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RSJ/SWENSON QUARTERLY NEWSLETTER
HUMAN RESOURCES AND MANAGEMENT NEWS
July 2009
July 2009Top Costly Workplace Mistakes To Avoid This Year
1.New employer costs for COBRA. Requires every employer to advance 65% of COBRA premiums (for 9 months) for employees who are involuntarily terminated without cause from September 1, 2008 through December 31, 2009. Employers eventually reimbursed through payroll tax offsets.
New employer costs for COBRA. Requires every employer to advance 65% of COBRA premiums (for 9 months) for employees who are involuntarily terminated without cause from September 1, 2008 through December 31, 2009. Employers eventually reimbursed through payroll tax offsets. 2.New leave of absence obligations under Family and Medical Leave Act. Requires employers administering FMLA leave to give employees new additional written notices. Applies to employers with 50 plus employees in a 75 mile radius. Avoid This Mistake: Failing to revise employee handbook and leave policies to comply with the new FMLA regulations; failing to provide special notices to employees requesting FMLA leave. Adverse Consequences: Liability for lost compensation and benefits and additional leave; failure to give new written notices opens employer to federal lawsuit.
New leave of absence obligations under Family and Medical Leave Act. Requires employers administering FMLA leave to give employees new additional written notices. Applies to employers with 50 plus employees in a 75 mile radius. Avoid This Mistake: Failing to revise employee handbook and leave policies to comply with the new FMLA regulations; failing to provide special notices to employees requesting FMLA leave. Adverse Consequences: Liability for lost compensation and benefits and additional leave; failure to give new written notices opens employer to federal lawsuit. 3.New disabled employee obligations under Americans With Disabilities Act. Redefines "disabled" to include conditions that can be relieved by drugs or medical devices. Avoid This Mistake: Assuming that employee taking medication for physical or mental condition is not disabled; assuming that relatively minor ailments fall outside the protections of federal law. Adverse Consequences: Refusal to make reasonable accommodations for new conditions qualifying as disabilities opens employer to federal lawsuit.
New disabled employee obligations under Americans With Disabilities Act. Redefines "disabled" to include conditions that can be relieved by drugs or medical devices. Avoid This Mistake: Assuming that employee taking medication for physical or mental condition is not disabled; assuming that relatively minor ailments fall outside the protections of federal law. Adverse Consequences: Refusal to make reasonable accommodations for new conditions qualifying as disabilities opens employer to federal lawsuit. 4.More lawsuits challenging employee pay and/or terminations. A recent decision by the U.S. Supreme Court makes it easier for employees to claim their employer retaliated against them in violation of federal civil rights laws. Additionally, a recently enacted law gives employees more time to file a lawsuit claiming pay discrimination. Avoid This Mistake: Failing to have written legitimate, nondiscriminatory business reasons justifying adverse actions taken against employees (such as demotion, discharge, etc.) and any pay discrepancies between male and female employees performing the same jobs. Adverse Consequences: Employers may be sued in federal court. A successful plaintiff's recovery may be significant and can include lost back pay and benefits, front pay or reinstatement, compensatory and punitive damages and the plaintiff's attorney fees.
More lawsuits challenging employee pay and/or terminations. A recent decision by the U.S. Supreme Court makes it easier for employees to claim their employer retaliated against them in violation of federal civil rights laws. Additionally, a recently enacted law gives employees more time to file a lawsuit claiming pay discrimination. Avoid This Mistake: Failing to have written legitimate, nondiscriminatory business reasons justifying adverse actions taken against employees (such as demotion, discharge, etc.) and any pay discrepancies between male and female employees performing the same jobs. Adverse Consequences: Employers may be sued in federal court. A successful plaintiff's recovery may be significant and can include lost back pay and benefits, front pay or reinstatement, compensatory and punitive damages and the plaintiff's attorney fees.5.Fewer independent contractors and more IRS scrutiny? The federal Independent Contractor Proper Classification Act will enable workers to request an IRS determination on their independent contractor status and open employers to tax and other liabilities, penalties, and interest. Avoid This Mistake: Failing to audit your independent contractor relationships for compliance with the IRS test. Adverse Consequences: Retroactive liability on employers for taxes, employee benefits and statutory insurance.
