California’s Wage Theft Prevention Act of 2011 (“WTPA” or “Act”)takes effect on January 1, 2012. The WTPA is one of half a dozen new laws that affect an employer’s wage payment obligations. The WTPA amended five existing statutes within the California Labor Code, and created five new statutes in the same code.

Labor Code Section 2810.5 – Wage Notice for Certain Non-exempt Employees

The most important of the Act’s new statutes is Labor Code section 2810.5, which requires employers to give new employees and, in other circumstances, current employees a particularized notice about their wages and other employment-related information. The wage notice requirement, which will take effect on January 1, 2012, will affect most of the more than eight million California employees who are entitled to receive overtime.

Which Employees Must Receive A Wage Notice?

The new statute specifically requires that all employees hired on or after January 1, 2012, receive the notice except:

• An employee directly employed by the state or any political subdivision thereof, including any city, county, or special district.
• An employee who is exempt from the payment of overtime wages by statute or the Wage Orders of the Industrial Welfare Commission.

  This exception covers employees properly classified under the wage laws as professional, executive, or administrative, outside salespersons, and some members of an employee’s family, and can cover some employees such as those in particular occupations who receive more than half their compensation in commissions, truck and other drivers (including taxi cab drivers), broadcasting industry employees, irrigators, and motion picture projectionists.

An employee who is covered by a valid collective bargaining agreement (CBA) ifthe CBA “expressly provides for:”

• • wages;
  • hours of work;
  • working conditions of the employee;
  • premium wage rates for all overtime hours worked; and
  • a regular hourly rate of pay for those employees of not less than 30 percent more than the state’s minimum wage.

The Labor Commissioner has taken the osition in its “Frequently Asked Questions” (FAQs) that the wage notice must be provided to all current employees on January 1, 2012, as well as new employees. 

What Information Must the Wage Notice Contain?

According to the statute, a wage notice must contain at least eight categories of information⁵:

• The rate or rates of pay and basis thereof, whether paid by the hour, shift, day, week, salary, piece, commission, or otherwise, including any rates for overtime, as applicable.
• Allowances, if any, claimed as part of the minimum wage, including meal or lodging allowances.
• The regular payday designated by the employer in accordance with the requirements of the Labor Code.
• The name of the employer, including any “doing business as” (“dba”) names used by the employer.
• The physical address of the employer’s main office or principal place of business, and a mailing address, if different.
• The telephone number of the employer.
• The name, address, and telephone number of the employer’s workers’ compensation insurance carrier.
• Any other information the Labor Commissioner deems material and necessary.

What Additional Information Must Be Included in the Wage Notice?

The Labor Commissioner has issued a template wage notice form that employers may use and has issued 15 frequently asked questions (FAQs) about the required notice. The posted version of the Labor Commissioner’s template form includes many additional items of information not specified in section 2810.5. However, the statute provides the Labor Commissioner with authority to include in the template form “[a]ny other information the Labor Commissioner deems material and necessary.” Accordingly, employers should assume until further notice that all of the information on the Labor Commissioner’s template form should be included and completed on any version of the form which is used. The information included on the Labor Commissioner’s form that is not set out in the statute includes:

• Hire date and position.
• Business form of employer – corporation, partnership and the like.
• The identity of any other entities used to hire employees or administer wages or benefits, excluding recruiting services or payroll services.
• Whether the employment agreement is oral or written.
• The workers’ compensation policy number or certificate number for permissible self-insurance.
• The name and signature of the employee and the date the notice was received and signed.
• The name and signature of the employer representative providing the notice and the date notice is provided.
• An introductory paragraph and several concluding paragraphs which describe the terms on which Wage Notices must be provided.

The full text of the WTPA, Assembly Bill 459, is available at: www.leginfo.ca.gov/pub/11-12/bill/asm/ab_0451-0500/ab_469_bill_20111009_chaptered.html.

According to results from the annual 2011 – 2012 WorldatWork Salary Budget Survey, the overall total salary budget increase figures up by 10% to 2.8% for 2011. The salary budget for all employee groups (Executives, Exempt, and Non-exempt Hourly) is exactly the same for 2012. The projected mean is 2.9% and the mean is 3.0%.

Here are the salary increase budget figures by Type of Increase for 2012:

Note: Various categories do not add to “Total Increase” because not every organization provides all three types of Increase

IRS Increases Mileage Rate to 55.5 Cents per Mile

IR-2011-69, June 23, 2011

WASHINGTON — The Internal Revenue Service today announced an increase in the optional standard mileage rates for the final six months of 2011. Taxpayers may use the optional standard rates to calculate the deductible costs of operating an automobile for business and other purposes.

The rate will increase to 55.5 cents a mile for all business miles driven from July 1, 2011, through Dec. 31, 2011. This is an increase of 4.5 cents from the 51 cent rate in effect for the first six months of 2011, as set forth in Revenue Procedure 2010-51.

In recognition of recent gasoline price increases, the IRS made this special adjustment for the final months of 2011. The IRS normally updates the mileage rates once a year in the fall for the next calendar year.

“This year’s increased gas prices are having a major impact on individual Americans. The IRS is adjusting the standard mileage rates to better reflect the recent increase in gas prices,” said IRS Commissioner Doug Shulman. “We are taking this step so the reimbursement rate will be fair to taxpayers.”

While gasoline is a significant factor in the mileage figure, other items enter into the calculation of mileage rates, such as depreciation and insurance and other fixed and variable costs.

