Tracking Time: The Methods, the Risks and When You Can Change Time Cards

by Nancy Owen, PHR

As Ben Franklin once stated, “Time is Money”. Entrepreneur Brian Tracy says, “Your greatest resource is your time.”

So how do you keep track of your employee’s time?

Keeping track of non-exempt employees’ time is not an option for employers – regardless of whether you pay them on a salary or hourly basis and regardless of whether or not they ever actually work overtime. Federal and state laws require employers to keep records of all hours worked, all wages paid, and other conditions of employment.

Certain records, such as those containing wage dates, hours worked and pay dates, must be kept for at least three years. Records on which wage computations are based should be retained for two years, such as time cards, wage rate tables and work time schedules. These records must be open for inspection by the Department of Labor’s Wage and Hour Division representatives in the event of an audit or a complaint. The records may be kept at the place of employment or in a central records office.

The law does not specify how an employer keeps track of an employee’s time, only that it must be done.  Employers have a variety of options when it comes to the method used to keep track of time worked.  Here are some of those options.

  1. Manually with a paper form: Many smaller employers still use paper forms, usually customized to their specifics. The information is written on the form by hand by the employee each day or week and then handed in to their supervisor for approval. This method of calculating time creates much more work for all parties involved, as the numbers will need to be manually entered into a payroll or HRIS system and the risk of human error is therefore much higher.
  2. On Line Portal: This method is widely used today. The employees go into a website and punch in and out through a computer. One disadvantage of this system is that supervisors have no way of verifying accuracy if employees miscalculate their hours worked.
  3. Time Clock: This is used quite often today. The cost to employers is less than other systems. Employees either use a pass code or a badge to punch into the time clock. This type of system has a high percentage of time fraud associated with it because employees can piggy back into the site behind other employees and it is easy for one employee to punch in or out for another employee.
  4. Mobile Devices: Many companies that have a large offsite workforce allow their employees to clock in and out using an app on their mobile device. These employees need to be trusted that they are where they say they are when using this method.
  5. Biometric Clocks: Biometric time clocks work by identifying employees based on their unique traits such as fingerprints or the iris. Biometric clocks cost more than the other methods, but they are still often the most cost-efficient option. The clocks work seamlessly with the employer’s time and attendance software, leaving little room for human error and minimal chances for missed punches which cost additional time to fix manually. The percentage of time theft is also very small which adds considerable savings for employers.
  6. Fixed Schedules: Many employees work on fixed schedules that seldom change. The employer may keep a record showing the exact schedule of daily and weekly hours worked and merely indicate that the worker did follow the schedule. When a worker is on a job for a longer or shorter period than the schedule shows, the employer must record the number of hours the worker actually worked on an exception basis.

Whichever method you choose, you will want to have a policy that prohibits falsification of time cards or time clocks. When an employee deliberately records time incorrectly, or punches in or out for another employee, most employers consider this type of action to be a terminable offense. If you are one of these employers, you must inform employees of this standard and enforce the rule across the board.  If discipline for this offense is not enforced consistently, it may be used to support a discrimination claim.

Most employers do not require exempt workers to keep track of hours because it’s not required by the law. If you do not require exempt employees to keep a record of hours worked, make sure that there is no question about your employee’s status as exempt from overtime pay. If you have incorrectly classified an employee as exempt, but it is later determined that the employee was non-exempt, that employee might make a legal claim for overtime pay. If there are no records of the employee’s work hours, the employer will have great difficulty countering the employee’s claim as to the number of hours he or she worked. Time sheets for exempt employees should record sick days, floating holidays, vacation time, jury duty, bereavement, and other absences.

The risk to an employer for not keeping time records or for keeping incorrect time records can be high.

The Department of Labor (DOL) sees federal wage and hour claims pour in every day. They come from disgruntled employees, former employees and whistle-blowers. Bad payroll and timekeeping records lead many of these claims to be resolved in favor of the employee, costing employers thousands of dollars.

Regarding wage and hour violations, the stakes are getting higher. In several recent cases, the government has penalized company owners and officers for failing to pay overtime – imposing stiff fines and even imprisonment since wage and hour violations can also lead to personal liability.

In one case, the president of a Minnesota sheetrock company was sentenced to two years in jail and a potential fine of $3.3 million for intentionally underpaying employee overtime and union pension and benefit contributions.

In another recent case, the owners and officers of an Illinois security company were fined over $200,000.00 in back wages and liquidated damages for violating overtime and record keeping provisions.

Walt Disney will pay 16,339 employees back wages that total 3.8 million dollars. The DOL officials found that Disney violated employment law regarding minimum wage, overtime and timekeeping requirements.

Often federal and individual state labor laws are written with a clause that assumes employer guilt in the absence of adequate records. In other words, unless an employer has detailed enough records to prove that a violation did not occur, the employer will usually be found guilty of violating labor laws. To learn more about the timekeeping requirements of the federal Fair Labor Standard Act, read the DOL’s fact sheet about record keeping.

Please remember that in the event of a wage and hour claim, the burden of proof is on the employer to show there was no violation.  Proper timekeeping practices and good recordkeeping could save employers thousands of dollars. So why take a chance? Make sure you have a fool proof method for your time keeping.

We have had a lot of questions recently about an employer’s ability to change an employee’s time card.  Most of the time, the reason time cards are changed is to correct some type of error made by the employee when documenting hours worked.

