The Corporate Transparency Act (CTA) that went in to effect earlier this year, requires most businesses to file their Beneficial Ownership Interest (BOI) with the Financial Crimes Enforcement Network (FinCEN) by the end of 2024. A court in Texas has granted a temporary injunction against the rule.

This injunction is TEMPORARY and PRELIMINARY meaning that depending on more legal maneuvering in coming days and weeks, the injunction may be lifted and the December 31, 2024 be reinstated. If you were required to file, please consider continuing those efforts and compile the necessary information.

Please refer to the following articles for more information.

Texas District Court Issues National Preliminary Injunction Blocking Beneficial Ownership Information Reporting Requirements Under the Corporate Transparency Act.

BREAKING: Federal Court Enjoins Government from Enforcing Corporate Transparency Act

The Department of Agriculture recently released the Farm Labor Survey (FLS) results for 2024. The FLS is what the Department of Labor uses to set the Adverse Effect Wage Rate (AEWR) for H-2A workers. The law says that use of the H-2A program cannot have an “adverse effect” on domestic workers’ wages. The DoL has decided (it’s not codified) that the floor for wages is the average farm labor wage as indicated in the FLS.

NASS surveys farmers all year at multiple points during the year. The survey has been done since well before the H-2A program and has not formal ties to the program. The survey reflects what farmers are paying. It doesn’t discriminate between producers that have H-2A workers or not but it has become painfully apparent that there is a ratcheting effect that happens as more farmers are forced to use the program. Non program users have to compete and therefore must pay more than the H-2A to keep their employees. It’s a self-fulfilling increasing system.

The H-2A wages will adjust later this month. It doesn’t matter what your contract says if it is set at the current AEWR it will go up when it gets published in the Federal Register. This includes your domestic employees in corresponding employment. We should get a couple of days notice but unlike in previous years it may be in effect immediately upon publication. The 2024 and 2025(expected) Wages are below.

Some states did go down. Michigan, Minn and Wisconsin actually went down by almost 2%. Their rates are currently $18.50 and will be dropping to $18.15 but with producers that have workers now or contracts that are approved for 2025, they will be paying the higher rate. You can be forced to go up on your wage but you can’t reduce it lower than your contract.

We expect these rates to be published near the end of December but they can technically be published any time before January 1 and remember they will likely take effect immediately upon publication.

DSF

As a follow up from Wednesday’s post regarding Wage and Hour Visits, we wanted to make sure everyone had access to a publication from our friends at Fisher and Phillips.

In the past few days we’ve heard several reports from Georgia, Alabama, and the mid-south of Wage and hour investigations. It has been a few years since we’ve seen widespread investigations in the region but it seems like we’ll be seeing a lot more of them this year once again.

The typical investigation can be either announced by a letter or email or unannounced where they just show up. They will normally want to see payroll records for the past couple of years. There is an emphasis on child labor so they will want birthdays of all under 18 yr old employees. If you’re not comfortable sharing some information have a discussion with the inspector about why you’re not comfortable and see if there’s another way to get to the answer they’re looking for. Most of these inspectors are reasonable and the requests are relatively generic. Read the situation and act accordingly. Call me if you need more clarification here.

Make sure you have your posters on the wall. The main ones they will be looking for is the Minimum Wage Poster and anything related to the Migrant and Seasonal Worker Protection Act (MSPA)and H-2A. The MSPA poster applies to workers who leave their permanent residence and come to work for you temporarily. The H-2A poster should only be on the wall if you have H-2A workers.

The other thing that is normally checked out is any housing you provide. This applies to both MSPA and H-2A workers. If you provide housing for either of these groups, it would be a good idea to inspect your housing now. It doesn’t matter what shape your housing was in at the beginning of the season, the condition today is what you could be held accountable for. Look at this check list and go to your housing and go through the check list soon.

Let us know if you get an investigation so we can continue to track the activities of the agency this season.

Give us a call if you have questions.

Dusty

The United States District Court for the Eastern District of Texas has rendered the entire Overtime Rule published earlier this year invalid. The court held that the substantial minimum salary threshold effectively rendered the duties test redundant, effectively transforming the determination of employee exemptions into a “Salary Only Test.” Furthermore, the court found that the provision adjusting the minimum salary every three years violated the notice-and-comment requirement mandated by the Administrative Procedures Act.

Consequently, the minimum salary has been restored to the level of $35,568, which prevailed prior to July 1, 2023. The Department of Labor (DoL) retains the option to appeal the decision, but many anticipate that the defense of the rule will be abandoned in light of the recent election results. 

More to follow.

As we’ve reported and discussed at multiple meetings, the Department of Labor has updated the requirements for an employee to be considered exempt from overtime. The transition was in two parts with the first becoming effective in July and the second on January 1, 2025. The second part of this will need to be watched over the next few weeks.

There are two tests that employee must meet in order to be deemed exempt from overtime. The first is a “Duties Test”. This really hasn’t changed much over the years. You can find a number of jobs that can be exempt from overtime on this page. That link takes you to Fact Sheet 17A. These are the most common exemptions but there are a lot which I won’t get into today. Most gin employees that are salaried fit in one or more of these fact sheet descriptions. If you think an employee is exempt from overtime MAKE SURE YOU KNOW WHICH FACT SHEET AND JOB APPLIES.