The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use in lieu of tracking actual costs. This rate is also used as a benchmark by the federal government and many businesses to reimburse their employees for mileage.

The new six-month rate for computing deductible medical or moving expenses will also increase by 4.5 cents to 23.5 cents a mile, up from 19 cents for the first six months of 2011. The rate for providing services for charitable organizations is set by statute, not the IRS, and remains at 14 cents a mile.

Taxpayers always have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates.

Mileage Rate Changes (in Cents)

• Bachelor’s degree students taking part in internships will earn an average of $16.68 an hour
• At the master’s degree level, the average hourly rate is $24.21
• Both overall averages are down marginally from last year’s averages—$17 and $24.29, respectively
• Intern salaries fluctuate greatly depending on major, year of study, industry, and other factors

The SEC’s new rules specify that say-on-pay votes required under the Dodd-Frank Act must occur at least once every three years beginning with the first annual shareholders’ meeting taking place on or after Jan. 21, 2011. Companies also are required to hold a “frequency” vote at least once every six years in order to allow shareholders to decide how often they would like to be presented with the say-on-pay vote. Following the frequency vote, a company must disclose on an SEC Form 8-K how often it will hold the say-on-pay vote.

Under the SEC’s new rules, companies also are required to provide additional disclosure regarding golden parachute compensation arrangements with certain executive officers in connection with merger transactions.

The Commission also adopted a temporary exemption for smaller reporting companies (public float of less than $75 million).  These smaller companies are not required to conduct say-on-pay and frequency votes until annual meetings occurring on or after Jan. 21, 2013.

The SEC rules largely mirror the proposed ones.   The revisions in these rules:

• Delay the general effective date of Jan. 21, 2011 to Jan. 21, 2013, for smaller reporting companies
• Clarify that the votes have to occur only at shareholder meetings where directors are elected
• Give companies more time to report shareholder votes and management’s voting-frequency decisions, using Form 8-K instead of Form 10-Q
• Allow a company to exclude shareholder say-on-pay proposals only if it adopts the voting frequency backed by a majority (not a plurality) of shareholders.

For more information:

SEC Press Release: http://sec.gov/rules/final/2011/33-9178.pdf

Some of the other survey findings:

• About 85% of companies provide prorated holidays and vacation to their part-time workforce

• Categories of prorated benefits provided to eligible part-time employees:
  • 85% of companies offer Vacation
  • 84% of companies offer Holidays
  • 60% of companies offer Paid Sick Leave
  • 52% of companies offer Health Insurance
  • 39% of companies offer Life Insurance
  • 84% of companies offer Other Benefits (Paid Time Off, Dental, and 401(k)

• Minimum hours worked per week to be eligible for prorated benefits:
  • 35% of organizations require employees to work at least 30 hours per week
  • 40% of organizations require employees to work at least 20 hours per week
  • 4% of organizations require employees to work at least 10 hours per week
  • 3% of organizations’ employees work less than 10 hours per week
  • 18% do not offer benefits to part-time employees

•  59% of companies offer a 401(k) Plan to part-time employees

• 43% of companies offer an Incentive/Bonus Plan to part-time employees

Source:  Benefits for Part-Time Employees, BLR HR Daily Advisor November 2010.

The new 2011 rates are:

Arizona = $7.35

Colorado = $7.36

Montana = $7.35

Ohio = $7.40

Oregon = $8.50

Vermont = $8.15

Washington = $8.67

Here is some additional information about minimum wage rates in the United States:

• The state minimum wage rate requirements, or lack thereof, are controlled by legislative activities within the individual states.
• Federal minimum wage law supersedes state minimum wage laws where the federal minimum wage is greater than the state minimum wage.  
• In those states where the state minimum wage is greater than the federal minimum wage, the state minimum wage prevails.
• There are 4 states than have a minimum wage set lower than the federal minimum wage.
• There are 17 states (plus DC) with minimum wage rates set higher than the federal minimum wage.
• There are 24 of the states that have a minimum wage requirement that is the same as the federal minimum wage requirement.
• The remaining 5 states do not have an established minimum wage requirement.
• The State of Washington has the highest minimum wage at $8.67/hour.
• The states of Georgia and Wyoming have the lowest minimum wage ($5.15) of the 45 states that have a minimum wage requirement.

• Over 8 hours of work in a work day
• Over 40 hours of work in a work week
• The first 8 hours of work on the seventh consecutive day of work in a work week



• Over 12 hours of work in a work day
• Over 8 hours of work on the seventh consecutive day of work in a work week

The top 10 jobs that employers are having difficulty filling across the 36 countries and territories surveyed are (ranked in order):

1. Skilled Trades
2. Sales Representatives
3. Technicians (primarily production/operations, engineering or maintenance)
4. Engineers
5. Accounting & Finance Staff
6. Production Operators
7. Secretaries, Administrative Assistants & Office Support Staff
8. Management/Executives
9. Drivers
10. Laborers

2010 U.S. Hardest Jobs to Fill:

1. Skilled Trades
2. Sales Representatives
3. Nurses
4. Technicians
5. Drivers
6. Restaurants & Hotel Staff
7. Management / Executives
8. Engineers
9. Doctors
10. Customer Service Representatives

Source:  Manpower Talent Shortage Survey 2010

                        Actual 2010                      Projected 2011

                        Mean: 2.5%                           Mean: 3.0%

                        Median: 2.7%                       Median: 3.0%

Source: WorldatWork Salary Budget Survey 2010-2011