Employers can modify a time card without an employee’s knowledge as long as the change is a legal one. Some legal reasons include:

  • the employee forgot to punch in or out;
  • the employee took paid vacation;
  • the employee accidentally double-punched a time; or
  • there was some type of glitch in the system and the time had to be manually added in later.

There are times when it would be illegal for a supervisor to modify an employee’s time card. Those instances would include:

  • a supervisor reducing the hours on a time card as a form of punishment (including removing overtime hours worked); or
  • clocking an employee out for a break or a lunch they did not take or during which they were not freed of all work responsibilities.

Legally, time cards must accurately reflect all hours actually worked.  Any change to a time card that fails to do so would be illegal.

If you are an employer with questions, please contact our HR team by calling 724-864-8745.

Disclaimer: The information provided on this web site is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this web site does not create an attorney-client relationship between East Coast Risk Management or our employment attorney and the user or browser.

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Social Media: A Cautionary Tale Courtesy of ESPN

by Derek Ross

The recent news regarding ESPN sports anchor Jemele Hill is a reminder to employers to be cautious when disciplining employees for voicing opinions outside of the workplace.

Last week Ms. Hill made controversial tweets about President Trump, calling him a “white supremacist” on Twitter. Ms. Hill later issued a statement expressing regret that her personal beliefs had painted ESPN in an unfair light and that she continues to respect her colleagues and her company.

ESPN received backlash for not suspending or firing the sports anchor for her comments given the fact that the company has fired sports personalities in the past over social media comments. For instance, former ESPN employee Curt Schilling was terminated after sharing a lewd picture criticizing the controversial North Carolina “Bathroom Bill” barring transgender people from bathrooms and locker rooms that do not match the gender on their birth certificates. This was not the only violation that Schilling had committed and was the justification for his dismissal. After terminating Mr. Schilling, ESPN assured fans that “ESPN is an inclusive company”. This was Jemele Hill’s first offense.

Late last week, ESPN’s President John Skipper issued a statement that said, “We have social media policies which require people to understand that social platforms are public and their comments on them will reflect on ESPN. At a minimum, comments should not be inflammatory or personal.” Mr. Skipper also said it was a “violation of standards” and that the matter was dealt with privately.

It is yet to be seen if the social media uproar will affect ESPN’s business or ratings but this is likely not the coverage that ESPN would like to see at the forefront of many news casts.

Social media outlets are becoming more and more popular for employees as a place to say whatever they like, whenever they like — with or without consequences looming. From a business standpoint, social media can be one of the most powerful marketing tools in your arsenal. To protect your business, you should establish a social media policy. A carefully written, clearly communicated and consistently enforced social media policy will not only help you steer away from trouble, but it will help you navigate through a firestorm.

Here are a few steps I first shared in my February blog post “How to Help Your Company Avoid Social Media Messes”:

  1. First, employees need to know that they could be putting their jobs on the line if they post anything to social media, including pictures or videos of the workplace, if those postings are unlawful, include discriminatory or abusive language, are maliciously false, or violate company policies such as Anti-Harassment or Confidential Information.
  2. You can also require that your employees make it clear in their social media activity that they are speaking on their own behalf and not on behalf of the Company and that any statements made about the Company or any other employees must be truthful and accurate.
  3. Supervisors need to be trained to proceed with caution when dealing with social media issues. If confronted with a public relations nightmare created by an employee using social media, make sure the company’s response is appropriate. Organizations may be ordered to provide back pay and reinstatement if it is determined that the employee was wrongfully terminated. It is best to check with an HR professional to assess whether a specific posting is protected by law.

Remember that the National Labor Relations Board (NLRB) is very particular about these policies. Avoid any language that could be interpreted as an attempt to limit an employee’s protected right to “concerted activity”. In other words, avoid broad language that is too restrictive. It also helps to include a disclaimer stating that the policy is not intended to restrict communications or actions protected or required by state or federal law.

Be extremely careful when you consider firing an employee over social media post. Courts have found that social media violations constituted a legitimate, nondiscriminatory reason for firing an employee. Past decisions by the NLRB hold employers liable for terminating employees related to social media if the actions are related to protected concerted activity under the National Labor Relations Act. The NLRB has made a point of protecting employees who discuss their working conditions, complaints and terms of their employment with other employees through social media. So before you consider disciplinary action or termination of an employee for a social media posting you may want to check with your legal counsel regarding the following concerns:

  • Did the employee make complaints or threats against customers?
  • Was there harassing speech against a co-worker?
  • Was confidential information discussed or information about the company or client relationships or other information that may harm the company’s reputation in the marketplace?

One more caveat regarding social media. Employers who use social media in hiring process decisions must be aware of the risk involved. Federal and state laws generally prohibit discriminatory hiring decisions based on protected categories such as race, color, religion and sex. The danger of conducting background checks of applicants using social media is that you may discover the applicant belongs to a protected category—information you probably wouldn’t learn through your general application process.

The Fair Credit Reporting Act (FCRA) governs “employment background checks for the purposes of hiring” and applies if “an employer uses a third-party screening company to prepare the check.” Under the law, if you use an outside service to view social networking sites and provide information, the applicant must be informed of the investigation, given an opportunity to consent and notified if the report is used to make an adverse decision. If you decide to use social networking information in your hiring decision, you may want to think about conducting that yourself, not through a third party. That avoids claims under the FCRA.

If you are an employer in need assistance, East Coast Risk Management can help with creating a social media policy or revising your current policy. Please contact our HR team by calling 724-864-8745.

