Florida Employment Law Manual

Transcription

Florida
Employment
Law Manual
Copyright © 2010 by The Florida Chamber of Commerce. All rights reserved. No part of this
publication may be reproduced or transmitted in any form or by any means, electronic or
mechanical, including photocopy, recording, or any information storage and retrieval system,
without the express written consent of The Florida Chamber of Commerce.
The information in this guide is being provided by the authors and publisher as a service to the
business community. Although every effort has been made to ensure the accuracy and
completeness of this information, the authors and publisher of this publication cannot be
responsible for any errors or omissions, or any agency’s interpretations, applications and
changes of regulations described in this publication.
“This publication is designed to provide accurate and authoritative information in regard to the
subject matter covered. It is sold with the understanding that the publisher is not engaged in
rendering legal, accounting or other professional service. If legal advice or other expert assistance
is required, the services of a competent person should be sought.”
-
from a Declaration of Principles jointly adopted by a committee of the American Bar
Association and a Committee of Publishers and Associations.
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Copyright © 2010 by The Florida Chamber of Commerce.
All rights reserved. No part of this book may be reproduced or copied in any form without
permission from the publisher, except where expressly permitted.
This publication presents a summary of information that is intended to be accurate and
authoritative. The publisher and the authors cannot be responsible for any errors, omissions, or
changes in the material presented, nor for any administrative or adjudicative body’s interpretation
or application of the legal premises upon which this material is based.
This publication is an attempt to summarize certain legal principles in the field of employmentrelated and labor laws and regulations, but should not be considered legal advice. Varying factual
circumstances may require special consideration. Should you have any questions, you should
contact legal counsel for advice related to specific topics and circumstances.
For information on how to join the Florida Chamber, please contact us at (850) 521-1200.
This publication is available from:
American Chamber of Commerce Resources, LLC
65 East Wacker Place, Suite 1804
Chicago, IL 60601-7296
(866) 439-2227
www.accr.biz
Price: For information on ordering, including quantity discounts and distribution arrangements,
contact American Chamber of Commerce Resources at (866) 439-2227.
This book, and the entire Human Resources Library, is dedicated to Dick Apland,
who spoke his piece, shared a piece and was at peace. Thanks Dad.
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Foreword from the Florida
Chamber of Commerce
This 2010 edition of the Florida Employment Law Manual will help you achieve a new level
of efficiency and productivity in your workplace environment.
This manual has been updated to include recent revisions to statutes and regulations. Florida’s
workforce is changing, and employers who keep up on these changes will have more productive
employees and can focus their time and effort on running their business – instead of dealing with
personnel problems.
The 2010 Florida Employment Law Manual eliminates the need to create this key
information from scratch or spend hours searching for the updated information. Everything you
need is in this manual. And, best of all, it is written specifically for Florida businesses.
The Florida Chamber is made up of all types of businesses in all corners of the state and is
dedicated to helping Florida business succeed. To find out more about the Florida Chamber and
how to join the fight for Florida business, call 850-521-1200 or visit our web site at
www.flchamber.com.
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Florida Chamber of Commerce
ChamberPerks programs
For more information on any of the ChamberPerks offerings, contact your local Chamber of
Commerce or the Florida Chamber of Commerce at (850) 521-1200 or www.flchamber.com.
•
Office supplies
ChamberPerks is pleased to introduce the Office Supply Discount Program through
Office Depot. Members save up to 75% off the list price on more than 180 products on
the Most Popular Item list and average 10% off all other in-stock items. Shop online or in
stores – whichever option is more convenient for you!
Members get free shipping on all orders over $50 and can get an additional 1% off orders
over $150. Office Depot is more than paper and pens – check out the furniture and
technology departments.
•
Group and individual health insurance
We’ve got you covered – Your business can take advantage of our many group health
plans through all of the top health carriers in Florida. Whether you are looking for a major
medical plan with office co-payments or a basic plan to cover an unexpected catastrophic
event, we have plans for every need.
For a free quote, or more information on ChamberCARE, send an e-mail to
[email protected] or call us toll free at 1-866-322-7526.
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FedEx Shipping
All the great services you’ve come to expect from one of the leading national package
delivery companies, including express, ground, home, and international delivery options!
Members save up to 10-20% depending on the service. No enrollment fee, and savings are
automatic.
•
emTrain Compliance Training
emTrain specializes in on-demand, online HR compliance training. Used by many of the
top companies like Google, US Cellular, Safeway, and McDonalds, this is a great resource
for companies of all sizes that wish to 1) reduce the risk of harassment and discrimination
claims and 2) build litigation defense to dismiss claims at the earliest possible
opportunity. Meets FCHR training recommendations. Chamber members receive a 20%
discount.
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•
E-cast (e-Business Solutions)
A well presented and visually appealing email will get the attention of your recipients
significantly more than a plain text message. Instead of waiting for customers to come to
your web site, why not take the initiative to deliver a high impact message directly to
them? Use e-Cast and win the attention of your online audience!
•
SPAM & Virus Protection
In today’s world, viruses are the favorite tools used by spammers. AppRiver’s program
prevents spam, phishing scams, viruses and other Internet pollution from impacting your
operation. This simple, yet powerful spam and virus filtering service requires no
additional hardware or software. Members save 20-40%.
•
HR HotLine
No matter how many employees you have, no matter if you’ve been in business ten
months or ten years, you have questions on how to manage your most precious resource
– your employees. And now your Chamber of Commerce has the answer to those
questions: HR Hotline. HR Hotline is manned by Fisher and Phillips LLP, authors of the
Florida Employment Manual, the premier human resources reference tool for Florida
employers. Get accurate and authoritative information right from the people who wrote
the book on it (literally!). As a member of your Chamber of Commerce, there is no cost or
obligation to use HR Hotline. Just pick up the phone, get an answer now, and get back to
work!
HR Hotline
Answering your human resource questions
This publication helps you to understand what to do, how to do it, and a little bit of the why…
but sometimes, reading the book isn’t enough. You might have a question concerning our
explanations or sample policies and we want to ensure your complete satisfaction with this
publication.
That’s why we created the HR Hotline. Because you are the owner of this book, you have direct
access to the wealth of information stored in the heads of the attorneys who penned this manual.
When you use HR Hotline, you get accurate and authoritative information right from the people
who wrote the book on it (literally!).
You may call the HR Hotline and speak to a highly qualified labor and employment lawyer to
receive clarification or advice about any entry in the book. There is no charge for such phone
calls, although naturally they must be limited to initial advice only. For any in-depth research or
for representation in a legal matter such as an EEOC charge or lawsuit, you should arrange
for legal counsel.
No other law firm in the country offers a greater complement of labor and employment law
services or a more cost-conscious approach to providing common sense legal counsel. Over the
years, employers across the country have come to trust Fisher & Phillips LLP as their labor and
employment law advisors. Please let us serve you in any way possible.
There is no cost or obligation to use HR Hotline. Simply call 800-827-5669.
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Fisher & Phillips LLP
www.laborlawyers.com
There was a time before faxes, cell phones and e-mail. It was the 1940s and a young man in Atlanta named Ike
Fisher learned that the only way for an employer to give its employees a raise was to persuade the War Labor Board
to allow an increase. Word spread throughout the South, and Fisher became the “go-to” guy for wage and hour law
issues. Soon thereafter, Fisher expanded his practice to include assisting employers in defeating union organizing
campaigns. Then, after completing his tour of duty during World War II, Erle Phillips joined Fisher in representing
employers in labor and employment law matters. Phillips soon became the labor lawyer of choice for many of the
South’s leading businesses and institutions. The rest is history.
Now, after more than 60 years of continued growth and success, Fisher & Phillips LLP is one of the largest national
law firms specializing in the increasingly complex fields of labor, employment, civil rights, employee benefits and
business immigration law. Our expertise and continuing focus on employment-related matters provide our clients
with reduced start-up times, greater cost efficiencies, and better outcomes. Because of our size and experience, we are
able to offer employers advice in all of the myriad areas of labor and employment law.
Many of the most significant labor and employment laws and regulations are federal in nature. Thus, our practice is
nationwide in scope. But because state laws and court decisions increasingly affect the employment relationship, we
also handle cases in the courts and administrative agencies of virtually every state in the country. With three offices
in Florida, and an additional 13 other offices located in major cities around the nation, we can handle cases just
about anywhere in a cost-effective and timely manner.
Our attorneys hail from a wide variety of geographic locations, backgrounds and law schools. Some performed
government service in regulatory agencies prior to joining the firm. Others worked in labor relations or human
resources positions – or as managers or supervisors – prior to attending law school, giving them a practical
perspective on the legal problems our clients face. Each of our attorneys strives to handle the labor and employment
law issues faced by our clients with a practical, business-oriented approach designed to achieve the client’s objective
in a particular matter as efficiently as possible.
No other law firm in the country offers a greater complement of labor and employment law services or a more costconscious approach to providing common sense legal counsel. Over the years, employers across the country have
come to trust Fisher & Phillips LLP as their labor and employment law advisors.
We value that trust as our greatest asset.
Florida Offices Of Fisher & Phillips
Ft. Lauderdale
450 East Las Olas Boulevard
Suite 800
Ft. Lauderdale, Florida 33301
(954) 525-4800 TEL
(954) 525-8739 FAX
Orlando
1250 Lincoln Plaza
300 South Orange Avenue
Orlando, Florida 32801-3392
(407) 541-0888 TEL
(407) 541-0887 FAX
Tampa
2525 SunTrust Financial Centre
401 E. Jackson Street
Tampa, Florida 33602
(813) 769-7500 TEL
(813) 769-7501 FAX
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Contributors
Michelle Anderson
Steve Bernstein
Callan Carter
Randy Coffey
Myra Creighton
Alva Cross Hughes
Sean Driscoll
Andrew Froman
David Gobeo
Pat Harris
Sarah Hawk
Christine Howard
Vasilis “Bill” Katsafanas
Abigail Kofman
Stella LeBlanc
Jason Leo
Andria Lure-Ryan
Philip Marchion
Lawrence McGoldrick
James McLaughlin
Michael S. Mitchell
Greg Nichols
Josh Norris
Candice Pinare-Baez
Jennifer Sandberg
Tim Scott
Chris Stief
Janine Toner
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Chapter table of contents
Features of the HR Library ..................................................................................... 1
1. Snapshot ................................................................................................................. 3
2. Compliance thresholds ............................................................................................ 7
3. Hiring.................................................................................................................... 11
4. Job descriptions .................................................................................................... 47
5. Fair Credit Reporting Act ..................................................................................... 51
6. New hire reporting................................................................................................ 59
7. Affirmative action ................................................................................................. 65
8. Immigration........................................................................................................... 75
9. Discrimination in employment .............................................................................. 85
10. New employee orientation .................................................................................. 129
11. Flexible work arrangements ................................................................................. 133
12. Independent contractors...................................................................................... 141
13. Telecommuting.................................................................................................... 147
14. Wages and hours ................................................................................................. 153
15. Child labor .......................................................................................................... 179
16. Employee handbooks .......................................................................................... 187
17. Employee personnel files .................................................................................... 203
18. Employee performance reviews........................................................................... 207
19. Discipline............................................................................................................ 213
20. Resolving employee disputes .............................................................................. 223
21. Termination ........................................................................................................ 227
22. Whistleblowing ................................................................................................... 239
23. Plant closing or mass layoff................................................................................. 245
24. Unemployment compensation ............................................................................ 253
25. Employee benefits .............................................................................................. 265
26. Retirement plans ................................................................................................. 273
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27. COBRA/health care continuation ........................................................................ 285
28. Health care portability (HIPAA)......................................................................... 295
29. Family and medical leave..................................................................................... 317
30. Veterans’ rights ................................................................................................... 343
31. Workers’ compensation ...................................................................................... 353
32. Drugs and alcohol in the workplace..................................................................... 373
33. Smoking in the workplace ................................................................................... 391
34. Safety in the workplace....................................................................................... 393
35. Workplace violence ............................................................................................. 411
36. Guns in the workplace ........................................................................................ 417
37. Privacy in the workplace..................................................................................... 419
38. Changing technology in the workplace................................................................. 423
39. Employment in the Internet age........................................................................... 437
40. Lie detector tests................................................................................................. 445
41. Trade secrets....................................................................................................... 453
42. Public employers ................................................................................................ 461
43. Unions ................................................................................................................ 471
44. Diversity in the workplace.................................................................................. 493
A. Recordkeeping requirements................................................................................ 499
B. Posting requirements ........................................................................................... 505
C. Holidays ............................................................................................................. 509
Index................................................................................................................... 511
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Table of contents
Introduction
Features of the HR Library......................................................................1
Chapter 1
Snapshot .................................................................................................3
Chapter 2
Compliance thresholds ...........................................................................7
Chapter 3
Hiring ....................................................................................................11
Basic tips for recruiting new employees without inviting trouble ...................................... 11
Intentional interference with a business relationship.......................................................... 12
Applicants ........................................................................................................................ 12
Employment applications ................................................................................................. 12
What to include/not include on an application ........................................................... 13
How to use the application ........................................................................................ 13
Retention of applications .......................................................................................... 14
Hiring questions................................................................................................................ 14
Lie detector tests ....................................................................................................... 15
Exemptions ....................................................................................................... 15
EEOC suggestions for asking questions .................................................................... 16
What you can and cannot ask .................................................................................... 16
Interviews......................................................................................................................... 25
Suggested interview topics........................................................................................ 25
Interview checklist.................................................................................................... 28
Resumes ........................................................................................................................... 30
Background checks............................................................................................................ 30
Social Security number ............................................................................................. 30
IRCA ........................................................................................................................ 30
Form I-9.................................................................................................................... 30
E-Verify.................................................................................................................... 30
Driving records ......................................................................................................... 31
Criminal records ....................................................................................................... 31
Educational history ................................................................................................... 31
Consumer reports...................................................................................................... 31
Pre-hiring checklist.................................................................................................... 32
Reference checks............................................................................................................... 33
Procedures for getting references .............................................................................. 33
Immunity for providing references ............................................................................ 33
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Providing references ................................................................................................. 34
Potential liability related to reference checks............................................................. 35
Defamation........................................................................................................ 35
Negligent hiring/retention.................................................................................. 35
Florida financial institutions...................................................................................... 35
Medical examinations ....................................................................................................... 35
Pre offer.................................................................................................................... 35
Post offer, pre-employment....................................................................................... 35
Determining whether a test is medical....................................................................... 36
Tests that generally are not medical................................................................... 36
Tests which might be medical............................................................................ 37
Medical requirements governed by other federal and state laws................................. 37
Examples of post-offer decisions............................................................................... 37
AIDS ................................................................................................................................ 38
Withdrawing an offer of employment ............................................................................... 38
Blacklisting............................................................................................................... 38
Members of the Uniformed Services ......................................................................... 38
Verification of employment eligibility and identity of new hires using Form I-9 ............... 39
Non-compete agreements.................................................................................................. 40
Negligent hiring and retention........................................................................................... 40
Negligent hiring........................................................................................................ 41
Negligent retention.................................................................................................... 42
Mistakes can be costly .............................................................................................. 43
Release to provide a reference ................................................................................... 44
Applicant statement and release................................................................................ 45
Interview record........................................................................................................ 46
Chapter 4
Job descriptions ...................................................................................47
Developing job descriptions.............................................................................................. 48
Chapter 5
Fair Credit Reporting Act .....................................................................51
Definitions........................................................................................................................ 51
Disclosure and authorization rules..................................................................................... 51
Medical information.......................................................................................................... 52
Workplace misconduct investigations................................................................................ 52
Disclosure and authorization to obtain reports .......................................................... 54
Certification to consumer reporting agency................................................................ 55
Pre-adverse action notice........................................................................................... 56
Adverse action notice................................................................................................ 57
Penalties for violations of the FCRA................................................................................. 58
Where to go for more information...................................................................................... 58
Chapter 6
New hire reporting ...............................................................................59
Who qualifies as a new hire ............................................................................................... 59
What about independent contractors ................................................................................. 59
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What information must be reported................................................................................... 60
How to report................................................................................................................... 60
How often reporting is required ........................................................................................ 61
What if an employer has never made a new hire report...................................................... 61
What about employers with operations in multiple states ................................................. 61
Who sees the information.................................................................................................. 62
Chapter 7
Affirmative action .................................................................................65
Who is covered ................................................................................................................. 65
Enforcement ..................................................................................................................... 66
What is required................................................................................................................ 66
Executive Order 11246 ............................................................................................. 66
The Rehabilitation Act of 1973 ................................................................................. 67
The Vietnam Era Veterans’ Readjustment Assistance Act of 1974............................ 68
Ensuring compliance......................................................................................................... 69
Audits ....................................................................................................................... 69
Investigation of complaints ....................................................................................... 69
How a complaint is processed ........................................................................................... 70
Penalties for noncompliance ............................................................................................. 70
Dealing with the OFCCP........................................................................................... 71
Record keeping................................................................................................................. 72
Chapter 8
Immigration ..........................................................................................75
Employment verification and record keeping..................................................................... 75
E-Verify............................................................................................................................ 76
States requiring E-Verify ........................................................................................... 76
Federal contractors required to use E-Verify beginning September 8, 2009 ................ 76
Temporary visa classifications authorizing employment ................................................... 77
H-1B – Specialty Occupation (Professional) ............................................................. 77
Treaty NAFTA – Canadian and Mexican professionals............................................. 78
L-1A and L-1B – Intracompany transfers of
managers/executives or specialized knowledge personnel ......................................... 79
E-1 and E-2 – Treaty trader/investor ......................................................................... 79
H-2A and H-2B – Agricultural and other seasonal and temporary workers................ 80
H-3 – Trainees .......................................................................................................... 81
F-1 – Academic students ........................................................................................... 81
J-1 – Exchange visitors ............................................................................................. 81
O – Extraordinary ability aliens................................................................................. 82
P – Performing artists, athletes and entertainers......................................................... 82
Permanent residence ......................................................................................................... 82
Employment-based Category 1 ................................................................................. 83
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The EB-5 Regional Center Investment Program......................................................... 84
Chapter 9
Discrimination in employment ..............................................................85
Equal Employment Opportunity Commission .................................................................. 87
How a charge of discrimination is processed ............................................................. 88
1. Prevention through education and outreach................................................... 88
2. Voluntary resolution of disputes ................................................................... 88
3. Strong, fair enforcement ............................................................................... 88
Type A ...................................................................................................... 89
Type B....................................................................................................... 89
Type C....................................................................................................... 89
Retaliation ................................................................................................................ 89
Possible sanctions ..................................................................................................... 90
Rejecting the EEOC decision .................................................................................... 90
Records and reports................................................................................................... 91
Employer Information Report EEO-1 ................................................................ 91
Dealing with discrimination charges................................................................................... 91
Florida Commission on Human Relations ......................................................................... 93
Enforcement ............................................................................................................. 93
How a charge of discrimination is processed ............................................................. 93
Possible sanctions ..................................................................................................... 93
Records and reports................................................................................................... 94
Sexual harassment ............................................................................................................ 94
Policy against harassment ......................................................................................... 95
Recognizing sexually harassing behavior .................................................................. 95
Sexual harassment by a manager/supervisor.............................................................. 96
Quid pro quo ..................................................................................................... 96
Hostile work environment ................................................................................. 96
Harassment by co-workers and non-employees ......................................................... 97
Preventing complaints of harassment ........................................................................ 97
Investigating complaints of harassment ..................................................................... 98
Sexual orientation ..................................................................................................... 99
Title 9 ....................................................................................................................... 99
Equal pay.......................................................................................................................... 99
Equal Pay Act ........................................................................................................... 99
Who is covered.................................................................................................. 99
Establishment defined ..................................................................................... 100
Equal work defined ......................................................................................... 100
Enforcement.................................................................................................... 101
Investigations .................................................................................................. 101
What to do if investigated................................................................................ 101
Possible sanctions............................................................................................ 102
Records and reports......................................................................................... 102
Employer defenses .......................................................................................... 103
Equal pay legislation in Florida............................................................................... 103
Who is covered................................................................................................ 103
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Enforcement.................................................................................................... 103
Pregnancy discrimination................................................................................................ 104
Race or national origin discrimination............................................................................. 104
Disparate impact ..................................................................................................... 104
Reverse discrimination............................................................................................ 104
Sickle cell testing.................................................................................................... 105
The Civil Rights Act of 1866 .................................................................................. 105
Section 1983 of the Civil Rights Act of 1871 .......................................................... 105
Section 1985 ........................................................................................................... 106
Age discrimination.......................................................................................................... 106
Age Discrimination in Employment Act.................................................................. 106
Prohibited practices covered by ADEA ........................................................... 108
Hiring/firing ............................................................................................ 108
Advertising.............................................................................................. 109
Mandatory or involuntary retirement........................................................ 109
Benefits ................................................................................................... 109
Employer defenses .......................................................................................... 109
Florida Civil Rights Act .......................................................................................... 110
Older Workers Benefit Protection Act..................................................................... 110
Waivers .................................................................................................................. 111
Religious discrimination ................................................................................................. 111
Expanding religion.................................................................................................. 111
Disability discrimination................................................................................................. 112
Americans with Disabilities Act (ADA).................................................................. 112
Enforcement.................................................................................................... 112
Definition of disability .................................................................................... 112
A physical or mental impairment that substantially
limits one or more major life activities of an individual............................ 113
Record of a covered disability.................................................................. 114
Regarded as disabled ............................................................................... 115
Relationship with a disabled individual ........................................................... 115
Qualified disabled individual........................................................................... 116
Conditions not covered by the ADA ................................................................ 116
Reasonable accommodation ............................................................................ 117
Undue hardship ............................................................................................... 117
Direct threat .................................................................................................... 118
Pre-employment medical inquiries and examinations....................................... 118
Post-offer, pre-employment medical inquiries and examinations ..................... 119
Post-employment medical inquiries and examinations ..................................... 119
Drug screens.................................................................................................... 120
Confidentiality ................................................................................................ 120
Employer resources ......................................................................................... 120
Handicap-Rehabilitation Act of 1973 ...................................................................... 120
Enforcement.................................................................................................... 121
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Prohibited practices ......................................................................................... 121
Florida Civil Rights Act .......................................................................................... 122
Marital discrimination..................................................................................................... 122
Commonly asked questions and answers......................................................................... 122
Sample policy against harassment ........................................................................... 124
Employee acknowledgment form............................................................................. 126
Manager and supervisor acknowledgment form ....................................................... 127
Chapter 10
New employee orientation .................................................................129
Basic subjects to cover.................................................................................................... 129
Physical surroundings ............................................................................................. 129
Work schedule ........................................................................................................ 129
Payroll issues .......................................................................................................... 130
Supervisors ............................................................................................................. 130
Job descriptions ...................................................................................................... 130
Employee benefits................................................................................................... 131
Necessary paperwork .............................................................................................. 131
Continuing orientation .................................................................................................... 131
Chapter 11
Flexible work arrangements ...............................................................133
Job-sharing...................................................................................................................... 133
Employee benefits .......................................................................................................... 133
Pre-hire considerations .................................................................................................... 134
Temporary/leased employees .......................................................................................... 134
Definition ............................................................................................................... 134
Discrimination ........................................................................................................ 135
Family and Medical Leave Act ............................................................................... 136
National Labor Relations Act.................................................................................. 137
Wages and hours..................................................................................................... 137
OSHA/workplace safety.......................................................................................... 137
Immigration Reform and Control Act (IRCA)......................................................... 138
Unemployment compensation ................................................................................. 138
Casual labor ............................................................................................................ 138
Definition........................................................................................................ 139
Federal Fair Labor Standards Act .................................................................... 139
Chapter 12
Independent contractors ....................................................................141
Unemployment compensation ........................................................................................ 141
Workers’ compensation .................................................................................................. 142
Employees under the Internal Revenue Code................................................................... 143
Federal Fair Labor Standards Act .................................................................................... 145
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Chapter 13
Telecommuting ...................................................................................147
Examples of jobs easily adapted to telecommuting .......................................................... 148
Selecting the telecommuter .............................................................................................. 148
Supervising the telecommuter ......................................................................................... 149
Organization ........................................................................................................... 149
Communication....................................................................................................... 149
Timetables .............................................................................................................. 150
Performance reviews............................................................................................... 150
Reciprocal communications .................................................................................... 150
Safety concerns............................................................................................................... 150
Setting up the home office............................................................................................... 151
Part-time telecommuting ................................................................................................. 151
State employees.............................................................................................................. 151
Employer/telecommuter written agreement ..................................................................... 151
Employer/telecommuter written agreement checklist ............................................... 152
Chapter 14
Wages and hours ................................................................................153
Fair labor standards laws................................................................................................. 153
Who is covered ....................................................................................................... 153
Enterprise coverage ......................................................................................... 153
Individual employee coverage ......................................................................... 154
Enforcement ........................................................................................................... 154
Liability .......................................................................................................... 154
Statute of limitations ....................................................................................... 154
Civil penalties ................................................................................................. 154
Criminal penalties ........................................................................................... 154
Minimum wage............................................................................................................... 155
Youth Opportunity Wage ........................................................................................ 155
Overtime......................................................................................................................... 155
Regular rate ............................................................................................................ 156
Exclusions from the regular rate ...................................................................... 156
Compensable working time............................................................................................. 156
Rest periods ............................................................................................................ 157
Meal periods ........................................................................................................... 157
Medical attention .................................................................................................... 157
Physical examinations............................................................................................. 157
Travel time ............................................................................................................. 157
On-call time............................................................................................................ 158
Compensatory time off............................................................................................ 158
Private employers............................................................................................ 158
Public employers............................................................................................. 158
Unauthorized overtime............................................................................................ 159
Attendance at meetings and training programs ........................................................ 159
Changing clothes before and after work .................................................................. 160
Civic and charitable work ....................................................................................... 160
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Waiting time while on duty..................................................................................... 160
Paperwork completed at home ................................................................................ 161
Exempt vs. non-exempt................................................................................................... 161
Complete minimum wage and overtime exemptions................................................ 161
Executive employee exemption ....................................................................... 161
Administrative employee exemption................................................................ 161
Professional employee exemption.................................................................... 162
Computer employees....................................................................................... 162
Outside sales employee exemption .................................................................. 163
Highly compensated employee exemption....................................................... 163
Others ............................................................................................................. 163
Partial minimum wage exemption ........................................................................... 164
Complete overtime exemption................................................................................. 164
Partial overtime exemption ..................................................................................... 165
Recordkeeping requirements........................................................................................... 165
Records to be preserved for three years ................................................................... 165
Records to be preserved for two years..................................................................... 165
Payroll records must include the following information........................................... 165
Wage payment ................................................................................................................ 166
Direct deposit of employee’s wages ........................................................................ 166
Wage payment upon termination............................................................................. 166
Vacation pay........................................................................................................... 166
Unclaimed wages.................................................................................................... 166
Wage rate discrimination ................................................................................................ 167
Garnishment and wage assignment in Florida ................................................................. 167
Definitions .............................................................................................................. 167
Garnishment.................................................................................................... 167
Wage assignment ............................................................................................ 167
Disposable earnings......................................................................................... 167
Restrictions ............................................................................................................. 167
The Consumer Credit Protection Act ............................................................... 167
Discharge ........................................................................................................ 168
Bankruptcy...................................................................................................... 168
Exemption for “head of family”....................................................................... 168
Exception for amounts due for alimony or child support.................................. 168
Exemption for pension and profit sharing plans ............................................... 168
Income deduction orders ......................................................................................... 168
Requests for information......................................................................................... 169
The garnishment process......................................................................................... 169
The “writ” ....................................................................................................... 169
Effect of writ................................................................................................... 169
Failure to answer ............................................................................................. 170
Fees and costs ................................................................................................. 170
Collection of student loans...................................................................................... 170
Employer notice of change in employment.............................................................. 171
Government contractors special wage-hour laws............................................................. 172
Walsh-Healey Public Contracts Act ........................................................................ 172
The labor standards ......................................................................................... 172
Exempt contracts............................................................................................. 172
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Subcontractors................................................................................................. 173
Covered employees ......................................................................................... 173
Employees not covered.................................................................................... 173
Employees at other worksites .......................................................................... 174
Overtime ......................................................................................................... 174
Enforcement and penalties............................................................................... 174
Davis-Bacon Act..................................................................................................... 174
Covered work.................................................................................................. 174
Covered employees – “site of the work”.......................................................... 174
Overtime ......................................................................................................... 175
Service Contract Act ............................................................................................... 175
Covered employees ......................................................................................... 175
Employees not covered.................................................................................... 175
Covered contractors......................................................................................... 175
Coverage under Walsh-Healey and Service Contract Act................................. 176
Overtime ......................................................................................................... 176
Where to go for more information.................................................................................... 177
Chapter 15
Child labor ..........................................................................................179
Child defined................................................................................................................... 179
Proof of age..................................................................................................................... 179
Permitted occupations for all children ............................................................................. 180
Prohibited occupations for all children............................................................................. 180
Children under 14 years of age........................................................................................ 181
Children 14 and 15 years of age ...................................................................................... 181
Hours...................................................................................................................... 181
Days per week ........................................................................................................ 181
Breaks/meals........................................................................................................... 182
Exceptions to hours of work restrictions.................................................................. 182
Prohibited occupations............................................................................................ 182
Children 16 and 17 years of age ...................................................................................... 183
Hours...................................................................................................................... 183
Days per week ........................................................................................................ 183
Breaks/meals........................................................................................................... 183
Exceptions to hours of work restrictions.................................................................. 183
Student learners .............................................................................................................. 183
Penalties ......................................................................................................................... 184
Contact information ................................................................................................ 184
Required poster .............................................................................................................. 184
Chapter 16
Employee handbooks .........................................................................187
What a handbook should accomplish............................................................................... 187
xxiii
Disclaimers ..................................................................................................................... 188
Receipt statement ................................................................................................... 190
Updates and revisions..................................................................................................... 191
Handbook uses ............................................................................................................... 191
Tips on drafting handbooks............................................................................................. 192
Suggested topics for employee handbooks (and some sample policies)............................ 193
Chapter 17
Employee personnel files....................................................................203
File basics ....................................................................................................................... 203
Employee access ............................................................................................................. 204
Private employers ................................................................................................... 204
Medical records ............................................................................................... 204
Confidentiality ................................................................................................ 204
Public employers .................................................................................................... 204
Written policy regarding personnel files .......................................................................... 205
Chapter 18
Employee performance reviews .........................................................207
Supervisor training.......................................................................................................... 207
Self-evaluation forms ...................................................................................................... 208
Evaluation forms............................................................................................................. 209
Areas for evaluation................................................................................................ 209
Reviewing compensation................................................................................................. 210
Review by objective person ............................................................................................ 210
Meaningful evaluations ................................................................................................... 210
Employee acknowledgment............................................................................................. 211
Chapter 19
Discipline ............................................................................................213
Discipline implementation program................................................................................. 213
The recordkeeping system .............................................................................................. 216
Discipline dos and don’ts................................................................................................ 217
Do........................................................................................................................... 217
Don’t ...................................................................................................................... 218
Sample – Disciplinary action record ........................................................................ 219
Sample – Disciplinary rules and regulations............................................................. 220
Chapter 20
Resolving employee disputes .............................................................223
Arbitration...................................................................................................................... 223
Unionized employers .............................................................................................. 223
Nonunion employers............................................................................................... 223
Mediation ....................................................................................................................... 224
Court-ordered mediation ......................................................................................... 225
Agency mediation ................................................................................................... 225
xxiv
Chapter 21
Termination.........................................................................................227
Exceptions to employment at-will................................................................................... 227
Public policy exception........................................................................................... 227
Implied contract exception ...................................................................................... 227
Intentional infliction of emotional distress............................................................... 228
Defamation ............................................................................................................. 228
Elements of a defamation claim....................................................................... 228
Libel/slander ................................................................................................... 228
Qualified privilege........................................................................................... 228
Preventing a charge of defamation................................................................... 229
Background and references checks .................................................................. 230
Florida financial institutions ............................................................................ 230
Fraudulent misrepresentation .................................................................................. 230
Judicial proceedings................................................................................................ 230
Jury duty................................................................................................................. 230
Political activities of employees .............................................................................. 231
Termination procedures .................................................................................................. 231
Termination conference .......................................................................................... 232
Termination agreements.......................................................................................... 233
Older workers.................................................................................................. 233
Non-compete agreements........................................................................................ 234
Wage payment after termination ............................................................................. 234
Severance pay ......................................................................................................... 234
Post-termination...................................................................................................... 234
Reference checks............................................................................................................. 234
Unemployment compensation ........................................................................................ 235
