If your company maintains more than one location, such as multiple retail store locations, chances are you maintain a manager or store supervisor that oversees each location's operations. In tough times like now, many retailers staff very conservatively. A supervisor may be one of two employees staffing a retail store. While the supervisor may direct and control 1 or 2 other employees, she may also perform the same/similar duties as her subordinates, such as ringing up customers at a cash register.
The federal Fair Labor Standards Act (FLSA) determines whether a supervisor is exempt from overtime and is not based on what title the company uses or if the person is salaried. Whether or not an employee is exempt from overtime depends on that individual's job duties and the proper application of FLSA regulations.
A store manager at one location may be exempt from overtime, while a manager at another may not. The difference is sometimes subtle and difficult to understand under the FLSA. The question arises when when managers perform many non-managerial tasks: can they be exempt from overtime?
Store managers generally are not exempt from overtime where they do not customarily and regularly direct the work of two or more other full-time employees or the equivalent. Whether a manager's primary duty is "management" under the FLSA is based on all the particular facts and circumstances. Recent cases under the latest FLSA regulations, define "primary duty" as the principal, main, major or most important duty that the employee performs. The determination must be made with a view toward the character of the employee's job as a whole. So, an employee performing some nonexempt work can still be exempt if her primary duty is managerial in nature.
With the increase in wage and hour class-action suits, you should be very careful when making a determination on the exempt status of management personnel. Your policies and procedures will help define the scope of duties and managerial responsibilities, but remember, the FLSA governs.
Monday, July 6, 2009
Friday, July 3, 2009
Obama Administration Committed to I-9 Compliance
The Obama administration just announced that it was launching an investigation of hundreds of businesses as part of its strategy to focus immigration enforcement on the employers who hire illegal workers. The administration will be auditing I-9s and compliance with same.
An I-9 is a federally-mandated document that all employers are supposed complete with the cooperation of employees within 3 days of hire. It is intended verify that a person is authorized to work in the U.S.
Employers who do not properly retain, complete and verify I-9 information are subject to fines by the Immigration and Customs Enforcement (ICE). Reportedly, ICE served "Notices of Inspection" to 652 businesses, which is an increase from last year.
The biggest challenge facing employers subject to an audit may be their inability to confirm whether documents presented to them by workers were authentic (such as a Social Security Card) or that the worker's identity is genuine.
Now is the time to consult with counsel and to conduct a self-audit!
An I-9 is a federally-mandated document that all employers are supposed complete with the cooperation of employees within 3 days of hire. It is intended verify that a person is authorized to work in the U.S.
Employers who do not properly retain, complete and verify I-9 information are subject to fines by the Immigration and Customs Enforcement (ICE). Reportedly, ICE served "Notices of Inspection" to 652 businesses, which is an increase from last year.
The biggest challenge facing employers subject to an audit may be their inability to confirm whether documents presented to them by workers were authentic (such as a Social Security Card) or that the worker's identity is genuine.
Now is the time to consult with counsel and to conduct a self-audit!
Wednesday, July 1, 2009
Federal Min. Wage to Increase Soon
The federal minimum wage is currently $6.55 per hour. It will increase to $7.25 per hour effective July 24, 2009. Many states have also raised their minimum wage rates.
Employers in these 17 states will see their minimum wage increase the same as above:
Alabama
Georgia
Idaho
Indiana
Kansas
Louisiana
Mississippi
Nebraska (State law is not tied to federal law, so employers covered by state but not federal law will not be required to pay federal minimum wage.)
North Dakota
Oklahoma
South Carolina
South Dakota
Tennessee
Texas
Utah (The state's minimum wage does not apply to anyone entitled to the federal minimum wage.)
Virginia
Wyoming (Like Nebraska, Wyoming’s law is not tied to federal law, so employers covered by state but not federal law will not be required to pay federal minimum wage.)
Employers in these 17 states will see their minimum wage increase the same as above:
Alabama
Georgia
Idaho
Indiana
Kansas
Louisiana
Mississippi
Nebraska (State law is not tied to federal law, so employers covered by state but not federal law will not be required to pay federal minimum wage.)
North Dakota
Oklahoma
South Carolina
South Dakota
Tennessee
Texas
Utah (The state's minimum wage does not apply to anyone entitled to the federal minimum wage.)
Virginia
Wyoming (Like Nebraska, Wyoming’s law is not tied to federal law, so employers covered by state but not federal law will not be required to pay federal minimum wage.)
