The St. Petersburg Wage Theft Ordinance: New Notice and Poster Requirements

Monday, June 26, 2017

The City of St. Petersburg, Florida, recently amended its wage theft ordinance to require employers to provide pay notice to employees at the time of hire and to display “in a location accessible to all employees” a poster about wage theft. See St. Pete. Code, Chap. 15, Art. III, Sec. 15-40, et seq. These requirements are not yet in effect. As detailed below, the effective date is on hold pending the completion of a memorandum of understanding by the City, which is engaging a “community-based” organization to “implement the purposes of this article.”

The ordinance defines the term “employee” broadly to mean a “natural person who performs work within the geographic boundaries of the City while being employed by an employer . . .” including “a person who performs work that benefits an employer located within the City even though the employee may have performed work outside of the City.” The ordinance excludes “any bona fide independent contractor,” stating that the term “independent contractor” “shall have the same meaning as in the Internal Revenue Code, Fair Labor Standards Act, and implementing federal regulations, administrative interpretations and guidance” (though “independent contractor” is defined differently by the Internal Revenue Service and U.S. Department of Labor).

Background

On December 15, 2016, the St. Petersburg City Council passed several amendments to the City’s wage theft ordinance. Under Sec. 15-44, there are three new requirements for employers. Employers must provide a “written notice” to employees at time of hire, including a “template summary” summarizing the employee’s rights (available from the City), written notice of changes in pay, and a poster (available from the City). Sec. 15-44(a)-(d). There is also a $500.00 “per violation” penalty for an employer’s failure to adhere to any part of the ordinance. Sec. 15-44(e). The term “violation” is not defined.

Sec. 15-44(a)(1)-(7) provides:

(a) At the time of hiring, an employer shall provide to each employee a written notice, to be signed and dated by the employer and employee, containing the following information:

(1) The rate or rates of pay and basis thereof, whether paid by the hour, shift, day, week, salary, piece, commission, or otherwise, including any rates for overtime, as applicable;

(2) Allowances, if any, claimed as part of the minimum wage, including meal or lodging allowances;

(3) The regular payday designated by the employer;

(4) The name of the employer, including any “doing business as” names used by the employer;

(5) The physical address of the employer’s main office or principal place of business, and a mailing address, if different;

(6) The employer’s telephone number; and

(7) A template summary, available from the City, summarizing the protections and rights of employees pursuant to this article.

The “template summary” is not available at this time and there is no time frame in which it is to be completed.

Sec. 15-44(c) provides:

In addition to providing the written notice required by subsection (a), employers must place in a location accessible to all employees a poster, available from the City, summarizing the protections and rights of employees pursuant to this article.

Sec. 15-44(d) provides:

An employer shall notify his or her employees in writing of any changes to the information set forth in the notice required by subsection (a) within seven (7) calendar days after the time of the changes.

These requirements, however, did not go into effect when the City passed the amendments. According to the amendments, the requirements of Section 15-44 (the notice and poster provisions) “will not become applicable to employers until ninety (90) days after a community-based organization has been selected for the purpose of facilitating implementation of this ordinance.” Sec. 15-47.

Key Takeaways

An official with Pinellas County, who is in charge of administering both the St. Petersburg and Pinellas County ordinances, confirmed to Ogletree Deakins that the “community based organization” has not yet been selected and that there is not yet a “template summary” to provide (referenced in Sec. 15-44(a)(7)).

Pinellas County has requested a “memorandum of understanding” from St. Petersburg regarding the notice and posting requirements. The county does not have any comparable notice or poster. Presumably, this may be a precursor to these requirements being enacted countywide.

The official also noted that the delay in implementation may have to do with personnel changes within the City of St. Petersburg. St. Petersburg has now put Pinellas County in charge of administering the ordinance, because Pinellas County has a similar ordinance (although the County ordinance has no notice or posting requirements).

Finally, the official stated that Pinellas County will likely tweak St. Petersburg’s current form and poster before they are finalized. The official also anticipates that the county will adopt similar notice and posting requirements in the future. Pinellas County refused to provide an estimated time for such actions.

St. Petersburg and/or Pinellas County will probably issue a press release before the requirements are finalized.

For more information or to contact the author please follow the link below:

Rachel A. Morris

Associate

Ms. Morris focuses her practice on representing employers in all aspects of labor and employment litigation and compliance.

 

[email protected]

813-221-7233

www.ogletree.com

4th Circuit’s decision underscores importance of posting employment notice

FosterThomas, Inc -By Kevin C. McCormickVirginia employment law

Most employers know that to fully comply with all the federal and state employment laws, they must post specific employee notices in the workplace. Indeed, many companies specialize in providing state-specific posters that include all of the required notices for each state. Occasionally, however, an employer fails to post a required notice in the workplace and does not realize its mistake until a lawsuit is filed. By then, it is often too late to remedy the problem.