Replacing a terminated employee .................................................................................... 235
Checklist of factors for terminating “protected” employees..................................... 236
Chapter 22
Whistleblowing ...................................................................................239
Private employment........................................................................................................ 239
Public employment ......................................................................................................... 240
Federal laws .................................................................................................................... 241
Compliance with Sarbanes-Oxley .................................................................................... 241
Supervisor training is necessary .............................................................................. 242
State remedies are not precluded ............................................................................. 243
Chapter 23
Plant closing or mass layoff ................................................................245
Who is covered ............................................................................................................... 245
Key definitions ............................................................................................................... 245
How the law works......................................................................................................... 246
Notice required ....................................................................................................... 246
Parties notified ................................................................................................ 246
Sale of business............................................................................................... 246
Required notification period reduced............................................................... 246
xxv
Natural disasters ...................................................................................... 247
Faltering company ................................................................................... 247
Unforeseeable business circumstances ..................................................... 247
Extension of layoff period ............................................................................... 248
Aggregation of employment losses under the Act ............................................ 248
Method of notice............................................................................................................. 248
Content of notice ............................................................................................................ 248
Affected employees ................................................................................................ 249
Collective bargaining representatives ...................................................................... 249
Dislocated worker unit and local chief elected official............................................. 249
State agencies and local governments...................................................................... 250
Enforcement ................................................................................................................... 250
Civil actions............................................................................................................ 250
Jurisdictional provision ........................................................................................... 250
Maximum liability........................................................................................................... 250
Liability reduced ............................................................................................................. 251
Costs and attorney’s fees................................................................................................ 251
State or local laws ........................................................................................................... 251
Chapter 24
Unemployment compensation ............................................................253
Who is covered ............................................................................................................... 253
Exemptions ..................................................................................................................... 254
Employer contributions .................................................................................................. 255
Eligibility for benefits...................................................................................................... 255
Calculation of unemployment benefits ............................................................................ 256
Disqualification from benefits ......................................................................................... 256
Benefits under the Act .................................................................................................... 260
Filing a claim................................................................................................................... 261
Appeals .......................................................................................................................... 261
Hearing ........................................................................................................................... 262
Further appeals............................................................................................................... 263
Chapter 25
Employee benefits ..............................................................................265
Information on the Employee Retirement Income Security Act (ERISA)......................... 265
What plans are covered ........................................................................................... 265
Basic requirements.................................................................................................. 265
Reporting and disclosure requirements.................................................................... 267
Reporting to government agencies................................................................... 268
Penalties and liability.............................................................................................. 268
Older Workers Benefit Protection Act............................................................................. 269
Americans with Disabilities Act...................................................................................... 270
Family and medical leave................................................................................................. 270
xxvi
Florida’s Child Care Health Insurance Act ...................................................................... 270
Child Care Executive Partnership Act ............................................................................. 270
Chapter 26
Retirement plans.................................................................................273
ERISA retirement plans .................................................................................................. 274
Specific types of qualified retirement plans..................................................................... 274
Profit-sharing plan .................................................................................................. 274
401(k) plan ............................................................................................................. 275
Stock bonus plan..................................................................................................... 276
ESOP...................................................................................................................... 276
Money purchase pension plan ................................................................................. 276
Hybrid benefit plans................................................................................................ 277
Defined benefit pension plans ................................................................................. 277
SIMPLE plans......................................................................................................... 278
Loans from plans ............................................................................................................ 278
Qualified Domestic Relations Orders (QDRO)................................................................ 279
Fiduciary duty................................................................................................................. 280
Who is a fiduciary and what are his duties............................................................... 280
Reporting and disclosure requirements.................................................................... 282
Reporting to government agencies .......................................................................... 282
Chapter 27
COBRA/health care continuation........................................................285
COBRA.......................................................................................................................... 285
Who is covered ....................................................................................................... 285
Employers ....................................................................................................... 285
Employees....................................................................................................... 286
Qualifying events.................................................................................................... 286
Second-chance COBRA election............................................................................. 288
Leaves of absence under the Family and Medical Leave Act................................... 288
Continuation coverage periods ................................................................................ 289
Paying for continuation coverage ............................................................................ 289
Termination of continued coverage ......................................................................... 289
Notices.................................................................................................................... 290
Penalties ................................................................................................................. 291
Florida Health Insurance Coverage Continuation Act...................................................... 291
Who is covered ....................................................................................................... 291
Covered employers.......................................................................................... 291
Employees....................................................................................................... 291
Qualified beneficiaries..................................................................................... 292
Qualifying events.................................................................................................... 292
Election period........................................................................................................ 292
Premium payment ................................................................................................... 292
Period of continuation............................................................................................. 293
Notice to employees................................................................................................ 293
xxvii
Chapter 28
Health care portability (HIPAA) ..........................................................295
Definitions...................................................................................................................... 295
Health insurance portability ............................................................................................ 297
Limitations on imposing preexisting condition exclusions....................................... 297
General Notice of PCE............................................................................................ 299
Creditable coverage ................................................................................................ 300
Methods of crediting coverage ................................................................................ 302
Standard method.............................................................................................. 302
Alternative method.......................................................................................... 302
Certification of creditable coverage......................................................................... 302
Certification requirements ............................................................................... 303
Form and content of the certificate .................................................................. 303
Rules related to certification............................................................................ 305
Demonstrating creditable coverage through other means ................................. 305
Notification of preexisting condition exclusion................................................ 306
Special enrollment periods ...................................................................................... 306
Individuals losing other coverage .................................................................... 306
Dependent beneficiaries .................................................................................. 308
Notice of special enrollment rights .................................................................. 308
Prohibition against discrimination based on health status ................................................ 309
Eligibility for coverage ........................................................................................... 309
Premiums................................................................................................................ 310
Genetic Nondiscrimination Act of 2008 .................................................................. 310
Guaranteed renewability under multi-employer
plans and multiple employer welfare arrangements ......................................................... 311
General exceptions.......................................................................................................... 311
Penalties for noncompliance ........................................................................................... 312
Amount of the tax ................................................................................................... 312
Limitations on amount of the tax............................................................................. 313
Where to go for more information................................................................................... 313
Certificate of group health plan coverage................................................................. 314
Statement of HIPAA Portability Rights .................................................................. 315
Chapter 29
Family and medical leave....................................................................317
Federal coverage.............................................................................................................. 317
Coverage and eligibility ........................................................................................... 317
Leave ...................................................................................................................... 317
Serious health condition .......................................................................................... 318
Notice requirements ................................................................................................ 319
Employer ........................................................................................................ 319
Employees ...................................................................................................... 322
Maintenance of health benefits................................................................................ 322
Job restoration ........................................................................................................ 323
Military leave amendments to FMLA ..................................................................... 323
Family leave to care for an injured or ill military servicemember .............................. 323
Active duty leave .................................................................................................... 324
xxviii
Penalties and enforcement ....................................................................................... 325
Recordkeeping requirements.................................................................................... 326
How FMLA affects other employee rights.............................................................. 327
FMLA and the ADA....................................................................................... 327
FMLA and COBRA........................................................................................ 327
FMLA and the FLSA ...................................................................................... 328
Other leave policies ......................................................................................... 328
Florida laws .................................................................................................................... 329
State law ................................................................................................................. 329
County and municipal laws ..................................................................................... 329
Dade County ................................................................................................... 329
FMLA Notice and Designation Form...................................................................... 332
Chapter 30
Veterans’ rights ..................................................................................343
Uniformed Services Employment and
Reemployment Rights Act of 1994 (USERRA) .............................................................. 343
Protected employees ............................................................................................... 343
Applying for reinstatement...................................................................................... 343
Reinstatement requirements .................................................................................... 344
Protection from discharge ....................................................................................... 344
Vacation or leave time ............................................................................................ 344
Health care coverage............................................................................................... 344
Enforcement ........................................................................................................... 345
Vietnam Era Veterans’ Readjustment Assistance Act of 1974......................................... 345
Leave of absence and reinstatement ........................................................................ 345
Full-time active duty ....................................................................................... 345
Eligibility for reinstatement ..................................................................... 345
Rights after reinstatement ........................................................................ 346
Duration of rights..................................................................................... 346
Medical and life insurance coverage ........................................................ 346
Vacation pay............................................................................................ 346
Salary ...................................................................................................... 347
Active duty for training ................................................................................... 347
Duration of rights..................................................................................... 348
Vacation pay............................................................................................ 348
Salary ...................................................................................................... 348
Weekly drills, weekend drills or summer training duty .................................... 348
Vacation pay............................................................................................ 349
xxix
Salary ...................................................................................................... 349
Reporting obligations.............................................................................................. 349
Florida military leave requirements................................................................................. 350
Reporting obligations.............................................................................................. 350
Active duty with the Florida National Guard........................................................... 350
Military reserves ..................................................................................................... 351
Chapter 31
Workers’ compensation ......................................................................353
Who is covered ............................................................................................................... 353
Number of employees ............................................................................................. 353
Subcontractor.......................................................................................................... 353
Independent contractor............................................................................................ 353
Loaned employees .................................................................................................. 354
Excluded employees ............................................................................................... 354
Extent of workers’ compensation coverage ..................................................................... 355
Traveling ................................................................................................................ 355
Recreational or social activities............................................................................... 355
Activities for “personal convenience” ..................................................................... 355
Injuries resulting from “horseplay” ......................................................................... 356
On-call injuries ....................................................................................................... 356
Off premises injuries............................................................................................... 356
Assaults .................................................................................................................. 356
Injuries in employer-provided housing .................................................................... 356
Parking lot injuries.................................................................................................. 357
Lunch time accidents .............................................................................................. 357
Injuries occurring to or from work .......................................................................... 357
Telecommuting....................................................................................................... 357
Deviations from employment.................................................................................. 357
Out of state injuries................................................................................................. 357
Stress/mental disorder ............................................................................................. 357
Selecting workers’ compensation coverage ..................................................................... 358
Insurance policy...................................................................................................... 358
Self-insurance pools or funds .................................................................................. 358
Individual self-insureds........................................................................................... 358
Miscellaneous coverage plans ................................................................................. 358
Failure to obtain workers’ compensation coverage.......................................................... 359
Fraud .............................................................................................................................. 359
The employment process ................................................................................................ 359
Educating supervisory personnel..................................................................................... 360
Reporting accidents/injuries .................................................................................... 360
Medical care ........................................................................................................... 360
Educating the worker ...................................................................................................... 360
Workers’ compensation coverage posting ............................................................... 361
Safety rules ............................................................................................................. 361
Notice of accident to the employer.................................................................................. 361
Following the accident.................................................................................................... 361
Claims procedures................................................................................................... 361
xxx
Petition for benefits ......................................................................................... 362
Mediation........................................................................................................ 362
Lump sum payments ....................................................................................... 363
Final hearing ................................................................................................... 363
Appeals ........................................................................................................... 363
Expedited resolution process ........................................................................... 363
Filing of necessary forms ........................................................................................ 364
Notice of accident............................................................................................ 364
Wage statement ............................................................................................... 364
Investigating the accident........................................................................................ 364
Keeping in contact with the injured employee ......................................................... 364
Contact with Division of Workers’ Compensation................................................... 365
Controlling costs............................................................................................................. 365
Drug and alcohol testing ......................................................................................... 365
Drug free workplace program.......................................................................... 365
Drug testing labs ............................................................................................. 367
Managed medical care............................................................................................. 367
Compensation for injury ................................................................................................. 368
Permanent total disability........................................................................................ 368
Temporary total disability ....................................................................................... 368
Temporary partial disability .................................................................................... 369
Permanent impairment ............................................................................................ 369
Miscellaneous benefits ............................................................................................ 369
Statute of limitations....................................................................................................... 370
After the doctor permits the employee to return to work.................................................. 370
Employer return-to-work program........................................................................... 370
Chapter 32
Drugs and alcohol in the workplace ...................................................373
Drug-free workplace laws ............................................................................................... 373
Federal Drug-Free Workplace Act of 1988 ...................................................................... 376
Requirements .......................................................................................................... 376
Employer penalties.................................................................................................. 377
Similar state laws on government contracts............................................................. 377
Department of Transportation (DOT) Regulations .......................................................... 378
Testing procedures for transportation industry generally ......................................... 378
FMCSA regulations for drivers ............................................................................... 378
Persons covered by regulations........................................................................ 378
Information for drivers .................................................................................... 379
Safety-sensitive functions................................................................................ 380
Prohibited conduct........................................................................................... 380
Mandatory testing circumstances..................................................................... 381
Test methods ................................................................................................... 382
Consequences related to substance use ............................................................ 382
Required training for supervisors..................................................................... 383
Information from previous employers.............................................................. 383
Americans with Disabilities Act...................................................................................... 384
xxxi
Illegal use of drugs.................................................................................................. 384
Alcohol abuse ......................................................................................................... 385
Policies and testing ................................................................................................. 386
Family and Medical Leave Act (FMLA) ......................................................................... 387
Chapter 33
Smoking in the workplace ..................................................................391
Florida legislation............................................................................................................ 391
Refusing to hire smokers ................................................................................................. 391
Penalties ......................................................................................................................... 391
Sample smoking policy ........................................................................................... 392
Chapter 34
Safety in the workplace ......................................................................393
Occupational Safety and Health Act (OSHA) ................................................................. 393
Administration ........................................................................................................ 393
Enforcement ................................................................................................................... 395
Consulting services ......................................................................................................... 395
Regulations and standards............................................................................................... 395
Inspections...................................................................................................................... 396
Search warrants....................................................................................................... 396
1. Opening conference..................................................................................... 397
2. Walkaround................................................................................................. 397
3. Closing conference ...................................................................................... 398
Citations and penalties .................................................................................................... 398
Other civil issues ............................................................................................................ 398
Appeals or “contests”...................................................................................................... 398
Recordkeeping requirements........................................................................................... 399
Refusals to work ............................................................................................................. 400
Employee access to medical records ............................................................................... 400
The OSHA Hazard Communication Standard ................................................................. 400
Who is covered ....................................................................................................... 401
Written hazard communication program ................................................................. 401
Hazard evaluation ................................................................................................... 401
Labels and other forms of warning.......................................................................... 401
Exceptions....................................................................................................... 401
Material safety data sheets ...................................................................................... 402
Employee information and training ......................................................................... 402
Trade secrets........................................................................................................... 403
OSHA regulations on bloodborne pathogens........................................................... 403
OSHA Personal Protective Equipment (PPE) Standard ................................................... 405
OSHA suggestions to avoid heat-stress ........................................................................... 406
Workplace violence......................................................................................................... 407
AIDS and related illnesses in the workplace .................................................................... 408
Emergency action and emergency response plans ............................................................ 408
Challenges of multi-employer work sites......................................................................... 409
xxxii
Chapter 35
Workplace violence.............................................................................411
Employer responsibility ................................................................................................. 411
Law regarding guns at work............................................................................................. 412
OSHA guidelines on workplace violence ......................................................................... 413
Steps recommended by the guidelines ..................................................................... 413
Domestic violence costs employer and employee............................................................ 414
Employer strategies for preventing workplace violence ................................................... 415
Chapter 36
Guns in the workplace ........................................................................417
The law........................................................................................................................... 417
What the Act allows ....................................................................................................... 417
Searches .......................................................................................................................... 417
Non-discrimination policy .............................................................................................. 417
Complying with the law.................................................................................................. 418
Chapter 37
Privacy in the workplace .....................................................................419
Recording or monitoring employees ................................................................................ 419
Searches .......................................................................................................................... 420
Electronic and voice mail................................................................................................. 421
Chapter 38
Changing technology in the workplace ..............................................423
Electronic mail ................................................................................................................ 423
E-mail as the smoking gun ...................................................................................... 424
E-mail as a forum for harassment............................................................................ 425
E-mail as a mechanism to transmit trade
secrets and other confidential information............................................................... 425
Monitoring employee e-mail ................................................................................... 426
Electronic Communications Privacy Act ................................................................. 426
Constitutional issues........................................................................................ 427
State law issues ............................................................................................... 428
Other ramifications.......................................................................................... 428
Effect on employee morale ...................................................................... 428
Employee self-help .................................................................................. 428
The use of e-mail in union activities................................................................................ 428
Voice mail systems ......................................................................................................... 429
Checking for messages............................................................................................ 430
Monitoring Internet use................................................................................................... 430
Online communities and social networking ............................................................. 430
Sample acknowledgment/consent form .................................................................... 432
Preventive measures........................................................................................................ 433
Sample telecommunications policy.......................................................................... 435
Sample solicitation and distribution policy .............................................................. 436
xxxiii
Chapter 39
Employment in the Internet age.........................................................437
Employees who use communications technology inappropriately................................... 437
Limitations to monitoring employees in an electronic workplace............................. 437
Federal Wiretap Act ........................................................................................ 438
Electronic communications are defined broadly ....................................... 438
Three defenses to alleged violations of the Wiretap Act ........................... 438
Penalties for violations............................................................................. 438
Florida law ...................................................................................................... 439
Blogs, chatrooms, online postings ........................................................................... 439
Attempting to gain access to suspect postings.................................................. 439
Are these postings legally protected................................................................. 440
NLRA rights of private sector employees................................................. 440
Constitutional rights of public sector employees ...................................... 440
Reducing your risks of harm from technology abuses...................................... 441
Instant messaging.................................................................................................... 442
Establishing guidelines..................................................................................................... 442
Sample blogging policy............................................................................................ 443
Chapter 40
Lie detector tests................................................................................445
Who is covered ............................................................................................................... 445
What is prohibited .......................................................................................................... 445
Enforcement.................................................................................................................... 446
Exemptions ..................................................................................................................... 446
Federal government exemptions.............................................................................. 446
National defense.............................................................................................. 446
Security........................................................................................................... 446
FBI contractors................................................................................................ 447
Private employers ................................................................................................... 447
Security services.............................................................................................. 447
Drug security, theft and diversion investigations.............................................. 447
Ongoing investigations.................................................................................... 448
Restrictions on exemptions.............................................................................. 448
Rights of the examinee.................................................................................................... 449
Pretest phase rights ................................................................................................. 449
Actual test phase rights ........................................................................................... 449
Post-test phase rights............................................................................................... 449
Disclosure of information................................................................................................ 450
Notice requirement.......................................................................................................... 450
Interaction with other laws and agreements ..................................................................... 450
Polygraph testing by public employers........................................................................... 450
Chapter 41
Trade secrets ......................................................................................453
What is a trade secret ...................................................................................................... 453
xxxiv
Misappropriation of a trade secret .................................................................................. 454
Injunctive relief....................................................................................................... 455
Damages ................................................................................................................. 455
Criminal penalties ........................................................................................................... 455
Definitions .............................................................................................................. 455
Protecting confidentiality ................................................................................................ 457
Restrictive covenants – Non-compete
agreements and other post-employment restrictions........................................................ 457
Chapter 42
Public employers.................................................................................461
Code of ethics – public officers and employees ............................................................... 461
Suspension or dismissal .................................................................................................. 461
Sick leave ........................................................................................................................ 462
Overtime and “comp” time ............................................................................................. 462
Discrimination prohibited ............................................................................................... 463
Affirmative action........................................................................................................... 463
Security and background checks ...................................................................................... 464
Smoking.......................................................................................................................... 464
Parental or family medical leave ...................................................................................... 464
Polygraph testing............................................................................................................ 464
Right to personnel records .............................................................................................. 464
Drug testing .................................................................................................................... 465
Florida direct deposit of paychecks................................................................................. 465
Collection of Social Security numbers ............................................................................. 465
Military leave ................................................................................................................. 465
Florida National Guard ........................................................................................... 465
Military reserves ..................................................................................................... 466
Veterans’ preference ............................................................................................... 466
Strikes ............................................................................................................................ 466
Unions ............................................................................................................................ 466
Public Employees Relations Commission (PERC) .................................................. 467
Coverage................................................................................................................. 467
Public employers............................................................................................. 467
Public employees ............................................................................................ 467
Rights of public employees ..................................................................................... 468
Recognition and certification of bargaining representative ...................................... 468
Recognition..................................................................................................... 468
Certification .................................................................................................... 468
Decertification................................................................................................. 468
Union unfair labor practices .................................................................................... 469
Employer unfair labor practices............................................................................... 469
Chapter 43
Unions .................................................................................................471
The National Labor Relations Act (NLRA)..................................................................... 471
Who is covered ....................................................................................................... 471
xxxv
The National Labor Relations Board (NLRB) ......................................................... 471
Rights provided under the NLRA............................................................................ 472
Concerted activity ........................................................................................... 472
Employee’s right to a witness (Weingarten rights)........................................... 473
Bulletin boards ................................................................................................ 474
Pro-union insignia ........................................................................................... 474
No solicitation/distribution rules...................................................................... 474
Employer unfair labor practices............................................................................... 475
Threat ...................................................................................................... 476
Interrogation............................................................................................ 476
Promises .................................................................................................. 476
Spying or surveillance ............................................................................. 477
Union unfair labor practices .................................................................................... 478
Processing of unfair labor practice charges.............................................................. 479
Elections ................................................................................................................. 479
The petition..................................................................................................... 479
RC petition .............................................................................................. 479
RD petition .............................................................................................. 480
RM petition ............................................................................................. 482
UD Petition.............................................................................................. 482
UC petition .............................................................................................. 482
AC petition .............................................................................................. 482
Determining the appropriate unit ..................................................................... 483
The election campaign..................................................................................... 483
Mechanics of the election ................................................................................ 484
Eligibility list........................................................................................... 484
Notice of election..................................................................................... 484
Election observers.................................................................................... 484
Pre-election conference............................................................................ 485
Counting the votes ................................................................................... 485
Objections ............................................................................................... 485
Collective bargaining .............................................................................................. 485
Good-faith bargaining ..................................................................................... 486
Surface bargaining................................................................................... 486
Concessions............................................................................................. 486
Proposals and demands ............................................................................ 486
Delaying tactics ....................................................................................... 487
Imposing conditions................................................................................. 487
Unilateral changes in conditions .............................................................. 487
Direct communications with employees................................................... 488
The duty to furnish information....................................................................... 488
Impasse ........................................................................................................... 488
Subjects of bargaining ..................................................................................... 488
Illegal subjects of bargaining ................................................................... 489
Bargaining over relocation or transfer of work ........................................................ 489
Bargaining over drug testing ................................................................................... 489
Florida Right-to-Work Law ............................................................................................ 489
Exclusions .............................................................................................................. 490
Penalties ................................................................................................................. 490
xxxvi
Florida Public Employees Relations Act ......................................................................... 491
Chapter 44
Diversity in the workplace ..................................................................493
Diversity vs. affirmative action ....................................................................................... 493
Why diversify................................................................................................................. 493
Recruiting and retaining employees......................................................................... 493
Understanding an expanding customer base ............................................................ 494
Increasing creativity................................................................................................ 494
Getting used to change............................................................................................ 494
Implementing a plan for diversity ................................................................................... 494
Involve executives .................................................................................................. 494
Communicate the goal of diversity carefully ........................................................... 494
Assess your company.............................................................................................. 495
Establish a diversity training program ..................................................................... 495
Review and rework the plan.................................................................................... 496
Steps to diversity..................................................................................................... 496
Sample workplace diversity policy ......................................................................... 497
Appendix A
Recordkeeping requirements .............................................................499
FLSA – Fair Labor Standards Act ........................................................................... 499
FMLA – Family and Medical Leave Act................................................................. 499
Title VII of the 1964 Civil Rights Act ..................................................................... 500
ADA – Americans with Disabilities Act ................................................................. 500
ADEA – Age Discrimination in Employment Act ................................................... 501
Equal Pay Act ......................................................................................................... 502
OSHA – Occupational Safety and Health Act ......................................................... 502
IRCA – Immigration Reform and Control Act of 1986 ............................................ 503
Appendix B
Posting requirements .........................................................................505
Federal posters ............................................................................................................... 505
State posters ................................................................................................................... 506
Appendix C
Holidays ..............................................................................................509
Public employers ............................................................................................................ 509
Private employers ........................................................................................................... 509
Index ...................................................................................................511
xxxvii
xxxviii
Introduction
Features of the HR Library
Employment laws are modified every year and staying up to date on all the changes can be a fulltime job – and is, for human resources professionals and employers. For the experienced
attorneys who write our books, this manual is a way to help businesses stay on the right side of
employment law, minimize the risk of litigation, and avoid costly penalties. This reference has
been organized to fit your needs and outfitted with numerous features to help you make sure
your policies and business practices are in compliance with the law.
•
The snapshot and compliance threshold
To start the book off with a bang, we’ve gathered a list of questions (provided in Chapter
1) that will create a snapshot for you to use in determining whether or not you are
complying with fundamental employment laws. If you do not know an answer to one of
the questions, a page reference is provided so you can quickly find what you need to
know and what you need to do. Chapter 2 is formatted to help you determine what you
need to worry about and lists prevalent employment laws, their compliance thresholds,
and where they are discussed in this manual.
•
The visual aids
To make this book a more functional resource, we’ve displayed lots of the subject matter
in lists, tables, and checklists. Don’t miss:
the Discipline dos and don’ts on page 217
or
the Commonly asked questions at the end of Chapter 9, Discrimination in
employment
or
the table of What you can and cannot ask in an interview setting on page 16.
And look out for:
sample forms on subjects ranging from family and medical leave (page 332) to
discipline (page 200)
and
1
Features of the HR Library
•
a checklist on page 152 to help you create an Employer/telecommuter
written agreement.
The content
While we’ve worked to make this book as effective as possible – providing efficient ways
to find specific content without expecting busy employers to sit down and read the text
straight through – we want every chapter to be readable and uncomplicated, letting you
know what to do, how to do it, and a little bit of why. In case you don’t have time to
read the whole book, here are some current hot topics we’d like to highlight:
Based on the growing trend social networking sites like Facebook, Twitter,
LinkedIn, and MySpace, Chapter 38, Changing technology in the
workplace, and Chapter 39, Employment in the Internet age, have been
expanded to help you deal with the increased misuse of the Internet during
working hours.
There have been significant changes to the Family and Medical Leave Act this
year, most importantly perhaps are the updates to military leave. To see the
changes, check out page 323, Military leave amendments to FMLA.
•
The connections
As there is a lot of information in this book that requires interaction with different
professional parties, contact information – including websites, email addresses, phone
numbers, and fax numbers for many government departments and local organizations – is
spread throughout the book. In-text mentions of external sources are followed by links to
make it easier for you to apply our text to your own business. To continue the dialogue,
look out for sections entitled, Where to go for more information, like on page 44.
Think of it as the most detailed address book you’ve ever owned!
•
The appendices
We’ve tried to make every page of this manual useful, not just the beginning; so don’t
dismiss the appendices. At the end of the book there are a number of valuable resources
for your use. The topics include recordkeeping and posting requirements, both complete
with federal and state constraints. Find the exact information you need, compiled and at
hand, ready for your use.
•
The digital download
Once you pay for the book, ACCR will email you a link where you can download the
book as a PDF. When you have the digital file saved to your desktop, you will be able to
execute a search within the document so you can find the information you need without
ever turning a page. Simply open the document, access the horizontal menu at the top of
the page, click on “Edit,” pull down to “Find,” enter in a keyword, and start reading!
From hiring to firing, this book will be your personal guide to managing your personnel. Be
confident that you are running a legitimate, functional business with your employment lawyer
sitting on your bookshelf!
2
Chapter 1
Snapshot
The following list of questions provides a snapshot of the most pertinent topics of this book.
You can use this comprehensive checklist to determine whether or not you are complying with
fundamental employment laws and regulations. You should know the answer to every one of
these questions. Although a “No” answer does not necessarily mean you are in violation of any
laws or regulations, you should understand why the answer is “No.” A cross-reference to the
page number in the book that covers each corresponding topic is provided.
Page
reference
Yes
No
Are you reporting your new hires to the Florida Department
of Revenue? ..................................................................................... 59
Have you posted all required employee notices in
conspicuous places (EEO, minimum wage, unemployment
compensation, workers’ compensation, child labor, etc.)?............... 505
Do you keep all medical records separate from other
personnel files?............................................................................... 204
Do you have all new hires complete I-9 forms and do you
keep the I-9 forms separate from supporting documentation?............ 39
Do you retain I-9 forms for each employee for three years
from the date of hire and one year after termination, whichever
is later?........................................................................................... 503
Do you retain for one year job applications, resumes, and
promotion/demotion/discharge letters ............................................. 500
Do you retain for three years each employee’s: name, address,
date of birth, occupation, rate of pay and compensation
earned each week?.......................................................................... 499
Do you know what questions you can’t ask job applicants,
and which ones you should? ............................................................. 16
Do you check all job and personal references before hiring?............... 33
3
Snapshot
4
Do you have complete job descriptions which describe the
essential functions of each job, and do you update them
periodically?..................................................................................... 47
Do you know the difference between exempt and non-exempt
employees?..................................................................................... 161
Are your employees properly designated as exempt or
non-exempt under the Fair Labor Standards Act?............................ 161
Do you have an employee handbook? If so, is it regularly
updated, and do you include a clear statement that
employment is not guaranteed?....................................................... 187
Do you pay required overtime compensation to nonexempt employees, which can include salaried employees?.......... 155
Do you have a written sexual harassment policy, and are
your employees aware of it? ............................................................. 95
Do you have a procedure for investigating employee
complaints about harassment?........................................................... 98
Do you test for drugs or alcohol in compliance with
both Florida and federal law?.......................................................... 386
Do you have a progressive discipline policy, and do your
supervisors understand it and apply it consistently? ...................... 213
Are you aware of the state and federal requirements regarding
continuation of group health care coverage? ................................... 285
Does your company need an affirmative action policy? .................... 65
Do you have a plan for dealing with workplace violence?................ 411
Does your company have a smoking policy that complies
with the Florida Clean Indoor Air Act?........................................... 392
Do you have a system for handling wage garnishment
or income deduction orders? ........................................................... 167
Do you know if your employees are eligible for family
and medical leave? ......................................................................... 317
Are your employees represented by a union? If not, are
you prepared for a union campaign? ............................................... 471
Snapshot
Does your company have a plan for complying with
WARN in the case of a mass layoff or plant closing?...................... 245
Do you know the procedure for reinstating a veteran after
military leave?................................................................................ 343
Do you have a system for sending out COBRA notices
within the required time limits?....................................................... 290
Does your workers’ compensation insurance carrier
provide managed medical care as required by Florida law?............ 367
If you have minor employees, do you display required
posters regarding Florida’s child labor laws? .................................. 507
Does your company have an electronic mail, Internet and
other communications policy? ........................................................ 435
Does your company have a policy regarding employee
blogging/online chatting/instant messaging while at work?............. 430
Have you considered telecommuting as a work option
for certain job positions? If so, have you developed a
telecommuting policy?.................................................................... 147
5
Snapshot
6
Chapter 2
Compliance thresholds
The following list does not include all federal and Florida employment laws, but it does provide
a snapshot view of how many employees an employer must have to be covered by these most
significant laws. Remember, however, that coverage for some of the laws also depends on
requirements other than the number of employees. If the number places your business on the
borderline, consult further in the book for an explanation of those other requirements.
