By: Stacia Abner
The contemporary American workplace is susceptible to numerous federal, state, and local laws and regulations that impose strict obligations on businesses, such as wage and hour laws and nondiscrimination legal guidelines as a few examples.
All too often, many companies, especially smaller organizations, do not know the scope of such obligations and consequently and frequently will violate what the law states, albeit inadvertently. These violations can result in costly lawsuits, along with civil and criminal penalties.
In my experience as being a defense attorney, in addition to being a plaintiff’s lawyer, the ten most common employment law mistakes by companies and corporations are:
- Misclassification of employees as independent contractors. Generally, only workers who operate their very own separate organizations are “independent contractors.” Few workers meet this test and actually, most personnel are considered “employees” under the law. This means that they are eligible for the complete variety of workplace protections.
- Misclassifying non-exempt employees as exempt. Generally, all workers are eligible for minimum wage and overtime pay, unless they are “exempt” under state and federal law. The exemption rules (e.g., for executive, administrative, and professional employees) only apply in limited circumstances. Therefore, many workers who are claimed by businesses as “exempt” in reality, have entitlement to minimum wage and/or overtime pay.
- Non-compliance with state wage payment laws. As an example, the state of New York imposes several specific rules regarding how businesses can be forced to pay their workers. These rules include providing new employees 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 submit an application for unemployment benefits.
- Not having a laborer handbook in place. A laborer handbook is a crucial tool for effective employer-employee relations. It advises employees of the company’s values, policies and procedures; promotes compliance with labor and employment legal guidelines and helps to create an orderly, efficient, and transparent workplace.
- Non-documentation of employee job performance. A well-managed company clearly communicates its employees’ duties and responsibilities through written position descriptions and trains and supervises staff members to be sure they are meeting company requirements. Companies and corporations should also give regular, objective and consistent employment feedback through written evaluations and, where necessary, disciplinary actions. A deficiency of accurate, complete and contemporaneous documentation can lead to liability in the eventuality of a case by a staff member.
- Not training supervisors regarding EEO laws and regulations. Federal, state, and local equal employment opportunity (EEO) law regulations prohibit businesses from taking adverse actions against workers, such as demotion or termination, for reasons not associated with an employee’s job performance. Employees are protected under the EEO laws in relationship to their race, color, sex, age, disability, religion, national origin, sexual orientation and even their marital status; commonly referred to as “protected characteristics”. Furthermore, employees are protected under law against any company retaliation for that employee’s good faith complaints of discrimination. It is imperative that supervisors learn the way to manage workers without violating (or appearing to violate) these legal guidelines.
- Not providing reasonable accommodations for disabled personnel. Most EEO laws prohibit businesses from taking adverse actions against staff members according to certain protected characteristics, but disability discrimination laws also impose an affirmative obligation on businesses to “reasonably accommodate” disabled workers to be able to assist them to perform the main functions of their jobs. Such accommodations can include restructuring job duties, modifying work schedules, or providing assistive devices. Businesses must give a disabled laborer needed accommodations unless the process would cause an “undue hardship” for the corporation, such as not affordable or too disruptive.
- Not obtaining releases from terminated personnel. When terminating a worker, businesses should obtain a release that waives the employee’s potential legal claims against the company. The proper way to get a release is in exchange for an offer of severance, where appropriate. Generally, organizations are not essential to pay for severance to employees, unless necessary, for an employment contract or even a collective bargaining agreement. If they choose to achieve this, such as in association with a layoff, they must require employees to sign a release in substitution for the payment.
- Not protecting confidential company information. Every enterprise is dependent upon certain vital, often confidential specifics of its organization operations, including trade secrets, marketing and advertising practices, and customer and client lists. Access to this information ought to be limited by employees with a “need to know” basis and will be protected by appropriate non-disclosure, non-compete and/or non-solicitation agreements, depending on the nature of the information, as well as the employee’s position.
- Not consulting an experienced employment law attorney. Perhaps the most critical point to take away from this discussion is businesses have to consult a professional employment lawyer to ensure they are in compliance with all the increasingly numerous and complex laws and regulations that carpet work just like a minefield. Large businesses normally have attorneys and will hire professionals working to help them in this field. Small and medium-size organizations often fail to do this. Their biggest mistake is attempting to navigate this minefield on their own, automatically.
So how does your company rate against the top 10 employment law mistakes?
About the author: Stacia W. Abner writes for Employment Law Training courses. Sharing her experiences as a defense attorney, she devotes her time by aiding workers and organizations in understanding the elements of employment law.