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Labor Department Proposes Changes to Minimum Salary for Overtime Exemptions

The United States Department of Labor has issued a notice of proposed rulemaking that would change the minimum salary levels necessary for an employee to be properly classified as exempt from the overtime compensation requirements of the Fair Labor Standards Act.  Under the proposed rule, the minimum salary for most exemptions would rise from $455 per week ($23,660 annualized) to $679 per week ($35,308 annualized).  The minimum annual compensation for the “highly compensated employee” exemption would rise from $100,000 to $147,414.

For employees in the executive, administrative and professional exemptions, the proposed rule would permit nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to ten percent (10%) of the required minimum salary.  In addition, provided that the employee has received at least ninety percent (90%) of the required minimum compensation in each payroll week for 52 weeks, the employer would be permitted to make a single “catch-up” payment

USDA and FDA to Jointly Regulate Cell-Cultured Food Products

The U.S. Department of Health and Human Services’ Food and Drug Administration (“FDA”) and the U.S. Department of Agriculture’s Food Safety and Inspection Service (“FSIS”) formally agreed on March 7 to share regulatory authority over cell-cultured meat products (“CCM”) derived from livestock or poultry.

As we previously reported, regulatory authority over CCM has been a much contested issue. FSIS purports to have jurisdiction over CCM under the Federal Meat Inspection Act (“FMIA”), while FDA purports to have jurisdiction under the Federal Food, Drug, and Cosmetic Act (“FFDCA”). Instead of battling over jurisdiction, the agencies have decided to collaborate – both will have oversight but at different stages of production. Essentially, FDA will oversee the initial stages of production, while FSIS will take on authority during cell harvesting.

While the details have yet to be refined, the agreement broadly allocates the agencies’ respective roles and responsibilities as follows:

Retailers Should Consider Impact of California Consumer Privacy Act on Employee Data

Retailers and other employers with operations in California should be aware of the potential application of the California Consumer Privacy Act (“CCPA”) to data collected about California employees.  Although the CCPA refers to “consumers,” as currently drafted the CCPA’s definition of a “consumer” also will apply to California-based employees.

As we previously reported, the CCPA grants consumers various rights with regard to their personal information held by businesses.  This is part of a multi-part series addressing frequently asked questions concerning the CCPA.

Which employers will have to comply with the CCPA?

Employers with employees in California will need to comply with the CCPA if their business falls into one of the following three categories:

  • Their business buys, sells, or shares the “personal information” of 50,000 “consumers” or “devices”;
  • Their business has gross revenue greater than $25 million; or
  • Their business derives 50% or more of its annual revenue from sharing
  • Avoiding the California Consumer Privacy Act Litigation Tsunami: What Does it Mean to “Do Business” in California?

    Companies that do business in California know that it is a magnet for class action litigation.  The California Consumer Privacy Act (“CCPA”), a new privacy law that applies to data collected about California residents, will provide even more incentive to plaintiff’s attorneys to bring suit in California.

    The CCPA was enacted in early 2018 as a political compromise to stave off a poorly drafted ballot initiative.  Although the CCPA is scheduled to go into force in early 2020, there is a great deal of confusion regarding the requirements of the CCPA, including the degree to which it aligns with other privacy regulations such as the European General Data Protection Regulation (“GDPR”).  To help address that confusion, BCLP is publishing a multi-part series to address the most frequently asked litigation-related questions concerning the CCPA.  BCLP is also working with clients to assess – and mitigate – litigation risks for when the CCPA goes

    Bioengineered Food Disclosure Rules Finalized, Require Disclosure of “Detectable” GMOs

    On December 21, 2018, the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service (AMS) published its final rule implementing the National Bioengineered Food Disclosure Standard (NBFDS) signed into law by President Obama in 2016.   The NBFDS preempted state and local genetic engineering labeling requirements and charged AMS with developing a national mandatory standard for disclosing the presence of bioengineered (BE) food.  The rule takes effect on February 19, 2019, and implementation will be phased in over the next three years.

    As we previously reported, the NBDS requires food manufacturers, importers of food labeled for retail sale in the U.S. and some U.S. retailers to disclose foods and ingredients produced from foods that are or may be bioengineered.  The final rule defines “bioengineered food” as any food that “contains genetic material that has been modified through in vitro recombinant deoxyribonucleic acid (DNA) techniques and for which the modification

    Ninth Circuit Issues Important Decision in Domino’s Website Accessibility Action

    As businesses continue to face lawsuits and demand letters alleging that their websites are inaccessible to blind and deaf patrons in violation of the Americans with Disabilities Act (“ADA”), courts across the country continue to weigh in on the issue. On Tuesday, January 15, 2019, the United States Court of Appeals for the Ninth Circuit issued its much-awaited decision in the Robles v. Domino’s Pizza case – holding that the ADA applies to the Domino’s Pizza (“Domino’s”) website and mobile application (“app”), and rejecting due process and primary jurisdiction challenges raised by Domino’s successfully in the court below.

