Brunini Law

Mississippi Environmental Quality Permit Board Summary of Meeting Held October 11, 2016

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The Mississippi Department of Environmental Quality Permit Board (Board) convened its regular monthly meeting at 9:00 a.m. on October 11, 2016 at the offices of the Mississippi Department of Environmental Quality in Jackson.  Mr. Mike Bograd, RPG, chaired the meeting.

The Board approved minutes from September meeting and the non-controversial actions/ certifications by the staff since the September meeting.

Following a prepared agenda, items considered were as follows:

OFFICE OF POLLUTION CONTROL

No items were on the agenda

OFFICE OF GEOLOGY

In accordance with MDEQ staff recommendations, the Board approved the following surface mining bond releases and permits to combine:

 Surface Mining Bond Release:

 

Permittee County Permit Staff Recommendation
P&P Sand and Gravel Marion P08-008AAA Final 40%
Oddee Smith Construction, Inc. Lincoln P01-028 Final 15%

Mississippi Lignite Mining Company

The Board approved a partial release of additional acreage based on the completion of required reclamation.  The applicant did not request or receive the release of any bond funds.

OTHER BUSINESS

Mr. Roy Furrh, MDEQ General Counsel advised the Board that Evidentiary Hearings have been scheduled for the November and December meeting pertaining to the following matters: issuance of a water quality certification and storm water coverage to Renaissance at Colony Park – Phase III (Costco), and issuance, modification and transfer of a water quality certification and other permits to Drying Facility Asset Holdings, LLC.

Following the Permit Board meeting, an evidentiary hearing was held to consider NPDES Permit No. MS0061751 regarding Mississippi Power Company, Kemper County.

The next Permit Board meeting will be held on November 8, 2016 at 9 a.m.

 

 

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New Version of Form I-9 Announced

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The U.S. Citizenship and Immigration Services (USCIS) recently announced the approval and pending release of an updated version of the Form I-9 – Employment Eligibility Verification (Form I-9).  USCIS currently plans to release the new version of the Form I-9 on Tuesday, November 22, 2016.  Once released, the updated Form I-9 is scheduled to have an expiration date of August 31, 2019.

USCIS also announced that U.S. employers are allowed to continue using the current Form I-9 version (Rev. 03/08/2013) until Saturday, January 21, 2017.  Starting January 22nd, it and all prior versions expire and will no longer be valid.  This extension is great news for employers—in 2013, USCIS only provided employers with less than two months between introduction of the updated form and expiration of the old version.

Changes in the Updated Version

While it has yet to be released to the public, USCIS has given employers a preview of the changes they can expect when the updated version of the Form I-9 is released.  The proposed changes to be included in the updated version strive to make the Form I-9 more “e-friendly” and less confusing for employers, with the inclusion of “smart, error-checking features.”  When released, the updated Form I-9 will be a “smart PDF” form—meaning employers will be able to access and complete the form on their computers via Adobe Acrobat.  With this new fillable PDF, employers will have access to features such as:

  • Validation assistance in certain fields, to ensure information is entered correctly. (For example, the revised form will validate the correct number of digits for a Social Security number or an expiration date on an identity document.)
  • Drop-down lists and calendars.
  • Embedded instructions for completing each field.
  • Buttons that will allow users to access the instructions electronically, print the form, and clear the form to start over.

While employers can complete the updated version of the Form I-9 on their computers, it will not be a fully electronic document.  After populating the fields, employers will still need to print the PDF form, obtain handwritten signatures, store the hard copies in a safe place, monitor reverifications and updates with a calendaring system, and retype information into E-Verify as required.