Minimum
employees
Law
Notes
Chapter
1
Employee
Polygraph
Protection Act
(EPPA)
40
Lie
detector tests
1
Fair Labor
Standards Act
(FLSA) –
including child
labor
14
Wages
and hours
1
Family and
Medical
Leave Act
(FMLA)
Public employer.
29
Family and
medical leave
1
Federal new
hire reporting
requirements
The law does not
currently provide
minimum number
of employees for
coverage.
3
Hiring
1
Florida Clean
Indoor Air Act
33
Smoking in
the workplace
1
Immigration
Reform and
Control Act
(IRCA)
3
Hiring
8
Immigration
7
Minimum
employees
8
Law
Notes
Chapter
1
Unemployment
Compensation
Law
24
Unemployment
compensation
1
Uniformed
Services
Employment and
Reemployment
Rights Act
(USERRA)
30
Veterans’ rights
1
Workers’
Compensation
Law
31
Workers’
compensation
2
Equal Pay Act
9
Discrimination
in employment
2
Health Insurance
Portability and
Accountability
Act (HlPAA)
28
Health care
portability
(HIPAA)
4
Workers’
Compensation
Law
General.
31
Workers’
compensation
10
Florida Whistle
Blower
Protection Act
Private employer.
21
Termination
15
Florida Civil
Rights Act
9
Discrimination
in employment
15
Title VII of the
Civil Rights Act
of 1964
9
Discrimination
in employment
15
Americans with
Disabilities Act
(ADA)
9
Discrimination
in employment
Construction.
Minimum
employees
Law
Notes
Chapter
20
Age
Discrimination in
Employment Act
(ADEA)
9
Discrimination
in employment
20
Consolidated
Omnibus Budget
Reconciliation
Act (COBRA)
25
Employee
benefits
50
Family and
Medical Leave
Act (FMLA)
29
Family and
medical leave
50
Florida Violence
Leave Act
35
Workplace
violence
100
Worker
Adjustment and
Retraining
Notification Act
(WARN)
23
Plant closing
or mass layoff
Private employer.
9
10
Chapter 3
Hiring
The hiring process, from the decision to hire, through the selection process and the final decision
who to hire, is one of the most sensitive and potentially dangerous of the employer/employee
relationship.
Various discrimination laws and regulations dictate what you should do throughout the hiring
process (see Chapter 9, Discrimination in employment), therefore, you should review all
hiring practices in light of the following:
•
the possible impact of questions the employer asks on an application and during an
interview
•
the essential and non-essential functions of the job
•
reasonable accommodations for applicants who fall within the ADA guidelines
•
the minimum job requirements.
Basic tips for recruiting new
employees without inviting trouble
•
Generate job descriptions for each position which describe the essential and nonessential
functions of the job.
•
Use multiple sources for recruitment. Contact agencies that service disabled,
disadvantaged, and/or minority individuals to inform them of job openings.
•
Sanitize advertisement language. Unless it is a bona fide occupational qualification,
delete references to physical or mental capabilities and other protected characteristics.
•
Include an EEO compliance statement (drafted in reference to prohibited employer
actions described in § 760.10, Fla. Stat.), essential job functions (from the job
description), and drug policy in recruitment announcements.
•
Ensure the exterior and interior of the facility are accessible to applicants who may need
a reasonable accommodation to access your business to submit an application or
participate in an interview.
11
Hiring
•
Make sure all recruitment agencies or employment agencies used comply with the ADA
requirements. Add a clause in the contract with these agencies which states they will
comply fully with the requirements of the ADA.
Intentional interference
with a business relationship
The legal claim of intentional interference with business relationships allows an individual to
bring suit against another who intentionally and unjustifiably interferes with a business
relationship under which there are legal rights where such interference results in the termination
or breach of that relationship. The fact that the relationship is terminable at will does not, in and
of itself, bar a claim of this type. Therefore, under certain circumstances an employer may be
liable for damages if it intentionally lures an employee away from a competitor.
Applicants
An applicant may be defined as:
•
someone who has indicated an interest in being considered for hiring, promotion, or other
employment opportunities and has applied for the position by completing an application
form (their interest may be expressed orally, depending on the employer’s application
process)
•
someone who wished to apply for the position, but was deterred by the employer’s
alleged improper or unlawful actions
•
for an employer recruiting via electronic methods, applicant means
the employer has acted to fill a particular position
the individual has followed the employer’s standard procedures for submitting
applications
and
•
the individual has indicated an interest in the particular position
someone who the employer considered, or should have considered, for the position at
issue.
Knowing who falls within the category of an applicant is important both in defending against
claims of hiring discrimination as well as in determining whether your hiring practices create an
adverse impact on members of a protected class.
Employment applications
The employment application sometimes turns out to be the most important document in an
employment-related lawsuit. You should review your application form periodically to make sure
12
Hiring
the questions are lawful and in compliance with all of the state and federal employment
regulations applicable to your business.
You should carefully consider the questions you ask on your employment application. All
questions should be job-related, i.e. they should relate to the minimum qualifications required for
the position. Some employers have different types of employment applications for different
classes of employees and some employers use the same employment application for all
prospective employees. In drafting your application form, however, you should consider that non
job-related questions in an application or an employment interview could form the basis of a
lawsuit if they elicit improper information.
What to include/not include on an application
•
Omit medical questions and questions about prior workers’ compensation injuries
or claims on the application form.
•
Specify on the application form how long the application will remain active or on
file (how long it will be considered). Limiting the time for actively considering
applications can serve as a defense against claims of continuing discrimination.
•
The employment application should contain no questions which would tend to
identify the applicant’s race, sex, age, religion, disability, national origin, marital
status, etc. Do not write any comments on the application that would identify
these characteristics, even if it is volunteered by the applicant.
How to use the application
•
Accept applications only when there is a job opening. Make applications
available, however, to all who inquire about an opening.
•
Implement a formal application procedure with a closing date. Require all
applicants to formally apply by completing all of the required steps. Include a
notice in the application package that incomplete or late applications will not be
considered.
•
Make the application format accessible for applicants who may need a reasonable
accommodation. This may include, providing written materials in accessible
formats, such as large print, braille, or audiotape, providing readers or sign
language interpreters, ensuring that recruitment, interviews, tests, and other
components of the application process are held in accessible locations, providing
or modifying equipment or devices, and adjusting or modifying application
policies and procedures.
•
Require applicants to specify for which job they are applying. If they are
applying for more than one position, consider requiring a separate application for
each opening if the skill sets required are unrelated to one another.
•
If you have multiple openings institute a process where applicants who apply for
more than one position will be considered for all openings for which they apply.
13
Hiring
This is particularly important in businesses that do not have a central hiring figure
or who delegate hiring responsibilities to department heads.
•
Ensure that everyone you hire has completed your application form before
offering them a position. Applicants should be required to sign the application,
attest to the truth of the information, and authorize you to perform a background
check, if this is a requirement for employment.
•
Applications must be kept on file for at least one year.
Retention of applications
Applications must be retained for a minimum of one year following their completion.
Applications should be stored similarly to all other company personnel information, in a
locked filing cabinet with limited access to those directly involved in the hiring process
or personnel administration.
Hiring questions
Florida and federal laws prohibit the use of pre-employment inquiries and requirements which
tend to screen out members of protected groups if they are not valid predictors of successful job
performance or cannot be justified by “business necessity.”
There are many decisions that may seem on the surface unrelated to race, sex, age, religion,
color, national origin, marital status or disability. Yet, when examined in the context of a large
group, certain employment practices may have an “effect” of discrimination. For example,
requiring everyone at a manufacturing plant to have a college degree may not in itself appear to
be discriminatory. When you look at the statistics, however, a total picture of the population will
show that a smaller percentage of certain protected classes have a college degree. Additionally,
it is generally not a business necessity for an employee such as an assembler or a line worker to
possess a college degree to perform the essential functions of the job. For that reason, having a
policy of requiring a degree can have a discriminatory “impact” or “effect” upon certain
protected classes.
Before including a question on an application or in an interview, the impact of the question
should be examined from both the employer’s perspective (what is the reason or motivation for
asking the question) and the employee’s perspective (how will the employee perceive the
question). Care must be taken to ensure that questions do not elicit responses about an
applicant’s inclusion in a protected class. For example, if you ask what someone’s religion is, he
or she is likely to think that you will take religion into consideration in deciding whether or not to
hire. The laws do not say that you cannot ask about someone’s religion in an interview. Instead,
the law states that religious discrimination is prohibited. Yet, an observer could assume that if
you ask such questions, this information was a factor in your employment decision with regard
to that individual. Even a section entitled hobbies and interests on an application may receive
responses about an applicant’s involvement in church or religious activities.
See page 16, What you can and cannot ask for a table of proper vs. improper hiring
questions.
14
Hiring
Knowing and documenting your reasons for taking employment actions are important in
defending claims by employees that you acted improperly or unlawfully. If you are diligent in
consistently applying your workplace rules and policies and documenting your actions carefully,
in the event an employee claims you have acted unlawfully, you will be able to explain the reason
for your action and it will be more difficult for a court or jury to assume that you had an
improper or an unlawful reason for your actions.
An employee’s perception of your actions is also very important. Even though an employer’s
reason for asking a question is not discriminatory, an employee may perceive the question as
discriminatory.
Lie detector tests
The Employee Polygraph Protection Act of 1988 (EPPA) makes lie detector testing of
applicants unlawful. The law applies to private sector employers only (see Chapter 40,
Lie detector tests).
Employers may not:
•
cause any employee or prospective employee to submit to any lie detector test
•
use the results of any lie detector test of any employee or prospective employee
•
discipline, deny employment or promotion to, or threaten any employee or
prospective employee based on the results of any lie detector test or an employee
or applicant refusal to take or submit to any lie detector test
•
discipline, or deny employment or promotion to, or threaten any employee or
prospective employee for the exercise by the individual of any right under the
EPPA, including filing a complaint or testifying in any proceeding under the
EPPA.
Exemptions
•
The EPPA allows for polygraph testing of prospective employees by
private employers whose primary business consists of providing armored
car personnel or personnel engaged in the design, installation, and
maintenance of security alarm systems.
•
Security agencies that provide security personnel for the protection of
electrical or nuclear power plants, public water supply facilities,
radioactive or toxic waste materials, public transportation, currency,
negotiable securities, precious commodities, or proprietary information
may administer polygraph tests to prospective employees who will be
employed in a position that involves such activity.
•
Employers authorized to manufacture, distribute, or dispense controlled
substances may administer polygraph tests in limited circumstances, when
the individual has, or will have, direct access to the controlled substances.
15
Hiring
EEOC suggestions for asking questions
The Equal Opportunity Employment Commission (EEOC) has suggested that an
employer consider the following in deciding whether to include a particular question on
an employment application or in a job interview.
•
Does the question tend to have a disproportionate affect in screening out
minorities and females?
•
Is this information necessary to judge this individual’s competence for
performance of this particular job?
•
Are there alternate nondiscriminatory ways to secure necessary information? (See
the table below for examples of proper ways to elicit necessary information.)
What you can and cannot ask
Below is a table with some sample questions in sensitive areas which may be protected
under federal or state law. Both improper and proper forms of the questions are provided.
Subject
Proper
Improper
Address of
residence
or
duration of
residence
Applicant’s place of
residence.
Age
Are you at least 18 years
of age or older? If not,
please state your age.
How old are you?
Dates of education and
employment can be asked
if used for verification of
information given.
What are the ages of your
children?
Questions on this topic are
proper.
How long have you
been a resident of
[city, state]?
What is your date of birth?
How old is your spouse?
Do not ask questions
which tend to identify
applicants over age 40.
Do not ask questions for
the purpose of determining
age (i.e., date of
completion of high
school).
16
Hiring
Subject
Arrest record
Proper
Have you ever been
convicted of a crime?
Please give the details of
your conviction.
You may ask questions
designed to determine if
the conviction relates to a
trait necessary to perform
the job.
Birth control
There are no allowable
questions concerning birth
control.
Improper
Have you ever been
arrested?
Do not ask any
questions concerning
arrests instead of
convictions.
Are you pregnant?
Are you likely to become
pregnant?
as to number of
children, plans for
future children, views
on abortion or birth
control.
Birth date
You must be at least 18
years of age as a
requirement for this
position. Do you meet
this criteria?
Do not require applicants to
produce proof of age in
form of birth certificate or
baptismal record prior to
offer of employment.
Proof of age in form of
birth certificate or
baptismal record can be
requested after hiring for
reasons such as insurance.
Birth place
In what other cities, states
and nations have you
lived?
Can you, after
employment, submit
verification of your legal
right to work in the U.S.?
Birth place of applicant or
applicant’s family is
improper if designed to
determine national origin of
applicant.
17
Hiring
Subject
Proper
Improper
Bonding
Being bonded is a
requirement for this
position. Are you able to
be licensed and bonded?
regarding the applicant’s
refusal or cancellation of
bonding.
Child care
(If required for job)
Who cares for your
children?
Are you able to work
nights and weekends?
On occasion, overtime
work is required. Will you
be able to work outside of
the regular scheduled shift
as needed?
Citizenship
What are the ages of your
children?
Who will care for your
children if they get sick?
Are you authorized to
work in the United States?
Are you a naturalized or
native born citizen?
If you are not a U.S.
citizen, do you have
permission to live and
work in the U.S.?
What date did you acquire
citizenship?
Whether applicant’s family
are naturalized or native
born citizens?
Date parents or family
acquired citizenship?
18
Hiring
Subject
Disability/
handicap/
physical
condition
Proper
The Americans with
Disabilities Act allows
only pre-employment
inquiries concerning the
ability of an applicant to
perform essential jobrelated functions. All
other pre-employment
medical examinations and
inquiries are prohibited
with the exception of a
post-job offer medical
history or examination that
is subject to certain
requirements.
Improper
Most public and private
Florida businesses are
prohibited by the
Americans with
Disabilities Act from
inquiring of an applicant
whether he/she has any
physical or mental
impairment that would
affect his/her ability to
perform a job.
Are you disabled?
Do you have a disability?
Are you handicapped?
Do you think a
handicapped person could
do this job?
Driver’s
license
(If related to the job) Do
you possess a valid
Florida driver’s license?
Do you possess a
chauffeur license?
Economic
status
If job related, provide a
statement that credit
checks are performed on
all applicants, for certain
positions.
Unless there is a jobrelated reason, applicants
cannot be required to
produce a valid driver’s
license.
regarding applicant’s
current or past arrests,
liabilities, or credit rating
including bankruptcy or
garnishment.
19
Hiring
Subject
Education
Proper
All inquiries into the
applicant’s academic,
vocational or educational
background, public or
private schools, are
permissible.
Improper
Isn’t that a girl’s school?
What year did you
graduate from High
School?
Inquiries into grades
received, completion of
course of study and
requirement of transcript
are proper if education or
training is job-related.
If a high school diploma
or GED are required, the
employer may ask: Have
you received a high
school diploma or its
equivalent?
Height
or weight
Height, weight and other
physical questions can be
asked after hiring but only
for business reasons such
as insurance.
These questions should never
be asked of an applicant
unless they are directly
related and proven as a
relevant factor to the
applicant’s ability to perform
the essential functions of the
job.
Language
You may make inquiries
into languages applicant
speaks or writes fluently.
What is your native
language?
If required for the job,
applicant can be asked if
he/she speaks and/or writes
English.
Do not inquire into how
applicant acquired his/her
ability to read, write or speak
a foreign language.
What is your mother tongue?
20
Hiring
Subject
Proper
Marital status
Improper
Are you married?
Do you wish to be addressed
as Miss? Mrs.? Ms.?
Are you single? Divorced?
Separated?
Military
experience
You may inquire into
applicant’s military
experience in the U.S.
Armed Forces or National
Guard.
You may inquire into
applicant’s service and
particular branch of
military.
Inquiries into type of military
discharge should be treated
the same as arrest records on
page 17.
Inquiries into an applicant’s
military experience other
than in the U.S. Armed
Forces or National Guard
should be avoided.
What type of discharge did
you receive?
Name
Have you ever been
known by a different
name?
Is additional information
concerning a change of
name, different names,
aliases or nicknames
necessary to enable a
check of your work or
background record? If
yes, explain.
Applicants should not be
questioned as to their
original names or names
from a foreign origin.
Do not ask a female
applicant her maiden name.
21
Hiring
Subject
National origin
Proper
Do you have a legal right
to remain permanently
and work in the U.S.?
You may ask about
languages applicant
reads, speaks or writes (if
job related).
Improper
Do not inquire into
applicant’s ancestry,
national origin, lineage,
parentage or nationality.
Do not inquire into
nationality of applicant’s
parents, spouse or relatives.
What is your native
tongue?
How did you acquire the
ability to read, write or
speak a foreign language?
Notify in case
of emergency
It is proper to request the
name and location of a
person to be notified in
case of accident or
emergency, but only after
hiring.
This information is not
related to job ability. Do
not ask until after the
applicant has been hired.
Organizations/
activities
You may inquire into an
applicant’s membership
in job-related
organizations which the
employer considers
relevant to the ability to
perform the job.
Do not ask applicant to list
all clubs, societies, lodges
and organizations to which
they belong.
Have you ever held any
positions of leadership
that are relevant to your
ability to perform this
job?
Photographs
22
It is permissible to collect
a photograph of persons
after they are hired.
Photographs should not be
taken or collected of
applicants prior to hiring.
Hiring
Subject
References
Proper
By whom were you
referred for a position
here?
You may ask applicant
for names of persons
willing to provide
professional and/or
character references of
applicant.
Improper
regarding applicants’
former employers or
acquaintances which list
information specifying the
applicant’s race, color,
religion, creed, national
origin, disability, sex, age,
or marital status. Avoid
asking a reference anything
you could not ask of an
applicant.
Residence
Questions about address
or duration of residence
in the area are proper.
Do you own or rent your
home?
Race or color
Do you have a legal right
to remain permanently
and work in the U.S.?
Questions as to applicant’s
race or color or any
comments or questions
concerning complexion,
color of skin or coloring is
impermissible.
Relatives and
nepotism
Are you related by blood,
marriage or adoption to
any current employees of
the company?
Does your spouse work
here?
Is that girl in the
warehouse your wife?
If employed in the
position applied for,
would you be supervised
by someone related to
you by blood, marriage,
or adoption?
23
Hiring
Proper
Subject
Religion or
creed
Improper
Does your religion prevent
you from working
weekends?
What religious holidays do
you observe?
Inquiry into applicant’s
religious denomination,
religious affiliations, parish
or church, religious
holidays observed is not
permitted.
Sex
The job requires one to
perform the following
essential functions…
Do not ask questions which
indicate applicant’s sex or
marital status.
Or:
Do not ask questions which
indicate number of, and
ages of, children, as well
as provisions for child care.
Page ____ of the attached
job description outlines
the essential functions of
the position.
Are you able to perform
the essential functions of
the job with or without
reasonable
accommodation?
Do not ask questions about
pregnancy, child bearing or
birth control.
With whom do you
reside?
Are you pregnant?
Social Security
numbers
Only ask for social
security numbers from an
applicant when needed
for purposes of a
background investigation
It is not appropriate to ask
for an applicant’s social
security number on an
application.
Unless you are offering
them a position contingent
upon the results of an
background investigation
which requires this
information, social security
numbers should not be
collected as a general piece
of information.
24
Hiring
Subject
Proper
Union
membership
or affiliation
Who were your prior
employers?
Work
experience
Any inquiries into prior
employment and duties
with prior employers,
reasons for ending
employer are proper.
Improper
Have you ever belonged to
a union?
At your former employer
were you a union member
or were the employees
represented by a labor
union?
Interviews
Suggested interview topics
With so many questions you shouldn’t ask, sometimes it’s hard to figure out what you
actually can ask. The following should provide a starting point for you to develop your
own interviewing plan. See the sample Interview record on page 46, which should be
completed after the interview.
•
•
Prior attendance, reliability and work ethic
How long have you lived in the area?
Do you have reliable transportation to work?
How was your attendance on your last job?
How many days were you absent in your last year of employment? If
required on occasion, is there any reason why you could not work
overtime?
Education background (related to job requirements)
What courses did you enjoy most in school? Why?
What were your strongest and weakest courses?
Did you work or hold any part-time jobs while you attended school? How
were your overall grades?
What courses or training have you taken since leaving school which might
be relevant to this position?
25
Hiring
•
•
•
26
Prior job performance
Describe in detail the kind of work you performed in your last job.
What was your supervisor’s title and responsibilities?
Why did you leave?
What kind of equipment did you operate?
Describe a typical day.
What salary increases, promotions or other special recognition did you
receive?
What were your strengths on the job? Your weaknesses?
Technical or other special skills (lifting, travel, etc.)
Are you able to do heavy lifting, if the job requires, or could you do such
lifting with a reasonable accommodation?
If required for the job, do you have, or could you obtain, a valid Florida
driver’s license?
What types of machinery, computers, office equipment do you know how
to operate?
This job requires travel of _____ days per week/month. Would you be
able to arrange your schedule accordingly?
Expectations and attitudes of applicant
What role do you expect your supervisor to play?
How would you describe the most effective supervisor you have ever had?
Do you prefer to work alone or with others? Why?
Describe the best employee you have ever supervised yourself.
What fringe benefits did you have at your last job?
What was your salary?
What are your current expectations regarding salary? How did you arrive
at that figure?
Hiring
•
•
Ability to learn and solve problems
How do you approach learning a new procedure or how to use a new
machine?
Do you enjoy assignments which require attention to detail?
What do you do when a customer, co-worker or supervisor is being
difficult?
Have you ever had a working situation where you were under pressure in
some way? How did you handle it?
If you have ever been assigned to work closely with someone else, tell me
how it turned out.
Do you find it difficult to be critical of someone else?
Goals and motivation
What are your long-term goals?
What type of job would you like to have five years from now?
Would you consider working part-time?
What did you like best about your last job?
What did you do to advance your career goals with your last employer?
27
Hiring
INTERVIEW CHECKLIST
Obtain a good employment application. (See also page 12, Employment
applications.) Include a signature block for the applicant to certify that the information
submitted for consideration of employment is truly reported to the best of their ability and
that they certify they have completely reviewed all of the application materials and meet
the minimum qualifications for the position.
Maintain applications for a minimum of one year. State on the application how long the
application is active and whether the individual needs to contact the employer to have
their application considered for future openings within that time period.
Do not take applications unless you have a job position open. Return unsolicited resumes
and inquiries to those persons.
Write interview notes separate from the application. Do not use “codes.”
Develop a job description for each position, accurately defining the requirements of the
job you are interviewing for in terms of the skills, education, physical requirements,
personality and experience necessary for the job.
Make sure all questions asked are job related. The interviewer should have a basic
background in discrimination laws (see Chapter 9, Discrimination in employment) to
understand the characteristics protected by law.
Prior to interviewing, develop a list of open-ended questions. Try to get the applicant to
talk for at least half of the interview time. Listen carefully to responses. Avoid leading
the applicant toward the “right” answer. Suggested open-ended questions are as follows:
How can you contribute to this Company?
How does this job relate to your future plans?
What are your career goals?
What are your strengths and weaknesses?
Why should I hire you?
Thorough background information on the applicant is critical. Require and check
references. If driving is required, check the applicant’s driving record. Check
felony/criminal history for employees when security is a factor. Background information
should be collected prior to an offer of employment. See also page 30, Background
checks. If passing a credit check is a requirement of the position, include a signed
disclosure form in compliance with the Fair Credit Reporting Act. See Chapter 5, Fair
Credit Reporting Act.
If implementing a drug and/or alcohol testing policy that includes pre-employment
screening of applicants, this should be included in the application materials.
28
Hiring
Avoid telling an applicant that they are hired during the initial interview. It is also best to
extend an offer of employment in writing, not over the telephone.
Review work rules and requirements of employment with the applicant prior to hiring
and get a signed commitment from the applicant to follow your policies.
29
Hiring
Resumes
Resumes are another opportunity for an employer to review an applicant’s credentials, but it is a
good idea to require all applicants to complete an application, even if the resume includes much
of the information requested on the application. A resume is designed by the applicant to put
their best foot forward with a potential employer, while a well crafted application allows an
employer to target the areas necessary to determine if an applicant is qualified. Additionally,
because applications require the applicant’s signature, unlike a resume, the applicant must verify
that the information provided in the application is truthful, accurate, and complete.
Background checks
In some situations, unnecessary background checks unrelated to the essential requirements for
the job may be considered evidence of discrimination under the laws that protect applicants from
discrimination on the basis of race, national origin, color, sex, or disability. You should closely
examine hiring decisions based on criminal arrests or convictions, credit history, educational
background, and medical records, and seek the advice of an attorney when faced with a
particular situation which raises these conflicting obligations.
Social Security number
Giving false Social Security numbers and false dates of birth are the most common means
by which applicants attempt to hide criminal backgrounds.
IRCA
The Immigration Reform and Control Act of 1986 (IRCA) requires U.S. employers to
verify the employment eligibility status of newly-hired employees and makes it unlawful
for employers to knowingly hire or continue to employ unauthorized workers.
Under IRCA, anti-discrimination is also enforced and employers may not refuse to hire
someone because of their national origin or citizenship status.
Form I-9
All employees, citizens and noncitizens, hired after November 6, 1986 and working in the
United States must complete a Form I-9. The I-9 form must be completed within three
days of the start date. Failure to comply with IRCA can result in significant fines from
$100 to $1,000 per I-9 form, as well as civil and criminal penalties.
Form I-9 Section 1 can be completed earlier than the start date however, should not be
used for pre-screening applicants. Section 2 must be completed after hire with original
documents showing acceptable work authorization and identification.
E-Verify
E-Verify is a free web-based system to verify new hires are eligible to work in the U.S. EVerify confirms the employment eligibility of new hires and the validity of their Social
Security Numbers. It is “voluntary” but at least seven states – Arizona, Arkansas,
Colorado, Georgia, Mississippi, Oklahoma and Rhode Island – require it for
30
Hiring
companies who have state contract work. There is also a pending regulation to implement
a new law requiring use of E-Verify for companies with any federal contract work. The EVerify site can be accessed directly at:
• https://www.vis-dhs.com.
Driving records
Verify information whenever possible, and do so in all cases where the position to be
filled involves driving. Checks of driving records can reveal personal problems, such as
driving under the influence of alcohol. Check even when applicants claim they do not
have a license, provided that driving is a required part of the job.
Criminal records
To obtain a criminal records check on an applicant or employee that includes all counties
in the state of Florida, provide the name, maiden name (if any), date of birth, social
security number, sex and race to the Florida Department of Law Enforcement. You may
obtain criminal background information from the Florida Department of Law
Enforcement via the internet or United States Postal Service. Prior to obtaining a criminal
background check as a condition of employment, the applicant should complete a release
form acknowledging that a criminal background check is a requirement of the position.
The form should include what information is required of the applicant to collect the
background information and where and how the criminal history results will be obtained
by the employer. For additional information, the Florida Department of Law
Enforcement’s website relating to criminal background checks is:
•
www.fdle.state.fl.us/CriminalHistory.
Educational history
Check with the Dean’s office or registrar of all schools listed by applicants. Verify the
dates of attendance and the degree received. The applicant may have to submit a release
of information form to the school in order to have information provided to the employer.
Consumer reports
Detailed consumer credit histories allow an employer to discover whether an applicant
has potential motivation to steal. Some employers use credit reports to judge an
applicant’s integrity. See Chapter 5 on the Fair Credit Reporting Act.
31
Hiring
PRE-HIRING CHECKLIST
Never promise an applicant or current employee such things as permanent employment,
job security, employment for a “fixed” period of time. Never include such promises in an
employee handbook.
Do not include elaborate statements in job offers or employee handbooks about
termination “for cause only.” These can create an expectation of continued employment
in the mind of the employee unless they commit one of the offenses listed as “for cause.”
Have new employees sign acknowledgments when they receive critical policy statements
(for example, confidentiality, drug and alcohol free workplace, and anti-harassment
policies) or other important documents. If they refuse to sign, do not hire them.
If you issue employee handbooks, have new employees sign a receipt acknowledging that
they have been given a copy. Again, if they refuse to sign, do not hire them.
Consider implementing a drug and/or alcohol testing policy that includes preemployment screening of applicants. If implemented in accordance with Florida’s
statutory worker’s compensation guidelines, this will result in a reduction in worker’s
compensation premiums.
32
Hiring
Reference checks
Procedures for getting references
•
Train the individuals responsible for obtaining references from the
applicant’s former employer(s). This individual must be knowledgeable of
current labor and employment laws and cannot inquire into an applicant’s sex,
race, age, marital status, or medical restrictions.
•
Develop a written reference check form which can be sent out on company
letterhead to the applicant’s former employer(s). The questions asked should
be job related and designed to obtain objective information regarding the
applicant’s prior job performance. Asking about an applicant’s “attitude” or
asking the former employer whether the individual’s performance was “excellent,
good, fair, or poor” is imprecise because different employers will have different
ideas as to what “good” performance is.
•
Document telephone references. If you wish to obtain a reference by telephone,
you should use your written reference check form and document the reference by
completing the form.
•
Inquire about eligibility for rehire. If the former employer will only provide
you with name, job title and dates of employment, ask the former employer if the
applicant is eligible for rehire under the company’s guidelines. If they answer no,
a follow up question as to the nature of the policy that makes the former employee
ineligible is appropriate even though the person providing the reference may
choose not to answer.
•
Keep information confidential. Keep all information obtained during a
reference check confidential and provide it only to those individuals who have a
need to know; in other words, limit access to those involved in the hiring process
of the applicant.
Immunity for providing references
In response to the growing number of private actions against employers, the Florida
legislature enacted the following law that provides employers qualified immunity from
liability for providing reference checks to prospective employers:
An employer who discloses information about a former employee’s job performance to a
prospective employer of the former employee upon request of the prospective employer
or of the former employee is immune from civil liability for disclosure or its
consequences. For purposes of this section, the employer is immune unless it is shown by
clear and convincing evidence that the information disclosed was knowingly false or
violated any civil right of the former employee protected under state law.
33
Hiring
Providing references
•
Centralize reference check function. Despite the fact that employers have a
statutory immunity against civil liability for providing job references, you should
assign the function of providing reference checks to the personnel department
and/or only those management officials who you have trained to provide proper
reference checks. All other management and supervisory officials should be
instructed not to provide references and to direct reference inquiries to the
individuals in the company assigned to provide the reference check function.
•
Obtain a written release of information waiver from applicants at the time of
application which allows the company to give and obtain references without
incurring liability. A sample waiver is provided on page 45.
•
Exercise your rights of qualified privilege. While many companies believe that
the safest way to provide a reference is to give only employee name, job title and
dates of employment, this approach fails to provide necessary information to
employers to screen out poor employees and, in fact, may subject you to more
liability than giving an adverse reference.
An employee will have a much more difficult time proving that the information
disclosed by a former employer was knowingly false or violated any civil right
under Florida law if the person checking references takes the following steps:
•
34
Verify the identity of the person who is asking you for the reference.
Prospective employers have a need to know information regarding
prospective employees. If you receive a telephone call regarding a former
employee from an individual who claims that they are a prospective
employer, the safest method of verifying the identity of the person is to
ask the individual to place their reference questions in writing on company
letterhead and to mail them to you. Alternatively, if you wish to give a
reference over the telephone, tell the individual that you will call him or
her back and get his/her name, title, company name and telephone number.
Verify this information when you call back and document your efforts to
verify the identity of the individual.
Provide only factual statements and if necessary, honestly held beliefs
involving a former employee’s job performance. Avoid information
unrelated to job performance, such as personal traits, opinions about the
former employee’s character, morals or values, and other characteristics
protected by law, such as, race, sex, age.
Document all information provided, including the identity of the
individual to whom the reference is given and the content of the reference.
Place the documentation in the former employee’s personnel file.
You may honestly answer the question whether you would rehire a former
employee without a high risk of incurring legal liability.