Wednesday, March 11, 2009
Demystifying the COBRA subsidy
The federal stimulus package is called the American Recovery and Reinvestment Act. The Act allows qualified beneficiaries who are eligible for COBRA due to an involuntary termination to pay 35% of the cost of the COBRA coverage. The remaining 65% of the plan cost will be paid by the U.S. government. An employer gets reimbursed for the 65% of the plan cost when it files its 941 for payroll taxes. The subsidy eligibility ends on December 31, 2009.
The Act is retroactive in that the coverage applies to all employees involuntarily terminated from September 1, 2008, to February 16, 2009, and to their qualified beneficiaries, even if they did not elect COBRA coverage when it was offered to them. So, that means employers have to contact employees and beneficiaries terminated during that time frame by April 18, 2009 (60 days after the February 17, 2009 enactment date).
In addition to the regular COBRA notice, an employer should send a supplemental notice to affected individuals with additional information including, for example, information about the individual’s right to the subsidy and the conditions on the subsidy, a description of the obligation of the individual to notify the employer of eligibility under another group health plan or Medicare, and the penalty for failure to provide this notification. The DOL is required to provide a sample notification form by March 19, 2009.
Unfortunately, the Act does not define the term “involuntary termination”, so any involuntary termination is covered. Accordingly, employees who are terminated for poor performance, attendance problems, and other reasons appear to be eligible for the subsidy. Employees who are terminated for gross misconduct, however, are not covered, since a termination for gross misconduct is not a qualifying event under COBRA.
The subsidy is equal to 65% of the monthly COBRA premium for the qualified beneficiary for up to 9 months. The subsidy applies to medical, dental, and vision benefits. It does not apply to medical flexible reimbursement accounts. Employees and other qualified beneficiaries are required to pay the other 35% of the premium.
The Act is retroactive in that the coverage applies to all employees involuntarily terminated from September 1, 2008, to February 16, 2009, and to their qualified beneficiaries, even if they did not elect COBRA coverage when it was offered to them. So, that means employers have to contact employees and beneficiaries terminated during that time frame by April 18, 2009 (60 days after the February 17, 2009 enactment date).
In addition to the regular COBRA notice, an employer should send a supplemental notice to affected individuals with additional information including, for example, information about the individual’s right to the subsidy and the conditions on the subsidy, a description of the obligation of the individual to notify the employer of eligibility under another group health plan or Medicare, and the penalty for failure to provide this notification. The DOL is required to provide a sample notification form by March 19, 2009.
Unfortunately, the Act does not define the term “involuntary termination”, so any involuntary termination is covered. Accordingly, employees who are terminated for poor performance, attendance problems, and other reasons appear to be eligible for the subsidy. Employees who are terminated for gross misconduct, however, are not covered, since a termination for gross misconduct is not a qualifying event under COBRA.
The subsidy is equal to 65% of the monthly COBRA premium for the qualified beneficiary for up to 9 months. The subsidy applies to medical, dental, and vision benefits. It does not apply to medical flexible reimbursement accounts. Employees and other qualified beneficiaries are required to pay the other 35% of the premium.
Tuesday, March 3, 2009
What's the Ledbetter Fair Pay Act?
A female employee is hired by an employer in 2009 and receives 24 paychecks, each reflecting a discriminatory pay practice by the employer because of his disability. How long of a period does the she have to file a complaint with the EEOC alleging pay discrimination under the Americans with Disabilities Act?
The answer is governed by Lilly Ledbetter Fair Pay Act of 2009, Public Law No. 111-2, 123 Stat. 5. The Ledbetter Act was drafted to overturn the Supreme Court's May 2007 decision in Ledbetter v. Goodyear Tire & Rubber Co.
The new law adds a provision to Title VII, which provides:
"unlawful employment practice occurs, with respect to discrimination in compensation in violation of this title, when a discriminatory compensation decision or other practice is adopted, when an individual becomes subject to a discriminatory compensation decision or other practice, or when an individual is affected by application of a discriminatory compensation decision or other practice, including each time wages, benefits, or other compensation is paid, resulting in whole or in part from such a decision or other practice."
So, the law treats each and every discriminatory paycheck as a new discrimination, thus re-starting the 180-day clock (300 days if the charge is also covered by state or local fair employment laws).
The answer is governed by Lilly Ledbetter Fair Pay Act of 2009, Public Law No. 111-2, 123 Stat. 5. The Ledbetter Act was drafted to overturn the Supreme Court's May 2007 decision in Ledbetter v. Goodyear Tire & Rubber Co.
The new law adds a provision to Title VII, which provides:
"unlawful employment practice occurs, with respect to discrimination in compensation in violation of this title, when a discriminatory compensation decision or other practice is adopted, when an individual becomes subject to a discriminatory compensation decision or other practice, or when an individual is affected by application of a discriminatory compensation decision or other practice, including each time wages, benefits, or other compensation is paid, resulting in whole or in part from such a decision or other practice."