Fewer independent contractors and more IRS scrutiny? The federal Independent Contractor Proper Classification Act will enable workers to request an IRS determination on their independent contractor status and open employers to tax and other liabilities, penalties, and interest. Avoid This Mistake: Failing to audit your independent contractor relationships for compliance with the IRS test. Adverse Consequences: Retroactive liability on employers for taxes, employee benefits and statutory insurance. DFEH Reports Rise in Employee Complaints
The California Department of Fair Employment and Housing (DFEH) recently issued its 2008 Annual Report, noting a 15 percent increase in employee complaints over the previous year.
The DFEH is the state agency responsible for enforcing California law prohibiting employment discrimination, harassment, and retaliation. Before an employee can file a lawsuit, he or she must first file a complaint with the DFEH, which either investigates and prosecutes the compliant itself, or authorizes the employee to proceed with a private attorney. As a result, the DFEH is in a unique position to closely track the kinds of complaints employees are making.
The California Department of Fair Employment and Housing (DFEH) recently issued its 2008 Annual Report, noting a 15 percent increase in employee complaints over the previous year.
The DFEH is the state agency responsible for enforcing California law prohibiting employment discrimination, harassment, and retaliation. Before an employee can file a lawsuit, he or she must first file a complaint with the DFEH, which either investigates and prosecutes the compliant itself, or authorizes the employee to proceed with a private attorney. As a result, the DFEH is in a unique position to closely track the kinds of complaints employees are making.
If You Accept Stimulus Funds, Prepare For Major Whistleblower Issues
Buried within the American Recovery and Reinvestment Act of 2009 (ARRA) is a provision that provides broad protections for whistleblowers. Section 1553 of ARRA contains several pro-employee elements not generally found in other whistleblower provisions enforced by the Department of Labor (DOL).
Who's protected: Employees of non-federal employers that receive direct or indirect stimulus funds. An example of an indirect receipt of funds is a private employer contracting with entities that have received federal stimulus funds. The language of Section 1553 suggests supervisors and managers can be held individually liable for violations.
What's prohibited: Retaliating against an employee for disclosing to an inspector general, a government agency, Congress, a supervisor, a court, or a grand jury information that the employee reasonably believes is evidence of:
- gross mismanagement of an agency contract or grant relating to stimulus funds;
- a gross waste of stimulus funds;
- substantial and specific danger to public health related to the implementation or use of stimulus funds;
- an abuse of authority related to the implementation or use of stimulus funds; or
- a violation of a law, rule, or regulation related to an agency contract or grant awarded or issued relating to stimulus funds.
Section 1553 makes it easier for employees to sue...and to win. Section 1553 only requires employees to prove that the protected activity was a "contributing factor" in the alleged retaliatory act. Employees can use circumstantial evidence, including the employer's knowledge of the employee's disclosure and the short passage of time between the disclosure and the reprisal.
Alarming for employers isn't just the fact that employees face an easier burden of proof, but also that Section 1553 does not establish a statute of limitations or impose a damages cap.
- Implement a policy that prohibits discrimination and retaliation against employees who report in good faith any type of wrongdoing, not just discrimination and harassment.
- Train managers on the new whistleblowing provisions, and reviewing old requirements.
- Train employees on the company's ethical expectations and complaint-reporting process.
- Actively encourage employees to report alleged wrongdoing internally first. Hold an awareness program, establish a complaint hotline, devote an e-mail inbox.
- Promptly investigate all complaints of alleged wrongdoing and alleged retaliation.
- Reinforce the need for managers to document all of their reasons for wanting to terminate an employee who recently filed a Section 1553-related complaint.
- Post a copy of Section 1553 with your other posting notices.
Take Care Giving Job References
Every employer hates to lose good employees, but giving favorable references for those employees is usually a pleasure. It’s a different story, though, when it comes to employees who performed poorly or were terminated with good cause. Sometimes employers are left with hard feelings about these workers. It’s important to make sure those hard feelings don’t color the references you provide.
In California, for example, the Labor Code provides that any person—including a manager, supervisor, or other employee—who prevents a former employee from gaining subsequent employment by making a factual misrepresentation or misleading statement about the employee is guilty of a misdemeanor.
