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Maryland General Assembly Employment Legislation Update

April 30, 2014

During the Maryland General Assembly session that ended in April 2014, Shawe Rosenthal lawyers again worked with the Maryland Chamber of Commerce to oppose or moderate legislation affecting employers.  Several employment bills were passed and have been or are expected to be signed by the Governor.  

  • Maryland Minimum Wage Act of 2014.  The state hourly minimum wage will be increased in stages over the next four years from the current (federal) rate of $7.25 to $10.10.  On January 1, 2015, the minimum wage will increase to $8.00.  On July 1, 2015, it will increase to $8.25, and then to $8.75 on July 1, 2016.  It will rise to $9.25 on July 1, 2017, and finally to $10.10 on July 1, 2018.  The law also establishes a six-month training wage for employees under the age of 20 at 85% of the minimum wage.  With regard to tipped employees, employers must pay a base rate of $3.63 per hour and are required to make up any difference if there is a shortfall in tips up to the minimum wage.  If there has been a violation of the law, in addition to recovering the difference between the wage paid and the wage required by law, as well as attorney’s fees, the employee may now also recover liquidated damages in an amount equal to the wage shortfall, unless the employer can show that it acted in good faith and reasonably believed it was in compliance with the law.

The Act also provides for an annual 3.5% rate increase in each of the next four years for State-funded community providers serving individuals  with developmental disabilities.  The rate increase is intended to address the impact of the increase in the State minimum wage on the wages and benefits of direct care employees of these community providers.

  • Parental Leave Act.  This legislation extends the obligation to provide up to six weeks of unpaid leave for the birth, adoption or foster care placement of a child to employers with 15-49 employees. (Employers with 50 or more employees are already required to provide up to twelve weeks of unpaid leave for this purpose under the federal Family and Medical Leave Act).  The Commissioner of Labor and Industry will issue regulations implementing this law.  The key provisions of this law, which takes effect on October 1, 2014, are:
    • In order to be eligible for such leave, the employee must have been employed for at least 12 months and have worked at least 1,250 hours in the previous 12-month period. 
    • The employer may deny parental leave if “necessary to prevent substantial and grievous economic injury to the operations of the employer,” as long as the notice of the denial is provided before the leave starts. 
    • If the employee has accrued paid leave, the employer can require, or the employee can choose, substitution of the paid leave for part or all of the unpaid parental leave.
    • The employer can require 30-days written notice of the need for leave, with the exception of situations involving a premature birth, or an unexpected adoption or foster case placement.
    • Upon returning from parental leave, the employee is entitled to reinstatement to his/her former job position or an equivalent one, unless reinstatement would cause “substantial and grievous economic injury to the operations of the employer,” or the employee is terminated for cause during the leave period.
    • Health care coverage must be maintained by the employer during the leave period.  If the employee fails to return from leave for reasons within his/her control, the employer may recover the premium it paid for such coverage during the leave period.    
    • If the Commissioner determines there has been a violation of this law, the Commissioner can try to resolve the matter by mediation or ask the Attorney General to bring suit on behalf of the employee.  In addition, the employee can bring his or her own lawsuit against the employer to recover economic damages and attorney’s fees and costs.
    • An employer may not discharge or otherwise discriminate against an employee for exercising rights under this law, including taking leave or making a complaint.
    • If a collective bargaining agreement provides greater rights, those rights must be given effect.  Such an agreement cannot provide fewer rights than the law, however.
  • Fairness for All Marylanders Act of 2014.  The state anti-discrimination law was amended to include gender identity as a protected characteristic.  Gender identity is defined as “the gender-related identity, appearance, expression or behavior of a person, regardless of the person’s assigned sex at birth.”  Thus, employers (other than those subject to a religious exemption) may not discriminate against their employees on the basis of gender identity.  The law permits an employer to establish reasonable dress and grooming standards related to the nature of employment, but the employee must be permitted to dress consistent with his/her gender identity.
  • Decriminalization of Marijuana.  This legislation, which takes effect on October 1, 2014, decriminalizes the possession of less than 10 grams of marijuana, and instead makes it a civil offense subject to a fine and a possible referral to substance abuse education, assessment, and/or treatment.  It is important to understand that this law does not legalize the possession of these limited amounts of marijuana – it is still illegal, but offenders will no longer be subject to criminal prosecution or imprisonment, and violations are not criminal convictions.  For employers, the law does not affect their ability to enforce drug-free and drug-testing policies in the workplace.
  • Enforcement of Local Minimum Wage Laws.  As discussed in our January E-update, Montgomery and Prince Georges Counties recently passed ordinances increasing the minimum wage that must be paid by county employers.  The bill grants the Commissioner the authority to enforce such local minimum wage laws.  Once signed, this law will take effect on June 1, 2014.
  • Work Permits for Minors.  The law governing the issuance of work permits for minors was amended to permit parents or guardians to apply online for a work permit for a minor, and to allow the Commissioner of Labor and Industry to issue work permits in accordance with the law.  This bill was signed into law by the Governor on April 8, 2014, and will take effect on October 1, 2014.