2018 Utah Legislative Guide on Employment Issues - January 31st Update

By Trenton L. Lowe

The 2018 Utah Legislature began on Monday, January 22, and a record number of bills have been filed this year – more than 1,100 – which will make for a busy session for lawmakers. Depending on how you look at it, there are seven bills that affect private employers, while an additional two bills that strictly affect public employees may, if passed, have an effect on private employers in the coming years. I have summarized each of the bills’ most important points and will update them as things change throughout the session.

The first week of the legislative session saw two additional bills introduced that are relevant to employers, HB 241 and SB 113, which are listed below. As is typical of the first week, not much happened substantively on any of the bills, with the exception of a substitution introduced on SB 75 and SB 53. See below for updates on each bill and come back next week for another round of updates.

For assistance navigating how these bills may affect you and your company, contact the Labor & Employment Group at Clyde Snow & Sessions at 801.322.2516.

Impactful Bills for Private Employers

HB 117 – Hourly Wage Increase Amendments
Sponsor: Rep. Lynn Hemingway (D-Millcreek)
This bill would increase the minimum wage to $10.25 starting July 1, 2018 and to $12.00 starting July 1, 2022. The Utah Labor Commission would be permitted to establish a separate minimum wage for minor employees under the age of 16 years old. The bill would still prohibit cities, towns, and counties from setting a minimum wage higher than this new amount, but sets the state minimum wage as the standard as opposed to the federal minimum wage, which is currently the standard. If passed, Utah would join 13 other states whose minimum wages exceed $10.00 per hour.

**Update: This bill has been assigned to the House Business Committee, but has not yet been considered.

HB 118 – Cash Wage Obligation Minimum for Tipped Employees
Sponsor: Rep. Lynn Hemingway (D-Millcreek)
This bill would increase the hourly rate for tipped employees from $2.13 per hour currently established by the Labor Commission to $3.25 per hour. The cash wage obligation would be statutory and the Labor Commission would no longer have the authority to set the amount.

**Update: This bill has been assigned to the House Business Committee, but has not yet been considered.

HB 30 – Utah Antidiscrimination Act Amendments
Sponsor: Rep. James Dunnigan (R-Taylorsville)
This bill makes changes to the Utah Antidiscrimination Act that (1) removes the Utah Antidiscrimination and Labor Division’s (UALD) power to hold a hearing when a complaint is received; (2) instructs the UALD to assign a mediator (as opposed to the previously-assigned investigator) to offer mediation services in an attempt to settle the case prior to an investigation; (3) allows for the UALD to attempt settlement between the parties; and (4) removes the ability of the complaining party to amend the allegations.

**Update: This bill has been circled in the House after its third reading. Essentially, this means the pause button has been pushed on this and it may be reconsidered at a later date.

SB 75 – Workers’ Compensation Penalty Amendments
Sponsor: Sen. Daniel Hemmert (R-Orem)
This bill provides for the Division of Industrial Accidents to reduce or waive entirely penalties imposed on employers who fail to procure workers’ compensation insurance.
The division could waive the penalty if the following are true: (1) the violation is the employer’s first violation; (2) the period of noncompliance was less than 180 days; (3) the employer has since remedied the noncompliance; (4) no employee reported an injury during the period of noncompliance; or (5) the employer is a corporation whose employees are all officers and who has become compliant.

The division could reduce the penalty if: (1) the violation is the employer’s first violation; (2) the employer has since remedied the noncompliance; (3) no employee reported an injury during the period of noncompliance; and (4) the employer, upon request from the division, submits its payroll records for the period of noncompliance. If a reduction of the penalty is granted, it shall be reduced by the “amount equal to the premium the employer would have paid for workers’ compensation insurance” based on the supplied payroll records.
Procedurally, the bill would require the division – as opposed to the current voluntary nature – to deliver a written notice of the noncompliance to the employer and, if necessary, issue an order requiring an employer to appear before the division and show cause why the employer should not be required to comply with workers’ compensation insurance laws.

**Update: Senator Hemmert introduced a substitute bill that is substantively the same regarding waiving or reducing the violations, but now requires that notice sent to the employer be done by either certified mail or personal service. The previous bill simply stated that the division must deliver the notice by certified mail.