In addition, both the individual who made the statement and the employer can be required to pay the former employee “treble damages”—meaning three times the actual damages—for the lost opportunity. What’s more, employers are required to take “all reasonable steps” to ensure that misrepresentations about a former employee are not made.
Employers are permitted to make truthful statements about why an employee was terminated or quit. However, employees rarely agree that they performed poorly or engaged in misconduct, and this can lead to lawsuits. To be prudent, employers should have a clear protocol for who is permitted to give references and what those references contain. In setting up your protocol, you may want to consider doing the following:
Designate a reference contact for all departing employees. At the time each employee departs, provide the employee with the name (or job title, such as “HR director”) to whom all reference inquiries should be directed. This will ensure that you know who is making statements on your company’s behalf. A supervisor or manager the departing employee has had conflict with should never be the designated reference person.
- Document the reasons the employee is leaving. Whether the employee was terminated or resigned, make sure the reason the employee left is clearly documented in the employee’s personnel file. This way, even if you are contacted for a reference after the individuals the employee worked with are gone, you’ll be able to provide truthful information about why the employee left and won’t make inadvertent misrepresentations.
- Avoid making personal statements about the employee’s character. Even when employees are terminated for misconduct, your response to a reference inquiry should always focus on how the employee performed on the job and not include subjective judgments about the employee’s character or personality.
- Consider implementing a neutral reference policy. Under a neutral reference policy, the only information your company gives about an employee is confirmation of the employee’s dates of employment, job titles, and final salary. By providing the same neutral information for all employees, you can avoid allegations that misrepresentations were made.
Make sure everyone knows the protocol. Instruct managers and supervisors to direct all reference inquiries to the designated reference person. If a manager or supervisor is the designated reference person, make sure he or she knows exactly what information can be provided and has access to relevant personnel files so that only accurate information is given out.
Are you using the wrong version of the I-9 form?
Many employers aren't aware that the federal government published an updated version of the Employment Eligibility Verification (1-9) form. Employers were required to begin using the new 1-9 beginning on April 3, 2009. Using the old edition - which was dated 6/5/07 - could trigger fines.
Insist on fluent English only if the job requires it
In many cases, it makes good business sense to require employees to communicate effectively in clearly spoken English. But EEOC is warning that overly broad policies will violate federal national origin discrimination law.
So, when can you set an English-fluency policy? That depends on the nature of the job. THE EEOC says such policies are allowed in positions only if fluent English is needed "for the effective performance of the position for which it is imposed."
Bottom line: Avoid setting identical fluency requirements for a broad range of positions. Don't require a greater degree of fluency than necessary for that job.
Recent case: Jesus Romero, a Spanish - speaking dishwasher at a hotel restaurant, was laid off while the hotel remodeled the restaurant. The hotel denied Romero his former job because of a newly implemented English - fluency policy.
He filed a complaint with the EEOC, which sued the restaurant on his behalf for national-origin discrimination. The hotel suspended its fluency policy pending the case's resolution.
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IN THIS ISSUE
DFEH REPORTS RISE IN
EMPLOYEE COMPLIANTS
IF YOU ACCEPT STIMULUS FUNDS, PREPARE FOR MAJOR WHISTLEBLOWER
ISSUES
TOP COSTLY WORKPLACE MISTAKES TO AVOID THIS
YEAR
ARE YOU USING THE WRONG VERSION OF THE I-9 FORM?
INSIST ON FLUENT ENGLISH ONLY IF THE JOB REQUIRES IT
TAKE CARE GIVING JOB REFERENCES
This newsletter, like all materials, training, and services offered by RSJ/Swenson LLC are offered and sold with the understanding that it is not engaged in rendering legal counseling or other professional service. If legal counseling or other professional assistance is required, the services of a competent practitioner in the relevant area should be sought.
At RSJ/Swenson, our mission is to support businesses like yours with training, products and services designed to reduce your liability and simplify your life. We work with you to put together your employee handbook; to ensure you're compliant with state and federal labor laws and practices and provide non-harassment training. Give us a call at 818.461.1874 or visit our web site at www.rsjswenson.com and see how our solutions can benefit your business.