Disclaimer: The information provided on this web site is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this web site does not create an attorney-client relationship between East Coast Risk Management or our employment attorney and the user or browser.

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Employee or Independent? A Word of Warning for All Employers (Especially in North Carolina)

by Nancy Owen, PHR and Laura Pokrzywa

Though the issue is one of concern for all organizations, employers in North Carolina should be especially concerned regarding misclassification of an employee as an independent contractor.

According to the Internal Revenue Service (IRS), millions of workers across the country are currently misclassified as independent contractors. Some employers are careless with classifications because treating the employee as an independent contractor allows the employer to escape paying social security, medicare, unemployment and payroll taxes. In fact, the IRS estimates that some employers save more than $43,000 per year in taxes by misclassifying employees.

When it comes to misclassifications, the employer’s gain is the government’s loss. In addition, employees who are improperly classified stand to lose important workplace protections such as the minimum wage, overtime compensation, unemployment insurance, and workers’ compensation. In their continuing efforts to stem the tide of misclassifications, the IRS teamed up with the Department of Labor (DOL) to share information. But the teamwork doesn’t stop there. Last month, North Carolina’s governor signed into law the North Carolina Employee Fair Classification Act. A portion of this law addresses worker classifications and will take effect at the end of this year.

The definition of “employee” and “independent contractor” remain unchanged under North Carolina’s new state law, but it creates a new section of the North Carolina Industrial Commission. The Employee Classification Section makes it easier for the state to pursue employers who misclassify their employees by providing for the sharing of information among various state agencies.

State Licensing boards will also be required to ask applicants to disclose any investigations for state employee misclassification along with the outcome of the investigation. Failure to comply will result in denial of the license or permit.

North Carolina’s posting requirements will also change as of the end of 2017. North Carolina employers subject to the Wage and Hour Act will be required to post amended posters that address provisions related to independent contractors. The new language includes instructions for employees who believe they have been misclassified as an independent contractor to report the suspected misclassification to the state Employee Classification Section within the Industrial Commission. The poster offers further instructions for the employee to include the physical location, mailing address, telephone number, and e-mail address where alleged incidents of employee misclassification occurred.

As ECRM’s Renee Mielnicki, Esq. explains in a December 2013 blog post, “Employers are left to decide whether or not it’s worth it to misclassify an employee given the consequences. Even if misclassification is unintentional, the penalties remain the same. Some estimate that if an employer gets hit in an audit for misclassification, the penalty may be as much as 40% of the Form 1099 gross amount. For small business owners, this may force them to close their doors. The best practice is then to first determine proper classification as an employee or an independent contractor.” She also explained that employers who are audited by the IRS and found to have misclassified an employee will be forced to pay back taxes, with interest, and a penalty.

In an effort to help employers do the right thing, in 2015 the DOL’s Wage and Hour Division issued an Administrative Interpretation that sought to clarify the definition of “independent contractor”. The DOL’s 15-page Interpretation of the Fair Labor Standard Act (FLSA) referred employers to the multi-factor “economic realities” test developed by the Supreme Court and Circuit Courts of Appeals to determine whether a worker is an employee or an independent contractor under the FLSA. Please note that the DOL warns these factors should not be applied as a checklist but should be considered in total, as they relate to each other. No one factor should be over-emphasized. The factors typically include:

A.  the extent to which the work performed is an integral part of the employer’s business;
B.  the worker’s opportunity for profit or loss depending on his or her managerial skill;
C.  the extent of the relative investments of the employer and the worker;
D.  whether the work performed requires special skills and initiative;
E.  the permanency of the relationship; and
F.  the degree of control exercised or retained by the employer.

Employers who believe that they have misclassified workers as independent contractors may be able to correct the issue courtesy of the IRS’ Voluntary Classification Settlement Program (VCSP). If they qualify for the program, the employer may voluntarily reclassify a worker as an employee and pay a penalty of only 10% of the employer’s tax liability. No other interest or penalties will be charged. The employer also must agree to treat the worker as an employee in the future and pay the proper taxes.

In her 2013 article, Mielnicki offered a warning to employers who might be considering this program. “Before deciding to voluntary enter the VCSP program, employers should be aware of its potential downfalls. Misclassification could expose the employer to wage and hour violation claims by a worker now classified as an employee which could impose further liabilities for benefit or compensation claims. This is especially true in light of the IRS’s partnership with the DOL to share misclassification information. Then what should an employer do? Employers should first analyze whether their current classifications are correct. If they are not, before applying for the VCSP, the employer should weigh the potential costs of entering into the VCSP and the potential for exposure to other liabilities in litigation as compared to the costs of continued non-compliance and the potential of a future IRS audit.”

If you are an employer with questions, please contact East Coast Risk Management at 724-864-8745.

Disclaimer: The information provided on this website is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this website do not create an attorney-client relationship between East Coast Risk Management or our employment law attorney and the user or browser.

 

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Safety Reminders for the Eclipse

A SPECIAL BULLETIN from ECRM’s SAFETY TEAM

Most of North America will witness today’s solar eclipse in one form or another. The eclipse will begin its sweep across the United States at 10:15 a.m. Pacific time. According to NASA, the fully eclipsed Sun will be visible along a 70-mile-wide path arching from Oregon to South Carolina. Observers outside this path will still see a partial solar eclipse with the moon covering part of the sun.