A recent decision from the U.S. 4th Circuit Court of Appeals—which covers Maryland, North Carolina, South Carolina, Virginia and West Virginia—underscores the importance of making sure that required posters are in the appropriate workplace locations and are up to date. Failing to display a poster can result in a court allowing an otherwise time-barred claim to proceed.

Background

Cristina Fernandez Cruz is a citizen of the Philippines, where she lived until 2002. She speaks Tagalog fluently but speaks limited English. In 2001, a friend told Cruz about an opportunity to travel to the United States to work for Nilda J. Maypa, an employee of the World Bank. Cruz submitted a résumé, and Maypa hired her soon after.

About a month later, Maypa faxed Cruz an employment contract that stated that Cruz would be employed as a domestic employee at Maypa’s residence for 2 years at $6.50 per hour. The contract stated that Cruz would work between 35 and 40 hours per week, have at least one full day off each week, accumulate two sick days per year, receive heavily subsidized medical insurance, and receive full compensation for her travel to and from the Philippines.

Cruz reviewed the contract with friends who were more fluent in English. However, before Cruz could sign the agreement, Maypa informed her over the phone that she would pay her only $250 per month rather than the $6.50 per hour specified in the contract. Cruz did not know that U.S. law required that she be paid a significantly higher wage. She signed the contract on January 17, 2002. On March 17, 2002, she left the Philippines and flew to the United States.

Soon after Cruz arrived in Virginia, it became clear that Maypa had misrepresented her working and living conditions. Cruz was required to work 17 to 18 hours per day 7 days per week, and she was expected to remain on call at night. She was not allowed to take a day off during the 6 years she remained under Maypa’s control, even when she was ill.

When Cruz arrived in the United States, eight people lived in Maypa’s house. Cruz was expected to cook, do laundry for the entire family, and clean the four-bedroom, three-bathroom home. She was also expected to provide 24-hour care for four children and maintain the property by mowing the lawn, trimming trees, shoveling snow, cleaning the pool, and performing other landscaping duties.

Although Cruz was initially paid $250 per month, by the time she escaped 6 years later, she was making $450 per month, which amounted to about $15 per day. Maypa executed two contract extensions during Cruz’s employment. Both extensions called for higher wages and benefits Cruz never received.

Maypa told her that the documents were “a formality” to keep her “safe.” Maypa told Cruz that she would be “hunted down,” imprisoned, and deported if she tried to leave. On January 17, 2008, Cruz gathered all the papers she could find related to her employment and immigration status and left.

On July 16, 2013, 5 years after she left, Cruz filed a lawsuit in federal district court seeking compensatory and punitive damages for violations of the Victims of Trafficking and Violence Protection Act (VTVPA) and the Fair Labor Standards Act (FLSA). Maypa asked the court to dismiss Cruz’s claims as time-barred since she filed the lawsuit more than 5 years after she left her employ. The district court granted Maypa’s motion and dismissed the claims. Cruz appealed that decision to the 4th Circuit.

4th Circuit’s decision

On appeal, Cruz argued that her VTVPA claim should be subject to the 10- year statute of limitations that was added to the law in 2008. She also claimed that her FLSA claim should be equitably tolled (extended) since she did not receive a notice of her rights under the FLSA because Maypa never posted the required signage in her home.

In considering Cruz’s claims, the 4th Circuit acknowledged that at the time Maypa allegedly violated the VTVPA, the Act was governed by a 4- year statute of limitations. However, in 2008, Congress amended the VTVPA to include a 10-year statute of limitations. The 4th Circuit found that the longer statute of limitations should retroactively apply to Cruz’s claims.

According to the 4th Circuit, equitable tolling is appropriate in two circumstances: (1) when a plaintiff is prevented from asserting her claims by wrongful conduct on the part of the defendant and (2) when extraordinary circumstances beyond the plaintiff’s control make it impossible for her to file the claims in time. The appellate court found that the district court erred in dismissing Cruz’s claims. Instead, her VTVPA claims were sent back to the district court for discovery (pretrial fact-finding) to determine whether the claims should be equitably tolled.

In addition to her VTVPA claims, Cruz alleged that Maypa willfully violated the FLSA by failing to pay her the required minimum wage. Although the district court applied the correct statute of limitations for willful FLSA violations (3 years instead of the normal 2), it found that Cruz’s claims should not be equitably tolled because she failed to show that there were extraordinary circumstances.

The 4th Circuit disagreed and found that equitable tolling was appropriate in this case. In reaching that conclusion, the court relied on an earlier decision, Vance v. Whirlpool Corp. In that case, the court held that the Age Discrimination in Employment Act’s (ADEA) previous filing requirement should be tolled because of the employer’s failure to post a notice of workers’ rights under the Act.

