“Selected” United States Labor Laws Which Apply To The Commonwealth

“Selected” United States Labor Laws Which Apply To The Commonwealth

Many of the Commonwealth’s laws and regulations administered by the Department of Labor and Immigration concern the entry and treatment of nonresident workers. Not much has been published regarding federal labor laws. Officers and management of firms doing business in the Commonwealth should familiarize themselves with certain federal laws and regulations as they may affect, or apply, to a particular business activity.

Several of the more important of these are as follows: – The Occupational Safety And Health Administration (OSHA) develops and promulgates occupational safety and health standards, develops and issues regulations for a wide variety of industries and services, conducts investigations and inspections to determine the status of compliance with safety and health standards and regulations and issues citations and proposes penalties for noncompliance with health and safety standards and regulations. Construction firms and other businesses working in the Commonwealth should be aware that their activities will be subject to laws and regulations administered by OSHA. In June, 1989 as a result of fines imposed by OSHA, a Japanese construction company on Saipan agreed to a $100,000. settlement for safety violations during the construction of a hotel. The company was charged with 89 violations of federal safety and health regulations. Charges included: failure to install guard railings on stairways; no scaffolding and open sided floors above ground level; not using enclosed chutes to dispose of waste from upper floors; not providing employees with protective equipment such as helmets, and many other violations. In 1977 the U.S. Supreme Court ruled that foreign subsidiaries are constituted under and subject to the full panoply of U.S. civil rights and labor laws, (Sumitomo Shoji America Inc. v. Avagliano, 1982, 457 U.S.176). – The National Labor Relations Board (NLRB) has two principal functions: preventing and remedying unfair labor practices by employers and labor organizations and their agents and conducting secret ballot elections among employees in appropriate collective bargaining units to determine whether or not they desire to be represented by a labor organization.

The Board has other functions and activities but can only act when it is formally requested to do so by individuals, employers or unions. – Civil Rights: The implementation of all federal activities in the area of civil rights, consumer affairs, public health, social security administration and many other areas related to the well being of society are the responsibility of the U. S. Department of Health and Human Services. The Department enforces policies promulgated under the Civil Rights Act of 1964 which prohibits discrimination with regard to race, color or national origin. – The Fair Labor Standards Act which establishes overtime pay, record keeping, and child labor standards applies in the Commonwealth and is enforced by that agency's Wage and Hour Division. Workers are entitled to overtime pay at a rate of not less than one and one-half times their regular rates of pay after 40 hours of work in a workweek. Wages are due on the regular day for the pay period covered. Deductions made from wages for such items as cash or merchandise shortages, employer-required uniforms and tools of the trade are not legal to the extent that they reduce the wages of an employee below the minimum rate of pay or reduce the amount of overtime pay due the worker. The Act restricts the hours of work for minors under the age of 16 and lists jobs considered too dangerous for minors to perform. Employers are required to keep records relating to: personal information, ( employee's name, home address, occupation, sex and date of birth); hour and day when their workweek begins; total hours worked each workday and each workweek; total daily or weekly straight-time earnings; regular hourly pay rate for any week when overtime is worked; total overtime pay for the workweek; deductions from or additions to wages; total wages paid each pay period and date of payment and pay period covered. Records required for exempt employees differ from those for nonexempt workers and special information is required for home workers, for employees working under uncommon pay arrangements, or for employees to whom lodging or other facilities are furnished. A workweek is a period of 168 hours during 7 consecutive 24 – periods.

