An Ounce of Prevention – Small Steps to Avoid Big Problems

Every year thousands of complaints are filed against employers by current, former and prospective employees (applicants) alleging discrimination.  In turn, employers spend thousands of dollars (if they’re lucky) responding to and defending these claims.  How can you avoid these expenses?  By avoiding these claims.  A little background:

The EEOC sued a Burger King franchisee in 1998 on behalf of a group of female employees who alleged sexual harassment.  The case has been pending for 14 years and is one of the EEOC’s most extensive sexual harassment cases ever.

While not admitting liability or any wrongdoing, Burger King recently decided to settle this matter for $2.5 million (!) because, according to company executives, the settlement would cost less than continuing this litigation.  "It has cost the company an enormous amount of money to defend itself up to this point … It would have cost many more millions of dollars in legal fees. "

Remember those New Year’s resolutions you made for your workplace (if you still haven’t made any, see my previous blog post)? This is another good reason to implement them.  Although you can't predict if you’ll be sued, who will file the complaint or when, you do have control over your exposure and can take steps to minimize the likelihood of a complaint and minimize your risks.  Even if you get sued, you can minimize the damages by taking preventive action.  Also, by taking action, your work environment will likely be more positive and productive.  Here’s how you can start:

• update your employee handbook and your employment policies;
• communicate workplace policies and expectations of workplace conduct consistently; 
• conduct regular training for your managers and employees on EEO  and anti-discrimination policies; and 
• document all disciplinary infractions and performance issues.

Remember, an ounce of prevention. . . 

If you have any questions or would like guidance in this area, contact me or visit my website.  
   

Workplace Resolutions for 2013!!

2013 is still new,  so you still have time to implement the New Year’s resolutions you made for your workplace.  The new year is time to start fresh, so take a look at your policies.  Are they up to date?  Are they effective?  Have they been communicated to the workforce?  If you haven’t made any resolutions yet, don’t worry.  I have a few suggestions. 

Review Your Employee Handbook   Has it been updated to include changes in the law?  Does it reflect changes in company policies?  The handbook is a powerful document.  It helps establish and therefore should be consistent with the culture of your workplace.  Any disparities between the handbook and workplace practices may be held against the employer.  

Review Job Descriptions  Do they still accurately describe the essential job functions and reasonable expectations for the relevant position?  Updated and accurate job descriptions can be critical when facing Americans with Disabilities Act (ADA), Fair Labor Standards Act (FLSA) or other discrimination claims.  

Review Employee Classifications  Make sure that all employees are treated as non-exempt for overtime purposes unless they fit into a recognized exemption.   Lawsuits alleging employees are being misclassified as exempt or as independent contractors remain a source of litigation for plaintiff attorneys. 

Review Your Social Media and Electronic Communications Policies  Make sure your policy addresses your company’s expectations regarding how employees participate in social media.  In addition, make sure your policies reflect your expectations and policies regarding harassment, confidential information and other acceptable communications. 

Review Attendance And Leave Policies  The ADA and FMLA are implicated by seemingly innocuous language regarding leave, leave without pay, medical documentation and accommodations.  The Equal Employment Opportunity Commission (EEOC), the Department of Labor (DOL) and plaintiffs’ attorneys will pursue claims of discrimination or failure to accommodate.  

These a just a few resolutions to help get 2013 off to a good start.  If you have any questions or would like assistance with your review, contact me or visit my website.  

IRS Expands Eligibility for Voluntary Classification Settlement Program

Last year, the Internal Revenue Service ("IRS") announced a settlement program for employers with misclassified workers: the Voluntary Classification Settlement Program (“VCSP”).  Under VCSP, employers can get a reduction in their federal employment tax liability (that would have been assessed based on past nonemployment treatment of workers) by agreeing to properly classify their workers for future tax periods.  This program encourages employers to treat these workers correctly going forward by limiting exposure to penalties for prior misclassification.  In December 2012, the IRS expanded this program so that more employers will be eligible to participate.  Read the IRS announcement here.

To be eligible to participate in VCSP, employers must not be under current employment tax audit by the IRS or current audit of worker classification by the Department of Labor or any state government. A prior audit will not disqualify an employer that complied with the results of the prior audit.  But here’s the good news for employers: the IRS announced that the program will be available through June 30, 2013 for taxpayers who are ineligible under the general criteria because they did not provide the required Forms 1099 to the affected workers for the prior three years.

Bottom Line:  Employers who haven't provided 1099s to your workers, still might be eligible to participate in VCSP until June 13, 2013.  Enforcement activity and audits will continue to be a priority for the Department of Labor and the IRS. Fair Labor Standards Act (FLSA) litigation has also proven to be a lucrative area for plaintiff/employee attorneys and class action attorneys.  Audits and lawsuits can be costly for employers.  Employers should take special care to insure that their workforce is properly classified and take advantage of this program if eligible.  

Not sure if your workers are classified correctly? Not sure if you're eligible to participate in VCSP?  Contact me or visit my website.