Posts filed under ‘HR’

Two Reports You Have To Read

Those of you in charge of anticipating where interest rates are headed or attracting and retaining the best employees, should take the time, assuming that your retinas are still in working condition, to read two recent reports released by the Federal Reserve Banks of San Francisco and New York. One report unveils a new survey intended to gauge employee sentiment and the other offers yet another plausible explanation for why we have not seen pressure to increase wages even as the unemployment rate continues to tumble at a rate almost as fast as the President’s approval ratings.

As readers of this blog will know, yours truly is becoming obsessed with the issue of inflation and wage growth. Simply put, if the economy is growing and the unemployment rate is dropping, why aren’t we seeing more upward pressure on prices in general and wages in particular?

The New York Federal Reserve has just introduced a new labor market survey which may help answer those questions. According to the New York Fed, the survey is the first which focuses on employee experiences and expectations. For example, it asks respondents how many job offers they have received and breaks them down by age. In July, 22% of persons under 45 reported receiving at least one job offer in the past four months compared to about 13% of older respondents.

A key question that this survey may help answer is, why has there been so little churn or job movement? In a well-functioning free market economy, churn is key since it both creates jobs for young employees and rewards the best performers with new growth opportunities. According to the survey, workers with annual household income of $65,000 or less are more likely to predict that they will be switching jobs or becoming unemployed in the near future than higher income employees. According to the Fed, these predictions are actually good indications of where the economy and the labor force is headed.

A second report produced by the Federal Reserve Bank of San Francisco has me scratching my head a little. It reports that wage growth is improving and that such growth, “may be even better than the headline number suggests.”

The good news is that wage growth for continuously full-time employed workers is currently in line with the wage growth peak of 2007. The bad news is that the entry of new and returning workers to full-time employment is holding down aggregate wage growth. The bank goes on to explain that, “As the labor market has continued to strengthen, many workers have moved from the sidelines of the labor force or part-time positions into full-time employment. The vast majority of these new workers earn less than the typical full-time employee, so their entry brings down the average wage.”

Now I don’t know why  the Bank considers this good news exactly. It means that the glut of under employed workers is so large that there is little pressure on wage growth. This type of report makes me wonder why the Fed is even considering raising interest rates any time soon.

August 22, 2017 at 8:48 am Leave a comment

Its Time To Prepare For NY’s Paid Family Leave

Today I have one message for you: It’s time to stop ignoring New York’s Paid Family Leave Law. It  Kicks-in  on January 1. Based on some of the questions that have come into our compliance department,  I get the feeling that some of you keep on hitting the snooze button when it comes to preparing for this expansive new mandate. It’s time to stop. The final regulations were released last week.

Most importantly, this law applies to your credit union and its employees regardless of how many employees it has or  whether it  is  state or federally  chartered. Employees with a regular schedule of 20 or more hours per week are eligible after 26 weeks of employment. Qualifying events triggering leave include:  leave to care for a child after birth or placement for adoption or foster care within the first 12 months after the birth or placement; for a qualifying exigency arising from the service of a family member in the armed forces of the United States; or to care for a family member with a serious health condition.

This is a big deal, especially since most credit unions aren’t subject to the FMLA.

There are nuanced regulations to learn, notices to be prepared and handbooks that have to be updated. In addition there is the practical consideration of  how best to deal with potential  absences of employees.  in other words ,  it’s time to get an HR expert in the room and get serious about complying with this new law if you haven’t done so already.

 

July 25, 2017 at 9:46 am Leave a comment

Are You Prepared For Paid Family Leave?

Greetings. It is back to reality after what I personally believe was a phenomenal Annual Convention in Bolton Landing.

Judging by the dramatic dive in my readership that takes place around this time of year, I know that many of you take a break from the nuances of the legislative and regulatory developments of our industry. I call it summer hibernation.

One thing that you should be paying attention to though is the roll out of NY’s Paid Family Leave law. In case you haven’t been paying attention, starting in January 2018 New York is going to start phasing in paid family leave. For example, starting January 1,2018 – eligible employees will receive the lesser of 50 % of their weekly wage or 50% of the states average weekly wage , whichever is less, for a period of 8 weeks during any 52 week calendar period. By the time it is fully phased by 2021, employees will be eligible to receive 12 weeks of paid leave in any calendar year. This law applies to your credit union regardless of its size or charter type.

Even though the law and its benefits don’t kick in until January, New York State is giving employers the option of starting to deduct money from paychecks starting on July 17, 2017 for benefits that kick in January 2018. This is optional and I would certainly recommend checking in with HR folks to see what the best approach is for your credit union.

IF the plan works as intended its cost will be paid for through employee contributions. On June 1st the DFS issued the 2018 premium for Family Leave Benefit Employee Contributions. For coverage beginning January 1, 2018 the amount will be 0.126 of the employees weekly wage provided it doesn’t exceed the average weekly wage of NYS.

