Department of Labor Proposes New Overtime Rules

Overtime2

Earlier this month, the Department of Labor announced its plans to establish a new rule that would allow millions of additional workers to earn overtime. Following an executive order by President Obama, who has advocated for increasing the wages of middle-class workers, the Department of Labor has proposed a rule that would increase the minimum salary necessary for a worker to qualify as exempt from the overtime rules.

Under the federal Fair Labor Standards Act, all employees must receive overtime when they work more than 40 hours in a week, unless they are exempt from the overtime rules. The most common exemptions are the so-called “white-collar” exemptions for certain professional, managerial, and administrative workers. To qualify as exempt under these categories, a worker must make a minimum weekly salary. Currently, the minimum is $455 per week, which is the equivalent of $23,660 per year.

The new rules would increase the minimum weekly salary to $970 per week, which is roughly $50,440 per year. This would make a large number of lower-paid managers, professionals, and administrative employees eligible for overtime pay. For example, a retail store manager who makes $30,000 and works 50 hours a week will now receive overtime pay for those ten extra hours.

Until now, increases to the minimum salary have been infrequent, the last time being in 2004. The new rules would automatically adjust the minimum salary for inflation in the future. This would prevent the exemption requirements from becoming outdated and ensure that receiving overtime is the rule, rather than the exception, for most workers.

The Department of Labor will be accepting comments on the proposed regulations until September 4, 2015. Absent any challenges from Congress, the new rules could go into effect as early as next year.

For more information on the professional, administrative, and executive exemptions, including additional requirements that must be met, see Understanding the “White-Collar” Exemptions.

Police Officers Can’t Search Hotel Records on Demand, but What Does That Mean?

On June 22, 2015, in Los Angeles v. Patel, the U.S. Supreme Court decided that cops can’t rummage through hotel records whenever they want. (576 U.S. ___ (2015).) The opinion, framed in terms of the hotel’s privacy interest rather than that of its guests, nixed part of a Los Angeles Municipal Code section.

The code section in question mandated that hotel and motel operators (1) maintain certain records about their guests and (2) allow police officers to inspect those records on demand. The second part is unconstitutional, Justice Sotomayor wrote, because it forces hotels to disclose records at law enforcement’s whim without any opportunity to object.

The Law

Los Angeles Municipal Code section 41.49 requires hotel operators to document a variety of information about their guests, like:

  • names and addresses
  • the number of people in each guest’s party
  • detailed vehicle descriptions for cars parked on premises
  • arrival and scheduled departure dates, and
  • room numbers.

Hotels have to store this kind of data for 90 days.

The Supreme Court was okay with these requirements. The problem, according to Sotomayor and the four Justices who signed onto her opinion, was a provision that forced hotels to open records to police officers without justification. Failure to comply was a misdemeanor carrying up to six months in jail and a $1,000 fine.

Independent Review

Courts have created fundamental exceptions to the Fourth Amendment requirement that police officers get warrants before conducting searches. Nevertheless, in general, a search conducted without a judge’s prior approval qualifies as unreasonable. The Patel Court stressed that this principle applies both to homes and most businesses.

One of the exceptions to what courts call “the warrant requirement” has to do with administrative searches. In broad terms, these are searches that serve some purpose other than typical crime control. Think of, on the one hand, a restaurant inspection to ensure health code compliance and, on the other, a drug house raid to gather evidence for criminal prosecution.

The Patel Court allowed for the fact that searches of hotel records serve a purpose other than criminal investigation—that they ensure that lodging providers keep records the way they’re supposed to. (People who are up to no good, the theory goes, are more likely to frequent hotels that don’t keep guest records.)

But even if hotel record inspections qualify as administrative searches, Sotomayor said, a hotel operator is owed an opportunity to have a “neutral decisionmaker” evaluate a search demand before the search takes place—or the operator is arrested for refusing.

Not Such a Big Deal

Sotomayor explained that inquisitive police officers could simply issue what’s called an administrative subpoena: a simple form demanding record inspection. In most instances, she surmised, the hotel operator would cooperate. But a hotel that objected to the search would be able to challenge the subpoena (move to “quash” it). Then that “neutral decisionmaker”—for instance, an administrative law judge—would decide whether the search should go through.

And fear not tampering, Sotomayor assured: An officer who reasonably suspects that a hotel will alter the sought-after records while a judge evaluates the propriety of the proposed search can guard them until the ruling comes down.

Not only that, but officers remain free to seek warrants authorizing records searches before approaching hotel owners. And they can of course search records without prior approval when there’s some kind of emergency—for example, where they have reason to believe a hotel guest has taken a hostage.

Sotomayor and company’s point was essentially this: Providing hotels with an opportunity for independent review before they have to hand over their records won’t thwart criminal investigation and will prevent overly broad, harassing intrusions. Sotomayor remarked that the now defunct code provision would have allowed a hotel to be “searched 10 times a day, every day, for three months, without any violation being found . . . .”

But Kind of a Big Deal

At first blush, the Patel decision might appear to affect only the hospitality industry. And all it does is provide hotels the option of challenging record-inspection demands; one has to wonder how often they’ll actually exercise it.

But as Professor Rory Little observes, the ruling is broad enough to require “an  ‘opportunity for precompliance review’ for virtually all governmental inspection programs.”

