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The Legislative Report blog provides timely information on federal and state legislation and regulations and state trends as well as the myriad issues affecting the private club industry. A companion to CMAA's Legislative website, this resource should be your first stop for any information regarding legal, tax or legislative club-specific issues.

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Supreme Court Declines to Halt WOTUS Consideration

(Congress, Legal Issues, Regulation) Permanent link

Supreme Court Declines to Halt WOTUS Consideration

On Monday, April 3, the Supreme Court declined a request by the Trump Administration to delay consideration in the National Association of Manufacturers vs. the Department of Defense. This case is not specific to the merits of the Waters of the US (WOTUS) rule but instead addresses the issue of jurisdiction, specifically which courts should hear challenges to the Clean Water Act. 

The Trump Administration requested a delay in consideration due to its recent executive order to the Environmental Protection Agency to proceed with rescinding and/or revising the Waters of the US (WOTUS) rule through the regulatory process.

Without further explanation, the Court issued a brief statement denying the request.  

This does not mean that a ruling will be immediately forthcoming. The case will be scheduled for oral arguments in the term beginning in October and a decision would not be expected any earlier than the summer of 2018. 

The final WOTUS rule remains on nationwide injunction,  following the October 2015 action of the Sixth Circuit of the US Court of Appeals.  

Overtime Litigants Ask for Expedited Review

(Legal Issues, Dept of Labor) Permanent link

In September, two separate challenges were filed against the Department of Labor’s overtime rules. In the first challenge, 21 states have joined together to object to the rule, based on its impact on state funds and budgets. In a separate action, the US Chamber of Commerce and more than 50 other national and Texas business groups challenged the rule for violating the Administrative Procedure Act. 

On October 12 and 14 respectively, attorneys for both litigants filed motions for expedited summary judgement in the cases. In layman’s terms, this means that they are requesting a verdict from the judge without the benefit of a full trial. 

Both challenges are under review by the same court and judge, Judge Amos Louis Mazzant III of the United States District Court for the Eastern District of Texas. 

The final overtime rules are slated to take effect December 1, 2016. Stay tuned for any impact from these latest legal challenges. In the meantime, clubs and all employers should be preparing to comply with the final regulations.

Understanding Worker Misclassification and Independent Contractors

(Legal Issues, Dept of Labor) Permanent link

Understanding Worker Classification - Gardener ImageGiven the current changes to the overtime regulations, businesses may be considering how reclassifying employers to independent contractors could ease the costs of compliance.

However, in 2015, long before the Wage and Hour Division Department of Labor (DOL) finalized the new overtime rules, it issued new guidance on the misclassification of workers focusing on the application of the Fair Labor Standards Act (FLSA) and the multi-factor “economic realities” test. 

This test explores whether an employee is economically dependent upon the employer through six specific questions:

  • Is the work an integral part of the employer’s business?
  • Does the worker’s managerial skill affect the worker’s opportunity for profit or loss?
  • How does the worker’s relative investment compare to the employer’s investment?
  • Does the work performed require special skill and initiative?
  • Is the relationship between the worker and the employer permanent or indefinite?
  • What is the nature and degree of the employer’s control?

This guidance was shared through the DOL’s Misclassification Initiative. Through this initiative, more than 35 states and the Internal Revenue Service are working closely with the DOL to share information and resources in an effort to curb misclassification. North Carolina is the newest state to join the initiative. 

Based on this DOL guidance, clubs should review existing independent contractor relationships and seek external review by legal counsel when establishing new relationships to ensure they fall within the bounds of the updated FLSA guidance.

Litigation Filed to Stop Overtime Rules

(Legal Issues, Dept of Labor) Permanent link

 Litigation Overtime RulesOn Wednesday, September 20, two separate cases were filed to stop the implementation of the final overtime rule changes.

Twenty-one states have joined together to file suit against the Department of Labor. In their challenge, they argue that the DOL erred by elevating the salary threshold over the duties test in defining an exempt vs. non-exempt employee. The states also take umbrage at the automatic update provision which do not take into account the effects on the public and private sectors. Finally, the challenge asserts the DOL exceeded its constitutional authorization by forcing states to adhere to federal regulation which results in the depletion of state funds. The 21 states are Alabama, Arizona, Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Mississippi, Nebraska, Nevada, New Mexico, Ohio, Oklahoma, South Carolina, Texas, Utah and Wisconsin.