Stay tuned. This law is the HR Professional Employment Act in waiting.

June 5, 2017 at 10:36 am Leave a comment

Two Cases You Need To Know About

Today’s blog highlights two recent decisions, one that will interest your Compliance/IT department and another that will peak the curiosity of your HR folks.

A decision by the 9th Circuit yesterday underscores yet again the broad reach of the Telephone Consumer Protection Act (TCPA). We recently did a blog on this, but I get the sense that most people, including financial institutions, are still in denial. Chances are your credit union has to comply with the TCPA.

In Flores v. Adir Int’l, LLC, No. CV1500076ABPLAX, 2015 WL 4340020, at *4 (C.D. Cal. July 15, 2015, defendant repeatedly received generic text messages from the debt collector, even after he requested that the texts no longer be sent. He sued under the TCPA, which makes it illegal to contact consumers without their permission with the use of an automatic telephone dialing system (ATDS). He argued that the unsolicited texts demonstrated that the debt collector was using an ADTS to contact him, without his permission and was therefore violating the law. In tossing this claim the Federal District Court held that “Plaintiff’s own allegations suggest direct targeting that is inconsistent with the sort of random or sequential number generation required for an ATDS.” In other words the district court assumed, as have many businesses, that the TCPA outlaws automated dialing.

Yesterday, the court of appeals for the 9th Circuit on the west coast reversed this decision. In a concise memorandum it explained why the district court got it wrong. Dialing equipment does not need to dial numbers or send text messages “randomly” in order to qualify as an ATDS under the TCPA. Rather, “the statute’s clear language mandates that the focus must be on whether the equipment has the capacity “‘to store or produce telephone numbers to be called, using a random or sequential number generator.”

By the way, this decision has nothing to do with the fact that the persistent texter was a debt collector. As explained in a previous blog, unless you use “old fashioned” roto- dialers at your credit union, chances are your system qualifies as an ATDS. Every time a member is contact the TCPA is in play.

Second Circuit Allows “ Gender Stereotyping” claim To Move Forward

This is the one that your HR person should take a look at. The court of appeals for the 2nd Circuit, which has jurisdiction over New York, yesterday ruled that an employee could bring a successful discrimination claim by proving he was victimized by “ gender stereotyping “ in the work place.

Matthew Christenson, an openly gay man sued his employer, an International Advertising Agency, alleging that his supervisor engaged in a pattern of humiliating harassment targeted at his “femininity and sexual orientation.” The harassment included graphic illustrations on an office white board.

The case has drawn attention because Christenson explicitly asked the court to rule that employers can be sued for discrimination based on sexual orientation under Title VII of the Civil Rights Act of 1964. The second circuit was unwilling to go this far, but allowed the case to go forward if the employee could prove he was the victim of gender-stereotyping.

In a splintered 1989 decision, the Supreme Court held that an employer who made an employment decision based  on the belief that a woman could not be aggressive,  had acted on basis of gender discrimination under Title VII. (Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S. Ct. 1775, 104 L. Ed. 2d 268 (1989).

 

Remember that discrimination on the basis of sexual orientation is already illegal based on New York State law.

 

Don Draper beware!

March 29, 2017 at 9:32 am Leave a comment

Get Ready for Paid Family Leave

Although efforts to repeal and replace the Affordable Care Act are getting all the attention, as New York employers, credit unions have much more immediate concerns.  The State is now accepting comments on proposed regulations implementing paid family leave. 

Beginning January 1, 2018 the state will start phasing in the new mandate under which employees will be eligible to receive some pay during the time they are away from their job in order to bond with a child, care for a close relative who has a serious health condition, or help care for family of someone who is called to active duty.  For example, starting in 2018, an eligible employee would receive 50% of their salary for a maximum of 8 weeks during a 52 week period.  When it is fully phased in by 2021, employees could receive up to 12 weeks of paid family leave in an amount equal to 67% of their salary.  However, the payment benefits are capped to a percentage of the State’s average weekly wage.  To be eligible, an employee must have been with a covered employer full time for 26 weeks or part time for 175 days.  Covered employers are those covered by the Workers Compensation Law.

If all goes according to plan, employees will pay for the expanded benefit through payroll deductions analogous to contributions that support the Workers Compensation Fund.  I have my doubts, but the time for questioning the wisdom of the proposal is over and the time for getting your HR person focused on compliance has begun.

As with all complicated regulations, the devil is always in the details, particularly when we are dealing with an area of law that interacts with existing federal mandates.  Please feel free to reach out to the Association if you spot something that needs clarification.  By the way, my kids just got their second consecutive snow day.  I understand completely why states like North Carolina and Georgia get crippled by snow storms but something is wrong when upstate New York can’t handle a two-footer.  Are we becoming a state of wimps?

