2017 Utah Legislative Session Highlights

The 2017 Utah Legislative Session wrapped up March 9, 2017. Although there were a number of bills proposed during the session that would have directly impacted Utah employers, most failed to pass. The following is a list of bills that passed and which may have an impact on your business. These bills must still be signed by Gov. Gary Herbert to become effective.

HB 238: Payment of Wages Act Amendments

This bill comes in response to the Utah Supreme Court’s decision in Heaps v. Nuriche LLC (Utah 2015), in which the court held that directors and officers could not be individually liable for unpaid wages under the Utah Payment of Wages Act (UPWA). HB 238 adopts the Fair Labor Standards Act’s (FLSA) definition of employer, thereby ensuring that the Utah and federal standards are the same. Under the FLSA, a manager or officer of a company may be held liable for unpaid wages when certain conditions are met. Therefore, this change overrules the Utah Supreme Court decision and will allow for individual liability under UPWA. Additionally, the bill creates a private cause of action for wages under the UPWA. With this change, an aggrieved party now has the right to file an action in state court to recover for violations of the UPWA, whereas before, Utah courts held that no such right existed. Finally, this bill contains an exhaustion-of-remedies requirement. Specifically, it requires all claims equal to or less than $10,000 to be filed with the Utah Labor Commission. A claimant may, however, file directly in state court without exhausting the administrative remedies if: (a) the employee’s wage claim is over $10,000; (b) the employee’s wage claim is less than or equal to $10,000 and the employee asserts one or more additional claims against the same employer and the aggregate amount of damages resulting from the claims is greater than or equal to $10,000; or (c) multiple employees join in the same claim against the employer and the aggregate amount of the employees’ combined wage claim is greater than $10,000.

HB 156S01: State Job Application Process

HB 156S01 prohibits public employers from requiring an applicant to disclose past criminal convictions prior to an initial interview. For those familiar with the “ban-the-box” movements across the country, this is essentially a ban-the-box for public employers in Utah. Public employers will not, however, be prohibited from asking an applicant about the applicant’s past criminal history during or after the initial interview, or from considering the applicant’s conviction history when making a hiring decision.

Other Bills that Failed to Pass: There were a number of high-profile bills, such as HB 81 (Post-Employment Restrictive Covenant Amendments), HB 242 (Family and Medical Leave Amendments), and HB 213 (Workplace Discrimination Amendments) that were defeated. With regard to HB 81 (the non-compete bill), and in conjunction with the comprehensive research funded by both the Legislature and the Salt Lake Chamber, the Legislature concluded that there would be no further legislative action on the topic of non-compete agreements this session. Although these bills were defeated, they may very well be back on the table next year.

This is not intended to be an all-inclusive list of bills that may affect Utah employers. If you have questions about how these or other bills that the Utah State Legislature passed may affect your organization, contact your MSEC representative.