Hiring
•
If possible, get an agreement from a departing employee regarding the
content of any reference that you will give about that employee.
Whenever a departing employee asks you if he/she can use you as a reference,
come to an agreement, in writing, regarding the content of the reference and have
each party sign the agreement. The law does not protect former employers who
deliberately provide false or misleading information, therefore, it is important to
provide objective answers rooted in truth and fact.
Potential liability related to reference checks
Defamation
A statement is considered defamatory if it tends to harm the reputation of another,
lower him or her in the estimation of the community and/or deter a third party
from associating or dealing with such a party.
Negligent hiring/retention
See page 40, Negligent hiring and retention.
Florida financial institutions
Florida law provides that it is not unlawful for a person to provide employment
information to a financial institution about an employee’s known or suspected
involvement in a violation of any state or federal law, rule or regulation which has been
reported to state or federal authorities.
Medical examinations
Pre offer
You should not require a job applicant to take a medical examination, to respond to
medical inquiries, or to provide information about workers’ compensation claims before
making a job offer to an applicant.
Post offer, pre-employment
Employers cannot ask applicants about the existence, nature, or severity of a disability.
Applicants may be asked about their ability to perform essential functions of the job. A
job offer may be conditioned upon the results of a medical examination, but only when
examinations are required for all entering employees in similar positions. Medical
examinations of employees must be job related and consistent with the employer’s
business needs.
Note
Applicants engaging in the illegal use of drugs are not covered by the ADA. Tests for
illegal drugs are not subject to the ADA’s restrictions on medical examinations.
According to the EEOC, “employers may hold illegal drug users and alcoholics to the
same performance standards as other employees.”
If an individual is not hired because a post-offer medical examination or inquiry reveals a
disability, the reason(s) for not hiring must be job-related and necessary for the business.
The employer must also show that no reasonable accommodation was available that
35
Hiring
would enable this individual to perform the essential job functions or that the suitable
accommodation would impose an undue hardship.
You may disqualify an individual based on a post-offer medical examination if the results
of that examination reveal the person will pose a direct threat to the health or safety of
himself or herself or to others, if such disqualification is job-related and consistent with
business necessity.
If a person is currently able to perform the essential job functions, you should not
disqualify him/her simply because you speculate the disability may cause a risk of future
injury.
Determining whether a test is medical
A medical examination is a procedure or test that seeks information about an individual’s
physical or mental impairments or health. Determining whether an examination is
“medical” under the Americans With Disabilities Act can be difficult, but regulations set
forth the following factors to assist you in determining if a certain test or procedure is
medical:
•
whether a test is administered by a health care professional or someone trained by
a health care professional
•
whether the results of the test are interpreted by a health care professional or
trainee
•
whether the test is designed to reveal an impairment or the state of an individual’s
physical or psychological health
•
whether the test is given for the purpose of revealing an impairment or the state of
an individual’s physical or psychological health
•
whether the test is invasive (for example, requires drawing of blood, urine, breath,
etc.)
•
whether the test measures physical/psychological responses (as opposed to
performance of a task)
•
whether the test is normally done in a medical setting
•
whether medical equipment/devices are used for the test.
Tests that generally are not medical
36
•
Physical agility/physical fitness tests that do not include medical
monitoring.
•
Certain psychological tests, such as tests that simply concern an
individual’s skills or tastes.
•
Tests for illegal use of drugs.
Hiring
Tests which might be medical
•
Certain psychological tests.
•
Certain vision tests.
•
Certain alcohol tests.
Medical requirements governed
by other federal and state laws
You should also consider the medical and safety requirements established under other
federal and state laws and conduct required examinations accordingly. It is important to
keep in mind that ADA requirements for an employer to make a reasonable
accommodation when it does not impose an undue hardship on the employer may still
apply even though another law drives the requirement for an examination. For example,
the Federal Highway Administration regulations require medical examinations and
evaluations of interstate truck drivers, and the Federal Aviation Administration requires
examinations for pilots and air controllers.
Examples of post-offer decisions
•
A medical history reveals that an individual has suffered serious multiple reinjuries to his back doing work similar to what he was hired to do, which have
progressively worsened the back condition. If you employ this person in this job,
you would incur significant risk that he would further re-injure himself. You can
withdraw the offer of employment if he cannot perform the essential functions of
the job and there is no reasonable accommodation that would enable him to do so
without imposing an undue hardship.
•
A workers’ compensation history indicates multiple claims in recent years which
have been denied. In this case, you might have a legitimate business reason to
believe that the person has submitted fraudulent claims. Withdrawing a job offer
for this reason would not be contrary to the ADA because the decision is not
based on disability, but is instead based on legitimate reasons.
•
A medical examination reveals an impairment that would require the individual’s
frequent lengthy absence from work for medical treatment. The job requires daily
availability at the worksite over the next three months. In this situation, the
individual is not available to perform essential functions of the job, and no
accommodation is possible, therefore the offer of employment may be withdrawn.
•
A landscape firm sends an applicant with 20 years of applicable experience for a
laborer’s job for a physical exam, and an x-ray shows that he has a curvature of
the spine. The doctor advises the firm not to hire him because there is a risk that
he might injure his back at some time in the future. The doctor provides no
specific medical documentation that this will happen or is likely to happen. The
company provides no description of the job to the doctor, but the job actually
37
Hiring
involves riding a mechanical mower. This is an unlawful exclusion because it is
based on speculation about future risk of injury, and is not job-related.
•
An individual is rejected from a job because he cannot lift more than 50 pounds.
The job requires lifting such a weight, but only occasionally. The employer has
not considered possible reasonable accommodations, such as sharing the
occasional heavy weight lifting with another employee or providing a device to
assist lifting. If it will not impose and undue hardship on the employer to make a
reasonable accommodation and the employer fails to explore these options with
the employer, that employer may face liability under the ADA.
AIDS
Florida has a comprehensive AIDS Act encompassing a wide range of AIDS-related topics,
including informed consent for HIV testing, confidentiality of test results, and a prohibition of
discrimination against those infected with HIV. No person may require an individual to take an
HIV-related test as a condition of hiring or continued employment unless the absence of HIV is a
bona fide occupational qualification for the job in question.
Withdrawing an offer of employment
Blacklisting
It is unlawful in Florida for two or more persons to conspire in order to either prevent a
person from acquiring employment or to cause a person to be discharged from
employment. Likewise, it is unlawful to threaten verbally, or by written or printed
communication, any injury to life, property or business of any person for the purpose of
securing the discharge of an employee or to prevent an employee from employment.
Furthermore, it is unlawful to discharge or otherwise threaten an employee to compel that
person to trade, or as the case may be, not trade, with a particular business.
Members of the Uniformed Services
An employer may not:
•
refuse to hire
or
•
fire
or
•
fail to promote
or
•
fail to give any advantage of employment
to an individual because of his or her commitment to the Uniformed Services (see
Chapter 30, Veterans’ rights).
38
Hiring
Verification of employment eligibility
and identity of new hires using Form I-9
For any person hired after November 6, 1986, you are required to verify identity and work
authorization and complete an Employment Eligibility Verification (I-9) form. The employee
completes Section 1 of the form by recording basic information such as name, address, date of
birth, Social Security Number, and immigration status. The employee signs and dates Section 1,
thereby attesting to his or her immigration status. The employee must complete Section 1 of the
form before work commences.
You must examine documents presented by the employee to verify identity and employment
eligibility. You then complete Section 2 of the form by recording information about the
documents presented and attesting that they appear to be genuine, thereby authorizing
employment. You must complete Section 2 and certify the form before the end of the third
business day after the employee’s start date. If you do not comply with the verification
procedures, you face potential civil penalties for violations that range from $110 to $1,100 per
individual for whom the form is not properly completed or retained.
You should not tell the employee what documents to present. Instead, you should let the
employee choose from the lists on the back of the I-9 form. List A is a list of documents that
prove both identity and employment eligibility. List B documents prove only identity and List C
documents prove only employment eligibility. An employee has the discretion of providing the
employer with one document from List A or two documents, one from List B, the other from List
C.
It is unlawful:
•
to require the employee to produce any specific document or combination of documents –
that is why you should let the employee pick what to present
•
to require the employee to produce more documents than are minimally necessary to
comply with the law
or
•
to reject documents that reasonably appear to be genuine on their face.
Collectively, these prohibitions are referred to as the document abuse discrimination provisions.
Fines for violating these rules parallel the fines for I-9 non-compliance ($110 to $1,100 per
individual).
You are allowed to photocopy documents presented by the employee, but you are not required to
do so. Though no specific retention rules exist, keeping these photocopies is a good idea to
assist in the process of periodic self-audits to ensure your I-9 forms are completed correctly. If
you suspect you may be subject to an audit, or if you suspect that your workers may be illegal,
you should do a thorough self-audit before discarding photocopies.
39
Hiring
Employers are required to retain I-9 forms for three years from the date of hire and for one year
after termination. Because there is no statute of limitations in IRCA, you should discard I-9
forms when you have met the retention requirement.
If the employee presents a document for employment authorization that has an expiration date,
then you must “re-verify” employment eligibility before the expiration of that document. This
requires you to examine a new document presented by the employee. You then complete Section
3 of the form by recording information about the new document, signing, and dating the form.
Note that there is an exception to the re-verification rule: you should not re-verify eligibility for
employees who present a U.S. passport or an I-551 Resident Alien (or Permanent Resident) card.
IRCA also makes it illegal for you to knowingly hire or continue to employ someone you know
lacks authorization to work. It is also illegal for you to use an independent contractor
relationship if you know that the contractor lacks authorization to work. The penalties for
“knowing” employment violations range from $275 to $2,200 for a first offense, from $2,200 to
$5,500 for a second offense, and from $3,000 to $11,000 for a third offense. You might also
face criminal sanctions if you are found guilty of a pattern or practice of non-compliance. If you
are a federal contractor, knowing employment violations could result in your exclusion from
receiving federal contracts or certain subcontracts and from certain types of federal assistance
and benefits.
It is important to note that in April 2006 the Department of Homeland Security (DHS) and its
Bureau of Immigration and Customs Enforcement (ICE) announced an intent to use the
harboring and concealing provisions of the criminal code to go after “systemic violators” of
immigration law. DHS has since made it clear that the SSA mismatch letter puts employers on
constructive notice that persons listed therein are potentially illegal workers. DHS and ICE
enforcement efforts in the Spring of 2006 also make employers liable for harboring violations
where they know that a contractor’s worker is illegal, but do nothing to prevent that worker from
continuing to work on the employer’s project.
Non-compete agreements
For a summary of non-compete agreements, see the information provided in Chapter 41, Trade
secrets.
Negligent hiring and retention
Negligent hiring and retention lawsuits are becoming more frequent. For various reasons, certain
employees can pose a threat to co-workers, customers, and members of the general public.
Increasingly, injured parties seek to hold employers responsible for failing to take precautions to
ensure that employees will not harm others, either negligently or intentionally. Florida law,
however, requires you to make reasonable, rather than exhaustive, efforts to ensure those you
hire are fit for employment in that job and meet reasonable requirements for such a position. For
example, an employer who works with vulnerable populations such as disabled, elderly, or
minors would be remiss in not conducting a criminal background check to ensure the employee
had not been convicted of a crime that would preclude them from working with or around those
populations.
40
Hiring
Generally, to establish a claim for negligent hiring, the person who is injured and to whom the
employer owed a duty must show:
•
the employee who caused the injury was unfit for the job
•
the hiring of the employee contributed to the injury
and
•
the employer knew or should have known of the employee’s unfitness and propensity for
criminal behavior.
Negligent hiring may have been difficult to prove in the past, but the number of cases are
increasing, as is the potential liability for employers in such cases.
Negligent hiring
Failure to properly screen out applicants who have a history of dangerous or criminal
behavior may subject an employer to claims of negligent hiring. It is incumbent upon an
employer to make a background investigation which will reasonably demonstrate the
suitability of the prospective employee for the particular work to be performed or for
employment in general.
Employees making certain types of claims, such as sexual harassment, often include
negligent hiring claims against the employer, as well as claims under federal or state
discrimination laws. Florida law gives you a level of protection against such negligence
claims. In order to take advantage of the law, employers should conduct pre-hire
background investigations which include at least one of the following:
•
obtaining a criminal background investigation on prospective employees by
requesting and obtaining from the Department of Law Enforcement a check on
the information reported and reflected in the Florida Crime Information Center
System as of the date of the request
•
making a reasonable effort to contact references and former employers of the
prospective employee (the reference should address the suitability of the
prospective employee for employment)
•
requiring the prospective employee to complete a job application that includes
questions as to whether or not the individual has ever been convicted of a crime,
and, if so, the details of the crime and the date of conviction and the penalty
imposed
•
requiring the prospective employee to complete a job application that asks
whether the prospective employee has ever been a defendant in a civil action for
an intentional act causing harm to a person or property (such as assault and
battery), and, if so, the type of act committed, the harm caused, and the
disposition of the case
41
Hiring
•
obtaining, with written authorization, a driver’s license record check of the
prospective employee, if driving is relevant to the work the individual will be
performing
•
interviewing the prospective employee.
This law only provides a protection against negligence for employers. If a pre-hire
background check reveals past problems, the law will not protect an employer who hires
that individual, despite the results of the background investigations.
Negligent retention
Negligent retention occurs when, during the course of employment, the employer
becomes aware or should have become aware of problems with an employee that
indicates his or her unfitness, and the employer fails to take further action such as
investigation, discharge, or reassignment.
42
•
The general rule for negligent retention is that as an employer, you can be liable
to third parties for failing to exercise ordinary care in maintaining your
employees. Even if you made a reasonable investigation into an employee’s
background and fitness for the position before hiring them, if issues surface
during their employment which you fail to address, a third party may file a claim
that you were liable for retaining that individual as an employee.
•
An employer may not be held liable for negligent retention when they do not have
actual or constructive knowledge of the employee’s behavior, which involves
harm to another’s body, property, or legal rights, or the breach of some duty
owed under statutory law. In Florida, some claims for negligent retention are not
recognized when they are based upon premises of sexual harassment or hostile
working environment. This is a complicated area of Florida law so it is important
to speak with legal counsel when retention issues arise.
•
Generally, a negligent retention claim requires evidence that the employer
continued to employ an employee who was unfit and the employer knew or
should have known of his/her unfitness and failure to exercise proper care in
keeping them on the worksite resulted in harm to the third party.
•
Such a claim can be successful regardless of whether the incident causing the
injury occurred inside or outside the scope of employment.
•
Juries could have differing views as to whether or not the behavior of your
employee was foreseeable and whether or not to place the responsibility for such
behavior on you for failing to investigate allegations, evaluate performance or
discipline accordingly.
Hiring
Mistakes can be costly
•
If someone is injured by your employee, the injured party could claim you were
negligent in hiring and/or retaining the employee. If you lose, significant damages
may be awarded against you.
•
In a negligent hiring/retention case, the injured person will try to prove that your
human resource department was negligent by failing to verify references, inquire
as to criminal record, or notice and require an explanation about gaps in the
employment history of the person causing the injury – any of which could have
revealed potential problems with the individual, such as jail or hospital time, prior
criminal or dangerous behavior, or previous employment issues.
43
Hiring
RELEASE TO PROVIDE A REFERENCE
– SAMPLE –
In order to provide (Employer name) with information and opinions that may be useful in its
hiring decisions, I hereby authorize any person, school, current or past employer, organization or
entity disclosed in my resume, application, or during my interview to provide any information
regarding me, including without limitation, information concerning my performance. I
acknowledge that the information divulged may be negative or positive with respect to me.
Nevertheless, pursuant to this authorization, I unconditionally release such person, school,
employer, organization or entity from any and all legal liability for furnishing such information
and in making such statements.
A photocopy of this signed release shall have the same force and effect as the original release
signed by me.
Applicant Signature: ______________________________________
Applicant Name (please print): ______________________________________
44
Hiring
APPLICANT STATEMENT AND RELEASE
– SAMPLE –
I certify that the information provided in my application for employment with (Employer Name)
is true and complete to the best of my knowledge. I authorize the investigation of all matters
contained in this application and hereby give the Employer permission to contact schools,
previous employers, references, and others listed on my application and resume. I hereby release
the Employer from any liability as the result of such contact. I understand that
misrepresentations, omissions of fact or incomplete information provided on my application or
resume may remove me from further consideration for employment. In addition, if I am
employed, I understand that any misrepresentation or omissions of fact on my application or
resume may subject me to discipline, up to and including discharge, at any time without any
previous notice.
Applicant Signature: ______________________________________
Applicant Name (please print): ______________________________________
45
Hiring
INTERVIEW RECORD
– SAMPLE –
Name: ____________________________________________________________________
Job Position: _______________________________________________________________
Date: _____________________________________________________________________
Last Pay Rate:______________________________________________________________
Asking Pay Rate: ___________________________________________________________
Qualifications: _____________________________________________________________
Education: * _______________________________________________________________
Work Experience:___________________________________________________________
Ability to Perform Essential Job Functions: * _____________________________________
_________________________________________________________________________
Initiative:__________________________________________________________________
Other: ____________________________________________________________________
Interview Comments: ________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
Overall Impression: _________________________________________________________
*Make certain the interviewer rates only abilities which are essential functions of the job.
46
Chapter 4
Job descriptions
Job descriptions are written documents which describe the essential job duties, minimum
requirements, expectations, and responsibilities of a particular job or a group of jobs within a
single department or division of the company. Job descriptions can be general, there are many
sample job descriptions available on internet sites, such as O*NET Online, and through
purchasable software. Or, an employer may chose to craft their own. It is important to
remember, however, that even if you use a sample you should tailor it to meet the needs of your
organization.
Job descriptions are helpful for several reasons. They can form the basis of employee
performance evaluations, and can serve as a means of communicating to applicants and
employees the exact nature of their job responsibilities. Job descriptions can also be helpful in a
departmental or company reorganization, as well as in hiring and recruiting efforts.
The first step in crafting a job description is to define the essential functions of the job. Essential
functions are duties which the applicant or employee must be able to perform, with or without an
accommodation, in order to be considered qualified for the job. Typically, determining whether
some part of a job is an essential function involves addressing the following factors:
•
Is this a primary, fundamental purpose of the job?
•
Does the position exists primarily to perform that function?
•
How much time do people currently filling the job or people who filled the job in the past
spend on that function?
•
Is the function actually performed?
•
How often is the employee required to perform this function?
•
If removed, would it fundamentally alter the job?
•
Does this usually occupy a large percentage of an employee’s time?
•
Does it require special expertise or skills?
•
If there is a collective bargaining agreement, what does it say about the duties of the job?
•
Can the function can be assigned to other employees? (Consider the number of
employees available, the particular skills involved, and demands of the job or business.)
47
Job descriptions
•
What are the consequences of failing or being unable to perform the functions? For
example: a fire fighter must be able to carry an unconscious adult from a burning
building. While many fire fighters will never actually be required to perform this
function, the consequences of being unable to do so would be serious.
Written job descriptions are one example of objective evidence as to what the employer
considers to be essential functions of a particular job. Employers should focus on the purpose of
a particular job function, such as the result required, rather than on how the job function is
performed. For example, entering data on a computer may be an essential function, but typing
skill used to enter the data may not necessarily be essential because adaptive devices allowing
voice input could achieve the same result as manual typing.
Additionally, job descriptions should include not only the physical requirements of the job, but
also any mental abilities necessary to perform the essential job functions, such as the ability to
work under time pressure and ability to analyze detailed reports. Keep in mind, however, if you
make a conditional offer of employment contingent upon the employee passing a specific
physical or mental examination, and later withdraw the conditional offer, this may raise
questions of whether or not a reasonable accommodation was possible, but not explored. Refer
to Chapter 9, Discrimination in employment for information on the ADA and reasonable
accommodations.
Once drafted, a job description is a living document and should be reviewed and updated on a
regular basis. Ideally, job descriptions should be reviewed annually. It is particularly important
that job descriptions provided during the hiring process accurately reflect essential functions of
the job and minimum requirements. Part of your company’s employee recruitment plan should
include a review of the job description before opening the position.
Your focus in developing written job descriptions should be to develop a tool that clearly
outlines the essential elements of the position, the areas employees can expect to be evaluated
on, basics such as pay, schedule, supervision structure, and the requirements for the position.
Writing and revising job descriptions may appear overwhelming, but the benefits of having well
informed applicants and employees saves time, money, and is a first line of defense in tackling
legal claims. A properly drafted job description, that includes bona fide job requirements and the
essential functions of the position, is an important tool to lessen potential liability from a
discrimination claim.
Developing job descriptions
The following are recommended steps for developing job descriptions:
48
•
Designate one person or a group of persons to oversee the process of drafting all job
descriptions to ensure uniformity in structure. This may include a Human Resources
employee or, at a minimum, the manager with the most knowledge of the position.
•
Include all essential tasks of the job in one section and additional responsibilities in
another.
Job descriptions
•
List required job qualifications – include any physical qualifications, such as lifting and
climbing, as well as any mental qualifications, such as necessary mathematical skills,
reading level or educational training.
•
Ensure persons responsible for drafting job descriptions review the list of essential
functions with the employees’ who actually perform the jobs and the supervisors of such
positions to confirm written job descriptions reflect the reality of the position.
If possible, all written job descriptions should follow a similar format, and be no more than one
page in length. Examples of items to include in a job description include the following:
•
job title
•
supervisory status and chain of command
•
pay grade, salary, hourly wage, or other job classification as to compensation
•
classification under the Fair Labor Standards Act, either exempt or non-exempt
•
description of the job’s general purpose
•
description of each of the job’s essential functions (see page 47 for further explanation of
essential functions)
•
other duties which may be requested (for example: “other duties as assigned,” but note
that such general descriptions are probably not essential job functions)
•
list of minimum skills or bona fide educational requirements for the job
•
list of travel, transportation, and insurance requirements or other general working
conditions
•
a list of physical or mental requirements, such as must be able to lift 50 lbs. on a daily
basis or must be able to work in a fast paced high pressure environment
•
disclaimer and notice of right to revise the job requirements (for example, “This job
description is not intended to be a contract for employment, and the employer reserves
the right to make any necessary revisions to the job description at any time without
notice”).
Consider the possibility of utilizing videotaped job descriptions, especially for safety sensitive
jobs. Often, there is no way for a written job description to portray, in any realistic sense, what a
job really requires. By videotaping employees actually engaged in their jobs in the workplace,
there can be little dispute over what are the essential functions of the job or what physical
requirements are job-related.
Use written job descriptions in the hiring and recruiting process. Remember, the ADA does not
permit you to ask questions on a job application or in a job interview about physical or mental
impairments that might affect job performance. What you can do, however, is attach a copy of
49
Job descriptions
the job description to the application and ask the applicant if he/she can perform each of the
essential functions listed on the job description with or without accommodation.
Finally, document the process of preparing each job description, including the names of
individuals who participated, how they participated and the dates of preparation and revision.
Many job descriptions also include an approval date, with a statement such as, “the Board of
Directors approved this job description on October 5, 2006.” Commit to review all job
descriptions at least annually to ensure they reflect current job requirements and make necessary
revisions as required.
50
Chapter 5
Fair Credit Reporting Act
The Fair Credit Reporting Act (FCRA) has been in existence since 1971. It governs the privacy
and accuracy of information supplied by a “consumer reporting agency” (a firm such as a credit
bureau or other background report provider). The FCRA strictly limits the use of “consumer
reports” provided by such firms, but the law permits employers to use such reports for
employment purposes which include hiring, promotion, reassignment or retention.
Currently, the FCRA permits the use of consumer reports for employment purposes only if the
employee or applicant gives written permission and has received a written disclosure that such
reports will be obtained. Employers seeking to take adverse action against an employee or
applicant on the basis of a consumer report must also follow additional requirements of the
FCRA such as providing a copy of the report to the individual before taking the adverse action.
An employee or applicant can file a lawsuit against an employer for violation of the FCRA and
may win damages, attorney’s fees and costs.
Definitions
All reports from a consumer reporting agency are called “consumer reports.” One type of
consumer report, the type based on personal interviews by the agency, are known as
“investigative consumer reports,” and those reports trigger additional disclosure obligations.
For employment purposes, the term “adverse action” means a denial of employment or any other
decision for employment purposes that adversely affects any current or prospective employee.
Disclosure and authorization rules
Employers using consumer reports now have several disclosure and authorization obligations
including:
•
provide to applicants and employees a written disclosure, in a document that consists
solely of the disclosure, that a consumer report may be obtained for employment
purposes
•
obtain written authorization from applicants and employees to obtain the consumer report
•
before taking adverse employment action based on a consumer report, provide a copy of
the consumer report and the FTC’s “summary of rights” to the applicant or employee
•
after adverse action is taken based on a consumer report, provide written notice to the
applicant or employee that such adverse action has been taken and provide other
information including a written description of certain rights under the FCRA
51
•
prior to obtaining consumer reports, provide a written certification to the consumer
reporting agency stating that your Company is complying with the above-referenced
requirements and will not use the reports in violation of any applicable federal or state
equal employment opportunity law or regulation.
Employers that request an investigative consumer report for an applicant or employee have
additional duties:
•
not later than three days after requesting an investigative consumer report, provide
written disclosure to the applicant or employee that such a report may be requested and
that the individual may request information regarding the nature and scope of the
investigation.
Medical information
The FCRA prohibits consumer reporting agencies from providing consumer reports that contain
medical information for employment purposes, or in connection with credit or insurance
transactions, without the specific prior consent of the individual who is the subject of the report.
In the case of medical information being sought for employment purposes, the information must
be relevant and the individual must explicitly consent to the release of the medical information in
addition to authorizing the obtaining of a consumer report generally.
Workplace misconduct investigations
Employers continue to be free to conduct internal investigations using their own employees
without risk of triggering the FCRA. Effective March 31, 2004, Congress stepped in to ensure
that employers who want to hire an outside expert to investigate certain types of workplace
misconduct should not be bound by all of the FCRA’s notice, authorization, and disclosure
requirements. The amendment to the FCRA provides a simpler procedure for handling certain
types of reports to employers. Specifically, the amendment applies to a report from an outside
investigator hired by an employer where:
•
the oral or written report is made to an employer in connection with an investigation of:
suspected misconduct relating to employment
or
•
compliance with federal, state, or local laws and regulations, the rules of a selfregulatory organization, or any preexisting written policies of the employer
the report is not made for the purpose of investigating a consumer’s credit worthiness,
credit standing, or credit capacity
and
•
the report is not provided to any person except:
52
the employer or an agent of the employer
or
a government officer, agency, or department
or
any self-regulatory organization with regulatory authority over the employer or
employee
or
as otherwise provided by law.
For reports such as those described above, there is no advance-notice or authorization
requirement, and the only disclosure obligation on the employer will be this: After taking any
adverse action based in whole or in part on such a report, the employer must disclose to the
employee a summary containing the nature and substance of the report. In that summary, the
sources of information acquired solely for use in preparing the report do not need to be disclosed.
53
DISCLOSURE AND AUTHORIZATION TO OBTAIN REPORTS
– SAMPLE –
DISCLOSURE
For employment purposes, the Company may obtain consumer reports on you as an applicant or
from time to time during employment. “Consumer reports” are reports from consumer reporting
agencies and may include driving records, criminal records, etc.
For such employment purposes, the Company may also obtain investigative consumer reports.
Some reference checks by a consumer reporting agency fall into this category. An “investigative
consumer report” is a consumer report in which information as to character, general reputation,
personal characteristics, or mode of living is obtained through personal interviews with
neighbors, friends, associates, acquaintances, or others. You have a right to request disclosure of
the nature and scope of an investigation and to request a written summary of consumer rights.
AUTHORIZATION
I authorize the Company to obtain consumer reports and/or investigative consumer reports
regarding me from time to time for employment purposes.
Signature: _____________________________________
Date: ___________________
Driver’s License Number:_________________________ State:___________________
Other Driver’s Licenses Held in Past 5 Years: ___________________________________
Print Maiden or Other Names Under Which Records May be Listed: ________________
________________________________________________________________________
Date of Birth (to be used only for proper identification): __________________________
If the Company requests an investigative consumer report and you would like to receive a
disclosure of the nature and scope of the investigation and a written summary of consumer rights,
indicate your request here: ____________________________________
54
CERTIFICATION TO CONSUMER REPORTING AGENCY
– SAMPLE –
[CONSUMER REPORTING AGENCY]
[STREET ADDRESS]
[CITY, STATE, ZIP]
Date:__________
RE: CERTIFICATION TO CONSUMER REPORTING AGENCY
To Whom It May Concern:
For employment purposes, our Company seeks to obtain consumer reports and/or investigative
consumer reports on applicants and/or employees. In accordance with the Fair Credit Reporting Act
(FCRA), our Company certifies to you as follows:
1.
Our Company has complied with FCRA Section 604(b)(2) by providing the consumer an
appropriate disclosure of intent to obtain consumer reports. We have also complied with
FCRA Section 606(a)(1) by disclosing the definition of investigative consumer reports and
informing the consumer of the right to request additional disclosures regarding an
investigation and to request a written summary of consumer rights. The Company will
provide those additional disclosures as required.
2.
The consumer has authorized us in writing to obtain consumer reports, including
investigative consumer reports.
3.
The Company will comply with FCRA Section 604(b)(3) by providing the consumer a copy
of the consumer report and the FTC’s written description of consumer rights before taking
any adverse action based in whole or in part on the report.
4.
Information from the consumer report will not be used in violation of any applicable federal
or state equal employment opportunity law or regulation.
5.
Our Company will use the consumer report for employment-related purposes and for no other
purpose.
Sincerely,
_________________________
For [Company Name]
55
PRE-ADVERSE ACTION NOTICE
– SAMPLE –
[APPLICANT/EMPLOYEE]
[STREET ADDRESS]
[CITY, STATE, ZIP]
Re:
Consumer Report
Dear ___________________:
You authorized us to obtain a consumer report on you in connection with your application for
employment or your current employment with us.
This letter is to inform you that [COMPANY NAME] is considering making an employment
decision about you based in whole or in part on information contained in this consumer report.
We provide you with the attached information:
(a)
a copy of the consumer report; and
(b)
a description in writing of your rights under the Fair Credit Reporting Act, as
prescribed by the Federal Trade Commission.
If you believe the information in the report is incorrect, please provide written
documentation IMMEDIATELY.
If an adverse decision affecting your employment occurs based in whole or in part on the report,
you will receive additional information.
Sincerely,
______________________________
For [Company Name]
56
ADVERSE ACTION NOTICE
– SAMPLE –
[APPLICANT/EMPLOYEE]
[STREET ADDRESS]
[CITY, STATE, ZIP]
Dear: ______________________:
1.
Your recent application for employment has been denied, or your current employment
has been terminated, based in whole or in part on information contained in a consumer
report.
2.
The consumer reporting agency providing this report was:
Name: ___________________________________________________________
Address: _________________________________________________________
Phone: ___________________________________________________________
Toll-free phone [if applicable]: ________________________________________
3.
The above-named consumer reporting agency did not make the decision to take the
adverse employment action and is unable to provide you the specific reasons why the
action was taken.
4.
You have the right under law to obtain an additional free copy of your consumer report
from the above-named consumer reporting agency. You have sixty (60) days from the
date you receive this notice to request this free copy of your consumer report.
5.
You also have the right under law to dispute with the above-named consumer reporting
agency the accuracy or completeness of any information contained in your consumer
report.
Sincerely,
_______________________
For [Company Name]
57
Penalties for violations of the FCRA
Failure to comply with the FCRA can result in state or federal enforcement actions, with possible
civil penalties of up to $2,500 per violation. Individuals can also bring suit for violation of the
FCRA. In addition, any person who knowingly and willfully obtains a consumer report under
false pretenses may face criminal prosecution.
Where to go for more information
The Federal Trade Commission provides information on the Fair Credit Reporting Act, as well
as compliance guides on various other consumer related laws, at their website www.ftc.gov or
upon request by telephone at 1-877-FTC-HELP.