With all the excitement of this monumental event, many companies have planned special activities including eclipse parties and special breaks to allow employees to stop their work, step outside, and experience this amazing phenomenon.

If your employees are planning to view the eclipse, whether you are in the “path of totality” or not, here are a few important reminders from NASA to keep those eyes safe:

  • Homemade filters or ordinary sunglasses, even very dark ones, are not safe for looking at the sun; they transmit thousands of times too much sunlight.
  • The only safe way to look directly at the uneclipsed or partially eclipsed sun is through special-purpose solar filters, such as “eclipse glasses” or hand-held solar viewers that are compliant with the ISO 12312-2.
  • Always inspect your solar filter before use; if scratched or damaged, discard it. Read and follow any instructions printed on or packaged with the filter.
  • Stand still and cover your eyes with your eclipse glasses or solar viewer before looking up at the bright sun. After looking at the sun, turn away and remove your filter — do not remove it while looking at the sun.
  • Do not look at the uneclipsed or partially eclipsed sun through an unfiltered camera, telescope, binoculars, or other optical device.
  • Similarly, do not look at the sun through a camera, a telescope, binoculars, or any other optical device while using your eclipse glasses or hand-held solar viewer — the concentrated solar rays will damage the filter and enter your eye(s), causing serious injury.
  • If you are within the path of totality, remove your solar filter only when the moon completely covers the sun’s bright face and it suddenly gets quite dark. Experience totality, then, as soon as the bright sun begins to reappear, replace your solar viewer to look at the remaining partial phases.
  • Outside the path of totality, you must always use a safe solar filter to view the sun directly.
  • If you normally wear eyeglasses, keep them on. Put your eclipse glasses on over them, or hold your handheld viewer in front of them.

If you don’t have a proper solar filter, consider the following suggestion from NASA:

“An alternative method for safe viewing of the partially eclipsed sun is pinhole projection. For example, cross the outstretched, slightly open fingers of one hand over the outstretched, slightly open fingers of the other, creating a waffle pattern. With your back to the sun, look at your hands’ shadow on the ground. The little spaces between your fingers will project a grid of small images on the ground, showing the sun as a crescent during the partial phases of the eclipse. Or just look at the shadow of a leafy tree during the partial eclipse; you’ll see the ground dappled with crescent Suns projected by the tiny spaces between the leaves.”

Perhaps the safest way to view the event is to watch NASA’s live stream of the eclipse!

If your employees will be driving, make sure they remember a few basic safety rules:

  • Do not stop in the middle of the road to view the eclipse. Move your car off the road, to a safe location.
  • Take care not to trespass on the personal property of others.
  • Keep your headlights on, and don’t rely on automatic headlights.
  • Do not wear your eclipse glasses, while driving.
  • Do not try and photograph the eclipse while driving.
  • Be mindful, that pedestrians will be walking around looking in the sky, and not watching for cars.
  • Plan your trip accordingly to allow for extra congestion on the roads during the eclipse period.

By keeping these safety tips in mind, you and your employees can safely enjoy this amazing spectacle.

ECRM’s team of safety professionals provides full-service safety consulting and safety training. For more information, contact us today by calling 724-864-8745 or emailing us at info@eastcoastrm.com.

Posted in Uncategorized |

How Off Duty Conduct Can Cost You Your Job

by Renee Mielnicki, Esquire

By now we are all familiar with the tragedy that happened in Charlottesville, Virginia over the weekend. As a recap, white nationalists assembled in Charlottesville to protest the city’s plan to remove a statue of Confederate General Robert E. Lee from a local park. What started as a protest turned into a firestorm of hatred and violence leaving one dead and many injured.

Many of us were shocked at the images we saw on television. You would think that in 2017, we, as a nation, were far past this type of thinking and behavior, but this weekend has proven we are not. In fact, one could argue that this display of hatred has set us back decades. I know I, myself, started wondering, who are these people? Where does someone who belongs to such extreme racist organizations even work today? I mean, who would hire them? Does the employer even know they belong to such organizations? Probably not. As I listened to the radio and watched television coverage of this story, I learned that these extremists could be working right alongside of you and me and we would have never known it. I think a lot of people were probably shocked to learn that those involved were people they would never have expected.

Given the nature of my profession, I started thinking about the types of consequences this could have on the careers of the people involved. If one of my clients called to tell me that one of their employees was seen on television carrying a torch or white supremacist materials, wearing extremist garbs, involved in an act of violence or spewing racial slurs, I already know the advice I would give. It’s true that this conduct did not occur at work. However, this event was covered nationwide on television for the whole world to see. These images are not going to go away anytime soon, especially those on the internet. Continuing to employ a person that has such hatred, rage and violent tendencies carries several risks for an employer. First and foremast is the threat to the reputation of the employer. All employers are in the business of selling something that they want someone to buy. A continued association with such an employee could cause consumers to not want to buy from the employer anymore. Business would ultimately be lost and a reputation permanently damaged. Second, one could also argue that such behavior might suggest that the employee is a potential danger to the safety of other employees in the workplace. Third, bringing such an employee back to work after engaging in this type of behavior is likely to cause conflict with other employees, including the potential for workplace harassment.

I often counsel clients on terminating employees for off-duty conduct and their question to me is always the same. “Am I allowed to do that?” In most cases, yes you can. This past weekend highlights the type of circumstances where such would be appropriate. Of course, before I made any final decisions I would investigate the matter. I would make sure the video or photos that I was relying upon were in fact the employee in question. In addition, I would make sure that state law did not prohibit me from firing an employee for off-duty conduct (and most don’t, by the way). As long as my investigation confirmed that the person in the video or picture was actually the employee in question, I would advise them to immediately move to sever the employment relationship (of course, I’d still double-check state law on off-duty conduct — but remember in most instances there aren’t any).