The updated version will also feature several structural changes and instructions which will be important for all employers to know and learn, including:

  • Additional spaces to enter multiple preparers and translators.
  • The requirement that workers provide only other last names used in Section 1, rather than all other names used.
  • The removal of the requirement that immigrants authorized to work provide both their Form I-94 number and foreign passport information in Section 1.
  • A new “Citizenship/Immigration Status” field at the top of section 2.
  • A dedicated area to enter additional information that employers are currently required to notate in the margins of the form (i.e., Temporary Protected Status; Optional Practical Training extensions; etc.)
  • A quick-response matrix barcode, or QR code, that generates once the form is printed that can be used to streamline enforcement audits.
  • Instruction sheet completely separate from the Form I-9 itself (though employers will still be required to present the instructions to the employee completing the form).

A major goal of the updated version of the Form I-9 is to clarify frequent points of confusion that arise for both employees and employers-specifically focusing on helping employers reduce technical errors for which they may be fined.

If you have any questions concerning your organizations’ Form I-9 compliance, or E-Verify compliance, feel free to contact us for further guidance.

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Mississippi Environmental Quality Permit Board Summary of Meeting Held September 13, 2016

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Prepared By Brunini, Grantham, Grower & Hewes, PLLC

The Mississippi Department of Environmental Quality Permit Board (Board) convened its regular monthly meeting at 9:00 a.m. on September 13, 2016 at the offices of the Mississippi Department of Environmental Quality in Jackson.  Mr. Mike Bograd, RPG, chaired the meeting.

The Board approved minutes from August meeting and the non-controversial actions/ certifications by the staff since the August meeting.

Following a prepared agenda, items considered were as follows:

OFFICE OF POLLUTION CONTROL

Municipal & Private Facilities

Meridian POTW – Lauderdale County – MS0020117

The Board denied the request by one individual for a public hearing to be held in Meridian (rather than at the MDEQ offices).  This individual was advised of the time date and location of this Permit Board hearing and did not attend.

Further, the Board approved the reissuance of the NPDES Permit.  One letter of concern was submitted; however staff noted that the permit was drafted within the limits and meets all federal and state laws and regulations.  No one in opposition was in attendance.

Agricultural Branch

The Board approved issuance of coverage under the AFO General Permit (MSG201887) and issuance of construction under the Storm Water Coverage (MSR107212) for Wegner Farms in Noxubee County.  The application proposes four poultry houses and construction activity on seven acres of disturbed land.  Staff stated that upon notification by the Applicant, three neighboring property owners submitted letters of concern; however, they did not attend the meeting.  Because the facility’s application is complete and the Applicant is in compliance, MDEQ staff recommended issuance of the Permit.

OFFICE OF GEOLOGY

In accordance with MDEQ staff recommendations, the Board approved the following surface mining bond releases and permits to combine:

 Surface Mining Bond Release:

 

Permittee County Permit Staff Recommendation
James Construction Group, LLC Hinds P14-005A Initial 50%
Krystal Gravel, Inc. Copiah P13-002 Additional 50%
Martin Meadowlands, LLC Madison P10-041AA Initial 90%
Joe McGee Construction Co., Inc. Clarke P12-008 Initial 90%
Joe McGee Construction Co., Inc. Winston P13-015 Additional 50%
Memphis Stone & Gravel Company DeSoto P03-033 Final 10%
Oddee Smith & Sons, Inc. Lincoln P95-091 Final 10%
Talbot Bros. Constr. Co. and Talbot

Bros. Grading Co.

 Grenada Pll-012 Initial 10%

Surface Mining Permit to Rescind:

Permittee County Permit
Eutaw Construction Company, Inc. Madison P1S-007

OFFICE OF LAND AND WATER RESOURCES

The Board approved the Proposed 2016 General Permit for Mississippi River Valley Alluvial Aquifer (MRVA) Groundwater Withdrawals.  The proposed 5-year permit is for irrigation, aquaculture and wildlife habitat enhancement.  A hearing was held on April 21, 2016 with comments accepted until May 21, 2016.  Modifications to the permit were made and incorporated per the comments.

OTHER BUSINESS

Mr. Roy Furrh, MDEQ General Counsel advised the Board Evidentiary Hearings have been scheduled for the next three permit Board Meetings and that each hearing should be completed in less than a day.

The next Permit Board meeting will be held on October 11, 2016 at 9 a.m.