The Southeast Region office of the FTC is located at:
Southeast Region
Federal Trade Commission
Suite 1500
225 Peachtree Street, NE
Atlanta, GA 30303
58
Chapter 6
New hire reporting
Florida state law and the Personal Responsibility and Work Opportunity Reconciliation Act
(PRWORA) of 1996, require all employers report newly hired and re-hired employees to a state
directory within 20 days of their hire date. The date of hire is the first day of work for which the
employee is owed income. All employers and labor organizations in the State of Florida must
participate in reporting; no one is exempt from this law.
New hire reporting legislation requires all employees be reported. Thus, an individual who is an
employee for purposes of federal income tax withholding from wages is also an employee for
new hire reporting purposes. If an employer needs to determine whether or not they should pay
federal income tax for an employees, they should contact counsel or the Internal Revenue
Service.
Who qualifies as a new hire
•
New employees
Employers must report all employees who reside or work in the State of Florida to whom
the employer owes wages. Employees should be reported even if they work only one day
and are terminated.
•
Re-hires or re-called employees
Employers must report rehires, or employees who return to work after being laid off,
furloughed, separated, granted a leave without pay, or terminated from employment.
Employers must also report any employee who remains on the payroll during a break in
service or gap in pay, and then returns to work. This includes teachers, substitutes,
seasonal workers, etc.
•
Temporary employees
Temporary agencies are responsible for reporting any employee who they hire to report
for an assignment. Employees need to be reported only once; they do not need to be rereported each time they report to a new client. They do need to be reported as a rehire if
the worker has a break in service or gap in wages from your company.
What about independent contractors
According to the Florida New Hire Reporting Center, they do allow Independent Contractor
reports, however, the law does not require employers to report them. The IRS provides strict
guidelines on whether an individual is in fact an Independent Contractor or an employee. If an
employer has questions regarding this guideline, they should contact counsel or the IRS. See
Chapter 12, Independent contractors, for an overview of independent contractors.
59
New hire reporting
What information must be reported
In accordance with Federal legislation, the State of Florida asks for the following information:
•
Employer Federal Employer Identification Number (FEIN) – if the employer has more
than one FEIN, they should make certain they use the same FEIN used to report quarterly
wage information when reporting new hires
•
employer’s name
•
employer’s address
•
employee’s name (first, middle, last)
•
employee’s address
•
employee’s Social Security number
•
employee’s date of hire.
Additional information may be required if reporting electronically, such as the employee’s date
of birth, employee’s address, and if medical insurance is available. Visit www.fl-newhire.com
for complete details on electronic filing.
How to report
•
Electronic reports
The website, www.fl-newhire.com, has an online reporting feature and is a very
convenient choice for employers. This feature provides a printable confirmation of
reports received and is available 24 hours a day, 7 days a week.
Employers can send new hire data files in a variety of ways, including transferring files
through this Web site, electronic transfer via modem (EFT), or mail reports to the state of
Florida on diskette.
•
Non-electronic reports
Paper new hire reports may either be faxed or mailed to the reporting Center.
Mail reports to:
Florida New Hire Reporting Center
P.O. Box 6500
Tallahassee, FL 32314-6500
Fax reports to:
(850) 656-0528
Toll-free: (888) 854-4762
Visit www.fl-newhire.com for complete details on electronic filing.
60
New hire reporting
How often reporting is required
Employers must report within 20 days of a new employee’s hire date. Again, the hire date is the
first day of work for which the employee is owed income. Employers who submit reports
magnetically or electronically must submit the reports in two monthly transmissions not more
than 16 days apart.
What if an employer has
never made a new hire report
New hire reporting is required in all 50 states. Under federal law the states have the discretion to
impose monetary fines on employers who fail to report new employees. An employer who has
not previously reported new hires, should begin by reporting any new employees they have hired
within the last 180 days and continue to report any new hires within 20 days of their hire date.
What about employers
with operations in multiple states
New hire reporting is required in all 50 states. One of the goals of new hire reporting legislation
is to make it as easy as possible for employers to comply. For those employers with employees in
more than one state, there are two convenient options for reporting.
If an employer has employees in more than one state, they are considered a multi-state employer.
Multi-state employers have two options for reporting new hires:
•
Option #1
The employer may report newly hired employees to the state in which they are working,
following the new hire regulations of each state to which the employer must report.
Information on the new hire reporting practices in other states is also available through
the Florida new hire reporting website.
•
Option #2
Or, the employer may select one state where they have employees working and report all
new hires to that state electronically. When an employer selects Option 2, they are
required to follow the new hire regulations only for the state they have selected to receive
their new hire reports. Employers choosing this method can save time and money by
consolidating their new hire reports and electronically submitting them to a single state.
Employers do not have the option of reporting new hires using both Options 1 and 2.
If the employer chooses Option 2, they must notify the U.S. Department of Health and Human
Services as to which state they have designated to receive all of their new hire information. This
is called “Multistate employer registration.” An employer may notify the Department in one of
the following three ways:
•
An employer may register as a “Multistate employer” using the Department’s web site at:
www.hhs.gov/.
61
New hire reporting
•
An employer may notify the Department of Health and Human Services using an optional
form. A copy of the form is available as a download from the OCSE web site at:
www.acf.hhs.gov/programs/cse/newhire/employer/publication/publication.htm or the
employer may call (410) 277-9470 to request a copy of the form. Once completed, the
form can be faxed or mailed to the OCSE:
Department of Health and Human Services
Administration for Children and Families
Office of Child Support Enforcement
Multistate Employer Notification
P.O. Box 509
Randallstown, MD 21133
Fax: (410) 277-9325
Alternatively, the employer may mail or fax a notification to the address listed above using its
own letterhead or form, being sure to include the following information:
•
employer legal name
•
Employer Federal Employer Identification Number (FEIN) – if the employer has more
than one FEIN, they should make certain they use the same FEIN used to report quarterly
wage information when reporting new hires
•
employer address
•
employer phone number
•
employer contact name
•
employer contact phone number
•
state to which employer will be reporting
•
a list of all states in which the employer currently has employees.
Who sees the information
The information is disclosed to the state agency administering the following programs to
determine eligibility under these programs:
62
•
any state program funded under part A of Title VI of the Social Security Act
•
the Medicaid program under Title XIX of the Social Security Act
•
the unemployment compensation program under s. 3304 of the Internal Revenue Code of
1954
•
the food stamp program under the Food Stamp Act of 1977
•
any state program under a plan approved under various titles of the Social Security Act.
New hire reporting
New hire information also is disclosed to the Florida agencies operating employment security
and workers’ compensation programs for the purposes of administering such programs.
Employers may contact the Florida New Hire Reporting Center at (850) 656-3343 or (888) 8544791 with any questions regarding the new hire reporting process. The help desk staff are
available Monday through Friday, 8:00am - 5:00pm Eastern time. The toll-free number operates
24 hours a day, seven days a week, and offers the ability to order documents and have them faxed
to the employer using an automated system.
63
New hire reporting
64
Chapter 7
Affirmative action
Although affirmative action programs have been subject to increasing levels of criticism by
courts and legislation in recent years, certain employers are still required to abide by existing
laws, which are enforced by the United States Department of Labor, Office of Federal Contract
Compliance Programs (OFCCP). The new administration has recently reiterated its support of
these laws and employers should expect an increase in OFCCP enforcement and audit activities.
Affirmative action obligations are imposed upon businesses providing goods or services to the
federal government or functioning as subcontractors for those providing goods or services
directly to the federal government. These obligations are set forth in:
•
Executive Order 11246
•
the Rehabilitation Act of 1973
•
the Vietnam Era Veterans’ Readjustment Assistance Act of 1974.
These laws not only prohibit discrimination by covered employers, but require them to make
good-faith efforts to hire and advance minorities, women, disabled individuals, disabled
veterans, and Vietnam-era veterans, as well as other classes of veterans. The OFCCP considers
the failure to make good faith efforts to comply with the law to be a violation warranting the
imposition of penalties. Penalties for noncompliance can include cancellation of contracts and
prohibition from further government business. The OFCCP can also pursue covered employers
for back pay and reinstatement for individuals whom it deems to be victims of discrimination.
Who is covered
As a general rule, federal contractors and subcontractors with contracts totaling $10,000 or more
are required to comply with certain aspects of the affirmative action laws.
Federal contractors and subcontractors with 50 or more employees and contracts over $50,000 or
who have government bills of lading (for example, government shipments) which can be
expected to total at least $50,000 over a one-year period are also required to develop and
implement written affirmative action plans. Additionally, institutions with 50 employees that
serve as a depository of federal funds or that issue or pay on U.S. savings bonds and notes,
regardless of the amount, must also have written affirmative action plans.
65
Affirmative action
Enforcement
The United States Department of Labor, Office of Federal Contract Compliance Programs
(OFCCP) is the federal agency responsible for enforcing these affirmative action laws. The
requirements for affirmative action plans are set forth in regulations issued by the OFCCP.
What is required
Executive Order 11246
The best known affirmative action requirements are contained in Executive Order 11246.
An employer’s obligations under the Order depend on whether it meets the $10,000 or
$50,000 threshold. The first threshold primarily applies to employers holding a federal
government contract or subcontract in excess of $10,000 or multiple contracts in excess
of $10,000 in the aggregate. An employer that supplies a service to a government agency
and receives payment from the agency in excess of $10,000 is a contractor under the
Order, even if the employer has not entered into any formal contract with the
government.
Executive Order 11246 requires that employers meeting the $10,000 threshold refrain
from discriminating on the basis of race, color, religion, sex or national origin. Such
employers must also take affirmative action to ensure equal employment opportunities.
This obligation to take affirmative action exists with regard to working conditions and
facilities as well as to all employment decisions in the areas of hiring, terminations,
training, promotions, and compensation. All employees of a covered employer are
protected regardless of whether they are actually working on a federal contract.
In addition to taking affirmative action in employment, each covered employer must take
the following actions:
•
include an equal opportunity clause in all subcontracts and purchase orders of
$10,000 or more, related to the carrying out of the government contract
•
include an equal opportunity statement in all solicitations and advertisements for
employment
•
advise each labor union with which it has dealings of its affirmative action
policies
•
furnish all information and reports required by the OFCCP and permit access by
the OFCCP to books, records, and accounts for purposes of investigation.
The Order’s most significant requirement applies only to contractors with 50 or more
employees and a federal contract in excess of $50,000; and to institutions serving as
depositories of federal funds or that issue or pay on U. S. savings bonds and notes and
who have 50 or more employees. This higher threshold requires covered employers to
develop and maintain detailed written affirmative action plans which must be updated at
least annually.
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Affirmative action
Written affirmative action plans must be developed for each of the employer’s facilities
regardless of whether each of the facilities has a direct federal contract. Each plan must
assign responsibility and accountability for its implementation, identify problem areas
relating to equal employment opportunity, provide for action-oriented programs to
correct problem areas and develop and implement an auditing system to measure the
plan’s effectiveness. Plans also must include a number of quantitative analyses,
including an organizational profile or workforce analysis (providing detailed information
about the incumbent workforce), a job group analysis (whereby incumbent employees are
broken down into job groups), an availability analysis (determining the statistical
availability of minorities and females in each job group), an utilization analysis
(comparing availability with the incumbent workforce) and the establishment of
placement goals (where utilization in the workforce is significantly less than availability).
Plans must be reviewed and updated annually.
The Rehabilitation Act of 1973
Section 503 of the Rehabilitation Act of 1973 prohibits employers with federal
government contracts totaling $10,000 or more from discriminating against disabled
individuals and further requires affirmative action to provide employment and
advancement opportunities for such persons. Covered employers also must make a
reasonable accommodation to the disabilities of handicapped individuals to the extent
such actions do not cause an undue hardship or financial burden on the employer.
Employers required to have written affirmative action plans under the Executive Order
are also required by this Act to prepare a written affirmative action program. The plan
must include:
•
a policy statement confirming the employer’s commitment to affirmative action
regarding disabled employees and applicants
•
the publication and posting of notices regarding the contractor’s obligations
•
a plan for recruitment of disabled individuals
•
a plan for reviewing personnel processes to ensure that they provide for
consideration of the job qualifications of applicants and employees with known
disabilities
•
a plan for reviewing all job requirements to ensure that they are job-related
•
a procedure to guard against disability harassment
•
assignment of responsibility to a company official to implement the program and
monitor its results.
Unlike Executive Order 11246, the Rehabilitation Act does not require that contractors
perform workforce analyses or that they set specific goals or timetables regarding the
hiring or advancement of disabled individuals. However, plans must be reviewed and
updated annually.
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Affirmative action
Contractors must post an equal employment opportunity policy statement informing all
applicants and employees of their rights under the Rehabilitation Act. Each covered
contractor must ensure that disabled applicants and employees are informed of the
contents of the policy statement. The OFCCP suggests that contractors read the policy
statement to a visually disabled applicant or employee or post it at a lower level so that it
can be read by an applicant or employee in a wheelchair.
When an employee with a known disability is having significant difficulty performing a
job and it is reasonable to conclude that the performance problem may be related to the
known disability, contractors are now required to inquire whether the performance
problem has any connection to the employee’s disability. A second inquiry regarding
needed accommodations must be made when the employee, in response to the initial
inquiry, indicates his/her performance problem is connected to his/her disability.
Contractors must extend invitations to disabled applicants and employees to “selfidentify” so they can benefit under the contractor’s affirmative action program.
Generally, this invitation should be extended only after an offer of employment has been
made. The invitation must inform the individual that the request to benefit under the
contractor’s affirmative action program may be made immediately or at any time in the
future. Contractors must maintain a separate file on individuals who have self-identified
and provide the file to the OFCCP upon request.
The Vietnam Era Veterans’
Readjustment Assistance Act of 1974
Coverage under this Act depends upon the date of the underlying federal contracts. For
contracts entered into before December 1, 2003, if the contracts are $25,000 or more,
then employers are required to take affirmative action as to the following:
•
special disabled veterans
•
Vietnam-era veterans
•
veterans discharged from active duty in the past year
•
veterans who served on active duty in a war, campaign or expedition for which a
campaign badge has been authorized.
For contracts entered into after December 1, 2003, if the contracts are $100,000 or more,
then employers are required to take affirmative action as to the following:
•
disabled veterans
•
veterans discharged from active duty within the past three years
•
veterans who received service medals for active duty in a military operation or
campaign badges for a war, campaign or other expedition.
Under the OFCCP’s regulations, employers required to establish written affirmative
action plans under the Executive Order must also adopt written plans under this Act.
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Affirmative action
Such plans are virtually identical to those required for disabled individuals under the
Rehabilitation Act. Affirmative action plans covering veterans are not required to
contain workforce analyses, nor must they include any goals, but the plans must be
reviewed and updated annually.
In addition to the above, employers covered by the Veterans’ Act must report to the local
employment service all suitable employment openings not involving management
employees or temporary (three days or less) positions that exist or arise during the
performance of their government contract or subcontract. Job openings which are to be
filled from the contractor’s existing work force are not required to be listed.
Covered employers are required to file an annual report with the Department of Labor on
Form VETS-100. The report contains information concerning incumbent and newly
hired employees in the protected categories listed above. The categories change
depending upon the date on which the underlying contracts were entered.
Ensuring compliance
The OFCCP reviews compliance with the three laws in two different ways.
Audits
The most common method is by an audit. OFCCP audits can range from the simple
compliance check (where minimal records are reviewed) to the desk audit (where more
comprehensive documentation is reviewed) to focused reviews (where specific areas are
reviewed in detail) to the full audit (where OFCCP investigators review documents onsite and interview managers and employees). Generally, contractors and subcontractors
are selected for these audits based on a statistical review of employment activity or
representation of minorities and females in the workforce. Companies who indicate that
they are federal contractors on their EEO-1 reports are subject to selection. In conducting
audits, the OFCCP can review all phases of the employer’s employment practices to
determine if the affirmative action requirements of each of the three laws have been met.
If deficiencies are noted during an audit, the OFCCP will notify the employer and request
corrective action. The employer may be asked to sign a conciliation agreement if a
number of serious problems are discovered. In recent years, the OFCCP has shifted the
focus in its audits away from the technical aspects of the law to determining whether
there is statistical evidence demonstrating discriminatory intent with respect to the hiring,
promotion, retention and compensation of minorities and females. Close attention is also
paid to the manner in which minorities and females are paid in relation to their
counterparts performing similar work. This level of review and analysis necessarily
requires detailed information about employment activity and relative compensation.
Investigation of complaints
The second method of enforcement by the OFCCP is through the investigation of
complaints filed with the agency. Complaints may raise individual or class claims of a
violation, and must be filed within 300 days of the suspected violation. The OFCCP will
notify the employer of the complaint and provide it with a summary. If the complaint
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Affirmative action
involves a possible Title VII violation, such as discrimination on the basis of sex, race, or
national origin, the OFCCP may refer the complaint to the EEOC.
The OFCCP’s investigation will usually consist of a request for relevant documentation
and a statement of the employer’s position on the complaint, along with interviews of all
relevant witnesses. The OFCCP may perform a full-scale compliance audit in connection
with complaint investigations, but not usually. Once it has reviewed the evidence, the
OFCCP will issue a written determination stating whether or not cause exists to believe
the complaint is true.
When the determination is in favor of the employer, the complainant may request
reconsideration of the decision by the OFCCP Director within 30 days, which, if granted,
can result in a reopening of the case. Usually, though, some specific error must be shown
by the individual to warrant this action. If the determination goes against the employer,
the OFCCP will usually offer a settlement. If refused by the employer, enforcement
proceedings may be initiated.
How a complaint is processed
When the OFCCP determines that an employer is violating one of the affirmative action laws, it
can recommend to the United States Solicitor of Labor that enforcement proceedings be initiated.
These proceedings are usually administrative in nature. Violation of a conciliation agreement,
refusal to adopt and implement an acceptable affirmative action plan, refusal to provide access to
records and documentation, or refusal to permit an on-site review, are types of violations which
will be quickly handled. The OFCCP has put a priority on cases involving evidence of systemic
discrimination which is generally based on statistical inferences.
After reviewing the evidence in an enforcement proceeding, the Administrative Law Judge will
issue a written opinion stating whether the employer has violated the law as charged. If the
decision is against the employer, the judge will recommend appropriate penalties. The judge’s
decision will become final unless appealed within 30 days. If an appeal is taken, the Secretary of
Labor will review the record and issue a final order. When a violation is found the Secretary will
order compliance and impose penalties. Failure to comply with the Secretary’s order will result
in the suspension or termination of any existing federal contracts and may result in an official bar
from federal contracts. The Secretary’s final order may be reviewed in federal court under the
Administrative Procedure Act. The Court’s review will be limited to a consideration of whether
the action taken by the Secretary was “arbitrary and capricious” or wrong under the law.
Penalties for noncompliance
The penalties for violations of the affirmative action laws can be severe. They include:
70
•
preventing the employer from acquiring federal contracts (known as debarment)
•
blacklisting in the Federal Register so that other employers cannot do business with the
offending employer in connection with federal work
•
awards of backpay, front pay and reinstatement to victims of discrimination in
employment
Affirmative action
•
suspension or cancellation of existing federal contracts
•
recommendations for civil actions by the EEOC or Justice Department or for criminal
actions by the Justice Department.
If an employer is debarred or blacklisted, it will have the opportunity to bring itself into
compliance with the affirmative action laws and then petition the Secretary for reinstatement as
an eligible contractor.
Dealing with the OFCCP
When confronted with an audit or complaint investigation by the OFCCP, employers
should keep in mind several points, including the following.
•
The OFCCP usually focuses on instances of system-wide or class discrimination.
Investigators will give particular attention to cases involving discrimination
against a class of people. These cases most often are developed in the areas of
applications, promotions, wages, and terminations through statistical use of the
employer’s activity logs and personnel records. Employers are well-advised to
monitor statistical patterns on an ongoing basis. Immediate corrective action can
then be taken before the OFCCP does an audit or investigation. When faced with
a compliance review, the employer should ensure that the OFCCP is made aware
of the minimum qualifications for each opening.
•
Before submitting information for an OFCCP desk audit or in response to an
OFCCP complaint, employers should contact their labor/employment attorney to
review the information. Data that does not conform to OFCCP specifications or
that does not fairly meet the OFCCP’s request for information can lead to an
immediate initiation of enforcement proceedings.
•
Prior to on-site interviews, persons likely to be interviewed should be fully
prepared by an attorney regarding the probable areas of inquiry.
•
During the course of the OFCCP’s investigation or audit, the employer should
maintain a detailed log, showing:
the nature of all information supplied to the OFCCP
the content of all conversations with OFCCP agents
the time spent on on-site visits and interviews by OFCCP investigators
the identity, by name and job title, of all persons interviewed by OFCCP
investigators
and
the duration of all such interviews.
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Affirmative action
•
Employers should avoid the temptation to resolve minor deficiencies as soon as
they are raised by the OFCCP. This “nickel-and-dime” approach often leaves
employers without negotiating leverage once the OFCCP gets to major issues like
goals or class matters. An employer should inform the OFCCP that all suspected
deficiencies should be presented to the employer in writing at the conclusion of
the investigation or review. This approach will leave the employer in the best
possible bargaining position. The employer will also have the benefit of having
observed the OFCCP’s entire review so that it can accurately determine what
matters seem of most importance.
•
Employers should document their positions by letter to the OFCCP on all
important issues and disputes that arise during the course of the investigation or
audit. Decisions on whether to pursue enforcement proceedings are made by
attorneys in the office of the Solicitor of Labor, who will review the entire
investigative file, and not by the OFCCP. Employers will want their versions of
the facts to be clearly stated in such files and employers should not assume that
the OFCCP is going to do that for them.
•
The OFCCP will often demand a binding conciliation agreement from an
employer to resolve deficiencies identified during an audit. Any such agreement
should contain a definite expiration date, preferably one to two years from the
date it is made, and should limit reporting to a semiannual basis if at all possible.
Record keeping
Contractors must retain all personnel or employment records for at least two years from their
date of making or the personal action involved, whichever is later. However, contractors with
fewer than 150 employees or that do not have a contract of at least $150,000 must retain such
records for only one year. For those contractors who were subject to the affirmative action
requirements during the preceding year, they must retain copies of their plans for both the current
year and the preceding year.
Covered employers must permit the OFCCP access to relevant books and records during normal
business hours. The OFCCP may require the employer to maintain employment or other records
and to furnish, within reasonable limits, other information for review and analysis. For
employers subject to the written affirmative action plan requirements, additional recordkeeping
burdens arise due to the OFCCP’s need to review the employer’s compliance. In order for
officials to conduct reviews, records of workforce analyses for minorities and women must be
maintained. The employer’s current EEO-1 report and records used in compiling that report
should also be maintained for inspection, as well as information on the supply and identity of
successful and unsuccessful applicants for employment, details on the number of individuals of
each race and sex who were considered for promotion and who were selected, and similar
information relating to both voluntary and involuntary terminations. The personnel and
employment records to be retained include:
72
•
requests for reasonable accommodation
•
results of any physical examinations
Affirmative action
•
job advertisements and postings
•
applications and resumes
•
tests and test results
•
interview notes
•
records pertaining to hiring, promotion, demotion, transfer, layoff or termination
•
records pertaining to rates of pay or other forms of compensation
•
records regarding selection for training or apprenticeship.
Covered contractors and subcontractors must also retain records for at least one year that relate
to complaints filed by disabled veterans and Vietnam veterans. Individuals may be advised to
voluntarily identify themselves as individuals with disabilities for purposes of affirmative action
programs. Collected medical information must be kept in files separate from other employee
records. Failure to maintain complete and accurate records is a violation of the Act.
Employers are permitted to maintain its records in electronic form. If an employer transfers
paper documents to an electronic format, care should be taken to ensure that the electronic
versions are duplicate copies of the original papers and can be converted back to paper form.
Once this has taken place, the employer may destroy the paper originals.
You may learn more about affirmative action requirements from your labor/employment attorney
or at the Department of Labor’s website:
•
www.dol.gov/esa.
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Affirmative action
74
Chapter 8
Immigration
The law requires you to employ only those persons authorized to work in this country. You are
required to verify the identity and employment eligibility of all individuals hired after November
6, 1986, regardless of how many people you employ. Verification of identity and employment
eligibility is accomplished by completing Form I-9. You should be careful not to engage in
document abuse discrimination (see page 39) in this process by specifying what documents the
employee presents, requiring more documents than are minimally necessary, or rejecting
documents that reasonably appear to be genuine.
Employment verification
and record keeping
You should keep I-9 forms for at least three years from the date of hire and for one year from the
date employment terminates. Once you are certain you have met both requirements, you should
shred and properly dispose of the forms in a secure manner. You are allowed to make
photocopies of the documents presented by the employee, but if you choose to make copies,
you must do so consistently for all employees, and you must still complete the form also. Under
present regulations, the retention rules do not apply to photocopies.
If the employee presents a work authorization document with an expiration date, you must
reverify employment eligibility before that document expires. Reverification is accomplished by
examining a new document and completing Section 3 of the I-9 form. You do not need to
reverify U.S. passports and I-551 (Permanent Resident or Resident Alien) cards.
If the employee cannot present an original document for employment eligibility, due to loss or
theft, you may accept a receipt for a replacement employment eligibility document. The receipt
will allow employment for 90 days from the date of the receipt or the date the prior employment
authorization expired, whichever is later. Remember that you will need to reverify employment
eligibility at the end of the 90-day grace period. Note also that you cannot accept receipts if the
employment will last three days or less.
If you do not complete and retain the form properly, you may face civil money penalties and
possibly criminal penalties as well. Fines for I-9 problems and document abuse discrimination
range from $110 to $1,100. Penalties for knowingly employing someone who lacks
authorization to work range from $275 to $2,200 for a first offense, $2,200 to $5,500 for a
second offense, and $3,000 to $11,000 for a third offense. You may also face criminal sanctions
of up to six months in jail and a fine of $10,000 if you are found guilty of a pattern or practice of
75
Immigration
non-compliance. If you are a federal contractor, you may face debarment for substantial noncompliance.
The government must give you three days notice in writing before inspecting your I-9 forms.
You should use this time wisely to ensure that your forms are correctly completed and that you
have all the forms you should retain. As a general rule, you should politely insist upon your right
to advance notice of an audit and you should not waive your rights by agreeing to an inspection
of only a handful of forms immediately.
E-Verify
E-Verify is an Internet-based system operated by the Department of Homeland Security (DHS)
in partnership with the Social Security Administration (SSA) that allows participating employers
to electronically verify the employment eligibility of their newly hired employees.
Companies participating in E-Verify, www.uscis.gov/e-verify, the online web-based program
offered by the DHS to confirm work authorization and SSN, waive the subpoena requirement,
and agree to access by the government as indicated in the MOU, Memorandum of Understanding.
States requiring E-Verify
Many states are enacting immigration-related legislation affecting employers, and it is
becoming increasingly important for employers to know what legislation applies in the
states they do business. This is especially the case for employers who operate in more
than one state. We are following developing legislation across the nation in this emerging
area, and we are pleased to make available a survey of state immigration laws affecting
employment State Survey of Laws for E-Verify. It can be found on our website at
www.laborlawyers.com, under the section called Publications. Click on Resource
Materials, then State Survey of Immigration Laws.
Federal contractors required to use
E-Verify beginning September 8, 2009
Effective September 8, 2009, federal contractors and subcontractors will be required to
use the E-Verify system to verify their employees’ eligibility to work in the United
States. Specifically, Federal Contractors must now use E-Verify to verify the legal work
status of newly-hired employees and current employees working directly on the covered
federal contract.
The rule applies to any company with a prime federal contract with a value over
$100,000 and a performance period of at least 120 days, and will flow down to
subcontractors for services over $3000. The E-Verify requirement is triggered by the
inclusion of an E-Verify clause in a new or renewed federal contract.
We advise all employers to review any current federal contracts, any bids or solicitations
for future federal contracts, as well as the scope of any applicable contracts to determine
whether and when the requirements of this rule will need to be implemented. (Please refer
to the E-Verify website or contact our office for additional information.)
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Immigration
Temporary visa
classifications authorizing employment
U.S. employers may sponsor foreign employees for certain temporary visa categories that
authorize employment in this country. Some of the most common employment-based categories
sponsored by U.S. companies include:
H-1B – Specialty Occupation (Professional)
The H-1B visa is for professionals who will work in a “specialty occupation” on a
temporary basis for no more than six years. A specialty occupation is one that requires at
least a baccalaureate degree in a specific area of specialty relevant to the position. In
addition, the employee must have attained that level of education (or foreign equivalent)
in the specialty. H-1B visas are employer- and job-specific.
The H-1B petition process involves certification of a Labor Condition Application (LCA)
by the DOL to confirm the wage meets the prevailing wage for the work location and
approval of an H-1B visa petition filed with the Department of Homeland Security’s U.S.
Citizenship and Immigration Services (USCIS). Once the employer’s H-1B petition is
approved by USCIS, the foreign national worker can obtain an H-1B visa stamp by
appointment at the U.S. consulate or embassy in his or her native country. If the foreign
national is already in the U.S., a change of status to H-1B is possible, and if the foreign
national is already in H-1B status, he or she can begin working for a new H-1B employer
as soon as the employer’s petition is filed without having to wait for an approval under
H-1B portability provisions.
The LCA attestation process requires you to certify that:
•
the H-1B foreign national will be paid the higher of the prevailing or actual wage
for that occupation in your area
•
you will offer the foreign national the same terms and conditions of employment
that you offer to U.S. workers
•
you will not employ the alien in a strike or lockout
and
•
you will notify other similarly situated employees (or their agent) of your intent to
employ an H-1B foreign national in the relevant position.
You must document your compliance with the LCA attestations by retaining relevant
documents and by making available a “public inspection” file upon request.
There is a federal quota or limit of 65,000 regular H-1B visas that can be issued each
fiscal year. H-1B status is initially granted for no more than three years. Extensions are
available, but the employee is subject to a maximum cumulative period of six years of H1B status. One year extensions beyond the six-year limit are sometimes possible if the
individual is the beneficiary of an employment-based permanent residence process that
has been pending for more than one year. Proof that such a process has been pending for
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Immigration
the requisite time period must be submitted to USCIS for adjudication of the additional
extension.
Another H-1B quota allows 20,000 H-1Bs for holders of a U.S. Master’s or higher degree
on an annual basis. In addition, there is a reserved number of H-1Bs for foreign nationals
from Singapore and Chile. The combined statutory limit is 6,800 per year. 1,400 visas are
set aside annually for nationals of Chile, and 5,400 for nationals of Singapore.
The E-3 visa for Australian citizens is based on a similar requirement for a “specialty
occupation.” In determining whether an occupation qualifies as a “specialty occupation,”
follow the definition contained in the Immigration and Nationality Act (INA) 214 (i)(1)
for H-1B non-immigrants and applicable standards and criteria determined by the DHS
and USCIS. The E-3 case is most often adjudicated at the U.S. consulate abroad in
Australia. An option of filing for a change of status in the U.S. is also available.
Dependents of H-1 aliens are eligible for H-4 status, which allows them to stay in the
U.S. with the H-1 alien. H-4 dependents are not authorized to work.
Treaty NAFTA – Canadian
and Mexican professionals
Under the North American Free Trade Agreement (NAFTA), citizens of Canada and
Mexico who are qualified professionals can work in the U.S. using the Treaty NAFTA
(or TN) classification. This visa category is available for designated professional
occupations set forth in an appendix to NAFTA. The list of professions includes many
occupations that would also qualify for H-1 status, such as engineers, accountants, and
professors.
One advantage of TN status is that the application procedure is very simple. A Canadian
applicant can apply at the border by presenting:
•
proof of Canadian citizenship
•
proof of membership in a listed occupation (based on professional qualifications)
•
an offer of employment in that occupation from a U.S. employer
and
•
fifty dollars (subject to change).