I would also give the same type of advice to an employer who was in the midst of hiring one of the participants and stumbled across a photo or video of the person from this past weekend. The same issues would be at hand. Hiring this type of person could tarnish the company’s reputation, lead to potential workplace violence and create huge conflicts within the organization. Denying employment for these reasons would also be legal.

As both an American and a human being, I feel sad that this happened. I wondered if these people gave any thought beforehand to the repercussions that this type of conduct could have on their lives and jobs. Too late now because the damage is already done, not only to them (not that there is any empathy for that) but also to the people they hurt in the process. But on a positive note, employers do not have to, nor should they, put up with this type of behavior, even if it didn’t occur on the job.

Employees need to beware that what you do off duty can have serious implications in your career and can ultimately cost you your job.

If you are an employer with questions, please contact East Coast Risk Management at 724-864-8745.

Disclaimer: The information provided on this website is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this website do not create an attorney-client relationship between East Coast Risk Management or our employment law attorney and the user or browser.

Posted in Human Resources | Tagged , , ,

Cell Phone Use: Hands-free is not Liability-free for Employers

by Laura Pokrzywa

The driver in front of you is all over the road — making hard stops, cutting corners, and even crossing the center line. The problem isn’t drugs, alcohol or fatigue. The problem is distracted driving. The distraction is the driver’s cell phone.

According to the National Highway Traffic Safety Administration, 3,477 people were killed and 391,000 were injured in motor vehicle crashes involving distracted drivers in 2015. Texting and talking on cell phone are leading causes of distracted driving. Since just about everyone has a cell phone these days, the problem seems to get worse every year. In response to the rising risks, in 2010 and 2011 Federal law banned commercial truck drivers, bus drivers, and drivers transporting hazardous materials from using hand-held cell phones and messaging on electronic devices. Many states and municipalities have also taken action to try to reduce the statistics. Today every state but one (Montana) has some kind of law restricting cell phone use by drivers. For example: text messaging is banned for all drivers in 47 states (up from 35 states just 2 years ago). The use of handheld cell phones has been banned for drivers in 15 states (up from 9 states 2 years ago) and more states are considering similar bans.

None of these state laws specifically define an employer’s responsibility concerning company-owned vehicles, cell phones or an employee using a personal phone to conduct company business while operating a vehicle. Though the use of hands-free devices remains legal in all states, the laws do little to limit an employer’s liability.

Hands-free or not, if one of your employees is involved in an accident while using a cell phone to conduct company business, you may be liable. According to the National Safety Council (NSC), employers can and have been held liable for actions that are actually allowed by federal regulation and individual state laws. In fact, the NSC says employers are being held liable up to $25 million for employee crashes, even when employees use hands-free devices.

Establishing a company policy that prohibits drivers from using a hand-held device will not remove liability completely, nor will it guarantee that your drivers won’t have other distractions, but it will go a long way in protecting you and your employees.

In their publication, Employer Liability and the Case for Comprehensive Cell Phone Policies, the NSC says, “Employers who expect employees to use cell phones while driving as part of their business must recognize that doing so exposes their employees to preventable crash risk.” In fact, the NSC recommends that employers go further than state laws and prohibit the use of hands-free devices while driving.  It goes on to recommend, “The best action for employers is to implement a total ban policy that includes handheld and hands-free devices and prohibits all employees from using cell phones while driving.”

Whatever your company’s policy, it must, at a minimum, clearly require compliance with applicable state laws. You can find more information about specific state’s laws by visiting the Insurance Institute for Highway Safety website or by contacting your state’s office of highway safety.

If you need assistance with your cell phone or safety policies, please contact East Coast Risk Management at 724-864-8745. We have safety and human resources professionals ready to help.

Disclaimer: The information provided on this website is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this website do not create an attorney-client relationship between East Coast Risk Management or our employment law attorney and the user or browser.

Posted in Human Resources | Tagged , , , ,

Are Job Descriptions Really Necessary for My Business?

by Derek Ross

The answer is a resounding, “YES!”

No matter how big or how small your business is, written job descriptions are an essential piece to any organization, both in a practical and legal sense. But not just any job descriptions. Be warned that inaccurate or outdated job descriptions are no more beneficial than no job descriptions at all. Without accurate, up-to-date job descriptions, you run the risk of complications that could cost you back pay for misclassified employees with up to three years for unpaid wages, liquidated damages, attorney fees and court costs, to name a few.

The lack of accurate job descriptions can also affect:

  • Productivity – “That’s not in my job description!” Create a concrete set of expectations for the employee from day one.
  • Recruiting – How can you attract the best candidates for the position if the description is outdated or just plain inaccurate?
  • Return to work requirements – if you haven’t established the physical demands of a job, how can you expect a healthcare provider to certify that your employee is physically able to return from FMLA or a disability leave?
  • Reasonable accommodations under the Americans with Disabilities Act (ADA) and some state laws – Just like returning to work, without an accurate job description, you cannot expect a healthcare provider to establish what accommodations may be needed to help your qualified, but disabled employee perform the essential functions of their job.
  • Properly classifying employees – Compliance with the Fair Labor Standards Act (FLSA) requires that all employees are classified as exempt or non-exempt. That information should be captured in every employee’s job description. For more information about correctly classifying employees, see Jim Spencer’s June blog Wage and Hour: Back to Basics.