March 15, 2017 at 8:27 am Leave a comment

Administration Should Trump These Labor Regs

From the National Labor Relations Board’s (NLRB) intrusion into everything from an employer’s rights to regulate employee conduct, to the expansion of non-exempt employees, no area has had a more direct impact on your workplace. And no area may see a more radical shift under the Trump Administration.

Here are some examples:

Concerted Activity: The NLRB arbitrates disputes that involve both union activity and nonunion activity that implicates so called concerted activity. Traditionally this jurisdiction was understood as protecting the rights of nonunionized workers to ban together to address issues of concern in the work place and ultimately not be deterred from forming a union. In contrast, under the Obama Administration’s appointees, concerted activity has been used to regulate everything from punishment of an employee for Facebook postings critical of the boss, to workplace restrictions on sharing salary information. This shift has made your workplace policy manual a tripwire for litigation and made it more difficult to impose common sense restrictions on employee behavior. Let’s hope the NLRB will take a second look at these decisions.

Regulation of Mortgage Originators: For more than a decade now, the courts and the Labor Department have grappled over whether or not mortgage originators are exempt employees. Talk to any veteran of the mortgage industry and they will scoff at the notion that mortgage originators are anything other than exempt employees. After all, if a member calls at 4:55pm wanting to apply for a mortgage loan, no employee in their right mind would tell the applicant to call back tomorrow because their shift is almost over. Nevertheless, the Obama Administration’s Labor Department overruled an interpretation provided by the Bush Administration and opined that in-house mortgage originators are non-exempt employees who must receive overtime. The Supreme Court upheld the right of the Department of Labor to issue this interpretation. The good news is, what the Department of Labor giveth it can taketh away. I hope there will be quick action to reconsider this interpretation so that common sense can once again prevail in the mortgage industry.

Exempt-Employees: The most prominent Labor Department regulation increased the threshold of exempt employees to slightly more than $47,000, and indexed the threshold for inflation. Although it was supposed to take effect late last year, the regulation has been tied up in litigation and it is unlikely to survive the incoming Trump Administration without substantial revisions. Remember that even without the Federal changes, New York State has updated its own exempt-employee regulations

Obligations of Fiduciaries: Last but not least, in April, regulations imposing fiduciary obligations on financial advisors are scheduled to take effect. The outgoing Department of Labor recently issued a memorandum providing questions and answers about the new regulation. This one doesn’t have much of a direct impact on most credit unions. It does, however, on the individuals who provide investment advice to the trustees of your 401(k) plans. By tightening conflict of interest requirements and the fiduciary obligations of outside advisors, there are subtle changes to how your 401(k) plan is overseen. Expect to see changes made to this regulation.

This  extensive to-do list underscores how antiquated our labor laws have become. They were created at a time when a good chunk of the workforce was unionized and it was relatively easy to distinguish the white collar worker in the executive suite from the blue collar worker on the assembly line. The most constructive thing the Trump Administration’s Labor Department can do is advocate for changes to the National Labor Relations Act and the Fair Labor Standards Act  so that classifications such as exempt and non-exempt employees can reflect the modern workplace.

 

January 19, 2017 at 9:22 am Leave a comment

Is your job in jeopardy?

_85487012_robots_promoThe most interesting bit of news I read this morning is about how quickly technology is going to eliminate your job.

On Thursday, McKinsey & Company released a report analyzing the future impact of automation on the global workforce. The report is unique in that it tries to assess the impact that technology will have on occupational tasks rather than entire occupations. Its conclusion is that “given currently demonstrated technologies, very few occupations-less than 5%- are candidates for full automation, however, almost every occupation has partial automation potential.” The result is that while you may not be replaced by a machine, you certainly will have to want to work with one, if you want to stay employed.  Just how big of change is taking place? Researchers estimate that half of the world’s occupations, representing $16 trillion in wages could be automated.

Automation may impact those of us in the financial services industry more quickly than other professions. For example, 51% of all work time is spent collecting data, processing data and operating machinery.  Needless to say, a lot of data processing and collection will happen at your credit union today. And although you may not deal with much heavy machinery, many of the tasks employees will take on today are the type of predictable and repetitive duties ideal for automation.

One more thing. If you think your professional status insulates you from automation’s impact guess again. Many tasks performed by professionals such as lawyers, including contract review and document preparation, can actually be performed by increasingly intelligent computers. “Dear God!”

The report optimistically predicts that, while technology will transform the workplace, it won’t do so at the speed or level of job displacement that some pundits suggest. For a more pessimistic view as to where this is all headed, read a book I have previously mentioned  called “The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies .”  It argues that technological innovation is increasing exponentially. As a result, assumptions about what technology can and can’t do are short-sided. It wasn’t too long ago that people laughed at the idea of a fully automated car, but now the question is not if such technology will be available but when driverless cars will become as common as smart phones.  By the way, what is a smart phone?

January 13, 2017 at 9:24 am 1 comment

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Authored By:

Henry Meier, Esq., General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association.

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