The notice requirements in the ADEA and the FLSA are almost identical. Both laws require employers to post in a conspicuous place a notice pertaining to the laws’ applicability to ensure that employees protected by the statutes are aware of and are able to assert their rights.

The Vance decision tolled an administrative filing deadline rather than a statute of limitations, but the FLSA lacks an equivalent administrative filing requirement. Thus, like an administrative filing deadline, the FLSA’s deadline to sue is the critical juncture at which an employee’s rights are preserved or lost.

Neither the ADEA nor the FLSA inflicts statutory penalties for failing to comply with the notice requirements. Therefore, absent a tolling rule, employers would have no incentive to post notices since they could hide their violations from employees until any relevant claims expired.

Under the Vance decision, tolling based on a lack of notice continues until the employee retains an attorney or obtains knowledge of her rights. The 4th Circuit sent Cruz’s FLSA claim back to the district court. Since the record did not say when Cruz retained an attorney or obtained knowledge of her rights, the district court should allow discovery to determine whether her FLSA claim was time-barred despite being equitably tolled. Cruz v. Maypa et al, 4th Circuit, No. 13-2363, decided December 1, 2014.

Bottom line

This decision serves as a reminder to make sure that all of the required employment posters are appropriately displayed in your workplace and updated as needed. If that is not done, a disgruntled employee may be given more time than the standard 2 or 3-year statute of limitations to file a claim for FLSA violations.

As the 4th Circuit noted, equitable tolling is appropriate when (1) wrongful conduct on the part of the employer prevents an employee from asserting her claims and (2) extraordinary circumstances beyond the employee’s control make it impossible for her to file the claims on time.

While equitable tolling is available only when an employee has exercised due diligence in preserving her legal rights, courts may be inclined to extend the applicable statute of limitations because of an employer’s failure to post the notice required by the FLSA.

In this case, Cruz’s claims, which were filed five years after she left Maypa’s employ, may very well be considered timely because of her employer’s failure to display the appropriate posters in the workplace. Considering how simple it is to obtain the appropriate poster, this problem can be easily avoided.

Labor Law Posters – The Perils of Too Few or Too Many

By Rebecca Goldberg, Esq. on April 28, 2014

Posted in Employee Benefits, Employer Policies, Wage & Hour

Every employer in the United States must post at least some labor law notices. Many state and federal employment laws come with such a requirement. While different posters are needed for different situations (for example, based on the employer’s size or industry), no employer is exempt from posting at all. It may be obvious that failing to meet all posting requirements can result in legal liability. What is less obvious is that posting inapplicable notices may also result in legal liability – a danger if your company uses an “all-in-one” labor law poster service.

What’s Wrong with Too Many Posters?

Many employers overlook the risks of posting inapplicable labor law posters. Each year, many employers receive offers to purchase a laminated “all-in-one” poster designed to cover all bases. But, one size rarely fits all when it comes to the law. For example, the Family and Medical Leave Act (FMLA) generally applies only to companies with 50 or more employees. If a 20-employee company posts an FMLA poster, could this statement of employee rights bind the company to provide leave to the extent required by that statute? At least one court has held that in the right factual circumstances, an employee may be entitled to take leave akin to FMLA leave.

Another downside to too many posters is the difficulty in navigating employees’ inquiries about their rights. If an employee points to an FMLA poster and asks where to obtain the paperwork for maternity leave, human resources may have the unenviable task of telling her she is not eligible. This can lead to resentment and poor morale.

A third downside is the potential to invite legal action against the company. The National Labor Relations Board (NLRB) made a failed attempt to require employers to post a notice of employees’ rights under the National Labor Relations Act. Courts ruled against the NLRB’s posting requirement and, eventually, the agency abandoned its efforts. Countless employers have posted – and retained – these notices, even though the rule never went into effect and has been formally abandoned. Among other things, this notice tells employees how to file labor law complaints against their employers. Employers that keep this poster are inviting complaints against themselves!

What’s Wrong with Too Few Posters?

Generally, the stated penalty for failing to post a required labor law poster is a relatively small fine. But, the hidden consequences can be much more costly. In some cases, courts have allowed the employer’s failure to post a labor law poster to “equitably toll” an employee’s rights. This means the time period that starts the clock for the statute of limitations may be delayed until the employee learns of the rights outlined in the applicable poster. If it takes years for an employee to become aware of those rights, the employer may be on the hook for additional years of liability – a consequence that can easily add hundreds of thousands of dollars of liability in certain scenarios, such as class action overtime cases.

Having the Right Posters

What should employers do to get it right? This requires research to determine the required postings based on the state, industry, size, and other factors. Like any other labor and employment law question, the best way to get a reliable answer is to consult competent legal counsel. Fortunately, this is usually a quick and inexpensive inquiry. While some lists of required posters can be found on the websites for state and federal departments of labor, these lists are often incomplete because certain postings may be outside the agency’s purview. If we can be of assistance with this or any other workplace issue, please call us.