So, the law treats each and every discriminatory paycheck as a new discrimination, thus re-starting the 180-day clock (300 days if the charge is also covered by state or local fair employment laws).
Wednesday, February 11, 2009
Don't Text and Drive!
The press has widely reported the perils of using a cell phone while driving. Certainly, every company whose employees travel by car in the scope of their employment should have a policy that prohibits the use of a cell phone while driving. There have been recent cases where employers have been held liable for injuries suffered by persons involved in accidents caused by the employee's cell phone use.
Some states prohibit cell phone use while driving unless a driver is using a hands free device. Unfortunately, Georgia has yet to regulate cell phone use. Studies have shown that it is a distraction and can cut down on reaction times while driving. Since employers have a duty to keep their employees safe, they should implement policies to prevent needless cell phone related accidents.
Of course, cell phone use goes beyond being on the phone. With the increase use of smart phones, persons are just as likely to be text messaging as they are to be on the phone with someone. Text messaging while driving can be more dangerous than talking on a cell phone because it usually requires both hands to type, as well as looking down at the smart phone (and not at the road). In response to "texting while driving", several states have completely banned the practice by drivers. These states are: Alaska, California, Connecticut, District of Columbia, Louisiana, Minnesota, New Jersey and Washington. Unlike many seat belt laws, most of the states that have banned text messaging while driving make it a primary offense, meaning law enforcement can stop a driver for the offense (as opposed to secondary, where the police can pull a driver over for something like a broken tail light and then can add an offense such as texting or not wearing a seat belt).
So, companies should amend their policies and procedures to address "texting while driving", particularly where state law addresses the subject.
Some states prohibit cell phone use while driving unless a driver is using a hands free device. Unfortunately, Georgia has yet to regulate cell phone use. Studies have shown that it is a distraction and can cut down on reaction times while driving. Since employers have a duty to keep their employees safe, they should implement policies to prevent needless cell phone related accidents.
Of course, cell phone use goes beyond being on the phone. With the increase use of smart phones, persons are just as likely to be text messaging as they are to be on the phone with someone. Text messaging while driving can be more dangerous than talking on a cell phone because it usually requires both hands to type, as well as looking down at the smart phone (and not at the road). In response to "texting while driving", several states have completely banned the practice by drivers. These states are: Alaska, California, Connecticut, District of Columbia, Louisiana, Minnesota, New Jersey and Washington. Unlike many seat belt laws, most of the states that have banned text messaging while driving make it a primary offense, meaning law enforcement can stop a driver for the offense (as opposed to secondary, where the police can pull a driver over for something like a broken tail light and then can add an offense such as texting or not wearing a seat belt).
So, companies should amend their policies and procedures to address "texting while driving", particularly where state law addresses the subject.
Wednesday, February 4, 2009
Do you give notice when you layoff employees?
The obligation to give notice of a layoff depends upon whether the company is engaging in a mass or group layoff or a single layoff situation. If the WARN Act applies to the layoff in a group layoff situation (or more typically, where a plant or location completely closes down), that can require a 60-day notification to all effected employees.
State law may address this issue as well, but this typically falls into a question of an employer's comfort level with the employees and how they will react to the layoff. Assuming that it is one person effected by the layoff, would giving advance notice to that person result in possible sabotage? Would it cause the person to lack productivity until his/her last day of work? Does it create a security risk because that person has access to sensitive information?
In some case, an employer might consider some giving as a courtesy to the employee to allow him/her a jump on finding other employment (which could also cut down on the length of an unemployment claim).
Finally, an employer can offer a severance package which would typically be under the condition that the employee have at least 21 days to consider the offer (assuming it would be in compliance with the ADEA and the OWPBA). The last date of employment can be a future date or be in the past. In this sense, a severance package can be used to provide advance notice of a layoff.
State law may address this issue as well, but this typically falls into a question of an employer's comfort level with the employees and how they will react to the layoff. Assuming that it is one person effected by the layoff, would giving advance notice to that person result in possible sabotage? Would it cause the person to lack productivity until his/her last day of work? Does it create a security risk because that person has access to sensitive information?
In some case, an employer might consider some giving as a courtesy to the employee to allow him/her a jump on finding other employment (which could also cut down on the length of an unemployment claim).
Finally, an employer can offer a severance package which would typically be under the condition that the employee have at least 21 days to consider the offer (assuming it would be in compliance with the ADEA and the OWPBA). The last date of employment can be a future date or be in the past. In this sense, a severance package can be used to provide advance notice of a layoff.
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