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Over 20 States and 50 Business Groups File Suit Seeking to Block Enforcement of New Overtime Rule

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With less than 75 days before the U.S. Department of Labor’s (DOL) New Overtime Rules are scheduled to go into full effect (click here for a summary), two separate federal court lawsuits were recently filed challenging the legality of DOL’s proposed changes.  On September 21, 2016, a group of 21 states (lead by Texas and Nevada) sued the DOL, seeking to enjoin and ultimatelystrike the New Overtime Rule.  On the same day, several nationwide business groups and trade organizations filed a second lawsuit against the DOL concerning the controversial New Overtime Rule, which is slated to take effect on December 1, 2016.

In the first lawsuit (Nevada et al. v. U.S. Department of Labor et al., No. 1:16-cv-407, Eastern District of Texas), the 21 states argue that the New Overtime Rule—which raised the minimum salary threshold required to qualify for the Fair Labor Standards Act’s (FLSA) “white collar” overtime exemption to $47,476 per year—is unconstitutional on numerous grounds.  Specifically, the States argue that DOL overstepped its authority by imposing a salary requirement as the primary basis for determining exemption eligibility, instead of focusing on the bona fide job duties of an employee.  Similarly, the States claim that the FLSA’s statutory language does not permit the inclusion of the New Rule’s “automatic increase” provision.   Additionally, the States argue that by forcing them to comply with the New Rule, the Obama administration would unilaterally deplete individual states of their financial resources, in violation of the Tenth Amendment.

Joining Texas and Nevada in the lawsuit are Alabama, Arizona, Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Mississippi, Nebraska, New Mexico, Ohio, Oklahoma, South Carolina, Utah and Wisconsin.  The States’ lawsuit seeks both declaratory and injunctive relief—meaning that the states are asking the Court to enter a temporary order blocking the New Rule’s scheduled enforcement on December 1st, as well as a permanent judgment declaring the New Overtime Rule illegal.

In the second lawsuit (Plano Chamber of Commerce, et al. v. U.S. Department of Labor, et. al., No. 4:16-cv-00732, Eastern District of Texas), the U.S. Chamber of Commerce, along with over 50 other national business organizations, claims that the DOL exceeded its statutory authority under federal law in enacting key provisions of the New Overtime Rule, including the minimum salary threshold and the automatic increase provision.  Like the States, the Chamber of Commerce’s lawsuit seeks both declaratory and injunctive relief.

Both suits contend that, if implemented, the New Overtime Rule would require state governments, local municipalities, and private businesses alike to substantially increase their employment costs to the point that employers may ultimately be forced to either reduce services or lay off workers.  “Once again, President Obama is trying to unilaterally rewrite the law,” Texas Attorney General Ken Paxton said in a statement. “And this time, it may lead to disastrous consequences for our economy. The numerous crippling federal regulations that the Obama administration has imposed on businesses in this country have been bad enough. But to pass a rule like this, all in service of a radical leftist political agenda, is inexcusable.”

“The DOL went too far in the new overtime regulation,” said Randy Johnson, senior vice president of Labor, Immigration, and Employee Benefits for the U.S. Chamber. “We have heard from our members, small businesses, nonprofits, and other employers that the salary threshold is going to result in significant new labor costs and cause many disruptions in how work gets done. Furthermore, the automatic escalator provision means that employers will have to go through their reclassification analysis every three years. In combination, the new overtime rule will result in salaried professional employees being converted to hourly wages, and it will reduce workplace flexibility, remote electronic access to work, and opportunities for career advancement.”

The DOL did not immediately comment on the lawsuit, though it previously expressed confidence in the legality of the New Rule.

Experts predicted that the New Overtime Rule would face some type of legal challenge before its implementation at the end of this year.  However, not everyone agrees that the DOL exceeded its authority in enacting the regulations.  Many feel these challenges to the legality of New Overtime Rule are long-shots at best—with most feeling that the challenges to the automatic increase provision have the greatest likelihood of success.