The “application” is adjudicated on-the-spot and, if approved, the individual is given a
multiple-entry TN status good for three years.
Mexican citizens cannot apply at the border and must apply at the U.S. Consulate abroad
in Mexico to obtain a TN visa stamp to enter the U.S.
Although TN status can theoretically be renewed indefinitely in three-year increments by
filing a petition or by reapplying at the border, in practice the status may be limited to
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Immigration
five or six years of renewals because the treaty states that TN status cannot be granted to
an alien who intends to reside in the U.S. permanently. Dependents of TN aliens can get
TD (Treaty Dependent) status but cannot use that status to work in this country.
L-1A and L-1B – Intracompany
transfers of managers/executives
or specialized knowledge personnel
The L-1A and L-1B visas are designed to facilitate the temporary transfer of managerial,
executive, and specialized knowledge personnel from overseas entities to related U.S.
entities. L-1A status is for managers and executives, and L-1B status is for persons with
specialized knowledge of company methods, products, procedures, operations, etc. To
qualify for L-1 status, the employee must have worked for the company abroad in a
managerial, executive, or specialized knowledge position for at least one full year during
the three years prior to the transfer to a managerial, executive, or specialized knowledge
position with the related U.S. entity. First line supervisors are not eligible for L-1A status
as managers unless the persons they supervise are professionals.
The U.S. employer must file a petition for L-1 status with the regional CIS Service
Center, but Canadian transferees may submit the petition at the U.S.-Canada border for
immediate adjudication. Once the employer’s petition is approved, the alien may obtain
an L-1 visa stamp from the U.S. embassy or consulate abroad, or if already in the U.S.,
may commence the L-1 employment.
L-1 status is initially granted for three years, and extensions are available for two-year
periods. L-1A managers/executives are entitled to up to seven years of L-1 employment
in the U.S., and L-1B specialized knowledge personnel are eligible for a maximum of
five years of authorized stay. Dependents of L-1 transferees obtain L-2 status. Unlike
most temporary visa categories which do not allow dependents to work, L-2 spouses may
obtain employment authorization.
Some multi-national companies may qualify for “blanket” L-1 status. Typically, this is
available for entities that transfer more than 10 people per year, have annual sales in
excess of $25 million, or have over 1,000 U.S. employees. Blanket L-1 status allows the
U.S. entity to bypass the CIS petition process in individual cases. Instead, the U.S. entity
sends a special form to the transferee, who then applies for L-1 status directly at the U.S.
consulate or embassy.
E-1 and E-2 – Treaty trader/investor
Based upon a bilateral investment treaty or a treaty of friendship, navigation, and
commerce between the United States and a foreign country, an individual may come to
the United States to open and operate a foreign-owned business, or be employed in a
foreign-owned business that already exists here. Entities engaged in substantial trade
between the U.S. and the treaty country will be able to transfer managers, executives, and
key personnel using the E-1 (Treaty Trader) visa status. Entities making a substantial
investment in the U.S. may transfer managers, executives, and key personnel using the E2 (Treaty Investor) visa status.
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Immigration
The foreign entity must be a “citizen” or “native” of the treaty country. This means that
at least a majority of the ownership of the foreign entity must be held by citizens of the
treaty country. The person seeking E visa status must also be a citizen of the treaty
country. There is no prior employment requirement, however.
E-1 aliens must be engaged in activities supporting a substantial volume of international
trade in goods or services. E-2 aliens must be directing or developing an active and
substantial investment of irrevocably committed funds devoted to production of goods or
services. “Substantial” means more than enough to secure the success of the enterprise
and more than enough to support the E alien and family members.
Most E aliens apply for E visa status directly at the U.S. embassy or consulate in the
treaty country, but it is possible to change to E status from within the U.S. Aliens
admitted in E status are granted two years of authorized stay so long as their E visa stamp
is valid at the time of entry. Typically, E visas are valid for five years, but this may vary
depending upon the terms of the treaty. In most cases, the E visa can be renewed for
additional periods provided that the underlying trade or investment remains viable.
Dependents of E visa aliens acquire the same status as the principal alien, i.e. E-1 or E-2
status. E-visa spouses may obtain employment authorization.
A relatively new E-3 status is available for Australian citizens who qualify for H-1
treatment, for example, are specialty occupation professionals. The advantage is that
they can avoid the H-1 quota system and process for the E-3 visa at a U.S. consulate in
Australia.
H-2A and H-2B – Agricultural and
other seasonal and temporary workers
The H-2A visa is for seasonal agricultural workers, and the H-2B visa is for nonagricultural temporary or seasonal workers. H-2 status is only available for jobs that are
truly temporary in nature, so the status is almost always limited to one year. The
employer must test the market for available U.S. workers and obtain a certification from
DOL that none are available to fill the temporary position(s). The test of the market must
offer prevailing wages and working conditions through documented recruitment efforts
including print ads in local newspapers.
There is a quota of 66,000 H-2B visas that can be issued each fiscal year. Often, the
quota is exhausted well before the end of the fiscal year.
H-2A employers may be required to hire U.S. workers who apply for work anytime up to
halfway through the certification period, even if that involves discharging the alien
worker. Also, H-2A employers may need to pay special wages, offer housing, and in
some cases may have to pay transportation costs for the alien to come to the work site
and return home.
Each H-2 period of authorized stay will be one year or less. After using three
consecutive H-2 periods, the alien must remain outside the U.S. for at least six months
before becoming eligible to use H-2 status again.
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Immigration
H-3 – Trainees
A U.S. employer may sponsor a foreign national for H-3 status to provide the individual
training that is unavailable in the individual’s native country. The individual is not
supposed to engage in productive employment other than as necessary to provide
effective training. H-3 trainees cannot displace U.S. workers. The petitioning employer
must supply extensive documentation of an appropriate training curriculum with the
petition. The documentation must specifically discuss the amount of on-the-job vs.
classroom training, address why the training is not available in the trainee’s native
country, and explain how the training experience will enhance the alien’s career
prospects abroad. H-3 status is limited to the duration of the training program, which
cannot exceed two years.
F-1 – Academic students
F-l visas are for students engaged in degree programs at U.S. academic institutions.
There are several types of employment authorization available to F-l foreign students,
including on-campus employment, off-campus employment due to severe economic
hardship, international organization internships, curricular practical training, and optional
practical training before and after completion of studies.
An F-l student engaged in a full course of study may engage in part-time on-campus
employment such as working in a cafeteria or bookstore so long as this employment does
not displace a U.S. worker. This type of on-campus employment does not require
advance permission from CIS.
An F-l student may apply for employment authorization to work off-campus due to
economic necessity or for an internship with an international organization. Economic
necessity work permits are normally not granted except upon proof of a substantial and
unforeseen change in the student’s finances.
F-1 students may also engage in practical training employment related to their degree
program. While enrolled, F-1 students may use Curricular Practical Training. This may
take the form of an internship, co-op, work-study program or some other activity that is
an integral part of the degree program, and CPT can be commenced upon an endorsement
by the school’s foreign student advisor. A student who uses more than 12 months of CPT
becomes ineligible for post-graduate Optional Practical Training (OPT).
OPT permits up to 12 months of on-the-job practical training upon completion of an
academic degree program. F-1 students must apply for a work permit in order to use
OPT and cannot commence employment until the permit is issued.
Dependents of F-1 aliens are granted F-2 status and cannot work.
J-1 – Exchange visitors
Aliens participating in a designated exchange visitor program may engage in specific
types of employment as part of their program activities. There are many types of J-1
exchange visitor programs, including those for students, practical trainees, teachers,
professors, research assistants, specialists, camp counselors, au pairs, and distinguished
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Immigration
visitors. J-1 practical trainees are authorized up to 18 months of on-the-job training;
other categories have different time limits.
Some exchange visitors are subject to a two-year home country residence requirement
which must be satisfied before the foreign national is eligible for H, L, or permanent
resident status. This obligation attaches if the individual’s exchange visit is funded by
the alien’s government or the U.S. government, if the individual’s skills are in short
supply in his or her country, or if the individual is coming to the U.S. to obtain graduate
medical education. If the individual is subject to the two-year residence requirement, so
too are all of the individual’s dependents. It is sometimes possible to obtain a waiver of
this requirement, but the waiver process is cumbersome and time-consuming.
O – Extraordinary ability aliens
The O category is for highly talented or acclaimed individuals who are scientists,
educators, artists, athletes, entertainers, or business people. To qualify for O visa status,
the foreign national must demonstrate sustained national or international acclaim. The
U.S. employer must show that the individual will fill a position that requires a person of
extraordinary ability. The petitioning employer must also submit a peer review
evaluation confirming the individual’s international renown and the need for such a
person. Typically, O status will be granted for the duration of need but no more than
three years and can be extended in one-year increments with no limit on the number of
extensions.
P – Performing artists, athletes and entertainers
P visa status is for performing artists, athletes, and entertainers. Foreign nationals
seeking this category must demonstrate substantial achievement in their field. This status
also requires a peer review evaluation confirming the individual’s international renown:
•
P-1 status is for principal beneficiary
•
P-2 status is for essential supporting personnel
•
P-3 status is for coaches and trainers
•
P-4 status is for dependents.
Generally, P visa status will be granted for the duration of the engagement or season and
extensions are available if the performance period is deemed necessary.
Permanent residence
There are two major avenues to permanent residence:
1. family-based sponsorship
2. employment-based sponsorship.
Each type of sponsorship has several categories and different procedures.
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Immigration
Foreign nationals who marry U.S. citizens may be sponsored immediately for permanent
residence and are not subject to category or per-country quotas. If the sponsor’s petition is filed
within two years after the marriage, the individual will be granted a conditional permanent
residence and the couple must file a joint petition to remove conditions on residence two years
after the individual is granted conditional permanent residence. This requirement is intended to
deter marriage fraud.
Almost all other family-based petitions are subject to category and per-country quotas, and
because of the high level of demand, it may take many years before a visa is available. There are
family-based categories for unmarried sons and daughters of U.S. citizens, spouses and children
of permanent residents, married sons and daughters of U.S. citizens, and brothers and sisters of
U.S. citizens.
Employment-based permanent residence also has several categories. Each has different
requirements. For some categories, the employer must obtain “labor certification,” (a
certification from DOL that there are no U.S. workers qualified and available to fill the position
for which the alien is sponsored).
Employment-based Category 1
Employment-based Category 1 is for Priority Workers, which includes Nobel laureates,
college/university teachers/researchers, and intracompany transferee
managers/executives. Labor certification is not required for this category.
Employment-based Category 2 is for aliens with advanced degrees and aliens with
exceptional ability in the arts, sciences, education, athletics, or business. Labor
certification is usually required for this category unless the alien’s employment will
directly serve important U.S. interests.
Employment-based Category 3 is the most common of the employment-based categories,
as it is used by professionals without advanced degrees, skilled workers in jobs requiring
at least two years of training or education, and unskilled workers. Labor certification is
always required for this category.
Once labor certification is obtained, the employer files a permanent residence petition with CIS.
The alien and dependent family members may concurrently file for adjustment of status if a visa
is immediately available under the permanent residence visa quota system. If the alien has
worked without authorization or failed to maintain lawful status at all times, or if a visa is not
immediately available, the alien must complete the permanent residence procedure through
consular processing at the U.S. embassy or consulate in his or her native country. Sometimes
that will result in a hardship if the alien has accrued significant periods of unlawful presence in
the U.S.
Employment-based Category 4 is for Religious Workers, who are members of a religious
denomination that has a non-profit religious organization in the United States and has
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Immigration
been a member for at least two years before applying for admission to the United States.
Special processing is required to fully document the bona fide role of the religious worker
and the religious organization to meet USCIS’ approval.
Employment-based Category 5, which is for investors committing over $1 million to the
U.S. economy, is also known as the “employment-creation” visa and has gained
popularity to investors who have invested or are in the process of investing lawfully
obtained capital in a new commercial enterprise, resulting in employment of at least ten
full-time U.S. workers. The amount of the investment can be reduced to $500,00 if it is in
a targeted employment area.
The EB-5 Regional Center Investment Program
In addition, to encourage foreign investment in the U.S. economy through the EB-5
category, Congress created an EB-5 pilot program in 1993. A Regional Center is a private
enterprise or corporation or a regional governmental agency with a targeted investment
program within a defined geographic region. EB-5 applicants first receive a conditional
green card valid for two years. At the end of that time they must file another application
showing that their money was “at risk” during the two-year period and that the jobs have
been created. Once that has been approved, they become regular permanent residents of
the U.S. Of the approximately 10,000 EB-5 green cards available each year, 3,000 are
reserved for foreign nationals who invest through a Regional Center.
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Chapter 9
Discrimination in employment
Discrimination can and does take many forms, including discrimination based on race, national
origin, religion, marital status, age, sex or disability. Federal, Florida state and some local laws
regulate discrimination in employment.
The major federal laws prohibiting employment discrimination include:
•
Title VII of the Civil Rights Act of 1964
Title VII of the Civil Rights Act of 1964 is probably the best known of the various
federal anti-discrimination statutes. It governs the employment practices of most public
and private employers, prohibiting employment discrimination based upon race, color,
religion, sex, or national origin.
Title VII applies to private employers who employ 15 or more persons in each of 20
consecutive calendar weeks of the current or preceding year. Public employers also can
be covered under Title VII.
•
Americans with Disabilities Act
The Americans with Disabilities Act of 1990 (ADA) is a federal law which prohibits
discrimination against persons with disabilities in the context of private employment,
public transportation and accommodations, and telecommunications. The ADA prohibits
discrimination in employment against qualified individuals with disabilities by private
employers with 15 or more employees.
•
Rehabilitation Act of 1973
The Rehabilitation Act of 1973 covers public employers and private employers with
federal contracts. The Act prohibits discrimination against employees or applicants with
handicaps.
•
Age Discrimination in Employment Act
The Age Discrimination in Employment Act (ADEA) is a federal law prohibiting age
discrimination by private employers with 20 or more employees for each working day in
20 consecutive calendar weeks of the current or preceding year. Labor unions with 25 or
more members, employment agencies, federal agencies, and state and local governments
are also subject to ADEA requirements. Coverage also includes United States citizens
who work in foreign countries for United States companies or foreign employers
controlled by United States companies.
•
Older Workers Benefit Protection Act
This federal law, passed in 1990, amended the ADEA with regard to employee waiver
and release agreements and added prohibitions of age discrimination to the administration
of certain employee benefit plans.
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•
Equal Pay Act
The Equal Pay Act of 1963 requires equal pay for equal work without reference to
gender. The Equal Pay Act is an amendment to the Fair Labor Standards Act, therefore
the same complicated coverage factors apply for private employers. All public employers
are covered.
•
Ledbetter Fair Pay Restoration Act of 2009
On January 29, 2009, President Obama signed the Lilly Ledbetter Fair Pay Act of 2009
(the Act). Consistent with the new law, the EEOC issued the following guidance:
The Act supersedes the Supreme Court’s decision in Ledbetter v. Goodyear Tire
& Rubber Co., Inc., 550 U.S. 618 (2007). Ledbetter had required a compensation
discrimination charge to be filed within 180 days of a discriminatory pay-setting
decision (or 300 days in jurisdictions that have a local or state law prohibiting the
same form of compensation discrimination).
The Act restores the pre-Ledbetter position of the EEOC that each paycheck that
delivers discriminatory compensation is a wrong actionable under the federal
EEO statutes, regardless of when the discrimination began. As noted in the Act, it
recognizes the “reality of wage discrimination” and restores “bedrock principles
of American law.”
Under the Act, an individual subjected to compensation discrimination under Title
VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act
of 1967, or the Americans with Disabilities Act of 1990 may file a charge within
180 (or 300) days of any of the following:
when a discriminatory compensation decision or other discriminatory
practice affecting compensation is adopted;
when the individual becomes subject to a discriminatory compensation
decision or other discriminatory practice affecting compensation; or
when the individual’s compensation is affected by the application of a
discriminatory compensation decision or other discriminatory practice,
including each time the individual receives compensation that is based in
whole or part on such compensation decision or other practice.
The Act has a retroactive effective date of May 28, 2007, and applies to all claims
of discriminatory compensation pending on or after that date.
The Act clarifies that an unlawful employment practice with respect to
discrimination in compensation occurs “each time wages, benefits, or other
compensation is paid, resulting in whole or in part from such a decision or other
practice.”
It is important to understand that there will be an increase in litigation based on
the expansive intent and retroactive application of the Act. However, it is not yet
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clear how courts will interpret the application of the Act to various compensation
and benefit scenarios. Accordingly, employers should closely monitor this area as
the case law develops.
The state laws include:
•
Florida Civil Rights Act of 1992
This Florida law covers all employers with 15 or more employees for each working day
for 20 or more weeks, and prohibits discrimination on the basis of race, color, religion,
gender, national origin, handicap, age and marital status.
•
Equal Pay statute
This Florida statute is not applicable to any employer, labor organization or member
thereof, or employee whose employer is subject to the Fair Labor Standards Act, as
amended.
Most federal and Florida employment laws also prohibit retaliation against any person because
that person has exercised a right under an employment law.
Equal Employment Opportunity Commission
Federal anti-discrimination laws are enforced by the federal Equal Employment Opportunity
Commission (EEOC). Where a state or local agency exists, such as the Florida Commission on
Human Relations, the EEOC may defer its processing of the charge to allow the state or local
agency to handle the case. The EEOC is not bound by the results of the state or local agency
investigation, but it must give strong weight to any findings.
The EEOC has District Offices throughout the United States which carry on most of the day-today enforcement activities of the Commission. Each District Office covers a specific geographic
area, and most have satellite locations, known as Area Offices, that handle cases within a
localized portion of the district. The District Office covering Florida is located in Miami, and an
Area Office exists in Tampa. The following city or county agencies have been established to
investigate employment discrimination claims in Florida:
•
Broward County Civil Rights Division
•
City of Orlando Office of Human Relations
•
City of St. Petersburg Community Affairs Department
•
City of Tampa Office of Human Rights
•
Miami-Dade County Equal Employment Opportunity Board
•
Hillsborough County Equal Opportunity Administrator
•
Jacksonville Human Rights Commission
•
Lee County Office of Equal Employment Opportunity
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•
Palm Beach County Office of Equal Employment Opportunity
•
Pinellas County Office of Human Rights.
If you receive a charge filed with a local agency or board, you should carefully review the local
rules and procedures, since these will be applicable if the local agency investigates the charge.
How a charge of discrimination is processed
EEOC Regulations require that charges be filed within 180 days of the alleged wrongful
acts, although this period is extended to 300 days in Florida, provided a charge is filed
with the state agency.
The EEOC has adopted a National Enforcement Plan for administrative enforcement,
litigation and charge handling procedures. Each District Office has also been given the
authority to implement Local Enforcement Plans to tailor their priorities to the specific
communities they serve.
The National Enforcement Plan was necessary because of the massive inventory of
discrimination complaints and the possibility of further budget cuts. Without a method of
prioritizing the workload, the number of complaints under investigation continued to
climb, and the length of time necessary to process an individual discrimination complaint
continued to grow. Therefore, it became necessary to discontinue full investigation of
every complaint. The new plan focuses on three major approaches to eliminating
discrimination in the workplace.
1. Prevention through education and outreach
Public education and technical assistance is to be conducted at the national and
local level. These educational efforts are intended to result in recognition and
prevention of discrimination in the first instance.
2. Voluntary resolution of disputes
With agreement from both sides, the EEOC will organize and implement the use
of alternative dispute resolution. Third party mediators will be engaged to
encourage pre-investigation resolution of discrimination complaints. If the
employer operates an in-house ADR program (such as an internal grievance
procedure), the EEOC may suspend its own investigation until the in-house
procedures are exhausted.
3. Strong, fair enforcement
The EEOC has admitted that it cannot and should not pursue every discrimination
complaint which it receives. Instead, the EEOC will prioritize complaints, and
become involved in litigation of only a select number of complaints which it
determines may have far-reaching implications. The following areas have been
determined to have priority:
•
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cases involving challenges to EEOC regulations or guidelines
•
cases involving repeated and/or extreme incidents of discrimination, such
as harassment or employer policies which are clearly discriminatory on
their face
•
challenges to employment practices which affect many employees or
applicants, such as patterns of discrimination in hiring, layoff or pay
•
cases which present unresolved questions on the development of the law,
such as claims of national origin discrimination based on language
restrictions, accommodation of religious practices, cases arising under the
Americans with Disabilities Act and claims involving two or more bases
for discrimination
•
cases involving claims of retaliation for cooperation with the EEOC or for
opposing unlawful employment discrimination
•
cases involving violations of recordkeeping requirements or challenging
the subpoena or investigative powers of the EEOC.
The National Enforcement Plan basically sets up three types of discrimination
complaints.
Type A
The first type (Type A) will be cases in which discrimination is “likely” to
be found, which have complaints of the type on the priority list, and which
the EEOC is interested in taking to court. Those cases will be subjected to
intense investigation by the EEOC in preparation for litigation.
Type B
The second type (Type B) will be cases which will require employers to
prepare position statements. The EEOC will pursue investigation, but may
not take the case to trial if the information obtained does not lead to a
likelihood of success, or if the subject of the complaint is not one of the
“significant” issues on the priority list. In those cases, with little or no
investigation, the EEOC is most likely to issue a right-to-sue letter to the
charging party, and likely well before 180 days have passed (the statutory
period of conciliation).
Type C
Type C claims are those which, after a thorough intake interview by
EEOC personnel, do not appear to indicate discrimination. Type C claims
also include claims where the employer is not covered under applicable
law. For instance, the employer does not have the required number of
employees. Under the Plan, the EEOC is likely to dismiss the Type C
charges, but issue a “no-cause,” right-to-sue letter.
Retaliation
A troubling area for many employers is the employee who remains on the job after filing
a charge of discrimination against the company. Each one of the anti-discrimination
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statutes includes provisions which prevent retaliation against employees who assert their
rights under the law, or employees who help others assert rights. This means that an
employer may not take an adverse employment action of any kind against an employee,
either for filing his or her own charge, or for assisting the EEOC in an investigation of
another pending charge against the employer.
The EEOC is so determined not to allow retaliation, that it has pursued claims of
retaliation against employers, even when the original charge of discrimination has been
found to have no merit. Courts have supported the EEOC in this area. Therefore, you
must exercise caution when dealing with employees in such situations. But, it is not
necessary to ignore such an employee’s behavior when it violates or is contrary to the
employer’s policies, and would otherwise subject an employee to disciplinary action.
You simply should ensure such actions are well-supported, consistently applied to other
similarly situated employees who have not been involved in the filing or investigation of
a charge of discrimination and clearly documented because it is likely the employee who
is subject to such discipline will attempt to allege retaliation.
You should also notify management, on a need to know basis, that an employee has filed
a charge of discrimination, and reemphasize that no retaliatory action is to be taken
against the employee. Performance evaluations and necessary discipline should continue
as needed, but it will be particularly important to provide objective criteria for any
adverse employment actions, and to document your actions carefully.
Possible sanctions
If the EEOC investigates a charge of discrimination and concludes that in its belief
discrimination did occur at your workplace, the EEOC could demand that an employer
fire or transfer a manager or supervisor found to engage in discriminatory practices
and/or post an extensive notice of the employer’s agreement to comply with federal antidiscrimination laws. In addition, if an individual has complained, the EEOC is likely to
negotiate for monetary damages on behalf of the person claiming to have suffered
discrimination.
Rejecting the EEOC decision
It is important to realize that the EEOC determination on a charge is not binding and an
employer is free to reject an unfavorable determination, requiring the EEOC or the
charging party to sue. Settlement should be seriously considered at this stage of the
proceeding if the EEOC has determined there is reason to believe that discrimination
occurred. Within 90 days of receipt of a Notice of Right to sue, employees have the right
to file a lawsuit in which they are entitled to a trial by jury to recover damages, including
back wages, compensatory, and punitive damages to punish the employer.
Compensatory and punitive damages are available, but there is a cap on how much a
plaintiff can recover depending on the size of the employer. The damage caps under Title
VII are as follows:
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•
$50,000 if employer has up to 100 employees
•
$100,000 if employer has from 101 to 200 employees
•
$200,000 if employer has from 201 to 500 employees
•
$300,000 if employer has over 500 employees.
During a lawsuit, the issues raised by the plaintiff and the defenses raised by the
employer will be considered by a jury or by the court, and although the EEOC’s decision
could be part of the evidence in the case, its decision is in no way binding in a court
proceeding.
Records and reports
The EEOC requires employers to preserve personnel and employment records relating to:
•
hiring
•
promotions
•
demotions
•
transfers
•
layoffs or terminations
•
rates of pay
•
selection for training or apprenticeship programs.
These records must be preserved for a period of at least one year from the date the record
was made or the personnel action taken, whichever is later. When an employee is fired,
records must be kept for one year following the termination. When a charge of
discrimination is filed, all records must be preserved until the charge is resolved.
Employer Information Report EEO-1
Employer Information Report EEO-1, determining the relationship of minority
group employees to the total work force, is required of any employer with 100 or
more employees. Similar reports are required of apprenticeship programs, unions,
state and local governments, public school systems, and institutions of higher
education. You should maintain the latest copy of this report.
Dealing with discrimination charges
Because of the disruption to your business and the potential financial liability to your business,
you must be extremely careful in responding to any complaints of employment discrimination.
The following are suggestions for dealing with such complaints.
•
Supervisors should document all personnel actions when they happen. An employer’s
documentation, prepared as part of its regular business operations, could prove invaluable
in defending against any discrimination claim, but particularly against claims involving
discipline, discharge, or layoff. Documentation that is created after a charge is filed is far
less likely to be viewed as persuasive.
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•
The company’s personnel officer or some other responsible official should review
terminations and other significant personnel decisions before they are taken to make sure
that they are defensible. There should be evidence of a rule violation or some other
reasonable and objective basis, and a showing that the discipline is consistent with that
taken under similar circumstances in the past.
•
In situations where discharge is contemplated, you may wish to consider suspension of
the employee pending a more detailed investigation. If you discover there are issues
surrounding the employee’s employment and/or discipline, this could give you the
additional time necessary to review and weigh all circumstances and act in the best
interests of the employer.
•
When a charge of discrimination is received from the EEOC or similar agency, you
should review all issues related to the charge immediately, collect and preserve
documentation, including applicable email communications. and identify and interview
witnesses.
•
It is generally a good idea to review the charge and the employer’s case with a qualified
employment law attorney to ensure you are aware of all potential issues and raise all
available defenses. The attorney should also be involved in the investigation of the
charge including the identification and interview of possible witnesses.
•
Designate an attorney or a company official to represent you in your dealings with the
EEOC or the state agency.
•
Determine quickly if a clear defense exists, and decide whether an immediate response
raising this defense is appropriate. For example, the charge may have been made after
the applicable time limit to make a charge has lapsed or your company does not employ
the requisite number of employees to be covered by the law. Also determine whether the
case arose under circumstances that would justify a rapid resolution through voluntary
mediation before the formal investigation occurs.
•
In responding to the investigation, limit your responses to the issues raised by the charge.
Investigations should not be permitted into matters that are not related to the charge
because the scope of any subsequent lawsuit could be defined by the actual scope of the
EEOC’s investigation.
•
Submit to the EEOC a strong, concise statement of the employer’s position and the
documentation requested. A position statement should identify all factual errors or
omissions made by the employee and, most importantly, should clearly explain the
reasons for what happened.
•
The EEOC has limited its use of fact-finding conferences in recent years. However, if a
fact-finding conference is requested, consider whether cooperation in the proceeding is in
the employer’s best interests. If you do participate in such a conference, be prepared to
address all issues raised by the charge. It is possible that the employee will be represented
by an attorney and that your witnesses will be questioned by the EEOC representative, so
you should seriously consider representation by a qualified employment law attorney
during the conference. In any case, company witnesses should be thoroughly prepared for
possible questioning.
•
If the EEOC issues an unfavorable decision, you should evaluate your case and determine
your position on settlement. Any settlement negotiated with the EEOC should include at
least a complete release of employer liability as to the charge and a clause stating that the
settlement agreement is not intended to be an admission by the employer of any violation
of the law.
Florida Commission on Human Relations
The principal legislation covering employment discrimination in Florida is the Florida Civil
Rights Act of 1992 (FCRA), Chapter 760, Fla. Stat. The FCRA is similar to federal laws which
prohibit discrimination, but marital status is an additional protected category under Florida law.
Generally, Florida courts apply case law analyzing federal employment discrimination claims in
deciding cases under the FCRA.
The FCRA is enforced by the Florida Commission on Human Relations (FCHR). The FCHR
investigates complaints of employment discrimination on the basis of race, color, religion,
gender, national origin, handicap, age and marital status. The FCRA applies to employers with
15 or more employees for each working day for 20 or more weeks in the current or preceding
calendar year.
Enforcement
The FCRA grants enforcement powers to the FCHR, including the power to issue
subpoenas and require the production of documents pertaining to an investigation.
How a charge of discrimination is processed
The investigation of a claim of discrimination commences upon the filing of a complaint
by an employee. An individual may file a complaint of discrimination up to 365 days
from the date of the violation. Employees have the right to trial by jury whenever actual
or punitive damages to punish the employer are sought. Employees may also be entitled
to compensatory damages such as payment for injuries such as mental anguish, or loss of
dignity.
The procedures under the FCHA are different than those used by the EEOC. Following
the Commission’s investigation of the charges, the FCHR issues a letter of determination
finding cause or no cause. If the FCHR determines an employer did not violate the Act,
the employee may not bring a separate civil action against the employer. The employee
may pursue administrative remedies but cannot file a state or federal lawsuit for his or her
claims under the FCHR.
Possible sanctions
If the Florida Commission determines from its investigations of the complaint that there
is reasonable cause to believe that discrimination has occurred, or the Commission fails
to make a finding within 180 days of the date the complaint is filed, the complaining
party can pursue the claim in one of two ways. The charging party can request an
administrative hearing or file a civil lawsuit against the employer.
The administrative process usually involves a hearing before a commissioner or hearing
officer. The officer or commissioner can issue an order prohibiting the discriminatory
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practice and provide other relief, such as damages in the form of back wages and
attorneys’ fees.
Administrative orders can be appealed to the full Florida Commission. The Commission
may affirm, modify or dismiss the order filed by the hearing officer. Full Commission
orders can be further appealed to the Florida district courts.
Most complainants who are able to do so choose to file a civil action against the
employer. If the claimant prevails, he or she can recover back wages, attorney’s fees, and
compensatory damages, such as damages for mental anguish or loss of dignity, and in
Florida, such damages are unlimited. Punitive damages may also be awarded to the
claimant to punish the employer for the discriminatory action, but punitive damages in
Florida are limited to $100,000.
Records and reports
The FCHR does not impose additional recordkeeping requirements on employers. Once a
complaint has been filed with the Commission, however, the employer must preserve all
personnel records and other documents pertaining to the complaint until the matter is
resolved.
Sexual harassment
The EEOC defines sexual harassment as:
Unwelcome sexual advances, requests for sexual favors, and other verbal or
physical conduct of a sexual nature when:
•
submission to such conduct is made either implicitly or explicitly a
term or condition of employment
•
submission to, or rejection of, such conduct by an individual is used as
the basis for employment decisions affecting such individual
•
such conduct has the purpose or effect of unreasonably interfering with
the individual’s work performance or creating an intimidating, hostile,
or offensive working environment.
This definition reflects the Supreme Court’s analysis and has been widely adopted by lower
courts.
Conceivably, an individual could also complain about harassment directed at others. This
situation would arise where an employee complains because favoritism is shown to another
employee who granted sexual favors, or who may even be involved in a consensual relationship
with a manager or supervisor. Courts have been reluctant to recognize this type of claim on the
theory that preferential treatment for a lover is more akin to nepotism than sexual harassment.
