Dear valued clients and supporters: This month's newsletter will focus on: (1) proposed changes to the overtime rules by the U.S. Department of Labor that could potentially extend overtime protection to 5 million white collar workers; (2) New York City's passage of the The Fair Chance Act impacting an employers ability to inquire about a job applicants criminal history prior to hiring and (3) a closer look at selling a company or buying back shares in the context of our continuing series of articles on start-up entrepreneurs.
Proposed changes to overtime rules
The U.S. Department of Labor announced today that it was proposing a rule change that would effectively make millions of white collar employees who are currently considered "exempt" from over-time - eligible for overtime. One of the many factors that currently determines whether an employee is exempt or not from overtime is the total amount of wages earned annually. Today, certain professionals and managers are exempt from overtime if they make more than $23,660 a year and perform specific duties. The proposed rule would now set the overtime threshold to $50,440.00. Additionally, the proposed rule would simplify the identification of nonexempt employees, thus making the executive, administrative and professional employee exemption easier for employers and workers to understand and apply. Both employers and employees are advised to consider the implications of these changes in the event the rule is adopted and implemented as proposed.
The Fair Chance Act
New York City's newly passed Fair Chance Act (the “Act”), which will go into effect on October 27, 2015, prohibits employers from inquiring about a job applicant’s criminal history, including arrest and conviction records, during interviews before a conditional offer of employment is made. In addition, the Act prohibits employers from conducting pre-offer searches of public records and certain consumer reports that contain criminal conviction information. Once a job applicant is given a conditional offer of employment, the employer can do a background check and ask for information about convictions that may be relevant to the job. For more information about the Act, please visit our article here.
Start-up ventures and selling or expanding the business
We invite you to read our last article in the three-part series of articles on start-up ventures and entrepreneurs now posted here. The last article focuses on decisions an entrepreneur who has successfully grown a company and is looking to retire, cash-out, or start a new venture may make. The entrepreneur who is looking to sell should consideration whether the sale should be structured as a stock sale or an asset sale. There are tax and control ramifications that the seller must consider, depending on what they decide to do. The entrepreneur may also decide to buy back the shares that are were issued during the capital raising stage and consolidate control before selling to a third party or simply holding on to the company for a future sale after the buy-back occurs. We invite you to read the full series of articles: Attracting Investment for the Amateur Entrepreneur Part I, Attracting Investment for the Amateur Entrepreneur Part II: Additional Capital, and Attracting Investment for the Amateur Entrepreneur Part III: Selling the Business or Buying Back Stock