    As we previously reported, in March 2017, the United States District Court for the Central District of California granted Domino’s motion to dismiss under the primary jurisdiction doctrine, which allows courts to stay or dismiss lawsuits pending the resolution of an issue by a government agency. The District Court held

    Public Forums Underway in California Consumer Privacy Act Rulemaking

    January 14, 2019

    Categories

    The California Consumer Privacy Act (“CCPA”), was passed last summer as a compromise to avoid a highly restrictive privacy regime slated to appear on the November 2018 ballot in California.  Amidst much controversy and debate, the California Attorney General’s Office is set to draft implementing regulations for the new law.  As part of that process, six public rulemaking workshops have been scheduled for the public to provide comments and voice concerns.  The first  took place on January 8, 2019 in San Francisco and was attended by a cross-section of trade associations and privacy advocacy groups.  Although the public comments covered a variety of topics, a few themes emerged:

    • Industry groups want to more closely align the CCPA’s provisions with other privacy regulations such as the European Union’s General Data Protection Regulation (“GDPR”). Many businesses have already undertaken the Herculean task of coming into compliance with the EU law.  They

    California Court Grants Nonsuit in Website Accessibility Trial

    A California court has dismissed a website accessibility case shortly after commencing trial, issuing a sua sponte nonsuit on grounds that the defendant credit union’s website is not subject to the ADA.

    Martinez v. San Diego Credit Union, San Diego Superior Court Case No. 37-2017-00024673, would have been the only known website accessibility lawsuit to go to trial in the state of California. Instead, after commencing trial, the Court ordered the parties to submit trial briefs, inquired whether the parties would object to the Court issuing a sua sponte ruling at the outset of the case, and then granted the nonsuit.  In so ruling, the Court advised the parties that it agreed with the defendant credit union’s position that the complaint failed to state facts sufficient to constitute a cause of action, and that it wished to save plaintiff’s counsel the expense of flying its expert witness from the East

    California Joins States Banning Flame Retardants; San Francisco Ban to Take Effect in 2019

    November 16, 2018

    Categories

    California Governor Jerry Brown has signed into law a ban on flame retardants in certain household products. Starting January 1, 2020, it will be prohibited to sell or distribute children’s products, mattresses, and upholstered furniture that contain flame retardants in concentrations above 1,000 parts per million (ppm) in the state of California.

    In addition to banning the sale of products containing flame retardants, the law requires the International Sleep Products Association to survey mattress producers every three years to determine what materials are being used to meet flammability standards.

    The Bureau of Electronic and Appliance Repair, Home Furnishings, and Thermal Insulation is authorized to enforce the new law and adopt implementing rules and regulations.

    In passing the bill, the Legislature cited evidence that flame retardants do little to increase fire safety, and expressed concerns about the link between flame retardants and various health problems, such as developmental problems in children

    FDA Provides Guidance for New Nutrition and Supplement Facts Labels

    On November 5, the FDA released non-binding guidance intended to answer questions related to Nutrition Facts and Supplement Facts Label and Serving Size final rules. As we previously reported, the rules were finalized in May 2016 and initially set a general compliance date of July 2018. The FDA has extended that deadline to January 1, 2020 for manufacturers with $10 million or more in annual food sales. Manufacturers with less than $10 million in annual food sales have an extra year to comply, until January 1, 2021.

    The May 2016 rules require a revamped Nutrition Facts label that, among other things,

    • Increases the type size of certain nutrition information.
    • Requires declaring actual amount, in addition to percent Daily Value, of vitamin D, calcium, iron and potassium.
    • Requires declaring “Added sugars,” in grams and as percent Daily Value.
    • Updates the list of nutrients that are required or permitted.
    • Removes “Calories from

    DOJ Says Online Businesses Have “Flexibility” in How to Make Websites Accessible

    As we reported in June, a bi-partisan assembly of 103 members of the House of Representatives wrote a letter to Attorney General Jeff Sessions and asked the Department of Justice (“DOJ”) to “state publicly that private legal action under the ADA with respect to websites is unfair and violates basic due process principles in the absence of clear statutory authority and issuance by the department of a final rule establishing website accessibility standards.” That letter urged the DOJ to “provide guidance and clarity with regard to website accessibility under the … ADA.”