While it is possible the federal court could enter an order staying the implementation of the New Overtime Rule, at this time, employers are best served to continue preparing as if the New Rule will go into effect on December 1st.

 

 

 

 

 

 

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84 Days and Counting – Is Your Company Prepared for the New Overtime Rule?

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By now, I’m sure everyone is aware of (or at least heard of) the U.S. Department of Labor’s upcoming changes to the Overtime Rules contained in the Fair Labor Standards Act (FLSA).  Brunini’s Labor & Employment Newsletter Subscribers have received numerous updates over the past year, alerting them to the pending change and its potential implications:

Knowing about the upcoming change is one thing – being prepared for the change is something else altogether.  The New Rule is scheduled to go into effect on December 1, 2016.  That’s just 84 days from today.  Has your organization taken the steps to be in compliance with the New Rule when it goes into effect?

Brunini’s Labor & Employment Practice Group has prepared an article outlining practical considerations for employers to consider and implement in order to prepare for and comply with the New Rule.  You can access this article here: Ways to Prepare for the New Expanded Employee Overtime Eligibility.

Our professionals are available to discuss your organization’s current structure, as well as any steps needed to insure compliance with the ever-changing legal landscape facing employers.  Contact any one of our Labor & Employment Practice Group professionals with any questions concerning the upcoming transition.

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Mississippi Environmental Quality Permit Board Summary of Meeting Held August 9, 2016

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The Mississippi Department of Environmental Quality Permit Board (Board) convened its regular monthly meeting at 9:00 a.m. on August 9, 2016, at the offices of the Mississippi Department of Environmental Quality, in Jackson.  Mr. Mike Bograd, RPG, chaired the meeting.

The Board approved minutes from the Regular July meeting. Also, the Board approved non-controversial actions/certifications by the staff since the July meeting and incorporated the reports of these actions into the July minutes.

Following a prepared agenda, items considered were as follows:

OFFICE OF GEOLOGY

In accordance with MDEQ staff recommendations, the Board approved the following surface mining bond releases and rescinded the following surface mining permits:

Surface Mining Bond Releases

Permittee County Permit Staff Recommendation
Eutaw Construction Company, Inc. Pontotoc P12-017 Final 30% release
Eutaw Construction Company, Inc. Rankin P12-020 Final 50% release
Eutaw Construction Company, Inc. Clay P13-022 Additional 30% release
Eutaw Construction Company, Inc. Madison P15-007 Initial 40% release
Jim Grotkowski Harrison P98-055T Final 50% release
Joe McGee Construction Co., Inc. Madison P11-024 No release
C. Steve Lee Hancock P07-012 Final 20% release

Surface Mining Permits to Rescind

Permittee County Permit Staff Recommendation
South Byram Properties, LLC Hinds P06-009 Rescind Permit
W.P. Properties, LLC Hinds P03-025T Rescind Permit

OFFICE OF POLLUTION CONTROL

 

The Board approved a Modification of Section 401 Water Quality Certification (No. WQC 2012071) for Drying Facility Assets Holding, LLC, Picayune Frac Plant, located in Pearl River County, MS. The modification will alter permittee’s mitigation plan to allow for off-site mitigation, rather than on-site. MDEQ staff took no position on whether the Board should grant the proposed modification. The Modification was approved on the condition that the wetlands designated for enhancement and restoration are left within the perpetual conservation easement.

OTHER BUSINESS

Mr. Roy Furrh, MDEQ General Counsel, advised the Board that due to legislation, passed in the 2016 Regular Session of the Mississippi Legislature, that places fees collected by state agencies into the state’s general fund, the Office of the Attorney General would no longer be able to provide hearing officers to MDEQ. Mr. Furrh stated that a list of former assistant attorneys general and private practitioners was being compiled to serve as hearing officers.

The next Permit Board meeting will be held on September 13, 2016, at 9 a.m.

