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ALERT- DC Wage Theft Prevention Amendment Act of 2014

Fri, May 15, 2015

Columbia, Maryland

Recently the Association has received calls and emails about new regulatory issues regarding a DC wage and hour law that became effective on February 26, 2015.  Many are concerned about the required disclosures and penalties that could result from non-compliance with the new rules.  The Association sought the input from Kaufman & Canoles, our legal counsel and strategic partner to help address the many questions that have come to the Association.  Below is a Credit Union Alert authored by Andy Keeney, John Bredehoft and Mark Warmbier, members of the Kaufman & Canoles Credit Union Team. 

We hope you find this information helpful as you make preparations for the notification, contact information for Andy and the team at Kaufman & Canoles is located at the end of the FAQ’s.

ACTION ALERT FAQ’S

The District of Columbia’s new Wage Theft Prevention Amendment Act of 2014 (the “Act”) became effective on February 26, 2015.  The Act itself can be a bit confusing to read and understand because its primary purpose is to amend a number of provisions contained within other D.C. laws already in existence, such as the Minimum Wage Act Revision Act, the Living Wage Act, the Wage Payment and Wage Collection Law, and the Accrued Sick and Safe Leave Act.  However, the Act does impose a new disclosure obligation on D.C. employers that should not be lost in the sea of technical, statutory amendments. 

Q1.  What disclosure obligation does the Act impose on D.C. employers? 

The Act requires D.C. employers to distribute a notice to all employees about the terms of their employment.  Specifically, the notice must contain the following pieces of information: 

1.  The name of the employer and any “doing business as” names used by the employer

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

3.  The telephone number of the employer

4.  The employee’s rate of pay and the basis of that rate, including:

a.   Rate by the hour, shift, day, or week (whichever is applicable)

b.   Salary, piece rate, or commission (whichever is applicable)

c.   Any allowances claimed as part of the minimum wage, including tip, meal, or lodging allowances

d.   Overtime rate of pay or exemptions from overtime pay

e.   Living wage or exemptions from the living wage

f.    Any applicable prevailing wages

5.  The employee’s regular payday designated by the employer

Q2.  When must the notices be distributed to employees? 

All new employees should receive the required notice upon hire.  All existing employees should receive the required notice by May 27, 2015.  Thereafter, D.C. employers must provide updated notices whenever there are any changes to the information disclosed (i.e. changes to the employer’s name/address/telephone number, changes to the employee’s rate of pay, or changes regarding the designated payday).  

Q3.  Are sample notices available for use? 

Yes.  The District of Columbia Department of Employment Services has created a sample notice that complies with the requirements of the Act.  (See attachment).  As you will see, the sample notice is intentionally overbroad so that it may address the potential needs of employers in all industries.  Accordingly, some of the information will not be applicable to credit union employers.  For example, Section 4 of the sample notice references “tipped employees” and Section 6 includes information regarding prevailing rate jobs.  D.C. employers are free to either (i) use the sample notice, ignoring any inapplicable items, or (ii) create their own notice, provided that the custom-made notice includes the basic information discussed in Question 1 above.   

Q4.  Should the notices be signed? 

Yes.  As proof of compliance, both the employer and the employee should sign and date the notice.  Copies of the signed notice should be retained in the employee’s personnel file. 

Q5.  Is there a posting requirement associated with this Act? 

Yes.  D.C. employers are required to post a summary of the Act in a “conspicuous and accessible place” where the covered employees are employed.  The D.C. Department of Employment Services has created a summary to be used for posting purposes.  (See attachment). 

Q6.  Are there penalties for non-compliance? 

Yes.  A $500 penalty may be assessed for each failure to provide each employee with the required notice.  Additionally, the failure to provide an employee with the required notice will weigh against the employer’s credibility in a dispute regarding the promised rate of pay.  Further, failure to post the required summary of the Act (see Question 5 above) could lead to a fine of $100 for each day the summary is not posted.    

Q7.  Are there any other changes to D.C. laws of which to be aware? 

Yes.  On an unrelated note, D.C. employers should also take note that D.C.’s minimum wage will be increasing to $10.50 per hour, effective July 1, 2015.

Feel free to contact Andy Keeney, John Bredehoft, or Mark Warmbier if you have any questions or concerns.  Thank you.

 

Resources:

Notice of Wage Theft Prevention Act of 2014

DC Sample Notice

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Kaufman & Canoles is the Strategic Partner and Legal Counsel for the MDDCCUA.  Andy Keeney is co-chair of the Kaufman & Canoles Credit Union Team and can be reached at eakeeney@kaufcan.com or 757.624.3153. John M. Bredehoft can be reached at jmbredehoft@kaufcan.com or 757.624.3225 and Mark E. Warmbier can be reached at mewarmbier@kaufcan.com or 757.624.3304. 

The K&C Credit Union Team serves as general counsel to credit unions, large and small, regularly advising clients on consumer compliance issues, NCUA requirements, and the rules governing credit union service organizations. For more information about our team, view our client testimonial video on Kaufman & Canoles YouTube channel or visit www.kaufcan.com