Last December, Mayor Jim Kenney signed the Fair Workweek Employment Standards Ordinance into law, making Philadelphia the fifth city in the U.S. to pass similar workplace regulations. The Ordinance, which proponents believe will increase covered employees’ financial and life stability, was originally set to take effect on January 1, 2020. Due to recent public hearings on the draft Fair Workweek regulations, the new law is now slated to take effect on April 1, 2020. Despite the delay, employers should still familiarize themselves with the Ordinance’s requirements in preparation for the new year.

Who is affected?

The Ordinance covers employers in the retail, hospitality, and foodservice industries that employ 250 or more employees and have 30 or more locations. This includes chain establishments and franchises employing 250 or more employees in the aggregate. The “250 or more” number that the Ordinance references encompasses all employees, whether full-time, part-time, or temporary. The Ordinance protects covered employers’ non-exempt employees who are required to be paid at an overtime rate for hours in excess of a maximum number per week.

What does the Ordinance do?

Upon hiring an employee, or upon a “significant change” to the employee’s work schedule, an employer must provide a written, “good faith estimate” of the employee’s work schedule. While this estimate is not a binding contract, an estimate lacking good faith violates the Ordinance. The Ordinance does not specifically define significant change but states the changes can happen due to changes in the employee’s availability or the employer’s business needs. In order to allow employers to prepare for the new regulations, the “good faith estimates” requirement of the law will not be enforced until July 1, 2020.

The Ordinance also provides varying rates of “Predictability Pay” depending on the specific circumstances, but suffice it to say, if a covered employer alters an employee’s schedule without providing the proper notice, the employer will have to compensate the employee for the lack of stability such unexpected changes may induce. Furthermore, the Ordinance allows aggrieved employees to bring civil action against their employers for violating the Ordinance, allowing recovery of unpaid compensation including Predictability Pay, damages of up to $2,000, and reasonable attorney’s fees. The Ordinance’s implementation of “Predictability Pay” demonstrates that this Ordinance has some bite to back up its bark.

Other noteworthy sections of the Ordinance seek to improve an employee’s quality of (work)life by effectuating a right to rest between work shifts and prohibiting retaliation for an employee’s exercise of any rights vested under the Ordinance.

The Upshot

The Ordinance vests certain employees with rights that will likely aid in an employee’s schedule predictability leading to improved financial and life stability; however, the Ordinance also instills new compliance requirements on covered employers who want to set-up shop in Philadelphia, leading to added costs and considerations when these employers look to do business in the nation’s sixth-largest city.

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