“This means that business owners who are confronted with an administrative subpoena to inspect their premises must have some opportunity to ‘question the reasonableness of the subpoena before suffering any penalties for refusing to comply.’”

So Patel doesn’t necessarily expand the privacy interests of hotel patrons. But it does bolster protections for businesses subject to government inspection.

People Buy for the House, But Leave Due to Difficult Neighbors

dogcatIt shouldn’t surprise us, but this quote from Rhonda Duffy, an Atlanta real estate agent who has sold more than 17,000 homes, is a bit of a bombshell nonetheless:

“The No. 1 reason people move – besides downsizing or upsizing — is because they don’t like their neighbors.” (See “Check neighborhood before buying house,” by Marni Jameson, June 29, 2015.)

Her phrase “don’t like” is probably an understatement. Ask any homeowner about relations with neighbors. For every tale of casseroles and newfound bookclub comrades, there will be at least one about a vendetta, civil restraining order, or all-around craziness. I know someone whose mentally ill neighbor delivered a live cat to her front doorstep in a box, telling her that it was her “daughter” and she needed to start taking care of it.

A number of the neighbor-related Q&As you’ll find on Nolo’s website come from actual, real-life fact patterns. Check out these doozies, for instance, “My neighbor shot my dog for trespassing. What can I do?,” “What should I do if I think my neighbor is stealing my Wi-Fi?,” and “Can I file a small claims court action against a neighbor who trespassed on and damaged my property?“.

The possibility for neighbor disputes is approximately the last thing anyone wants to think about during the excitement of homebuying. As if it weren’t enough to make sure that the home passes inspection, appraises for the right amount, and is within one’s financial means.

But there’s obviously a reason that at least one state includes a “neighborhood review contingency” in its standard real estate contract. A homeowner is at relatively close quarters with neighbors, and might see them every day. If said neighbors are dealing drugs, making noise, leaving piles of garbage or junk out, and so on, it’s going to directly affect your enjoyment of life.

Fortunately, even without a clause in your purchase contract, prospective homebuyers can do a lot to research neighbor issues before buying. Driving and walking around the neighborhood at different hours of the day or night is a good start, as is chatting with as many neighbors as possible in the vicinity of the home you hope to buy.

We also suggest asking the seller about neighbor issues, as described in Nolo’s (free!) “Questions for Seller” worksheet. And for more tips on this and other aspects of choosing a home, see Nolo’s Essential Guide to Buying Your First Home.

“EXTENDERS” IN LIMBO

As Congress contemplates its usual August hiatus, taxpayers wonder what fate will befall late 2014 “extender” provisions of the law which won’t apply to 2015 unless action is taken. Among the more important provisions whose 2015 fate is still unlearned are:

~Deduction for state and local sales taxes
~Deduction for mortgage insurance premiums treated as qualified interest
~Exclusion from gross income of up to $2 million of discharged principal residence indebtedness
~Deduction of up to $500,000 in cost of certain otherwise depreciable business property, and applicability of 50% “bonus depreciation”
~Tax free distributions for charitable purposes from IRAs of taxpayers age 70-1/2 or older

“Sanctuary” Cities Aren’t What They Sound Like

sf aerialTo hear the media tell it, you’d think that various cities around America were, for undocumented immigrants, like home base in a game of tag — just show up and you’re free, untouchable by law enforcement authorities. Such has been the rhetoric since the awful murder of Kathryn Steinle, killed on July 2 in San Francisco, apparently by a five-time deportee from Mexico.

For instance, the BBC News said that “San Francisco’s ‘sanctuary’ law means city authorities don’t co-operate with immigration officials,” the Associated Press referred to them as “cities that harbor immigrants in the U.S. illegally,” and CBS News quoted Kentucky Senator Rand Paul as saying, “I don’t think you can have whole cities or whole states just not obeying the law.”

No, no, and no. As usual for anything having to do with immigration law, so-called “sanctuary” is a lot more complicated than that.

First off, sanctuary cities don’t shield anyone from federal law enforcement. Immigration enforcement agents have the same powers in a sanctuary city as they do elsewhere. They can arrest and deport people in the U.S. unlawfully — in fact, no one can figure out why they didn’t arrest and deport Steinle’s alleged killer, rather than turning him over to local authorities for prosecution on an ancient drug charge.

Second, San Francisco’s sanctuary law is plenty strict on the topic of dealing with immigrants who have committed serious crimeS — it says, “Nothing in this Chapter shall prohibit, or be construed as prohibiting, a law enforcement officer from identifying and reporting any person pursuant to State or federal law or regulation who is in custody after being booked for the alleged commission of a felony. . . .”

What is a sanctuary city, then? In most cases, the purpose of local sanctuary laws is twofold:

  1. to draw a dividing line between local law enforcement and immigration enforcement, such that police and the like don’t automatically report or turn over undocumented immigrants, for the very important reason that, if they did, members of the immigrant community would simply stop calling the police, leading to a RISE in crime, and
  2. to prevent the sort of Constitutional violation that can all too easily occur when federal authorities expect local jails to simply detain people for unspecified lengths of time AFTER the 48-hour period during which they MUST hold an undocumented immigrant if requested to do so by federal authorities.

For a full, well-researched and reasoned discussion of the sanctuary laws and the Steinle case, I refer you to Cesar Cuahtemoc’s discussion on his CrImmigration blog.