HB 241 – Post-Employment Restrictions Amendments (new bill, introduced January 26, 2018)
Sponsor: Rep. Mike Schulz (R-Hooper)

This bill provides an amendment to the Post-Employment Restrictions Act (Utah Code §§ 34-51-102 and -201) to prohibit post-employment restrictive covenants for members of the media (newspapers, magazines, news agencies, radio stations, television stations, and television networks). During the 2016 legislative session, the Legislature passed a bill (HB 251, also sponsored by Rep. Schulz) that made it illegal for a post-employment restriction (e.g., non-compete provisions in employment contracts, but not including nondisclosure, nonsolicitation, or confidentiality provisions) to extend beyond one year from the last day of the employment. This bill would make illegal all non-compete provisions for employees of Utah’s media outlets.

This would affect only members of Utah’s media outlets, but if this carve-out is passed this year, it may signal future attempts to provide restrictive covenant prohibitions for other industries as well.

Impactful Bills Exclusively for Public Employers

HB 156 – Family Leave Amendments
Sponsor: Rep. Elizabeth Weight (D-West Valley City)
This bill would require executive branch agencies and higher education employers (including public universities) to provide six weeks of paid parental leave to any qualifying employee for the birth or adoption of a child. A “qualifying employee” is any male or female employee who has been employed for at least the preceding 12 months and worked at least 1,250 hours during that period.
During the 2016 session, Rep. Angela Romero (D-Salt Lake City) introduced a nearly-identical bill that did not pass. If passed, Utah would become one of only five states that provide paid parental leave for public employees (California, New Jersey, Rhode Island, and New York currently provide such leave). Though this bill will only impact public employees, if passed, it may signal a shift in the private sector as well toward paid family leave.

**Update: This bill has not yet been assigned to a House standing committee. It is still being held by the House Rules Committee, which decides if a bill ever sees the light of day.

HB 133 – Employment Amendments
Sponsor: Rep. Craig Hall (R-West Valley City)
HB 133 would expand the definition of “relative” to include romantic partners, making it so that the nepotism rules for public employees would extend to such partners. In determining what constitutes a romantic partner, the length and depth of the relationship, nature of the partners’ interactions, and affirmation of the relationship by the partners, among others, may be considered.

**Update: This bill has been assigned to the House Business Committee, but has not yet been considered.

SB 113 – Postretirement Reemployment Revisions (new bill, not yet introduced to Senate)
Sponsor: Sen. Jani Iwamoto (D-Holladay)– Employment Amendments

SB 113 would allow certain public service and firefighter retirees to be re-employed after a certain amount of time has passed since retirement. A retiree could be re-reemployed if the retiree: (1) does not receive certain benefits for the re-employment; and (2) is employed by a different employer than the one that employed them upon retirement. The bill requires the new employer to pay certain amounts for the re-employed retiree and requires the Utah State Retirement Office to report information to an interim legislative committee. An additional penalty for violating the statute’s provisions is to pay a delinquent retiree surcharge.

Bills With Changes You Won’t Notice

SB 40 – Workers’ Compensation Dependent Benefit Amendments
Sponsor: Sen. Karen Mayne (D-West Valley City)
This bill makes a small change to the weekly benefit provided to spouses and dependents from workers’ compensation. The weekly benefit per spouse or dependent would increase from $5 to $20.

**Update: This bill was assigned to the Senate Economic Development and Workforce Services Committee, where it was passed out favorably on a 4-0 vote (3 committee members were absent during the vote) and will now head to the Senate floor for debate.

SB 53 – Workers’ Compensation Coordination of Benefits Amendments
Sponsor: Sen. Karen Mayne (D-West Valley City)
SB 53 simply eliminates outdated language relating to dates of repeal within the statute. Two subsections were set for repeal on July 1, 2018, and this bill would merely eliminate such language.

**Update: This bill was assigned to the Senate Economic Development and Workforce Services Committee, where a substitute bill was introduced by Senator Mayne. The substitute is substantively the same, except that it now allows the health benefit plan to be a party in a benefits hearing. The committee passed the substitute bill out favorably on a 4-0 vote (3 committee members were absent during the vote) and will now head to the Senate floor for debate.

SB 64 – Workers’ Compensation Health Care Amendments
Sponsor: Sen. Karen Mayne (D-West Valley City)
As with SB 53, this bill merely eliminates outdated time language.

**Update: This bill has been assigned to the Senate Business Committee, but has not yet been considered.