The U.S. Department of the Treasury issued, on August 28, 2020, a Notice concerning President Trump’s Presidential Memorandum concerning employers’ deferral of payroll taxes. Here are the key points:
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President Issues Memoranda on Payroll Taxes and Unemployment Insurance
President Trump issued, on August 8, 2020, Memoranda and Executive Orders concerning unemployment insurance, payroll tax withholding, evictions, and student loans. Below, we discuss the two employment-related Presidential Memoranda (which have been incorrectly designated Executive Orders in the media, although there is little technical distinction between the two). Neither requires immediate action by employers.
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Selecting Employees for Recall or Rehire
In the COVID-19 recession, many employers made reductions in force en masse, thus avoiding selection decisions that might be challenged as discriminatory. If the same employers recall or rehire employees en masse, they will continue to avoid such decisions. But what if the employer’s need to recall or rehire is partial or gradual, such that some employees are brought back before others? Such choices can give rise discrimination claims. To protect itself, an employer will need to apply and document a non-discriminatory method of choosing among employees.
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Salary Add-Ons Do Not Bar Fluctuating Workweek Overtime, U.S. DOL Rules
Bonuses, shift differentials, hazard pay, commissions and other add-ons do not preclude use of the fluctuating workweek method of computing overtime, according to a U.S. Department of Labor interpretive regulation issued May 20, 2020. 
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DOL Streamlines Its Regulation Interpreting Commission Sales Exemption from Overtime
Apparently inspired by the tidying up trend, the Department of Labor threw out two sections of its interpretation concerning the commission sales exemption from overtime that no longer gave it joy. The commission sales exemption covers sales employees who are primarily paid by commission. To come under the exemption, the employee must be employed in a “retail or service” establishment, must earn at least 1.5 times the minimum wage, and more than half the employee’s compensation for a representative period (not less than one month) must represent commissions.
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To Avoid Job and Wage Cuts CARES Act Funds Payrolls
In our March 27 E-lert, we explained important provisions of the CARES Act. One of them provides small businesses and nonprofits with forgivable loans to fund payroll and other costs incurred between February 15 and June 30, 2020 as an incentive to keep employees on the payroll. Under the “Paycheck Protection Program” the federal government will essentially give an employer 2.5 times its monthly payroll, to use for paying wages, rent, mortgage interest and utilities.
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Coronavirus Aid Relief and Economic Security Becomes Law
On March 27, President Trump signed the Coronavirus Aid Relief and Economic Security (CARES) Act, a $2 trillion bill that contains provisions that will provide relief to businesses and individuals negatively impacted by the recent pandemic.
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Department Of Labor Issues Final Rule On Regular Rate Exclusions From Overtime Calculations
On December 12, 2019, the U.S. Department of Labor (DOL) announced a revised interpretation listing payments that can be excluded from the “regular rate” used to compute overtime pay for non-exempt employees under the Fair Labor Standards Act. The DOL also issued a Fact Sheet and Highlights on this revised interpretation.
DOL Issues Final Overtime Rule, Increasing Required Salary Level for Exempt Employees
The Department of Labor issued, on September 24, 2019, its final rule revising the salary requirements for exemption from the Fair Labor Standards Act’s mandate to pay overtime for hours worked over 40 in a workweek. The new rule increases the salary required to meet the executive, professional and administrative exemptions to $684 per week (the equivalent of $35,568 per year). The required compensation for highly compensated employees is raised to $107,432.
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NLRB Expands Scope of Mandatory Arbitration Agreements
The National Labor Relations Board has now addressed the use of mandatory arbitration agreements following the U.S. Supreme Court’s 2018 decision in Epic Systems v. Lewis, which upheld the enforceability of arbitration agreements containing waivers of the right to bring class or collective actions over employment-related disputes, rejecting the NLRB’s then-position that such waivers violate the National Labor Relations Act (NLRA), as discussed in our prior E-lert.
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