    On September 25, the DOJ responded to that letter. While the response does not directly address the members’ questions, it does state that the DOJ “is evaluating whether promulgating specific web accessibility standards through regulations is necessary and appropriate to ensure compliance with the ADA.”

    The letter also provides some guidance that could prove useful to retailers

    California Passes Amendments to Consumer Privacy Act

    California Governor Brown recently signed into law SB 1121, which amends the California Consumer Privacy Act of 2018 to provide much-needed relief to retailers and other businesses that collect consumer information. The amendments take effect immediately.

    The California Retailers Association (CRA) worked successfully with other business leaders as part of the Privacy Coalition to secure passage and signature of SB 1121, and will continue to work on a more comprehensive clean-up bill in 2019.

    As we previously reported, the Act grants consumers various rights with regard to their personal information held by businesses, including:

    • The right to request that a business provide it with specific information the business has collected about them, including categories of information sold, and third parties to whom information is sold.
    • The right to request deletion of personal information the business has collected about the consumer. The business must comply unless one

    California Amends Slack Fill Law to Provide Additional Exemptions

    Governor Jerry Brown recently signed into law Assembly Bill 2632, which amended California’s slack fill statute to create several exemptions. This amendment will be an additional hurdle to the plaintiff bar, which has been flooding the courts with slack fill related lawsuits in recent years. These lawsuits, typically filed as class actions, allege that product packaging is misleading to the extent it contains nonfunctional empty space, known as slack fill, which causes consumers to believe they are receiving more of the product than they actually are.

    The new law, which will amend California Business and Professions Code Sections 12606 and 12606.2, includes the following key changes:

    • The amended law exempts packaging sold in a mode of commerce that “does not allow the consumer to view or handle the physical container or product.” It could be argued that this exempts online sales.
    • The amended law exempts product packaging that clearly

    End of the Road for Mike and Ike Slack Fill Case

    End of the Road for Mike and Ike Slack Fill Case

    August 17, 2018

    Authored by: Bryan Cave, Sarah Burwick and Robert Boone

    In another victory for a candy manufacturer, a federal court in Missouri denied class certification earlier this month, effectively ending the plaintiff’s attempt to seek damages on a class-wide basis for all consumers of Hot Tamales and Mike and Ike candies.

    The lawsuit, White v. Just Born, alleged that boxes of the candy were underfilled, leaving unusable empty space, known as “slack fill,” that deceived the consumer into thinking he was receiving more candy than was actually in the package. The plaintiff sought certification of a Missouri class, and two multi-state unjust enrichment classes, on the theory that the actual value of the candy was less than the consumers paid for it.

    The court declined to certify all three classes, ruling that proving class-wide violation of Missouri’s Merchandising Practices Act “will involve predominantly individual inquiries as to whether each class member purchased the candy.” Because most consumers purchase this type

    States Start to Enforce Online Sales Tax Laws, Look to Tax Marketplace Providers

    Since the Supreme Court’s landmark decision in South Dakota v. Wayfair, more than half of the states with sales tax have rapidly taken steps to begin collecting sales tax from out-of-state retailers, with 24 of the 45 states with a sales tax in various stages of requiring out-of-state retailers to collect.

    As we previously reported, in Wayfair, the Supreme court ruled that internet retailers can be required to collect sales and use tax in states in which they lack a physical presence, overturning 26 years of precedent barring states from taxing out-of-state sellers.

    Some states, like Massachusetts, are already enforcing laws they had on the books, while others will start on October 1, the beginning of the fiscal year for many states, or January 1 .  A number of states are still in the process of formulating their respective remote collection laws, while others are delaying enactment to provide

    Retailers Face Flood of Class Actions Related to “Off the Clock” Work

    August 16, 2018

    Categories

    “Off the clock” work may prove costly, as retailers battle a flood of putative class actions based on claims that employees were not compensated for required work duties.

    Recently, the parties in Samantha Jones v. Abercrombie & Fitch Trading Co. filed a joint motion seeking preliminary approval of a class action settlement for $9.6 million.  The plaintiffs alleged that the retailer failed to compensate them for time employees spent calling in to the stores. California law requires employers to pay the equivalent of at least two hours of work to employees who report to work.  Class counsel argued the employees effectively reported to work when the retailer required the employees to call ahead of their scheduled shifts.

    Abercrombie argued employees had no private right to bring their claims for reporting pay time claims under either PAGA or the Unfair Competition Law.  Abercrombie also disputed class certification, on the grounds the employees’ practice

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