Sunday, March 6, 2011
The contemporary American workplace is susceptible to numerous federal, state, and local laws and regulations that impose strict obligations on businesses (e.g., wage and hour legal guidelines, nondiscrimination laws and regulations, etc.). Most companies, especially smaller organizations, tend not to know the scope of such obligations and, consequently, frequently (albeit inadvertently) violate legislation. These violations can cause costly lawsuits, and also civil and criminal penalties. In my experience of being a defense attorney in addition to being a plaintiff's lawyer, the most frequent employment law mistakes done by corporations are these (in no particular order):
- Wrongfully classifying workers as independent contractors. Generally, only workers who operate their unique separate corporations are "independent contractors." Few workers meet this test; in reality, most personnel are considered "employees" for the law, meaning these are eligible to the total variety of workplace protections.
- Wrongfully classifying non-exempt personnel as exempt. Generally speaking, all workers are eligible for minimum wage and overtime pay, unless these are "exempt" under state and federal law. The exemption rules (e.g., for executive, administrative, and professional staff members) only apply in limited circumstances, however; therefore, many staff members who're claimed by businesses to become "exempt" in reality have entitlement to minimum wage and/or overtime pay.
- Not complying with state wage payment laws and regulations. i.e. New York imposes several specific rules regarding how businesses be forced to pay their staff members. These rules include providing new personnel with written notice of the rate of pay and regular pay date; prohibiting deductions from wages unless for that employee's benefit and authorized in writing; requiring written contracts for commissioned salespersons; and providing terminated workers with written notice of the last day's work, their last day's benefits, and their right to make an application for unemployment benefits. (Make sure you are aware of your state's specific rules).
- Not owning an employee handbook. A personnel handbook is a vital tool for effective employer-employee relations. It notifies personnel of the company's values, policies, and procedures; promotes compliance with labor and employment legislation; so it helps create an orderly, efficient, and transparent workplace.
- Not documenting employee job performance. A well-managed organization clearly communicates its employees' duties and responsibilities (e.g., through written position descriptions), trains and supervises workers to be sure they are meeting these requirements, and offers regular, objective, consistent feedback (e.g., through written evaluations and, where necessary, disciplinary actions). A deficiency of accurate, complete, contemporaneous documentation can cause liability in the case of a case by a staff member.
- Not training supervisors regarding EEO laws. Federal, state, and local equal employment opportunity (EEO) law regulations prohibit businesses from taking adverse actions against staff members (e.g., demotion, termination) for reasons not linked to an employee's job performance, including those according to an employee's race, color, sex, age, disability, religion, national origin, sexual orientation, and marital status ( to mention the most typical "protected characteristics"), plus retaliation for an employee's good faith complaints of discrimination. It is imperative that supervisors learn the way to manage personnel without violating (or appearing to violate) these law regulations.
- Not providing reasonable accommodations for disabled personnel. Most EEO law regulations prohibit businesses from taking adverse actions against employees depending on certain protected characteristics, but disability discrimination legal guidelines also impose an affirmative obligation on businesses to "reasonably accommodate" disabled workers in an attempt to make them perform the fundamental functions of these jobs. Such accommodations can include restructuring job duties, modifying work schedules, or providing assistive devices. Businesses must give a disabled laborer with needed accommodations unless this would cause an "undue hardship" for the company (e.g., very costly, too disruptive).
- Not obtaining releases from terminated staff members. When terminating a worker, businesses need to get a release that waives the employee's potential legal claims against the enterprise. The simplest way to get a release is in exchange for an offer of severance (where appropriate). Normally, companies are not necessary to pay for severance to staff members (unless essential to an employment contract or possibly a collective bargaining agreement). If they opt to do this (e.g., in association with layoffs), they must require personnel to sign a release in return for the payment.
- Not protecting confidential business information. Every organization depends upon certain vital, often confidential, information regarding its company operations, including trade secrets, marketing and advertising practices, and customer and client lists. Access to this information must be restricted to personnel with a "need to know" and may be protected by appropriate non-disclosure, non-compete, and/or non-solicitation agreements (depending on the nature of the information along with the employee's position).
- Not consulting an experienced employment law attorney. Perhaps the one most critical point to take away from this discussion is always that businesses must consult an experienced employment lawyer to ensure they are in compliance with all the increasingly numerous and complex legislation that carpet work just like a minefield. Large organizations will often have attorneys and hr professionals working to help them in this field. Small- and medium-size companies often don't. Their biggest mistake is wanting to navigate this minefield automatically.
And also you? What exactly are your top mistakes made in employment law?
The author Stacia Abner writes her blog, http://www.employmentlawtraining.org/, to help the public get all the information they need to raise awareness on labor rights and employment law and its associated benefits to support workers and companies on a daily basis.