So, how do you write a good job description?

A good job description should describe the tasks, duties, functions and responsibilities of a position. It outlines the details of who performs the job, the specific type of work, and the frequency and the purpose of the work as it relates to the company’s mission and goals.

A job description gives an employee a clear and concise outline for their job performance. Likewise, a supervisor can use a job description as a measuring tool to ensure that the employee is meeting their expectations.

Once enough information has been gathered, write a thorough, detailed job description. Common components of a well-written job description include:

  • Up-to-date and accurate job title
  • Overall position description
  • Responsibilities and tasks that will be required
  • Essential functions of the position, with examples of each
  • Required knowledge, skills and abilities
  • Required education and experience
  • Description of the physical demands
  • Description of the work environment

Standardize the information for each position: All of the job descriptions within your company should follow the same format. Be sure to include the following:

  • Date—when job description was written.
  • Job status—exempt or non-exempt under FLSA, include full-time or part-time.
  • Position title—name of the position.
  • Objective of the position—what the position is supposed to accomplish, how it affects other positions and the organization. Keep this brief and to the point.
  • Supervisor’s title—the position to whom the person reports.
  • Supervisory responsibilities—direct reports, if any, and the level of supervision.
  • Job summary—an outline of job responsibilities.
  • Essential functions—detailed tasks, duties and responsibilities.
  • Competency or position requirements—knowledge, skills and abilities needed.
  • Quality and quantity standards—minimum levels needed to meet the job requirements.
  • Education and experience—required levels.
  • Time spent performing tasks—percentages, if used, should be distributed to equal 100%.
  • Physical factors—type of environment associated with job: indoor/outdoor.
  • Working conditions—shifts, overtime requirements as needed.
  • Unplanned activities—other duties as assigned.

If you need assistance with job description creation or simply would like an audit of your current descriptions, please reach out to one of our experienced Human Resource professionals by calling East Coast Risk Management at 724-864-8745.

Disclaimer: The information provided on this website is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this website do not create an attorney-client relationship between East Coast Risk Management or our employment law attorney and the user or browser.

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A New Form I-9 . . . Again

by Laura Pokrzywa

It’s happened again. The Form I-9 has once again been updated by the U.S. Citizenship and Immigration Services (USCIS). The new form was just released this week, on July 17. If you are feeling a bit of déjà vu, you are probably not alone. The ink is barely dry on the previous revision, which became the required form at the end of January this year!

According to the USCIS, employers can use this revised version or continue using Form I-9 with a revision date of 11/14/16 through Sept. 17. On Sept. 18, employers must use the revised form with a revision date of 07/17/17. In the meantime, the USCIS says employers should continue to follow existing storage and retention rules for all of their previously completed Forms I-9. Those rules will not change.

Changes to the form itself are not immediately noticeable. Look closely and you’ll see that the USCIS changed the name of the Office of Special Counsel for Immigration-Related Unfair Employment Practices to its new name, Immigrant and Employee Rights Section. They also removed “the end of” from the phrase “the first day of employment.”

The other revisions are found in the List of Acceptable Documents in List C. The USCIS added a form of ID (the Consular Report of Birth Abroad), combined all the certifications of report of birth issued by the Department of State into one section on the list, and renumbered all List C documents except the Social Security card.

They are also offering a new and improved Handbook for Employers: Guidance for Completing Form I-9 (M-274).

Best to get familiar with the requirements and stay current on the form. Employers who violate the law may be subject to civil fines as much as $2126 per form for substantive and uncorrected technical I-9 mistakes (also known as “paperwork violations”), criminal penalties, debarment from government contracts, and a court order requiring an employer hire and pay back pay to individuals who have suffered discriminatory treatment.

The easiest and quickest way to verify the eligibility of new hires is using the internet-based system called E-Verify. It is free and required for federal contractors and all employers in certain states. With a completed Form I-9 and the new hire’s social security number, an employer can determine eligibility within seconds. This system does not replace the legal requirement to complete and retain those I-9 forms, but it is one more way to ensure legal compliance and avoid costly mistakes.

For more information about E-Verify, Form I-9, or for directions for renewing green cards or re-verifying an employee’s eligibility to work, visit the U.S. Citizenship and Immigration Services website.

Employers with questions about work authorization compliance, or any other HR issue, can contact one of our HR professionals by calling 877-864-3311.

Disclaimer: The information provided on this web site is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this Web site do not create an attorney-client relationship between East Coast Risk Management or our employment law attorney and the user or browser.

Posted in Human Resources | Tagged , , , ,

How to Conduct a Workplace Investigation

by Derek Ross

In 2016 there were 91,503 total charges filed with the Equal Employment Opportunities Commission (EEOC) costing employers more than $482,100,000. Yes, that is 482 MILLION dollars!!! Even if your recruiting and hiring process is perfect, all your policies are in place, and you carefully train all employees, you can’t guarantee that you will never have issues among your employees. Unfortunately, you may still have to deal with complaints of bullying, theft of company property, discrimination, or harassment.  You may not be able to prevent all these issues, but you will save your company a lot of money and headaches if you manage these issues properly when they do come up.

Having a strong workplace investigation process could help your company avoid shelling out big bucks to employees and their lawyers. It may also help you avoid one of the most prevalent complaints the EEOC reviews – retaliation.