On the other hand, where preferential treatment of employees who grant sexual favors becomes
so pervasive that co-workers might reasonably conclude that granting sexual favors is the only
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way to advance in the organization or to remain employed, courts are more likely to be
sympathetic to a claim of third party harassment.
In 1998, the Supreme Court recognized that Title VII also prohibits “same sex” sexual
harassment. It is important to remember that neither the harasser nor the victim needs to be
homosexual in order for same sex harassment to exist. Although these claims are not as
prevalent as traditional male-female harassment, they are becoming more common. Therefore,
you should treat all harassment complaints seriously.
Policy against harassment
Because of the heightened awareness of employees about the legal significance of sexual
harassment, employers should establish a clear policy prohibiting all forms of employee
harassment, sexual or otherwise. The policy should invite employees to bring complaints
promptly to the attention of their immediate supervisor or, if uncomfortable with that
approach, to the attention of the personnel officer or some other designated official. The
policy should direct employees to voice their concerns to a finite number of individuals
or positions rather than designate a group of individuals, such as “management” since the
employees’ view of who constitutes management may differ from that of the employers
and some members of management may not be suited to accept or deal with complaints.
Recognizing sexually harassing behavior
Determining what particular actions constitute sexual harassment can be extremely
difficult. The EEOC regulations do not make clear whether it takes one, two, or ten
sexually offensive comments or actions to constitute harassment. The Supreme Court has
stated that Title VII does not reach “genuine but innocuous differences in the ways men
and women routinely interact with members of the same sex and the opposite sex.” In
other words, there is a certain amount of horseplay or simply annoying behavior that
people must accept without legal relief.
Because of that, courts will look at several factors to determine if actionable harassment
has occurred including:
•
the frequency of the discriminatory conduct
•
the severity
•
whether the conduct is physically threatening, or a mere offensive utterance
•
whether the conduct unreasonably interferes with an employee’s work
performance
•
the conduct’s affect on the employee’s psychological well-being.
Unfortunately, the line between actionable harassment and merely boorish behavior is
drawn on a case-by-case basis and often left to a jury. One federal judge likened the
difficulty of performing an analysis to “attempting to nail a jellyfish to a wall.” It is clear
that the range of actions that could constitute sexual harassment is enormous and leaving
such a determination to a jury is risky and expensive.
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Sexual harassment by a manager/supervisor
Quid pro quo
Quid pro quo sexual harassment describes the situation where an employee’s
employment or any benefit of employment is affected by whether or not the
employee accedes to unwelcome sexual conduct. Under the most recent analysis
of the Supreme Court, your company will be held strictly liable for managers’
quid pro quo harassment. In other words, in such situations, managers will be
considered your “agents” by virtue of their authority to act on behalf of the
company. Examples of such harassment is a manager’s implication that an
applicant’s or employee’s submission to sexual demands will cause her to be
hired, promoted, or benefited in some way or a supervisor’s suggestion to an
employee that rejecting a sexual advance will result in her being disciplined,
terminated, or economically harmed.
In this situation, there is no defense, other than arguing that the harassment did
not occur. This harsh rule emphasizes the importance of carefully selecting and
training your managers.
Hostile work environment
By creating a hostile environment, your managers and supervisors can also expose
your company to liability, even without conditioning an employment action,
whether negative or positive, on the granting of sexual favors. A hostile
environment is a situation where sexual harassment is so severe or pervasive that
it alters the conditions of the victim’s employment by creating an abusive working
environment. In this case, to be liable, the employer must have failed to take
adequate corrective action following “notice” of the harassment. It is extremely
important that employers adopt and enforce a written “No Harassment” policy to
protect themselves from such hostile environment claims. The rulings of the
Supreme Court provide employers an affirmative defense to a hostile environment
claim as long as no tangible employment action has been taken against the
employee.
This defense allows an employer to avoid liability for a hostile environment
when:
•
the employer exercised reasonable care to prevent and correct promptly
any sexually harassing behavior
•
the victim unreasonably failed either to take advantage of any preventive
or corrective opportunities provided by the employer or to avoid harm
otherwise.
To ensure you receive adequate and immediate notice of any potentially harassing
behavior, you should adopt, disseminate, and consistently enforce a written “No
Harassment” policy – the law clearly favors employers who do. Where the victim
knows that your company has a policy preventing harassment but unreasonably
fails to report the harassment, courts will allow you to use this as a defense
against liability.
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Harassment by co-workers and non-employees
Harassment claims based on the actions of nonsupervisory employees are also possible.
Both quid pro quo and hostile environment are potential claims based on the actions of a
co-worker who is not the complaining party’s supervisor. Although quid pro quo claims
are possible in the case of co-worker harassment, they are rare. With hostile environment
claims, for co-workers or third parties, the complaining party must establish that the
employer had notice, either directly or indirectly, of the harassment and failed to take
appropriate corrective action.
Preventing complaints of harassment
There are several proactive measures employers can and should implement to help
prevent sexual harassment from occurring and to reduce exposure when it does occur.
Probably the most important is the adoption, communication, and consistent enforcement
of a written policy prohibiting all forms of harassment. This policy should:
•
generally define harassment
•
prohibit any level of harassment (“zero tolerance”)
•
state that supervisors do not have the authority to harass employees
•
outline responsibilities for reporting harassment
•
provide that violators will be disciplined appropriately
•
encourage complaints
•
assure the complaint will be kept as confidential as possible
•
designate a particular person or procedure that is certain to be responsive to the
employee’s complaint and, also, provide one or more alternative avenues for
issuing a complaint in case the employee is uncomfortable reporting to a
particular person)
•
assure no retaliation
•
require employees to acknowledge receipt of the policy and agree to abide by its
terms (see the Employee acknowledgment form at the end of this chapter).
After you have adopted a no-harassment policy, you should ensure it is communicated to
your employees in several ways, including:
•
posting it on the employer’s intranet bulletin boards, by time clocks, in lunch
rooms, or in other areas where employees congregate
•
distributing it to all new employees and periodically review with all employees
•
ensuring employees have signed acknowledgment forms and these forms have
been placed in their personnel files
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•
verbally communicating the No Harassment policy at supervisor and employee
meetings, stressing each individual’s responsibility for not engaging in prohibited
behavior and to immediately report inappropriate behavior
•
covering the policy in new employee orientation.
Also, supervisor training should be completed at least annually to emphasize the priority
the company places on preventing sexually harassing behavior. See the Manager and
Supervisor acknowledgment form at the end of this chapter.
Investigating complaints of harassment
There are four basic steps to handling a sexual harassment complaint. Guide your
investigation by ensuring that these steps are followed and documented. Maintain all
documentation in separate, confidential personnel files. Ensure that all interviews are
conducted in private areas.
1. Take the complaint
In taking the complaint, it is important to listen to the complainant’s story.
Consider having a witness in the room to take notes of the conversation and be an
active listener. Get specific facts of the incident(s), and assess whether the
conduct was welcome or unwelcome by determining what the complaining
employee’s response was to the harassment. Also, determine whether the
complainant kept notes and ask the employee if there are other individuals you
should be interviewing. Finally, ask how the complainant would like to see the
situation resolved, and assure the complainant that you consider the complaint a
serious matter and that appropriate action will be taken as quickly and as
confidentially as possible. If the employee requests that he or she have an attorney
present, you should seek the advice of a competent employment law attorney.
2. Interview the alleged offender
When you interview the alleged offender, conduct the interview in a straightforward unbiased manner and keep in mind that the accused has a right to hear
and respond to the allegations in detail. Consider having a witness in the room to
take notes, and when interviewing the alleged harasser, be serious and to the
point. When asking the individual about the allegations, focus on the alleged
harasser’s actual behavior rather than his or her intent. Find out whether the
alleged harasser and the complaining employee have socialized, and, if so, the
details of that relationship. If the accused admits to unlawful behavior, state that
the behavior must cease immediately. If the accused denies the behavior, explain
that you have two sides to the story and will be investigating further, cautioning
him or her not to speak with co-workers about the investigation. Finally, advise
the alleged harasser that the complaint and investigation will be kept as
confidential as possible and that no retaliation against the complaining party or
witnesses will be tolerated.
3. Investigate the complaint
When developing information, monitor your workplace to ensure the harassment
stops and no retaliation occurs. Try to speak with witnesses and the supervisors
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involved as quickly as possible and attempt to be discreet. If there are no
witnesses, consider speaking to others who might provide insight into the
situation. Inform the witnesses the investigation is confidential and discussing the
matter could result in disciplinary action. Do not limit the investigation to current
employees, but for those you do interview, phrase questions so they do not reveal
unnecessary information. Also, review and consider the personnel files of the
alleged harasser.
4. Take appropriate action
Take immediate corrective action if sexual harassment is determined to have
occurred. Disciplinary options include oral and written warnings, reprimands,
suspension, probation, transfer, demotion and discharge. Be sure to follow up to
ensure that the remedy chosen has stopped the harassment and that the victim and
witnesses have not suffered retaliation. Regardless of the determination, enact
future preventative measures, such as additional training and improved written
policies or procedures.
Sexual orientation
Some counties or municipalities have enacted ordinances which list sexual orientation as
a protected characteristic. Therefore, it is important to check the local laws that regulate
your workplace to ensure you are aware of and in compliance with those regulations.
Title 9
Title 9 prohibits sex discrimination and sexual harassment in educational institutions that
receive federal funds and protects both students and employees. The U.S. Supreme Court
has ruled that students may sue for damages for sexual harassment.
Equal pay
Equal Pay Act
The Equal Pay Act of 1963 prohibits pay differentials on the basis of sex in substantially
equal work requiring equal skill, effort and responsibility under similar working
conditions. There is no exemption for executive, administrative, professional and outside
sales employees. Generally, employees with two or more employees handling goods
which have moved in interstate commerce and annual dollar volume of sales of at least
$500,000 are covered, but some employers have no dollar volume threshold.
Who is covered
The Equal Pay Act is an amendment to the Fair Labor Standards Act, therefore
the same complicated coverage factors apply. For private employers, two tests are
used in determining coverage under the Equal Pay Act. The “nature of the
employee’s work” test provides for coverage when employees are engaged
directly in commerce or in the production of goods for commerce. The “nature of
the employer’s work” test is used to determine employer coverage based on the
dollar volume of the employer’s business. Several exemptions exist under the Act.
Included are exemptions for businesses involved in agriculture, agricultural
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processing, and fishing and shrimping operations. Later amendments to the Equal
Pay Act provide for coverage of all federal, state, and local employers.
Establishment defined
The Equal Pay Act applies only to jobs in the same establishment that involve
equal work. The EEOC, which enforces the Act, has defined an establishment as a
distinct business or enterprise which may include several separate places of
business. In some circumstances, two or more distinct physical portions of a
business may be treated as one. The EEOC considers such factors as:
•
the degree of central administrative control of hiring, setting wages, and
assigning locations
•
the interchange of employees between work locations
•
the identity of daily duties
•
similar working conditions.
Equal work defined
The “equal work” test does not require that jobs be identical for an equal pay
comparison to be made. Courts have accepted substantial similarity in equal pay
cases. In any event, the test focuses not upon job title, but upon job content,
analyzing the skill, effort, and responsibility required by the job and the working
conditions under which the jobs are performed.
•
Equal skill
This factor concerns the skills required and possessed by other employees.
Employers should look at what the jobs being compared require in terms
of experience, training, education, and ability.
For example, two teachers may perform similar duties, but if a female
teaches calculus while a male teaches telephone etiquette, the two jobs do
not require equal skill.
•
Equal effort
This factor deals with the physical or mental effort required by the jobs
being compared. To justify a pay differential, additional effort must be
regular, significant and have an economic value to the employer.
For example, female cleaning staff may not exert equal effort compared to
male maintenance employees, if additional physical effort is required in
performing maintenance functions.
•
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Equal responsibility
This factor concerns the degree of accountability to management required
in the performance of the jobs. Employers should look at things such as
the number of employees or assets for which the employees are
responsible and the importance of the jobs in the employer’s overall
operations.
•
Similar working conditions
In determining whether jobs are performed under similar working
conditions, the physical surroundings and potential hazards are taken into
consideration. Generally, working conditions which differ as to size, scope
or potential exposure hazards are not considered similar for EPA purposes.
Enforcement
The Act is an amendment to the Fair Labor Standards Act of 1938, therefore the
enforcement procedures and possible sanctions of the FLSA apply in equal pay
cases. The Equal Employment Opportunity Commission (EEOC) has been given
the responsibility of enforcing the Act. Because enforcement was originally
handled by the Wage and Hour Division, the Division’s procedures still apply,
making EEOC enforcement efforts different in the case of an equal pay
complaint.
Voluntary compliance by the employer is sought if a violation is found, but if the
employer refuses, the matter is sent to the EEOC legal staff. The EEOC may then
bring a lawsuit against the employer. Individual employees may also sue under
the Act, but that right terminates if the EEOC sues.
The statute of limitations for court cases under the Equal Pay Act is two years for
nonwillful violations and three years for willful violations. Employees must file
within these time periods, measured from the date of the alleged EPA violation.
Investigations
Investigations may be triggered by a complaint or initiated by the EEOC under its
statutory authority. The EEOC’s usual policy is not to tell the company whether it
has a complaint even if the company requests that information. As part of its
authority, the EEOC is entitled to conduct an on-site review of employer records
and interview witnesses. An employer should attempt to restrict the EEOC review
to records and questions relating to job content, pay, sex and the facts supporting
the employer’s defenses.
What to do if investigated
The following recommendations are made for employers who have been notified
of an upcoming investigation under the Equal Pay Act.
•
Make certain that all required pay records are in order and are available for
review. The FLSA requires that wage and hour records be maintained for
a period of three years. Records more than 3 years old should not be
retained and normally should not be made available to the investigator.
•
Immediately conduct a self-review of your records to identify possible
problem areas. Jobs that are substantially similar, regardless of job title,
held by male and female employees should be identified. If pay
differences have existed between the male and female employees, try to
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determine why. Perhaps the jobs did not require equal skill, effort or
responsibility or were not performed under similar working conditions.
Can the pay differentials be explained under one of the available defenses
discussed in the section captioned as Employer defenses? If not, consider
bringing wages into compliance immediately.
•
Alert supervisory employees to possible problem areas and review the
company’s position. Supervisors can sometimes unintentionally hurt the
company’s position when they are interviewed by the EEOC simply
because they are not aware of all the facts.
•
Since the EEOC also investigates claims of discrimination under other
federal laws, beware of inquiries during equal pay investigations regarding
other matters such as promotion sequences, job assignments, and race or
age identification, or you may find yourself defending additional
allegations of federal discrimination law violations.
•
Have your employment law attorney or a management representative
present when supervisors or other management employees are
interviewed. The company has a legal right to such representation because
these witnesses are agents of the company. Take detailed notes of
questions and answers. If affidavits are requested, offer a company
position statement instead. In addition, the company should try to make
the employees available on-site. Otherwise, the company will lose the
necessary control of the situation. If interviews are done off-site, the
company will have no idea with whom the EEOC spoke, how long the
interview lasted, or, possibly, what substantive facts were covered.
•
Keep a detailed log of records requested by the EEOC investigator,
employees interviewed by the investigator, and the amount of time spent
with each employee. These steps will make it much easier to piece
together the EEOC’s case in the event of a future claim.
•
If the investigator reviews his or her findings with you and asks for an
agreement, request time to review the matters with an employment law
attorney. Do not feel compelled to give an immediate response.
Possible sanctions
Sanctions may include backpay and “liquidated” damages, which double the
backpay award. Liquidated damages may not be awarded if the employer acted in
good faith and reasonably believed it was not violating the law. The court may
also award attorneys’ fees and issue an order requiring future compliance.
Records and reports
An employer must maintain and preserve basic records of payroll data for
employees, although the regulations do not require that records be kept in any
particular form. In addition, an employer must keep any records made in the
regular course of business which relate to the payment of wages, wage rates, job
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evaluations, job descriptions, merit systems, seniority systems, and collective
bargaining agreements for at least two years.
Employer defenses
The Equal Pay Act allows differences in pay between employees doing equal
work when the differentials are based on a seniority, merit system, or incentive
system, or any factor other than sex. Some examples of factors other than sex are:
•
different wages for different shifts
•
different rates for full-time versus part-time employees
•
lower wages paid to employees working under an established training
program.
It is important to note that the employer always has the burden of proving the
applicability of one of these defenses. An employer can properly rely on one of
the above defenses, provided the practice:
•
is completely nondiscriminatory in application
•
is uniformly applied to men and women
•
is the actual reason for the differential and is job-related.
Equal pay legislation in Florida
Equal pay in Florida is covered by Florida’s Equal Pay statute (§448.07, Fla. Stat.).
Who is covered
The Florida statute covers every employer in Florida that is not covered by the
federal Fair Labor Standards Act (FLSA).
Enforcement
Employees can bring suit against the employer in any state court within 6 months
of termination.
Possible sanctions
The Florida statute:
•
provides for recovery of costs and reasonable attorney’s fees by the
prevailing party
•
provides that victims of sex-based discrimination may recover the
difference between the wages paid and the wages which should have been
paid
•
permits the employee to bring a civil action without filing a complaint or
charge with an agency and provides a maximum of one year in damages
for back pay.
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Another piece of Florida legislation which touches upon equal pay makes it
unlawful to discriminate on the basis of sex, marital status or race in the areas of
loaning money, granting credit, or providing equal pay for equal services
performed. It is significant to note that this statute considers wage discrimination
on grounds other than gender and provides for the recovery of damages and
reasonable attorney’s fees.
Pregnancy discrimination
Federal law prohibits employment discrimination against women based upon pregnancy,
childbirth, or any other pregnancy-related conditions, under the Pregnancy Discrimination Act.
This provision requires that employers treat women affected by a pregnancy-related condition
the same as other applicants and employees according to their ability or inability to work.
With very few exceptions, it is unlawful discrimination to not hire a woman because she is
pregnant, and it is unlawful to not hire a woman because she has secured, or refuses to secure, an
abortion. In addition, benefits must be provided to pregnant women on the same terms as to
employees having other temporary disabilities.
Race or national origin discrimination
Both the Florida Civil Rights Act and Title VII prohibit discrimination on the basis of race,
color, or national origin. The statutes protect white employees and applicants as well as
minorities. An employer cannot treat a person differently because of his race, color, national
origin, or because of the individual’s association with a minority group.
Disparate impact
A disparate impact is the negative effect of an otherwise neutral employment requirement
or criteria on a particular group of people.
Certain employment actions taken for seemingly neutral reasons have been determined to
have a “disparate impact” on minority groups. For example, rejection of applicants
because of arrest records, as opposed to conviction records has been shown to have a
disparate impact on black applicants. This is because it has been determined that blacks
are more likely to be arrested than either whites or other minority groups, but not
necessarily more likely to be convicted. Therefore, use of this information in making
employment decisions has a disparate impact on blacks. Another example where
disparate impact on a certain protected class of employees could be found is a grooming
policy which requires male employees to be clean shaven if this policy is not supported
by business justification. In recent years, black employees have succeeded in showing
that such grooming policies adversely affect blacks, because they are more susceptible to
a particular skin condition which is aggravated by daily shaving.
Reverse discrimination
Title VII prohibits all discrimination based on race, color, sex, religion, or national origin.
What is not commonly appreciated, however, is that Title VII protects whites as well as
minorities from unlawful discrimination.
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Sickle cell testing
Florida law prohibits mandatory screening or testing for sickle cell trait.
The Civil Rights Act of 1866
This law, known as Section 1981 (its federal statute number) provides that:
All persons within the jurisdiction of the United States shall have the
same right in every state and territory to make and enforce contracts. . .
and to the full and equal benefit of all laws and proceedings for the
security of persons and property as is enjoyed by white citizens.
Section 1981 applies to both private and public employers and was originally designed to
protect former slaves from discrimination. Section 1981 has been interpreted as also
protecting whites and others who allege race discrimination. The statute does not
specifically apply to discrimination based on religion or national origin, but courts have
defined race rather broadly, and have included under the protection of Section 1981 Jews
and Arabs because they “were among the people considered by Congress to be distinct
races.”
Important differences from Title VII provide advantages and disadvantages to plaintiffs.
•
Unlike Title VII, Section 1981 covers all private employers, regardless of size, as
well as federal, state, and local government employers.
•
Section 1981 does not require a plaintiff to first file a charge of discrimination
with an administrative agency like the EEOC before commencing a lawsuit. The
time period for bringing a Section 1981 claim is governed by the most analogous
state law statute of limitations where the claim arises, which generally is much
longer than the time period for filing Title VII claims (four years in Florida).
•
Jury trials are available for employees who make a timely demand after filing
their lawsuits. Monetary awards under Section 1981 are not limited to backpay
and attorneys’ fees, but can also include “uncapped” compensatory and punitive
damages.
•
Under Section 1981, the plaintiff’s burden of proof is higher than under Title VII.
Intentional discrimination must be proved. Therefore, a plaintiff cannot sue for
unintended disparate impact.
Section 1983 of the Civil Rights Act of 1871
Section 1983 provides a remedy for violations of an employee’s Constitutional or
statutory rights. Unlike Section 1981, it generally does not apply to private employers or
to discrimination by the federal government, but predominantly covers acts taken by state
or local governments. As such, it has been used to reach employment discrimination
involving police and fire departments, public schools, colleges and universities, public
hospitals, and public transportation authorities.
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Section 1983 is most often used by public-sector employees when they feel their First
Amendment rights have been violated. For instance, a state hospital employee may
publicly criticize the director of the hospital for alleged Medicaid fraud. If the director
subjects the employee to an adverse employment action based upon those comments, the
employee may raise a Section 1983 claim.
Section 1985
Section 1985 is a federal law which prohibits conspiracy to interfere with civil rights. In
the employment context, the statute has been used to bring claims that the employer
conspired to intimidate witnesses.
In order to state a claim for witness intimidation under Section 1985, an employee must
show facts to support:
•
the existence of a conspiracy, such as a plan or agreement between two or more
persons
•
which was intended to deter testimony in federal court
•
by force or intimidation
•
and which caused injury.
The United States Supreme Court has ruled that loss of at-will employment was a
sufficient injury to bring suit for witness intimidation under 42 U.S.C. §1985.
The Eleventh Circuit Court of Appeals, with authority over federal courts in Florida,
held that two or more corporate employees can engage in a conspiracy for purposes of
Section 1985.
Age discrimination
Age Discrimination in Employment Act
Generally speaking the Age Discrimination in Employment Act (ADEA) protects
employees over age 40 from discrimination based on age. Its definition of covered
“employer” is identical to Title VII (private employers who employ 20 or more persons
in each of 20 consecutive calendar weeks of the current or preceding year and some
public employers) except that the ADEA has a 20-employee requirement, rather than
Title VII’s 15-employee requirement.
On June 18, 2009, in Gross v. FBL Financial Services, Inc., the Supreme Court held that
the ADEA, unlike Title VII, does not authorize mixed-motive claims of age
discrimination (where there is both direct evidence of discrimination and a legitimate,
nondiscriminatory reason for the adverse employment action). The burden of proof rests
at all times with the plaintiff to establish that age was a “but for” cause of the adverse
employment action.
In employment-discrimination cases, the burden of proof is on plaintiffs to establish that
they were the victims of unlawful discrimination. But the Supreme Court recognized a
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“mixed-motive” framework in the 1989 Title VII case, Price Waterhouse v. Hopkins.
There, a plurality opinion stated that the plaintiff had the burden of showing “by direct
evidence” that an illegitimate factor (such as race or sex) played a role in the adverse
employment action. If the plaintiff was successful in making this showing, the burden
shifted to the employer to prove that it would have taken the same action regardless of the
illegitimate factor. Lower courts applied the Price Waterhouse analysis in Title VII and
non-Title VII discrimination cases, such as age discrimination.
In 1991, Congress amended Title VII to explicitly authorize “mixed-motive”
discrimination claims. But Congress did not make similar changes to the ADEA. In
Desert Palace v. Costa, the Supreme Court held that the 1991 Title VII Amendments
eliminated the Price Waterhouse requirement that plaintiffs put forth “direct evidence” in
“mixed-motive” cases to shift the burden of proof to the employer. Following Desert
Palace, the Title VII discrimination plaintiff was only required to show by a
“preponderance of the evidence“ that an illegitimate factor was “a motivating factor” in
the adverse employment action. A preponderance of the evidence means any amount of
evidence, however small, that makes one side of a case more likely to be true than the
other side. It is a much lower burden of proof than “beyond a reasonable doubt” which is
the standard used in criminal proceedings. If a preponderance of the evidence shows that
a protected category such as race was a factor in the employment decision, then it was
then the employer’s burden to prove that it would have taken the same action in the
absence of the unlawful motivating factor.
For years, lower courts have struggled in applying the Price Waterhouse and Desert
Palace decisions in non-Title VII mixed-motive cases. While some courts held that the
Price Waterhouse “direct evidence” standard continued to apply, others interpreted
Desert Palace broadly to eliminate the “direct evidence” requirement in all mixed-motive
discrimination cases.
The Supreme Court has now resolved the conflict by holding that neither Price
Waterhouse nor Desert Palace apply in non-Title VII discrimination cases. Instead, the
Court held that mixed-motive claims are not available under the ADEA and other
non-Title VII discrimination statutes.
Although this is a clear victory for employers, it may be short lived since a number of
legislative initiatives have been introduced to overturn the Supreme Court’s ruling and
amend various federal anti-discrimination laws to specifically allow for mixed-motive
claims. Again, employers should continue to monitor this area of the law for
developments.
The ADEA, like Title VII, is enforced by the Equal Employment Opportunity
Commission (EEOC).
Possible sanctions
The ADEA provides that an employee or the EEOC can sue for back wages,
attorneys’ fees, and liquidated (double) damages if the violation is voluntary and
intentional, but not necessarily malicious.
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Records and reports
No particular order or form of recordkeeping is required, although the records
must contain in some fashion the information specified. If the information is
available or can be readily obtained from records kept for other purposes, no
further records need be maintained. Employers must keep, for three years, payroll
or other records for each employee which contain:
•
name
•
address
•
date of birth
•
occupation
•
rate of pay
•
compensation earned each week.
Employers must keep for a period of one year other personnel or employment
records made in the regular course of business which are related to job
applications, resumes, promotion, demotion, discharge, transfer, layoff, recall,
selection for training, job orders submitted to employment agencies or labor
organizations, employment tests, results of physical examinations, and job
advertisements. Employers must keep applications submitted by seasonal and
temporary workers for the same amount of time as other applications.
Employers must retain employee benefit plans, including pension plans, insurance
plans and written merit or seniority systems, for the duration of the plans and for
at least one year after termination of the plan.
Employers must retain records regarding enforcement actions under the ADEA
until final disposition of the action.
Prohibited practices covered by ADEA
The ADEA sets forth a number of specific requirements applicable to covered
employers. These include the following:
Hiring/firing
Employers cannot fail or refuse to hire, or discharge or otherwise
discriminate against any individual protected by the Act because of that
person’s age. This prohibition applies also if the person claiming
discrimination and the person he or she claims was treated more favorably
are both over 40. Thus, the person who was hired, promoted, or retained
in place of the employee making the claim need not be under 40 but only
“substantially younger” than the plaintiff in order to plead a valid claim.
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Advertising
The ADEA prohibits the use of an employment advertisement that in any
way discriminates or indicates a preference based on age. This restriction
is not limited to ads that state a maximum age for potential candidates.
Any indication of preference for one age group over another group
protected by the Act is unlawful. Some examples include the following:
•
recent college graduate (instead of just college graduate)
•
young person
•
age 50 or over (discriminates against younger people in the
protected group).
Mandatory or involuntary retirement
The ADEA prohibits the mandatory or involuntary retirement of an
employee, regardless of whether the retirement terms were voluntarily
entered into by the employee. Compulsory retirement is permissible under
the Act for certain executive-level employees, who must meet certain
criteria. Employers should consult with an employment law attorney
before relying upon this exemption as it is very narrowly interpreted by
the EEOC and federal courts.
Benefits
Employers are prohibited from ceasing to contribute or accrue retirement
benefits or reducing the rate of contribution or accrual under the
retirement plan for employees based on age. However, a plan may impose
a limit on the total amount of contribution or benefits or the number of
years of service credited so long as such limits are not age-based.
A retirement plan cannot exclude an employee from participation because
he is too old, but can impose a requirement that the employee participate
in the plan for at least 5 years before becoming eligible for benefits.
Employer defenses
The ADEA provides for various defenses upon which employers may rely in
defending claims of age discrimination. These include:
•
Actions otherwise prohibited by the ADEA are not unlawful if the
employer can show that age is a bona fide occupational qualification
(BFOQ) necessary to the operation of the business. This concept is very
narrowly interpreted. One example of a BFOQ which has been upheld is a
mandatory retirement age for certain security personnel.
•
An action that affects a protected employee is not unlawful if it is based
upon reasonable factors other than age. Some examples are job-related
physical requirements, job evaluation factors such as level of performance
and education, reliance upon a validated employment test, and a policy of
not employing relatives of current employees.
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•
As under Title VII, actions taken under a seniority plan are lawful.
•
Employers may provide reduced employee benefits to older workers if the
cost of benefits is at least as much as that incurred for younger workers.
However, this exception cannot excuse the failure to hire an individual in
the protected age group and, similarly, cannot require the retirement of
such an individual.
•
An employer does not violate the act if it disciplines or discharges an
employee based on good cause.
Florida Civil Rights Act
Like the ADEA, Florida law prohibits discrimination on the basis of age. Employers must
note, however, that coverage under the Florida law is broader than coverage under the
ADEA. Under Florida law, all employers with 15 or more employees during any 20 week
period are covered, while coverage under the ADEA requires 20 employees. Further,
Florida law does not specifically limit the protected age to 40 years or over.
Florida courts have adopted federal case law interpreting the ADEA in enforcing the
Florida Civil Rights Act.
The Older Workers Benefit Protection Act provides a standard to govern an older
worker’s waiver of rights under the ADEA and amends the ADEA to further prohibit
discrimination against older workers in employee benefit plans, with three exceptions.
1. Employers must ensure that either the actual amount of the benefits paid or the
cost incurred by the employer for benefits provided to older workers is no less
than that paid or incurred on behalf of younger workers. Employers should be
prepared to show that any differences in benefit levels for older workers are based
on the higher cost of such benefits.
2. The Act allows for limited enforcement of voluntary early retirement incentive
plans. These plans implement a reduction in force by targeting older workers who
meet age and service requirements. To be lawful under the Act, the voluntary
early retirement plan must be created for legitimate business reasons, and be
presented to the employees without intimidation. In addition, accurate information
must be presented to the employee, who must be given a reasonable amount of
time to consider the plan.
3. The Act allows setoffs of severance pay for pension benefits received by older
workers upon termination. As an incentive for employers to provide health
benefits for retirees, the Act also allows health benefits to be deducted from
severance pay up to certain statutory limits.
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Waivers
Any agreement to waive ADEA rights must be “knowing and voluntary,” and the Act
specifies certain minimum standards which must be met if the waiver is to be effective:
•
the agreement must be in writing and in plain English
•
it must specifically refer to ADEA claims and rights
•
it must not release or waive future claims or rights
•
it must be in exchange for valuable consideration in addition to any benefits or
amounts to which the employee is already entitled
•
the employee must be advised to consult with an attorney prior to signing the
agreement containing the waiver
•
the employee must be given at least 21 days to consider the agreement (if the
waiver is sought in connection with a termination of a group of employees, this
period must be at least 45 days)
•
the waiver must be revocable for at least seven days following the employee’s
execution of the agreement.
Religious discrimination
Both Florida and federal law prohibit discrimination against applicants or employees because of
their religious beliefs. The prohibition against religious discrimination is similar to other types
of discrimination prohibitions with one important difference – employers have a duty to
accommodate the religious activities of employees. While this may appear to create a substantial
economic burden for your business, it need not.