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Three Takeaways from the Recent Settlement in CFPB v. BancorpSouth

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There were many things from the recent settlement of Fair Lending and Fair Housing Claims against BancorpSouth that didn’t surprised me (see United States of American and Consumer Financial Protection Bureau v. BancorpSouth Bank, Case No. 1:16cv118-GHD-DAS, U.S. District Court for the Northern District of Mississippi, Aberdeen Division).  I was not surprised that BancorpSouth settled a Fair Lending investigation since it had been fairly well known that the bank was undergoing an investigation that had put on hold its regulatory applications for two planned bank acquisitions.  I also was not surprised that a Mississippi bank was the subject of such an investigation since Federal regulators have long utilized Mississippi’s tortuous and inescapable past as a reason to plow its fertile ground and harvest a rich political yield in the form Fair Lending investigations.  This regulatory tendency has existed at least a decade, going back to when the FDIC started sending Mississippi banks nasty letters about their HMDA data.  There were three big points worth noting, though, some of which were concepts I already knew but had reinforced by the settlement.  Others, however, were eye-opening revelations.  Below is a description of each.

  1. HMDA Data Matters

I have never represented BancorpSouth on this or any other matter so I don’t have any knowledge of how this investigation began or what exactly triggered it.  However, by reading through the lines in the complaint, there are too many references to “regression analysis,” “statistically significant” rate differentials, and the Memphis MSA to not think that it may have begun as a review of the bank’s HMDA data from Memphis.  That is just a guess, but based on prior experience, it seems to be a good one.  The way these things typically play out, the Feds, after sticking their statistics geeks in the corner with a bank’s HMDA data, find that there are statically significant differentials as to interest rates charged or denial rates for minority borrowers relative to non-minority borrowers.

Their questions start out benign at first, asking whether these differentials can be explained by business non-discriminatory reasons.  What they are looking for is for you to provide them a rate sheet, loan policy, or some other objective measure that shows why the mortgage borrowers were charged a certain rate on a certain loan or why a minority borrower was denied credit.  If they select a sample of loans and find that the rates charged followed closely a standard rate sheet used to price mortgage loans, or if denials of minority applications were the result of the applicant clearly not meeting objective credit standards stipulated in their loan policies, and those factors were carefully documented in the file as the reason for the decision made by the loan officer, the regulators will conclude (hopefully) that the “statistically significant” differences were caused by other non-discriminatory factors and move on to their next prey, I mean bank.  However, if they take a sample to test, and in the process cannot find any objective reason for why minority borrowers would be treated differently, the bank that is the object of the investigation had better hold on; it is going to be a bumpy ride!  This leads me to my second point . . .

  1. Underwriting Discretion is the Fair Lending Death Nail

I am the son of a community banker.  Like all of us, I remember asking my dad one time when I was small why he decided to pick his career.  His dad became a banker later in life, and both of my dad’s older brothers are bankers, so his choice was not a novel one.  Family influence, though, was not the reason he gave.  Instead, my dad believed that, as a community banker, he had the opportunity to help people meet the needs of their businesses and families.  Of course, one of the greatest tools a community banker has in his or her toolbox to pursue this divine calling is good common sense to exercise reasonable discretion when warranted.  Not only does it assist the community banker in pulling that customer out of a tough financial place in life, it also allows the community banker to compete with larger, less flexible institutions that have a tremendous advantage when it comes to economies of scale, especially in today’s compliance environment.

That tool now, though, has become the regulator’s number one enemy.  When it comes to Fair Lending, discretion is a four letter word, especially as to HMDA reportable loans.  If your bank’s LAR reveals that rates paid by minority borrowers or women are slightly higher on average than the control group, and they discover that your loan officers have the discretion to assign to borrowers whatever rates they, in their professional opinion, deem appropriate, your bank is presumed to be guilty of discriminating against minority borrowers until you somehow prove yourself innocent.  This all but forces banks to standardize their pricing and credit decisions, turning consumer credit into a commodity and erasing any competitive advantage community banks may have on such loans over their larger brethren that see the borrower as another number.  Unfortunately, what regulators don’t realize is that the one who really suffers is the borrower, black or white, who just needs a break to get over that next financial hurdle.  After all, you don’t receive any compassion from a loan policy or a rate sheet.