Let’s take a look at best practices for performing a workplace investigation:

Planning to investigate
To properly perform an investigation, a company needs to lay out a plan. First and foremost, the company will need to find out what policies and guidelines apply to the complaint, who will conduct the investigation, how have similar complaints been handled in the past, and what questions to need to be asked. For this example we will be looking at a sexual harassment allegation.

First remove the accused from the situation if possible. That could include moving the employee’s work space away from the accuser or requiring them to take a leave of absence until the investigation is complete. Never fire the employee prior to the completion of an investigation. On the flip side, be very careful that you never take an action that could be considered retaliatory against the employee making the claim.

Employers have a legal obligation to conduct an internal investigation and could be held liable if the investigation is not handled properly and fairly. The person conducting the investigation should be skilled in this area. Ideally, this person should be trained, unbiased and unprejudiced. In most cases, they will come from your Human Resources Department.

The interview (fact-finding) process
During the interview portion with the accuser:

  • The employee heading the investigation should have a comfort or trust level with the accuser. This will ensure that the accuser will be fully cooperative.
  • The investigator should identify all of the issues by asking only questions pertinent to the complaint and gathering all of the necessary facts. This should be done in a timely manner.
  • The investigator should determine if the accuser has facts to back up their accusations such as emails, texts and/or witnesses. If so, the accuser will need to divulge these.
  • The investigator will also want to determine if the incident was severe or pervasive enough to create a hostile work environment and find out if the accuser has confided in another employee.
  • The investigator should assure the accuser that this is a confidential meeting and information discussed will only be revealed to other employees on a need to know basis, as part of the investigation process.
  • And lastly, the investigator must reassure the accuser that the company will not tolerate retaliation, which, by the way, is the number one charge addressed by the EEOC (45.9% of all claims in 2016 were related to retaliation. Need to see more details? Click this link: https://www.eeoc.gov/eeoc/statistics/enforcement/charges.cfm)

During the interview portion with the accused:

  • You should provide as many details from the interview with the accuser as is needed. Be aware that the accused may become irritated or combative.
  • You should review the company’s Anti-Harassment Policy with the accused. (If you don’t have an Anti-Harassment Policy, you need to establish one right away.)
  • Ask open-ended questions and continue the questioning until you feel comfortable that you have all the information you need or that all of the questions were answered. Stick to only the facts that pertain to the employee’s complaint and do make assumptions or come to conclusions on your own.
  • Just as you did with the accuser, assure the accused that this is a confidential meeting and information discussed will only be revealed to other employees on a need to know basis, as part of the investigation process.

Documentation during the investigation
Take as many notes during the investigation as possible. During the entire investigation and interviews, documentation will become paramount. Again, collect as much data as you can from both sides and document entire conversations. This will ensure that you have all of the necessary information to make the best determination. After the investigation has been completed, the investigator should write a report and recommend appropriate action.

Discipline
If the accused is found to be in the wrong and in need of discipline, consider applicable laws, the employee’s previous history, as well as how similar situations have been handled in the past. Stay consistent with the company’s previous disciplinary actions. Review the policy from the handbook and follow your disciplinary policy.

Next time you need to investigate an accusation, here are a few basic rules to remember:

  • Do not fire the employee until the investigation has been completed
  • Either move the accused employee’s work space if possible or have the employee put on leave until the investigation is completed
  • Remind the accuser and managers involved that retaliation will not be tolerated
  • Stick to the facts
  • Document the entire investigation
  • Keep the complaint and investigation confidential and on a need-to-know basis
  • Follow company policy and be consistent with past practice with regards to discipline
  • Do not retaliate against the accuser or anyone participating in the investigation.

Lastly, make certain that managers are trained on their legal responsibilities regarding harassment, discrimination and retaliation. East Coast Risk Management can assist your company with HR-specific trainings. Employers can reach us by calling (724) 864-8745.

Disclaimer: The information provided on this website is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this website do not create an attorney-client relationship between East Coast Risk Management or our employment law attorney and the user or browser.

Posted in Human Resources | Tagged , , ,

Wage and Hour: Back to the Basics

by Jim Spencer

Earlier this month I wrote a blog regarding when it’s appropriate to pay overtime. In the blog, I had mentioned making sure your employees were properly classified into exempt and non-exempt categories in accordance with Fair Labor Standard Act (FLSA) rules. Since that blog was posted, we have received a lot of questions regarding classifications. So I thought it would be a great idea to return to the basics — the basics of wage and hour.

First, we’ll look at the difference between exempt and non-exempt; then the importance of job descriptions; and finally the penalties for non-compliance. Before I begin, I want to stress the fact that just because an employee is paid a salary does not make them an exempt employee. The FLSA has laid the rules out to help employers determine if an employee is exempt. Let’s begin there.

What exactly does exempt mean? Exempt generally means the employee is exempt from overtime pay. Although there are many exemptions, the most common are the “white-collar exemptions” which are executives, professionals, administrative, outside sales, computer professionals and highly compensated employees. Be careful here. Just because your employee has the word “professional” or “administrative” in their job title or description does not necessarily mean they are exempt from overtime. It will be the employee’s actual duties that primarily classify them as exempt or non-exempt. In addition to the duties test, the employee must pass a salary level test. They must be paid a salary not less than $23,600 per year ($455 per week). Last year that salary level was the subject of much debate as a proposed increase to the minimum salary requirement stalled in the courts. Employers may have breathed a sigh of relief when the proposed increase failed, but their obligation to comply with the already-existing FLSA overtime provisions remains. So let’s take a look at those white-collar exemptions.