In a separate action, the US  Chamber of Commerce, the American Society of Association Executives, Texas Association of Business, National Automobile Dealers Association, the National Association of Manufacturers, National Association of Wholesaler Distributors, National Federation of Independent Business, National Retail Federation and more than 50 other national and Texas business groups, filed a legal challenge, arguing that the DOL  exceeded its statutory authority in issuing the regulation and violated the Administrative Procedure Act. Specifically, the suit challenges the excessively high salary threshold, lack of acknowledgement of regional and industry differences and automatic update provisions. 

The final overtime rules are slated to take effect December 1. Stay tuned for the impact of these challenges! 

EEOC Issues Final Rules and Sample Notices on Wellness Programs

(Health Care Reform, Legal Issues) Permanent link

06.22.16 Treadmill

In late May, the US Equal Employment Opportunity Commission (EEOC) published new final rules under the Americans with Disabilities Act (ADA) governing employer-sponsored wellness programs. Under the final rule, employer wellness programs that ask employees about their medical conditions or ask employees to submit to medical examinations (such as tests which screen for high blood pressure, high cholesterol or diabetes) must be “reasonably designed” to promote health and prevent disease, be “voluntary” and safeguard the confidentiality of employees’ medical information.

The final rule allows employers to provide “limited” financial and other incentives in exchange for an employee answering disability-related questions or taking medical examinations as part of a wellness program, whether or not the program is part of a health plan.

Key Definitions Under the Final Rule

  • “Reasonably Designed” - To meet this standard, a program cannot require an overly burdensome amount of time for participation, involve unreasonably intrusive procedures, be a subterfuge for violating the ADA or other laws prohibiting employment discrimination, or require employees to incur significant costs for medical examinations.
      
  • “Voluntary” - Specifically, an employer:   Read more...

Expanding the Advocacy Resources

(501(c)(7) Tax Exempt Club Info, Health Care Reform, ADA, Congress, State Trends, Legal Issues, National Golf Day, Dept of Labor, OSHA, IRS, Immigration, WE ARE GOLF, Regulation, Budget, Tax Issues) Permanent link

Key State LegislationClubindustryvotes.org, CMAA’s Grassroots Advocacy website, has relaunched with expanded information and abilities. The new site adds dynamic state-level information with tracked legislation and legislators.

Through the website, all CMAA members will be able to easily access:

  • Currently Tracked Federal Bills and Regulations
  • Key State Bills (New!!!)
  • Directory of Federal and State Legislators (New!!!)
  • Action Alerts on CMAA-Tracked Issues
  • Non-Partisan Election and Voter Registration Information

As well, Chapters, through their Managing Directors and Legislative Chairmen, will have the opportunity to collaborate with CMAA on state-related Action Alerts (contact forms) and more.

This resource, coupled with the Legislative Report and webinar series providing timely compliance information on the regulations impacting clubs, will now comprise CMAA’s robust advocacy initiative. Get started now to make your voice heard.

DOL Offers Remedy to Continuing H-2B Visa Backlog

(Legal Issues, Dept of Labor, Immigration) Permanent link

The Department of Labor’s Office of Foreign Labor Certification has offered a remedy to employers impacted by the on-going delays and backlog of the processing of H-2B visa applications. As of February 22 and continuing until April 1, employers may now apply for emergency processing of currently pending application.

Employers must follow the steps outlined in the February 19 memorandum to request emergency processing. Employers must meet two conditions to apply:
Employers must have a pending H-2B visa with the Chicago National Processing Center, and

Employers must not have yet received from the Chicago NPC an initial notification of acceptance (NOA) or notice of deficiency (NOD) within the seven-business-day timeframe of the application filing date OR the employer has received a NOD beyond the seven-business-day timeframe and has not yet received a NOA.

The office has acknowledged the backlog which it blames on myriad factors including a technical issue and the change in policy based on Congress’ reinstatement of the returning worker provision.