Compliant with New Labor Laws

As a restaurant owner you’re no doubt aware of the plethora of labor laws you must follow in order to avoid a lawsuit – but get ready, there are likely more statutes coming your way on Jan 1.

You’ve probably heard that the Department of Labor is changing the federal overtime salary threshold in 2020, but lawmakers on the state level are also reconfiguring legislation to protect employees and ensure they have a better quality of life in terms of time off and scheduling practices.

If you’re in one of these states or municipalities, changing your policies in order to stay compliant can be daunting, but with the right tools and tricks, your New Year’s resolution of staying out of the courtroom will be a breeze to maintain all the way through December and beyond.

Here is a brief breakdown of each updated law, where it is being implemented and a few steps on how to prepare.

Predictive Scheduling

The phrase has become more and more common in recent years, but what exactly does predictive scheduling mean? Also known as “fair scheduling,” business owners and managers follow the practice by giving employees advance notice of their schedules.

Fair scheduling – and the laws that enforce it – also prevent employers from changing the schedules without notice and scheduling back-to-back closing and opening shifts.

Oregon

On July 1, 2020, Oregon will improve upon their already-implemented law by increasing the schedule notice requirement from seven to 14 days for retail, hospitality and foodservice industries with at least 500 employees. This means employers will have to post schedules 14 days in advance.

The law also requires employers to provide a good faith estimate of hours upon hiring and a rest period of at least 10 hours between shifts (or time-and-a-half pay if the employee agrees to forgo the rest period).

Philadelphia

Philadelphia employers with at least 250 employees and 30 locations will be required as of April 1, 2020, to post schedules 10 days in advance. This will increase to 14 days in advance on Jan 1, 2021.

Employees will also be entitled to a nine-hour rest period in between shifts or be paid $40 for shifts worked within the rest period.

Chicago

Chicago’s Fair Workweek Ordinance will be implemented July 1, 2020, and will affect businesses with at least 100 employees, nonprofit organizations with more than 250 employees and restaurants with at least 30 locations and 250 employees.

Employers within the stipulated industries will be required to post schedules for employees who earn less than or equal to $26 per hour or less than $50,000 a year 10 days in advance. The notice requirement will be increased to 14 days on July 1, 2022. 

The number one solution for getting into the groove of predictive scheduling is to adopt scheduling software that does the hard work for you. For example, Homebase’s free scheduling app allows you to create and publish a work schedule in just a few minutes, and if you keep the same schedule week to week, you can easily copy it over or even schedule weeks in advance.

Plus, your employees will be alerted by the app as soon as you publish the schedule to ensure they get it as quickly as possible. With the right scheduling tool under your belt, predictive scheduling compliance will be a total non-issue.

Federal Overtime Salary Threshold

No matter where you live, the Department of Labor’s final rule on overtime will impact you if your employees fall under certain categories. As of Jan 1, 2020, the minimum salary requirement for employees to be considered “exempt” from overtime – meaning they don’t get paid extra wages for extra work – will be raised from $455 per week to $684 per week, or $35,568 per year.

What does this mean? It means that in order to be considered exempt from overtime, employees who have an administrative, professional or executive status will need to make the aforementioned amount of money – while also satisfying the other two exemption tests – to be considered exempt from overtime.

If you have employees who are going to be impacted by the threshold increase, you have two options to stay compliant:

• Raise their salary to fall under the minimum requirement. If you choose to take this route, make sure they still pass all three tests
• Elect to reclassify the impacted employees as non-exempt and pay them overtime when necessary

If you decide to go the route of reclassifying employees as non-exempt, you must revisit your time-tracking policy. After all, if an employee hasn’t had to track their hours worked in the past, they might not be the most efficient at implementing the practice.

Homebase has two tools that will help make the transition smooth and easy: the Timesheets app and the Time Clock app. The two apps together make it simple to accurately track time from any device, and even track paid and unpaid breaks – which is important, because the Fair Labor Standards Act (FLSA) includes paid breaks in hours worked.

Minimum Wage Increases

While there is no federal minimum wage increase in 2020 (in fact, there hasn’t been one since 2009), 24 states and Washington, D.C. are upping their rates in the new year.

These states include Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nevada, New Jersey, New Mexico, New York, Ohio, Oregon, South Dakota, Vermont, Washington and Washington, D.C.

It’s also important to remember that while your state might not change its rate in 2020 – or even if it does – your city may have new laws of their own that you need to follow. Check with your local government to ensure total compliance on all levels.

If you pay any of your employees minimum wage and live in any of the states mentioned above, you’re going to want to make sure your payroll is as accurate as possible with the increased costs. Homebase takes the headache out of payroll by saving you more than five hours every week, and automatically identifies errors such as missed breaks or clock-outs.

You can even export your time sheets directly to the top payroll providers without entering any data yourself, so the increase in minimum wage shouldn’t be a problem for you and your business at all when it comes to compliance.

About Homebase: Homebase powers team management and staffing as part of CHECK^® Business Tools. Homebase helps you save time, reduce costs and make hiring easier. Recruit quality candidates, track labor costs, simplify payroll and streamline team communications with just one tool. Learn more about Homebase by visiting team management and staffing in CHECK Business Tools.

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