Executives: To qualify for this exemption, the employee must be compensated on the minimum salary basis ($455 per week). Their primary duties must consist of managing the enterprise or managing a customarily recognized department or subdivision of the enterprise. They must also possess the authority to hire/fire employees and advancement, promotion or any change of status of other employees must be given particular weight. An example of this would be a Vice President, or Plant Manager.

Administrative: To qualify for this exemption, the employee must be compensated on the minimum salary basis ($455 per week). The employee’s primary duties must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers. Also, the employee’s primary duty must include the exercise of discretion and independent judgment with respect to matters of significance. An example of this might be a Controller or Purchasing Agent.

Professional: This exemption applies only to employees with a learned profession. These employees must be compensated on a salary or fee basis at a rate of at least $455 per week with the exception of certain professions like lawyers and teachers. The employee’s primary duty must be the performance of work requiring advanced knowledge defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgement. The advanced knowledge must be in the field of science or learning and must be customarily acquired by a prolonged course of specialized intellectual instructions. An example of this would be a doctor or a teacher. There’s also a creative professional that would qualify for exemption so long as the employee met the above criteria and also their work performance must consist of invention, imagination, originality or talent in a recognized field of artistic or creative endeavor. An example of this would be a Human Resource Manager.

Computer Employee Exemption: This employee must be compensated either on a salary or fee basis at a rate not less than $455 per week or, if compensated on an hourly basis, at a rate not less than $27.63 an hour. The employee must be employed as a computer systems analyst, computer programmer, software engineer or other similarly-skilled worker in the computer field. The employee’s primary duties must consist of: 1) The application of systems analysis techniques and procedures, including consulting with users to determine hardware, software or system functional specifications; 2) The design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications; 3) The design, documentation, testing, creation or modification of computer programs related to machine operating systems; or 4) A combination of the aforementioned duties, the performance of which requires the same level of skills. This exemption does not include a technician that simply helps employees with computer issues.

Outside Sales Exemption: The employee’s primary duty must be making sales (as defined in the FLSA), or obtaining orders or contracts for services or for the use of facilities for which a consideration will be paid by the client or customer. The employee must be customarily and regularly engaged away from the employer’s place or places of business (including a home office).

Highly Compensated Employee: This exemption applies to office employees doing non-manual work that are paid a total compensation of $100,000 or more if they customarily and regular perform at least one of the duties of an exempt executive, administrative, or professional employee, as identified above. This would not include non-management production line workers, non-management employees in maintenance, construction, and similar occupations such as carpenters, electricians, plumbers, etc.

If your employee does not fall into one of the above exemptions, chances are they should be classified as a non-exempt employee and will be entitled to overtime. For more information on that, I would recommend reading my blog from last week, How to Calculate Overtime Correctly.

Please also note that the exemptions above are exemptions under federal law. Even if an employee fits into one of the exempt categories above, they must also be exempt from overtime under state law. For instance, in Pennsylvania there is no exemption for computer or highly compensated employees. Therefore, a computer programmer in Pennsylvania would have to fit into the Administrate or Executive exemption to be exempt from overtime pay.

Now that there’s an understanding of an exempt and a non-exempt employee, the most crucial step in the process is to have good, clear and concise job descriptions for all positions within your company. If you’re ever in a meeting with the Department of Labor (DOL) on an FLSA audit, you can best believe the first thing requested along with payroll records is your job descriptions. Having your employees properly classified in your job descriptions can be the difference between no fine and a huge penalty including back pay to employees.

A key to remember when creating your job description is job title alone is insufficient to establish the FLSA exempt status of an employee. Rather, the DOL has said exempt or non-exempt status of any particular employee must be determined on the basis of whether the employee’s salary and duties meet the requirements of the law. Just because you give a janitor a title of VP of Sanitation does not mean the employee will be exempt. The same is true of an Administrative or Executive Assistant. Whether these jobs are exempt from overtime will be determined by their job functions and salary. The best way to avoid any FLSA issues is to ensure that your job descriptions accurately reflect the actual job being done, then have the professionals at East Coast Risk Management review your job descriptions to make sure they are sufficient and classify each position as exempt or non-exempt. Errors on these classifications can cost your business big time because you will owe back pay for any overtime not paid, as well as other damages.

In my last blog, I listed the top 5 industries that are at risk for wage and hour violations and also at a serious risk of the dreaded DOL audit. As a quick review they were: Accommodation & Food Services, Healthcare and Social Assistance, Retail, Construction, and Manufacturing. One of the top risks for wage and hour liability is classifying a non-exempt employee as exempt from overtime pay when they are not. Some of the penalties include back pay for up to three years of unpaid wages and overtime owed but not paid, liquidate damages up to two times the original amount owed, attorney’s fees, court cost, and as an added kicker, most insurance policies do not cover these types of losses or claims!

I cannot stress enough how important it is to properly classify your employees through job descriptions. If you are unsure, don’t risk it. The HR professionals at East Coast Risk Management are here to help. Give us a call.  Employers can reach us by calling (724) 864-8745.

Disclaimer: The information provided on this website is for informational purposes only and not for the purpose of providing legal advice. Use of and access to this website do not create an attorney-client relationship between East Coast Risk Management or our employment law attorney and the user or browser.

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