Littler Global Guide - Puerto Rico - Q3 2023

Browse through brief employment and labor law updates from around the globe. Contact a Littler attorney for more information or view our global locations.

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Puerto Rico Governor Amends Workers’ Compensation Act to Provide Reduction of Employee Premiums for Safe Workplaces

New Legislation Enacted

Author: Daniel Limés Rodríguez, Associate – Schuster LLC | Littler

On August 8, 2023, the Governor of Puerto Rico signed into law Act No. 85-2023, effective immediately. The statute amends Puerto Rico’s Workers’ Compensation Act by further incentivizing safe workplaces. Specifically, the statute provides a special 5% reduction in employee premiums for employers that, during the preceding two years, have not been subject to claims for workplace accidents or illnesses. Pursuant to the amendment, the additional reduction of employee premiums will be granted only once to the employer. Thus, employers should be aware of the possibility for obtaining an additional reduction in premium payments based on their ability to maintain accident/illness-free workplaces.

Informal Caregivers in Puerto Rico Do Not Need to Satisfy Threshold Requirements for Requesting Work Schedule Changes

New Legislation Enacted

Authors: Erika Berríos-Berríos, Capital Member, and Daniel Limés Rodríguez, Associate – Schuster LLC | Littler

Pursuant to the recently enacted Act No. 82 of August 8, 2023, employers in Puerto Rico must consider an informal caregiver’s request for a work-schedule change without meeting some of the threshold requirements required by law. Act No. 82, Puerto Rico’s Informal Caregiver Public Policy Act (ICPPA), purports to address the growing number of adults in need of care. To achieve this aim, the ICPPA establishes a public policy favoring informal caregivers and sets forth a bill of rights for the group.

Amendments to Act 54 on Domestic Violence Will Impact Employer Policies

New Legislation Enacted

Author: Daniel Limés Rodríguez, Associate – Schuster LLC | Littler

The governor of Puerto Rico recently signed into law amendments to Act No. 54 of August 15, 1989, “Act for the Prevention and Intervention with Domestic Violence.” The amendments include “economic violence” as a form of domestic violence and provide additional remedies for addressing this specific type of domestic violence. Economic violence, as defined by the statute, is conduct aimed at undermining the victim’s present or future financial capacity, economic stability or secure housing. Economic violence may be perpetrated through various means, and it may also include interference with a victim’s employment or business.

Under Puerto Rico law (Act No. 217-2006), employers must create and enforce a policy for addressing domestic violence in the workplace. To the extent that these amendments redefine the scope of domestic violence and its possible impact in the workplace, employers should start considering amending these policies in accordance with the amendments, while staying vigilant for any guidance issued by the Women’s Solicitor’s Office on this matter.

Supreme Court of Puerto Rico Rules PR-DOL Christmas Bonus Exemption Decree Was Inapplicable to Unionized Employees

Precedential Decision by Judiciary or Regulatory Agency

Author: Anabel Rodriguez-Alonso, Capital Member – Schuster LLC | Littler

On June 30, 2023, the Supreme Court of Puerto Rico issued an Opinion and Order interpreting an employer’s obligation to pay the Christmas Bonus to employees covered by a Collective Bargaining Agreement. Writing for the Court, Judge Rafael Martínez Torres reasoned that because the Puerto Rico Department of Labor and Human Resources exempted unionized employees from its decision to relieve an employer of its obligation to pay a Christmas Bonus for financial reasons, the employer could not escape its obligation to pay the negotiated bonus under the CBA to its unionized employees.

Will the FLSA Regulations for Exempt Employees Apply to Puerto Rico Operations?

Proposed Bill or Initiative

Author: Daniel Quiles Pumajero, Senior Attorney-at-Law – Schuster LLC | Littler

On August 30, 2023, the United States Department of Labor, Wage and Hour Division, released a Notice of Proposed Rulemaking (NPRM) to update and revise the regulations under the federal Fair Labor Standards Act regarding exemptions from minimum wage and overtime pay requirements for executive, administrative, professional, outside sales, and computer employees. The proposed revisions include a significant increase in the standard salary level triggering exemption for these categories of employees to $1,059 per week ($55,068 annually for a full-year worker) and also increases the highly compensated employee total annual compensation threshold to $143,988.

The agency is proposing that said increases also apply in the U.S territories, including Puerto Rico. In the particular case of Puerto Rico, it is important to note that the standard salary threshold has not changed since 2004 and currently stands at $455 per week. The last time the salary rule was revised in 2019, the agency elected to preserve the $455 per week amount for employees in Puerto Rico, Guam, the U.S. Virgin Islands, and the Commonwealth of the Northern Mariana Islands instead of applying the then-new and current standard salary level of $684 per week that applies to employees in the 50 states and the District of Columbia. Given the current state of affairs in Puerto Rico, employers with operations on the Island should continue to monitor developments since there is a possibility that the Financial Oversight and Management Board for Puerto Rico will recommend the exclusion of Puerto Rico from the Final Rule consistent with the objectives of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA), as has occurred in the past.

Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.