It’s a sobering realization, says attorney Kara Shea, that DOL statistics show 73 percent of its investigations result in findings of violations, but you can push the odds in your favor.
Shea, who is a member of Nashville-based law firm Miller & Martin PLLC, made her remarks at BLR’s Advanced Employment Issues Symposium, held recently in Nashville and Las Vegas.
Shea lists three areas that regulators seem to be focusing on—and that employers would do well to double-check:
Independent contractors. Don’t think you can label someone an independent contractor and that does it. What’s happening a lot now, says panelist Al Vreeland, a shareholder at Lehr Middlebrooks & Vreeland PC in Birmingham, Alabama, is that employers are hiring back former employees as “consultants.”
Initially, the “consultants” don’t care about their status because their spouse has benefits. However, they are typically doing the same work that they did as employees. That means that f things turn sour, they are likely to be employees who are owed back pay and overtime, says Vreeland.
Remember, adds panelist Susan Fentin, a partner in Massachusetts-based law firm Skoler Abbott & Presser, P.C., that DOL now shares information with the IRS, and they will be interested in uncollected back taxes, FICA, and so on.
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Off-the-clock. Pay special attention to meal breaks and whether employees are truly getting an interrupted 30 minutes, says Shea. Nurses, for example, are often interrupted during their meals by patient emergencies. If they are on a time-keeping system that auto-deducts for meals, that’s trouble. The system will deduct the full 30-minute meal-time, but some of that period will have been compensable time worked.
Exemptions. Regulators are looking closely at exempt employees and whether they are truly exempt. Again, labeling an employee exempt doesn’t mean much. You’ll have to run the salary and duties test in each case to be sure.
If you have a category of job with many employees in it, and you aren’t sure whether it should be exempt or not, it might be worth getting expert help. In any situation affecting a large number of employees, penalties can add up dramaticallty.
In addition, Shea says, watch out for state law. For example, in “unjust enrichment” states, common law may allow the courts to go back up to 6 years for calculating back wage payments.
Wage and hour—a hassle for every employer, but it’s even worse for multi-state employers. One thing is for sure, no two states are the same. We asked our editors what they recommend and they came back with the Quick Guide to Employment Law.
For each of the150 HR-related topics the Quick Guide covers, such as wage/hour, employee rights, discrimination, workers’ comp, or affirmative action, the book creates a simple grid.
The topics run across the top, the states along the side. Thus, each grid box provides a short summary of the requirements in that state. Looking at the grid, you literally have a snapshot of what every state, plus D.C., requires on each topic, all at the turn of a page.
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If you’ve got a workforce spread over different states, this is a godsend, eliminating the need to plow through a big pile of individual state guides just to find out how each of your locations is regulated. Plus, the program includes three updates and newsletters each year to keep the data current.
Take as one example the “simple” matter of employee records retention. States vary widely in how many years you are required to hold records, and some even have variances within their own laws.
Here are some of the differences, as charted by BLR’s Quick Guide to Employment Law for basic payroll records only.
Years Required to hold employee records:
1 Year: Louisiana, Utah
2 Years: California, Colorado, Idaho, Massachusetts, Nevada, Oregon, West Virginia, Wyoming
3 Years: Alaska, Arkansas, Connecticut, Delaware, D.C., Illinois, Iowa, Kansas, Maine, Maryland, Michigan, Minnesota, Missouri, New Mexico, New York, North Carolina, Ohio, Rhode Island, South Carolina, Texas, Washington State, Wisconsin
4 Years: Arizona, Georgia, Nebraska, New Hampshire, North Dakota, Oklahoma, Pennsylvania, South Dakota, Virginia
5 Years: Alabama, Florida
6 Years: Hawaii, Kentucky, New Jersey
*Indiana, Mississippi, Montana, Tennessee, and Vermont specify a retention period “sufficient to administer employment law” or similar language.
Note: Federal law requires payroll records retention for 3 years.
The only way we were able to compare these differences efficiently was with the unique layout of the Quick Guide to Employment Law.
Bonus! For a limited time, we’ll send you the hot-off-the-presses special report Critical HR Recordkeeping just for examining the Quick Guide!
Links below let you examine the Quick Guide’s unique page layout and also sample the newsletter. If you’ve got any concern at all about making sure you’re complying with all relevant law—in every state—we suggest you take a look.
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W&H violations are particularly dangerous because of the likelihood that some plaintiff’s attorney will put together a class action.