Week In Review
October 19, 2015
Court adopts new test for determining interns� status
A federal appeals court has rejected the Department of Labor�s (DOL�s) six-part test for determining whether an intern working in the for-profit private sector is actually an employee and therefore entitled to the minimum wage and overtime pay under the Fair Labor Standards Act. The Court deemed the DOL�s test �too rigid� and instead adopted a flexible �primary beneficiary� test that focuses on whether the intern or the employer is the primary beneficiary of the relationship. The proper inquiry is made up of the following non-exhaustive set of considerations: (1) the extent to which the intern and the employer clearly understand that there is no expectation of compensation; (2) the extent to which the internship provides training that would be similar to that which would be given in an educational environment; (3) the extent to which the internship is tied to the intern�s formal education program by integrated course work or the receipt of academic credit; (4) the extent to which the internship accommodates the intern�s academic commitments by corresponding to the academic calendar; (5) the extent to which the internship�s duration is limited to the period in which the internship provides the intern with beneficial learning; (6) the extent to which the intern�s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern; and (7) the extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.
Rude acts and company�s failure to investigate do not amount to hostile environment
A federal appeals court has rejected a claim that the plaintiff�s former employer ignored her repeated complaints about her co-worker�s retaliatory harassment as a result of her protected activities under Title VII. The Court found that since the occasional name-calling, rude e-mails, lost tempers, and workplace disagreements, which took place over the course of several years, were insufficient to create an actionable hostile work environment, the employer�s failure to remediate was not actionable. The Court held that alleged acts that make up a hostile work environment claim must be �adequately linked� to one another. Finding that the HR department�s inaction was not unlawful, the Court reaffirmed that �Title VII is aimed at preventing discrimination, not auditing the responsiveness of human resources departments.�
Pizza franchisees to pay nearly $500,000 in back wages and damages
Four pizza franchisees in New York have admitted to numerous labor law violations regarding 250 employees. The admitted violations include: (1) failing to pay employees the minimum wage and overtime wages required under the federal Fair Labor Standards Act and state law; (2) failing to pay an additional hour at minimum wage when employees� daily shifts are longer than 10 hours, as required by state law; (3) failing to provide adequate uniforms for employees for the number of shifts in a week; and (4) failing to pay the required uniform laundry allowance.
SESCO recommends that clients review all applicable policy and practices to ensure compliance. For assistance, contact us at 423-764-4127 or by email at sesco@sescomgt.com