  1. The CFPB is Taking No Prisoners

I’m sure no one was shocked that the CFPB would aggressively pursue fair lending enforcement, especially among those banks that are larger than $10 billion in assets and within the wheelhouse of their examination authority.  There is a reason why that threshold was a big deal during the Dodd-Frank negotiations.  I was flabbergasted, though, by the lengths they went to in order to satisfy their appetite for a trophy kill.  Secret recordings of lower level management meetings and spies sent into branches in markets totally unrelated to where the original problems were found are just two examples of that.  This was not a regulatory investigation; it was a James Bond novel.  Apparently, the CFPB has inherited the playbook of the KGB.

Not only that, but in a settlement that was supposedly negotiated, they felt compelled to include in the complaint unnecessary and embarrassing quotes from their secret recordings just to rub salt in the wound.  I can only hope that waterboarding was not used to convince the bank to accept the complaint’s content.

Make no mistake, the CFPB is on a war path, and it is scalps, not justice, that it is after.  As an agency that is still trying to prove its worth and fend off political and judicial challenges to its constitutionality and unfettered administrative authority, the CFPB is more worried about justifying its existence than protecting its charge, the American consumer.  What will happen to American consumers, though, much less our financial system, when the CFPB scares half of our community banks into ending consumer lending all together and assaults the reputation of the other half until their safety and soundness is compromised?  They will be forced into the arms of industries much less regulated and unconcerned about their wellbeing, I’m sure.  This case may be the best illustration yet of what happens when you separate the consumer regulator from the prudential one.

 

 

 

OSHA Delays Proposed Injury and Illness Reporting Rule

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On July 13, 2016, the Occupational Safety and Health Administration (OSHA) announced a delay of  the implementation of its recently published Rule that amends requirements for reporting workplace injuries and illnesses.  The goal of the new Rule, originally scheduled to go into effect August 10, 2016, is to promote an employee’s right to report such injuries and illnesses without fear of retaliation.  Because it felt that post-accident drug testing rules were being used by employers to limit reporting of workplace accidents, OSHA also attempted to place restrictions on the use of drug and alcohol tests in the workplace.

Under the Proposed Rule, employers must electronically submit all work-related illness and injury records directly to OSHA, which, according to the Secretary of Labor, will be available to the public, with the exception of personally identifiable information.

OSHA’s announced delay came one day after the Manufacturers Center for Legal Action (MCLA) filed an action in the United States Federal District Court for the Northern District of Texas to enjoin the implementation of the Rule. In its Emergency Motion for Preliminary Injunction, the MCLA alleged the new Rule is contrary to and exceeds OSHA’s statutory authority and is “arbitrary, capricious and not in accordance with applicable law.” This follows a recent hearing before the U.S. House of Representatives’ Subcommittee on Workforce Protections, in which many employers expressed concerns over the Rule’s likely impact.

OSHA announced that it will not enforce the new Rule until November 1, 2016, allowing time “to conduct additional outreach and provide educational materials and guidance for employers.” However, the MCLA legal action remains active, and the District Court might address the matter prior to November 1.

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Mississippi Environmental Quality Permit Board Summary of Meeting Held July 12, 2016

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Prepared By Brunini, Grantham, Grower & Hewes, PLLC

The Mississippi Department of Environmental Quality Permit Board (Board) convened its regular monthly meeting at 9:00 a.m. on July 12, 2016 at the offices of the Mississippi Department of Environmental Quality in Jackson.  Mr. Mike Bograd, RPG, chaired the meeting.

The Board approved minutes from both the Regular and Special June meetings. Also the Board approved non-controversial actions/certifications by the staff since the May meeting.

