Under the federal Fair Labor Standards Act, employers must pay employees overtime based on their “regular rate.” Various states, including California, also follow the FLSA regular rate definitions. For non-exempt employees paid only on an hourly rate, determining the regular rate is easy: It is the hourly rate. However, matters can be tricky when an employer also pays non-exempt employees additional compensation, such as bonuses or commissions. In many cases, additional amounts paid must be included in determining the regular rate. These issues have become more important, as legal claims have increased in alleging the failure to include all amounts required in the regular rate. The failure to determine the regular rate correctly results in an underpayment of overtime, with possible penalties.
Under a proposed EU regulation, online retail companies in Europe may no longer be able to use geo-tracking in online shopping. The European Commission released a draft regulation on May 25, 2016 that proposes the removal of geo-blocking for online shopping, stating that it wants to ensure that consumers seeking to buy products and services in an EU country, be it online or in person, are not discriminated against in terms of access to prices, sales, or payment conditions.
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Walgreens recently settled with the state of New York over allegations that the drug retail chain misled consumers with its pricing, including value and clearance prices. According to the New York attorney general’s office, an undercover investigation showed that Walgreens was overcharging customers compared to the prices displayed in print advertising and on-shelf tags. Walgreens agreed to pay $500,000 to settle the dispute and has agreed to review and correct the allegedly misleading pricing practices. This should serve as a reminder to retailers in all industries of the need to exercise care in product pricing, as this area has become a common target for regulators and the plaintiff’s bar.
California has myriad laws giving employees the ability to take various paid or unpaid leaves. Some cities impose even broader paid sick leave mandates. Now, starting January 1, 2017, larger employers with employees working in San Francisco will have to provide employees with paid parental leave to bond with a new child. On July 1, 2017, the ordinance expands to cover smaller employers.
San Francisco’s ordinance is the nation’s first mandate for private employers to provide fully paid parental leave. The law extends to employees who work only part of the time in San Francisco. It also provides new retaliation protections, potentially reaching beyond California law and protecting some paid family leave taken under state law.
Store credits not redeemable for cash are not unclaimed property under California's Unclaimed Property Law (UPL). In Bed Bath & Beyond Inc. v. Chiang, Case No. 37-2014-12491 (Super Ct. San Diego, Cal. Mar. 4, 2016), the Superior Court issued summary judgment in favor of the national retail chain, Bed Bath & Beyond Inc., holding that merchandise credits not redeemable for cash are not subject to the UPL and also qualify for an exemption under the UPL for gift certificates that do not expire.
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A recent lawsuit filed against GNC serves as a reminder that companies need to ensure that prices listed as “regular prices” are substantiated.
Fashion companies deal with trade secrets and other confidential information all the time. Whether it is proprietary information regarding customers, pricing, sourcing, product design or manufacturing methods, this valuable intellectual property provides a competitive edge in the market by virtue of the fact that it is not generally known. If you use employment contracts or non-disclosure agreements with your employees restricting their use of the company’s trade secrets or other confidential information (and if you don’t, you really should), then you need to be aware of a provision in the Defend Trade Secrets Act of 2016 (DTSA), which has been passed by the House and Senate and will become the law of the land once the legislation is signed by President Obama.
Why does it matter? This seemingly inconsequential distinction may mean the difference between being able to prominently display your embroidered brand trademark on your jeans and being required to place a large “Made in China” marking next to the embroidered brand trademark. This is exactly what US Customs and Border Protection (CBP) attempted to do to the jeans manufacturer JBLU, Inc., whose “C’est Toi Jeans USA” trademark had been in use, but not yet registered.
US Customs and Border Protection has provided details on recent changes to the law that prohibits imports made of convict, forced, or indentured labor. The Trade Facilitation and Enforcement Act of 2015 repealed the “consumptive demand” exemption to the ban on imports made by “forced labor.” The repeal became effective on March 10, 2016.
Prior to the changes, there had been an exemption to the ban if goods were not mined, produced or manufactured in such quantities in the United States as to meet the consumptive demands of the United States.
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