There can be no averaging of 2 or more workweeks. Covered employees must be paid for all hours worked in a workweek. In general "hours worked" includes all time an employee must be on duty, or on the employer's premises or any other prescribed place of work. Also included is any additional time the employee is suffered or permitted to work. – Overtime Pay: (1) Hourly Rate – Regular pay rate for an employee paid by the hour. If more than 40 hours are worked, at least one and one-half times the regular rate for each hour over 40 is due. (2) Piece Rate – The regular rate of pay for an employee paid on a piecework basis is obtained by dividing the total weekly earnings by the total number of hours worked in the same week. The employee is entitled to an additional one-half times this regular rate for each hour over 40, plus the full piecework earnings. (3) Salary – The regular rate for an employee paid a salary for a regular or specified number of hours a week is obtained by dividing the salary by the number of hours for which the salary is intended to compensate. It is a violation of United States law to fire, or in any other manner discriminate against an employee for filing a compliant, or for participating in a legal proceeding under the Fair Labor Standards Act. Willful violations may be prosecuted criminally and the violator fined up to $10,000. A second conviction may result in imprisonment. Violators of the child labor provisions are subject to a civil money penalty of up to $1,000. for each violation. The equal pay provisions of the Fair Labor Standards Act prohibits wage differentials based on sex, between men and women employed in the same establishment, on jobs that require equal skill, effort and responsibility and which are performed under similar working conditions. These provisions as well as others prohibiting discrimination in employment are enforced by the Equal Employment Opportunity Commission. – Other Labor Laws: In addition to the Fair Labor Standards Act the Wage and Hour Division administers other United States labor laws as follows: – The Davis – Bacon and related Acts requiring payment of prevailing wage rates and fringe benefits on federally financed or assisted construction; – The Walsh – Healey Public Contracts Act requires payment of minimum wage rates and overtime pay on contracts to provide goods to the federal government; – The Service Contract Act requires payment of prevailing wage rates and fringe benefits on contracts to provide services to the federal government; – The Contract Work Hours and Safety Standards Act establishes overtime standards for federal service and construction contracts; – The Wage Garnishment Law limits the amount of an individual's income that may be legally garnisheed and prohibits the firing of an employee whose pay is garnisheed for payment of a single debt. Depending upon the number of employees maintained by a business, particularly those with more that 15 to 20 employees and whether or not a federal contract is involved, there are a number of federal laws that prohibit discrimination in employment. Among those that may apply to a business are: – Civil Rights Act of 1964: – Requires that there is no discrimination in employment practices based on race, sex, religion, disability or national origin. – Pregnancy Discrimination Act: – Equal treatment for pregnant women and new mothers for all employment related purposes including fringe benefits. – Equal Pay Act: – Equal pay for women. – Age Discrimination Employment Act: – No discrimination in hiring or dismissing because of age for persons between the age of 40 to 70. – Rehabilitation Act – (where a federal contract is involved): -No discrimination in employment practices based on mental health or physical handicap. – Vietnam – Veteran Readjustment Assistance Act – (where a federal contract is involved): Affirmative action programs for certain disabled veterans. – Sexual Harassment: – Employers must be aware of the possibility of liability for conduct in the work place relative to potentially unwelcome requests or conduct or for engendering a work environment which is oppressive and hostile to members of one sex. – The Worker Adjustment and Retraining Notification Act, (WARN Act):- (Usually applies to businesses with 100 employees or more with a 40 hour work week at a single location): – This law may apply when 50 employees or more, or one third of a work force, is laid off within a thirty day period. There are several exceptions and include: layoffs as a result of earthquakes, floods, a labor dispute,such as a strike or lockout, in which case no notice of the layoff need be given. Generally a “layoff” is considered when there is a permanent termination of employment, a layoff for a period exceeding six months, or loss of half an employee’s working hours for six consecutive months. When layoffs occur the employer is required to provide the employees with 60 days advance notice. Failure to do so could result in the employer paying the employees for 60 days minus the number of days the notice was given. The law does not prohibit an employer from making layoffs or closing a plant .

The WARN Act imposes restrictions on a company’s ability to reorganize, sell, consolidate or merge operations if such action will result in adversely affecting the employment of 50 or more employees. This Act makes the risk of building a plant in the United States much greater than was previously the case since, if the business fails, the owners may have to close their facility rather than restructure or sell the business. – Federal Contracts: All federal contracts for materials, supplies or equipment valued at more than $10,000. must contain guarantees that all persons employed by the contractor will be paid wages not less than the federal minimum wage ($4.25 per hour); provide for the compensation of workers at 1 1/2 times the regular rate for work performed in excess of 40 hours per week and provide a safe, sanitary workplace, (Walsh-Healy Act – U.S.C. Section 35-45 and Covenant, Section 502 (b). The above is a cursory review of some of the more important United States labor laws. For more specific information as to how any of the above may apply to your business consult a local attorney or the United States Government agency concerned.