Following a prepared agenda, items considered were as follows:

OFFICE OF GEOLOGY

In accordance with MDEQ staff recommendations, the Board approved the following surface mining bond releases and permits to combine:

Surface Mining Bond Release:

Permittee County Permit Staff Recommendation
Neely Trucking and Excavating Rankin P05-019AT No Additional Release
Dunn Roadbuilders LLC Forrest P06-14 Additional 30% Release

Surface Mining Permits to Combine:

Permittee County Permit
Business Properties, LLC Harrison P80-022T
S&B Industrial Minerals North America, Inc. Monroe P99-040T

OFFICE OF POLLUTION CONTROL

Agricultural Branch:

The Board approved issuance of coverage under the AFO General Permit (MSG201874) and issuance of construction under the Storm Water Coverage (MSR107157) for Penny Farm in Lincoln County.  The application proposes eight poultry houses and construction activity on thirteen acres of disturbed land.  Staff stated that upon notification by the Applicant, three neighboring property owners submitted letters of concern; however, they did not attend the meeting.  Because the facility’s application is complete and the Applicant is in compliance, MDEQ staff recommended issuance of the Permit.

Solid Waste and Mining Branch:

The Board approved re-issuance of the Pretreatment Permit (MSP092258) for Waste Management of MS, Inc., Plantation Oaks Landfill and Recycling Center and Natchez Hauling in Adams County.  Staff noted that there are no changes to the existing permit.  A public hearing was held and no one was in opposition.  Based on staff recommendation, the Board approved reissuance of the permit.

OTHER BUSINESS

Mr. Roy Furrh, MDEQ General Counsel advised the Board that the request for an evidentiary hearing on July 12, 2016 regarding the Starlanding Rubbish Site has been withdrawn and the prior decision is final.

Mr. Roy Furrh, MDEQ General Counsel advised the Board that there will be a hearing on August 9, 2016 regarding the Permit Modification for Drying Facility Asset Holdings.

The next Permit Board meeting will be held on August 9, 2016 at 9 a.m.

This Newsletter is a publication of the Environmental Department of the law firm of Brunini, Grantham, Grower & Hewes located in Jackson, Mississippi. This Newsletter is not designed or intended to provide legal or professional advice, as any such advice requires the consideration of the facts of the specific situation.

 

 

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Department of Labor Announces Increase in Wage & Hour Penalties for Employers

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When it comes to wage and hour issues, most U.S. employers are focused on preparing for the Department of Labor’s (DOL) much-debated New Overtime Rule that is set to go into effect on December 1, 2016.  Most notably, under the New Overtime Rule, the requisite salary level for exempt employees jumps from $23,660 annually (or $455/week) to $47,476 ($913 per week).  However, the federal agency has not closed up shop for the year.

On June 30, 2016, the DOL announced  an increase in the dollar value of the civil penalties that that agency assesses to employers for certain violations of the minimum wage and overtime provisions of the Fair Labor Standards Act.  Deemed an “interim adjustment,” pursuant to the 2015 Federal Civil Penalties Inflation Adjustment Act, the DOL’s Wage and Hour Division will increase the civil penalty assessed for “willful violations” from $1,100 to $1,894 per violation.

The DOL’s regulations define a “willful” violation of the minimum wage and overtime provisions as one in which the employer either knew that its conduct was prohibited by law, or showed a “reckless disregard” for the requirements of the law.  While there is no bright-line test on what qualifies as a willful violation, in 2015, the Fifth Circuit Court of Appeals ruled that an employer committed a willful violation of the FLSA by failing to keep adequate records of extended hours worked by an employee.  See Ramos v. Al-Bataineh, 5th Cir., No. 13-20749 (March 30, 2015).

The DOL’s proposed increase represents a 73% jump in the value of assessed penalties—on a per violation basis.  Importantly, the DOL assesses this penalty in addition to any actual back wages owed to the employee(s).  Plus, section 16(a) of the FLSA authorizes criminal sanctions against any person who is shown to have violated the FLSA intentionally, deliberately, and voluntarily, or with reckless indifference to or disregard for the law’s requirements.

 

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