You have no duty to accommodate religious needs if the accommodation creates an undue
hardship, which the Supreme Court has defined as anything that has “more than a de minimis
(token) cost.” For example, you are generally not obligated to change work schedules to
accommodate an employee’s religious practices if it would violate collectively bargained
seniority rules or require excessive scheduling of overtime. On the other hand, allowing an
employee to solicit another employee to switch work days voluntarily could be a reasonable
accommodation.
While an attempt at reasonable accommodation includes inviting the individual to offer proposed
solutions, you are not required to choose the accommodation preferred by the employee. An
employer should seek an accommodation which effectively eliminates any religious conflict and
reasonably preserves the person’s employment status.
Expanding religion
Religious beliefs must be sincerely held in order to necessitate an accommodation, but
employers should be very cautious in denying accommodations because of doubts about
such convictions.
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The EEOC has taken the position that vegetarianism is a religious/moral conviction. A
bus driver in San Francisco was fired for refusing to hand out free hamburger coupons on
his bus route. The driver claimed that he was a vegetarian, ate no animal products, and
did not wear clothing made from animals. He notified his supervisor that he would not
pass out the coupons. The EEOC declared that the employer failed to accommodate the
driver’s “strongly held moral and ethical beliefs.”
Disability discrimination
Americans with Disabilities Act (ADA)
The Americans with Disabilities Act of 1990 (ADA) is a federal law that prohibits
discrimination against disabled individuals with regard to terms and conditions of
employment if the individual is qualified to perform essential functions of a job with or
without reasonable accommodation.
Enforcement
The ADA is enforced by the Equal Employment Opportunity Commission
(EEOC), and employees can recover the same types of damages as those available
under Title VII, namely, back wages, reinstatement or front pay, attorney’s fees,
and limited compensatory and punitive damages. Jury trials are available to
employees who bring suit against an employer for ADA violations.
Definition of disability
To be protected under the ADA, the individual must meet the statutory definition
of disability. Under the ADA, a disability is defined as:
•
a physical or mental impairment that substantially limits one or more
major life activities of an individual
or
•
the record or history of such an impairment, in other words, the individual
with physical or mental disability but no longer has or was misclassified as
having an impairment
or
•
being regarded by the employer as having such an impairment.
Furthermore, the ADA also prohibits discrimination against employees who,
although not disabled, have a relationship with a disabled individual. As
explained below, the ADA does not require reasonable accommodation to meet
the needs of these employees.
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A physical or mental impairment that substantially
limits one or more major life activities of an individual
•
Impairment
An impairment is any physical, mental, or psychological disorder
or condition, cosmetic disfigurement, or anatomical loss affecting
one or more of the body’s systems.
The definition of impairment does not include physical
characteristics that are within “normal” range and are not the result
of a physiological disorder. For instance, eye color, hair color, lefthandedness, height, weight, and muscle tone are not physical
impairments covered by the Act. Similarly, personality traits such
as poor judgment or quick temper are merely mental
characteristics, not impairments, and are thus not covered by the
Act. Temporary non-chronic impairments such as cuts, bruises,
sprains, simple infections, or short-term viruses are not disabilities
either.
Nonetheless, some impairments such as blindness and deafness are
unquestionably disabilities under the Act. Other impairments such
as cancer, diabetes, and alcoholism may be disabilities under the
Act. The name of an impairment is rarely enough to resolve a
question of disability. Rather, the determination whether an
individual is disabled is a fact specific individualized inquiry.
•
Substantially limits
An individual is not disabled simply because he has an impairment.
Rather, an individual’s impairment must substantially limit a major
life activity to be a disability. If the impairment either:
prevents the individual from performing
or
significantly restricts the individual’s ability to perform a
major life activity as compared to the average person in the
general population
the impairment is substantially limiting. Factors to be considered in
analyzing whether an impairment is substantially limiting include:
the nature and severity of the condition
the duration or expected duration
the permanent or long-term impact of the condition.
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As an example, a broken leg generally will not be considered a
disability under the ADA.
The Supreme Court has held that if an individual is taking measures
to correct for, or mitigate, a physical or mental impairment, the
positive and negative effects of such measures must be taken into
consideration when evaluating whether the individual is
substantially limited in a major life activity. Therefore, an
individual who takes medication that completely controls his
condition so that it is not substantially limiting is not disabled.
•
Major life activity
Major life activities include such things as caring for one’s self,
performing manual tasks, walking, sitting, standing, lifting,
reaching, seeing, hearing, speaking, breathing, learning, sleeping,
reproduction, and working. Also mental and emotional processes
such as thinking, concentrating, and interacting with other people
are major life activities.
Record of a covered disability
The ADA also protects as disabled, those individuals with “a record of
such an impairment.” This includes someone who:
•
had a physical or mental disorder that substantially limited a major
life activity but no longer has that impairment
or
•
was simply misclassified as having such an impairment.
The past impairment must be one that would otherwise be covered under
the Act.
Example
Former cancer patients may not be discriminated against because of
their prior medical history.
Example
An individual of normal intelligence who was mistakenly classified
as “mentally retarded” or “learning disabled” is protected.
Note
Even though an individual has a record of being a “disabled” veteran or on
a “disability retirement,” or is classified as disabled for other purposes
such as worker’s compensation, he or she may not satisfy the definition of
disability under the ADA. In making a disability determination, other
statutes sometimes apply a different standard than the ADA.
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Regarded as disabled
An individual who is “regarded as having such an impairment” is someone
who:
•
has a physical or mental impairment that does not substantially
limit a major life activity but who is treated as though it does
or
•
has a physical or mental impairment that substantially limits a
major life activity only as a result of the prejudices of others
toward the impairment
or
•
does not have a physical or mental impairment but is treated as
though they do.
Example
A disfigured individual would be covered under this section, as
would a male homosexual applicant who is assumed to be infected
with HIV merely by virtue of his sexual orientation.
Example
If an employee with controlled high blood pressure that is not, in
fact, substantially limiting, is reassigned to less strenuous work due
to the employer’s unsubstantiated fears that the individual might
suffer a heart attack, there is an ADA violation.
An individual will also be regarded as impaired by showing that the
employer or prospective employer made an employment decision based
on “myth, fear, or stereotype” about the perceived disability.
Example
An employer discovers that an employee’s mother has
Huntington’s disease (an incurable neurological disorder). The
employer terminates the employee because he knows the employee
has a 50% chance of developing the condition.
Relationship with a disabled individual
While the law prohibits discrimination against persons in this category, it does not
require employers to reasonably accommodate (see page 117, Reasonable
accommodation) their needs. For example, a mother applying for a job may
have responsibility for a child who needs periodic visits to a hospital to treat a
disability. You may not discriminate against this person by failing to hire her
merely because you fear her child will occupy too much of her time and attention.
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On the other hand, her requests for time off to secure treatments for the child are
not protected under the ADA. Of course, in such a case the Family and Medical
Leave Act (FMLA) must also be taken into consideration. For more information,
see Chapter 29, Family and medical leave.
Qualified disabled individual
To be protected under the ADA a person must also be considered a qualified
individual with a disability. A person is qualified if he or she has the required
skills, experience, education, and licenses and can, with or without reasonable
accommodation, perform the essential functions of the job. An essential function
is a fundamental duty that the employee must perform. The employer’s judgment
regarding the essential functions of a job, including any written description of the
job functions, will be considered when determining if an individual is qualified.
For this reason, if a Company has written job descriptions, it is important to keep
them current (see Chapter 4, Job descriptions).
Factors the Courts and EEOC use in determining whether a function is essential
include:
•
whether the reason the position exists is to perform that particular function
•
the number of other employees available to perform the job
•
the degree of expertise or skill required to perform the function
•
the duties listed on any job description
•
the amount of time spent in performing the function
•
the consequences of failing or being unable to perform the function.
Conditions not covered by the ADA
The ADA includes a list of conditions that are specifically excluded from the
protection of the ADA:
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•
homosexuality or bisexuality
•
gender-identity disorders, such as transsexuality
•
compulsive gambling
•
kleptomania
•
pyromania
•
conditions associated with the current use of illegal drugs
•
psychoactive substance use disorders resulting from illegal drug use
•
certain sexual behavior disorders, such as voyeurism and pedophilia.
Special care must be used in analyzing the ADA’s coverage of those with drug or
alcohol problems. Although an alcoholic may be considered disabled, employers
may prohibit the consumption of alcohol in the workplace, prohibit an employee
from being under the influence of alcohol at work, and hold alcoholic employees
to the same conduct and performance standards as other employees even if the
failure to meet these standards is caused by the employee’s alcoholism.
It is important to note that, although illegal drug users are specifically excluded
from the protection of the ADA, rehabilitated drug users, or employees currently
in rehabilitation, are protected as long as they are not currently using illegal drugs.
Current use is use that occurred recently enough to justify the employer’s belief
that illegal use is an ongoing problem.
Reasonable accommodation
An employer is required to provide a reasonable accommodation to a qualified
disabled individual to enable him or her to perform the essential functions of his
or her job. Generally, an accommodation is a change or alteration to the work
environment, to policies or procedures, or to the manner in which things are
normally done that enables the disabled individual to have equal employment
opportunities. A reasonable accommodation is one that is reasonable on its face.
A reasonable accommodation may include, but is not limited to:
•
making facilities accessible
•
restructuring jobs
•
providing part-time or modified work schedules
•
reassigning an employee to a vacant position
•
acquiring or modifying equipment or devices
•
furnishing qualified readers, interpreters, or assistants
•
unpaid leave.
Failure to make reasonable accommodations to a disabled applicant or a disabled
employee is discrimination under the ADA unless the employer can show that the
accommodation is an undue hardship. Importantly, treating disabled employees
the same as non-disabled is not sufficient to meet the reasonable accommodation
requirement.
Undue hardship
Undue hardship refers to any accommodation that would require significant
difficulty and/or expense. Although no bright line standard for undue hardship
exists, whether or not a specific accommodation is an undue hardship will depend
on a number of factors such as:
•
the nature of the accommodation
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•
the net cost of the accommodation
•
the overall financial resources of the employer
•
the number of persons affected by providing the accommodation
•
the impact of the accommodation on business operations of the business
•
the impact of the accommodation on co-workers.
Direct threat
You are not required to employ an individual with a disability who poses a direct
threat to the health and safety of himself or to others or who cannot safely
perform the job even with reasonable accommodation. This is a very narrow
exception on which the company will bear the burden of proof.
A direct threat is defined as “a significant risk of substantial harm to the health or
safety of the individual or others that cannot be eliminated or reduced by
reasonable accommodation.” To reject an applicant on this basis, you must be
able to prove not only that there is a high probability of substantial harm, but also
that no reasonable accommodation could eliminate the risk or reduce it to an
acceptable level. You must also identify which aspect of the disability currently
poses the direct threat, and you may not speculate on the risk which might be
posed by the individual’s condition at some future time. The following four
factors must then be considered in light of valid medical analysis or other
objective evidence individualized for the particular person and job:
1. the duration of the risk
2. the nature and severity of the potential harm
3. the imminence of the potential harm
4. the likelihood that the potential harm will occur.
Example
An employer in the construction industry may not be required to hire an
individual disabled by narcolepsy (a condition causing sudden sleepiness) for a
carpenter’s job, the essential functions of which require the use of power saws and
other dangerous equipment.
Pre-employment medical
inquiries and examinations
It is important not to make any pre-employment inquiries about the existence,
nature, or severity of an applicant’s disabilities before making a conditional offer
of employment. Your employment applications should be carefully reviewed to
ensure they do not inadvertently violate the law by asking questions relating to
prior injuries, diseases, disabilities, and so on.
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Pre-offer inquiries about the ability of an applicant to perform job-related
functions are permitted, however. For example, if a job requires assembling small
parts, you may ask whether the applicant can perform that function, with or
without reasonable accommodation.
You may also state, before making a conditional offer of employment, the
requirements of your company’s attendance policy, and ask whether the applicant
can meet them. On the other hand, do not ask an applicant how often he or she
will need to take leave for treatment or because of incapacity resulting from a
disability. Questions about an applicant’s general attendance record on other jobs,
however, and inquiries designed to determine if he or she abused leave (such as
asking how many Mondays or Fridays he or she was absent from work) are
legitimate.
Post-offer, pre-employment
medical inquiries and examinations
Employers may require a medical examination and/or make medical inquiries
after an offer of employment has been made if all employees entering a position
are subject to the examination or inquiry.
If an employer withdraws a job offer based on the medical examination or
response to the inquiry, the employer must be able to state a job related and
consistent with business necessity reason for doing so.
An employer may inquire about a post-offer, pre-employment applicant’s history
of workers’ compensation injuries at this stage of the hiring process. An
employer’s act of submitting medical information to state workers’ compensation
offices or second injury funds will not be considered a violation of the ADA.
Post-employment medical
inquiries and examinations
Once the hurdle of a conditional offer and a pre-placement physical examination
are cleared, you may conduct examinations required by other laws (DOT
physicals, OSHA or MSHA tests, etc.) and offer voluntary wellness programs.
You are restricted in requiring your employees to undergo additional physical
examinations, however, to those which are job-related and consistent with
business necessity. A physical examination is job-related and consistent with
business necessity when the employee:
•
is having difficulty performing his or her job effectively
or
•
becomes disabled
or
•
requests an accommodation on the basis of a disability
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or
•
possibly is a direct threat based on objective evidence.
Drug screens
A pre-employment drug screen is not considered to be a medical examination and
is therefore permissible under the Act.
Confidentiality
All results of pre- or post-employment physical examinations – indeed all medical
information gathered on employees – must be kept confidential and stored in a
medical file separate from the employee’s regular personnel file. Access to
such records should be controlled and limited to those who have a genuine “need
to know.”
Records and reports
Under the ADA, employers are required to keep the same types of records as
those required by Title VII for completing the EEO-1 form. Requests for
reasonable accommodation must also be kept on file for a period of 1 year.
Employer resources
A network has been set up called the Job Accommodation Network (JAN), which
has a toll-free number for employers to call if they have questions or problems
concerning an accommodation to be made under the ADA. The network consists
of people trained in finding the quickest, easiest and least expensive method of
accomplishing the purpose of the JAN organization, which is to put disabled
individuals to work. The number for JAN is 800-526-7234. You may also access
their website at www.jan.wvu.edu/.
Handicap-Rehabilitation Act of 1973
This federal law was implemented several years before the Americans with Disabilities
Act. It prohibits discrimination against handicapped individuals, who are defined in the
same manner as disabled employees or applicants under the ADA.
The Rehabilitation Act applies to federal agencies and employers doing business under
certain federal contracts.
The Rehabilitation Act requires that all federal contracts and subcontracts in excess of
$2,500 include clauses:
•
not to discriminate against the handicapped
and
•
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to develop and implement an affirmative action program to provide employment
opportunities for the handicapped.
Federal contractors must prepare a written affirmative action plan with respect to
handicapped workers. They must provide applicants and employees with the opportunity
to identify themselves as handicapped. All medical information obtained must be kept
confidential and disclosed only on a need-to-know basis.
All federally funded institutions are prohibited by the Rehabilitation Act from engaging
in employment discrimination based on handicap. The federal agency providing the funds
is required to follow-up and terminate the funding to any institution found not to be in
compliance.
Enforcement
The Rehabilitation Act is enforced by the Office of Federal Contract Compliance
(OFCC) through the use of compliance audits and the investigation of complaints
filed by individuals. Complaints are handled by a process similar to an EEOC
investigation. The employee and employer are interviewed, company records are
reviewed, and an on-site inspection may be scheduled. In some situations, the
OFCC may obtain medical records and an independent medical opinion to aid in
determining if the complainant is an individual with a handicap.
Following the investigation, the OFCC may schedule an administrative hearing,
or bring the case to court via the U.S. Attorney General’s office. Individuals are
not generally allowed to pursue their individual claims in the administrative
process, but may intervene to challenge a dismissal of the complaint.
Individual employees may pursue their claims through the EEOC by filing a
charge under the Americans with Disabilities Act. (Most employers subject to the
Rehabilitation Act are also covered under the ADA.) Such charges are processed
the same as other EEOC charges.
Possible sanctions
Employees under the Rehabilitation Act can collect back pay, reinstatement of
their job, damages for medical damages and resulting emotional distress, costs,
and attorney’s fees. If the employee files a charge with the EEOC under the ADA,
the available damages are the same as those available under Title VII and the
ADA.
Records and reports
Employers subject to the Rehabilitation Act must retain for at least 1 year any
records regarding complaints or actions taken under the law. In addition, federal
contractors with at least 150 employees and federal contracts of at least $150,000
have additional recordkeeping requirements imposed by the Office of Federal
Contract Compliance Programs.
Prohibited practices
The Rehabilitation Act prohibits discrimination against handicapped individuals
in the same manner as the ADA prohibits discrimination of disabled individuals.
The cases developed under the Rehabilitation Act are often used in the ADA
context, since the language in the two statutes is similar. The Rehabilitation Act
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does impose additional burdens on the covered employer by requiring an
affirmative action plan. (For more information, see Chapter 7, Affirmative
action.)
Florida Civil Rights Act
The Florida Civil Rights Act prohibits discrimination on the basis of handicap. Case law
in Florida has followed the federal law under both the Rehabilitation Act and the
Americans with Disabilities Act. The Florida law applies to all employers with 15 or
more employees.
Florida also has a specific law prohibiting discrimination on the basis of HIV status, and
prohibiting testing for HIV, unless the absence of HIV infection is a qualification for the
job.
Marital discrimination
No federal legislation prohibits discrimination on the basis of a person’s marital status. Florida
law, however, specifically includes marital status as a protected class under the Florida Civil
Rights Act. The Florida Supreme Court has decided that marital status discrimination under
Florida law prohibits discrimination on the basis of a person’s legal status as married, divorced,
single, etc. but the court refused to expand the definition of marital status to include
discrimination based on the identity of an employee’s spouse.
The Florida Civil Rights Act permits employers to develop and implement an anti-nepotism
policy which prohibits the employment of close relatives, including spouses. When such a policy
is in place, it provides a complete defense to claims of marital status discrimination. Although
not required under Florida law, the policy should be in writing whenever possible, and a copy
should be provided to employees in any employer provided handbooks or other written materials.
Further, in enforcing such a policy, use caution to avoid actions that might raise gender bias
issues.
Commonly asked questions and answers
Q. Does an employee have to file a charge before filing a lawsuit against the employer for a
violation of the Florida Civil Rights Act?
A. Yes, under Florida law, employees must file a charge with the Florida Commission on
Human Relations (FCHR) within 1 year from the date of the alleged discrimination.
Q. We have an employee who filed a charge of age discrimination against our company
because he was not promoted. Now his job performance has dropped. Can we terminate
him?
A. It is unlawful to retaliate against an employee for filing a state or federal charge of
discrimination of any kind. Courts have awarded damages for retaliation, even when the
underlying charge of discrimination is found to be without merit! This, however, does not
mean that you cannot ever terminate an employee who has filed a discrimination charge.
Use careful judgment and ensure there is a legitimate, documented business justification for
any action you take with regard to this employee that could be considered adverse. With that
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in mind, however, you may treat this employee as you would any other employee who has
not filed a charge of discrimination. Unfortunately, however, any future adverse action is
likely to precipitate a claim of retaliation.
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SAMPLE POLICY AGAINST HARASSMENT
We do not tolerate the harassment of applicants, employees, customers, or vendors. Any form of
harassment relating to an individual’s race; color; religion; national origin; sex (including same
sex); pregnancy, childbirth, or related medical conditions; age; disability or handicap; citizenship
status; veteran status; or any other category protected by federal, state, or local law is a violation
of this policy and will be treated as a disciplinary matter.
Violation of this policy will result in disciplinary action, up to and including immediate
termination.
If you have any questions about what constitutes harassing behavior or what conduct is
prohibited by this policy, please discuss the questions with your immediate supervisor or one of
the contacts listed below. At a minimum, the term “harassment” as used in this policy includes:
•
Offensive remarks, comments, jokes, slurs, or verbal conduct pertaining to an
individual’s race; color; religion; national origin; sex (including same sex); pregnancy,
childbirth, or related medical conditions; age; disability or handicap; citizenship status;
veteran status; or any other category protected by federal, state, or local law.
•
Offensive pictures, drawings, photographs, figurines, or other graphic images, conduct, or
communications, including e-mail, faxes, and copies pertaining to an individual’s race;
color; religion; national origin; sex (including same sex); pregnancy, childbirth, or related
medical conditions; age; disability or handicap; citizenship status; veteran status; or any
other category protected by federal, state, or local law.
•
Offensive sexual remarks, sexual advances, or requests for sexual favors regardless of the
gender of the individuals involved.
•
Offensive physical conduct, including touching and gestures, regardless of the gender of
the individuals involved.
We also absolutely prohibit retaliation, which includes threatening an individual or taking any
adverse action against an individual for:
•
reporting a possible violation of this policy
or
•
participating in an investigation conducted under this policy.
Our supervisors and managers are covered by this policy and are prohibited from engaging in
any form of harassing, discriminatory, or retaliatory conduct. No supervisor or other member of
management has the authority to suggest to any applicant or employee that employment or
advancement will be affected by the individual entering into (or refusing to enter into) a personal
relationship with the supervisor or manager, or for tolerating (or refusing to tolerate) conduct or
communication that might violate this policy. Such conduct is a direct violation of this policy.
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Even non-employees are covered by this policy. We prohibit harassment, discrimination, or
retaliation of our employees in connection with their work by non-employees. Immediately
report any harassing or discriminating behavior by non-employees, including contractor or
subcontractor employees. Any employee who experiences or observes harassment,
discrimination, or retaliation should report it using the steps listed below.
If you have any concern that our No Harassment policy may have been violated by anyone, you
must immediately report the matter. Due to the very serious nature of harassment, discrimination
and retaliation, you must report your concerns to one of the individuals listed below:
1. First, discuss any concern with [high-ranking management job title #1].
2. If you are not satisfied after you talk with [#1], or if you feel that you cannot talk to [#1],
you should discuss your concern with [high-ranking management job title #2].
3. If you are not satisfied after you have talked with [#2], or if you feel you cannot talk to
[#2], you should speak to [high-ranking management job title #3].
4. If at any time, you feel the need to speak to other members of management, you may
contact the [owner, president, CEO].
You should report any actions that you believe may violate our policy no matter how slight
the actions may seem.
We will investigate the report and then take prompt, appropriate remedial action. The Company
will protect the confidentiality of employees reporting suspected violations of this or any other
Company policy to the extent possible consistent with our investigation.
You will not be penalized or retaliated against for reporting improper conduct,
harassment, discrimination, retaliation, or other actions that you believe may violate this
policy.
We are serious about enforcing our policy against harassment. Persons who violate this or any
other Company policy are subject to discipline, up to and including immediate termination. We
cannot resolve a potential policy violation unless we know about it. You are responsible for
reporting possible policy violations to us so that we can take appropriate actions to address your
concerns.
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EMPLOYEE ACKNOWLEDGMENT FORM
I acknowledge that I have received a copy of the Company’s NO HARASSMENT POLICY and
that the Company gave me a copy of this policy to keep.
I have read or will read the policy and will comply with it. If I believe the policy has been
violated, I will immediately report the suspected violation to one of the contacts named in the No
Harassment Policy.
I understand that if I violate this policy, I may be subject to disciplinary action, up to and
including immediate termination.
Print Name : _____________________________________________________________
Signature: _______________________________________________________________
Date: __________________________________________________________________
Social Security Number: ___________________________________________________
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MANAGER AND SUPERVISOR
ACKNOWLEDGMENT FORM
As a manager or supervisor, I acknowledge that I received a copy of the Company’s NO
HARASSMENT POLICY. I understand that the policy applies to all employees, including
managers and supervisors. I also understand that the policy applies to customers, vendors, or
other third parties in our workplace or conducting business with us.
I will not commit or condone harassment of, or discrimination or retaliation against, employees. I
will conduct myself in accordance with the Company’s policies.
I will immediately report any action, allegation, suspicion, or rumor of harassment,
discrimination, retaliation, or other violation of the policy to the contacts named in the No
Harassment Policy. I will support appropriate corrective action, including investigation of the
reported conduct.
I will not penalize any employee who has reported conduct that may violate the policy or any
employee who cooperates with investigations under this policy.
I understand that because I am a manager/supervisor, the Company can be held responsible for
acts of harassment, discrimination, or retaliation that I commit, condone, tolerate or fail to
investigate. If I know of or have reason to know of any actions or omissions that may violate
Company policy, both the Company and I can be placed in jeopardy.
Finally, I understand that if I violate the No Harassment Policy, I will be subject to discipline up
to and including immediate termination, and that I may be sued and held personally liable for my
acts or omissions.
Print Name : _____________________________________________________________
Signature: _______________________________________________________________
Date: __________________________________________________________________
Social Security Number: ___________________________________________________
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Chapter 10
New employee orientation
Starting a new job can be a little bit like starting kindergarten. New employees do not know what
is going to happen next, and they usually do not know anyone at the company with the exception
of human resource personnel and interviewers. They often do not know their way around and are
not sure who is available to answer their questions. An orientation program can go a long way to
make new employees feel comfortable in their new surroundings.
Orientation should be viewed as a process, rather than an event. It is not something to be done
solely by the personnel department on a Monday morning, but should include training by
department heads and front-line supervisors, as appropriate. The learning will be more effective
if some topics are spaced out over several days and if there is ample time built into the program
for follow up and questions.
Basic subjects to cover
New employee orientation can cover a number of issues that are important to your business.
However, every new employee should be introduced to various aspects of the company, which
are discussed below.
Physical surroundings
•
Explain the floor plan of the building, including location of restrooms, drinking
fountains, kitchen or cafeteria, and exits. Review fire drill and other emergency
procedures.
•
Review any safety features or hazardous material issues.
•
Explain the telephone system, including employer policies regarding personal
calls and voice mail.
•
Discuss the computer system and any current employer policy and practice for
monitoring electronic mail and Internet use.
•
Review employer policies and expectations regarding the use of equipment such
as photocopier, facsimile machine and office supplies.
Work schedule
•
Discuss expected work hours, including the length of rest and meal breaks and the
employer’s policy about leaving the worksite during meals times or breaks.
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•
Provide information about holiday and vacation schedules.
•
Explain whether or not a probationary period exists and when the employee can
expect their first performance evaluation.
•
Review rules for after-hours or weekend access to the office.
Payroll issues
•
Discuss when and how paychecks are distributed, the availability of payment
electronically, and if there will be a delay in the new employee’s first paycheck.
•
Review all time recording procedures, such as a time clock or time card system.
•
Explain the procedure and expected practice with respect to sick days. Let all new
employees know how much notice they are required to provide that they will miss
work due to illness. For example, an employee may be required to notify their
direct supervisor of their impending absence no less than two hours before their
scheduled shift. Explain whether the employee must speak directly with a
supervisor rather than leaving a message on a voicemail or sending an e-mail.
Inform the employee that if they miss a certain number of days due to illness they
will have to provide documentation from the care provider.
•
Review policies about punctuality.
•
Review overtime policies. Emphasize the importance of accurately recording all
time worked and not performing work off-the-clock.
Supervisors
Explain the chain of command within the department in which the new employee will
work. Identify and have the new employee meet his or her immediate supervisor as well
as other managers with knowledge of the new employee’s job.
Job descriptions
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•
Every position in the company should have a written job description. The first
day of work should not be the first time a new employee sees their job
description. The first day of work should be a time to review in detail with the
employee how they will accomplish all of the duties and responsibilities outlined.
Have the employee sign a copy of the job description stating that they have
received a copy and have had the opportunity to discuss it in detail with their
supervisor. Place the signed copy in their personnel file and provide the
employee with a copy for their records.
•
Review with the employee additional information relevant to compliance with
workplace policies, such as uniform or dress code requirements.
•
If an employee handbook is provided, it is still a good idea to give the employee
an opportunity read the material and then meet with them to answer any
questions. Have the employee sign a policy training receipt form and place it with
the personnel file.
Employee benefits
•
Review the basics of the employer health and retirement plans.
•
Explain procedures for reporting work-related injury or illness.
•
Review use of company credit cards, and procedures for submission of expenses.
Necessary paperwork
Provide the new employee with a copy of the employee handbook. Explain the disclaimer
and the signature page, acknowledging receipt of the handbook.
Give every new employee a separate copy of the company’s anti-discrimination,
harassment, and retaliation policy. Discuss the steps for reporting suspected harassment
or discrimination.
Review I-9 documentation and make certain that all application and payroll forms have
been completed and signed.
Continuing orientation
After a few weeks, it is a good idea to check back with the new employee and see if there are any
lingering questions that have not yet been answered. It is also an excellent way to review your
initial orientation efforts.
•
Review with the employee his or her overall impressions of the job, the department and
the company.
•
Expand on your earlier discussions about how the employee’s job works within the
department and the business.
•
Remind the employee of upcoming initial performance reviews. Explain that the new
employee will have significant input into the development of a performance plan and list
of goals to be attained.
•
Review the company’s work and safety rules, and ask if there are any specific questions
about the rules.
•
Discuss any training plans for the new employee, and explore the employee’s need and
desire for additional training.
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Chapter 11
Flexible work arrangements
Part-time employment is one of several flexible working arrangements that can benefit both
employer and employee. Other such arrangements include job sharing, telecommuting and flexible
work schedules. These flexible arrangements may be a voluntary choice or one imposed by the
employer, and most occupations today are adaptable to flexible schedules. Job sharing or parttime scheduling may be a reasonable accommodation to a disabled employee or to a worker
requiring light or transitional duty consideration due to an occupational injury.
Employees who choose flexible arrangements are likely to experience greater job satisfaction, less
stress and higher levels of productivity on the job. Some employers are reluctant to allow flexible
scheduling, and in particular, part-time employment, for fear of greater turnover among part-time
employees and less job loyalty. These concerns, are for the most part, unfounded. In particular,
older workers are often attracted back to the workforce by jobs that offer part-time hours and
flexibility.
Job-sharing
Job-sharing can allow two or more employees to work part-time, performing a single job. This
arrangement can be particularly effective in retaining valued employees, and often brings a greater
variety of abilities to a single job position. A good example of this situation may occur when two
woman doing the same or similar work take maternity leave at or about the same time, then both
wish to return to work part-time. If they can share the duties of a single position, they receive
the benefit of part-time employment and the employer realizes the benefit of two experienced
employees contributing to the company. A second example could be a clerical position that
incorporates both phone sales and paperwork recording or writing sales orders. A particular
employee may have excellent telephone skills but poor writing and math skills. If that employee
can handle the telephone sales calls and a second employee handle writing and recording the sales
orders, one again the employees receive the benefit of part-time work and the employer realizes
the benefit of productive, efficient sales work.
Employee benefits
Employers can attract a quality part-time workforce if a proportionate level of traditional
employee fringe benefits are offered, as well as an equitable pay structure. Employers often do
not offer any fringe benefits to part-time employees, although this trend is gradually changing as
employers look for ways to recruit and retain talented workers who cannot or do not want to
work full-time. The laws which regulate certain types of fringe benefits, such as retirement and
family/medical leave, specifically apply only to employees who work over a certain number of
hours. For instance, under the sections of ERISA which cover retirement plans, any employee
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who works over 1,000 hours in a plan year (approximately 20 hours per week) is a fully covered
employee. The Family and Medical Leave Act of 1993 covers employees who work at least
1,250 hours per calendar year. Medical and health care plans often exclude from coverage any
employee who works less than 25 hours per week.
Many employers do not offer benefits such as paid vacation and sick days to part-time
employees. However, these types of employer-provided benefits are easily adapted to part-time
employees. An employer who offers these benefits should consider offering them to all
employees, perhaps proportionately to the number of weekly hours worked. Part-time employees
often have the liberty of scheduling medical and personal appointments during their time away
from the job. Therefore, fewer sick/personal days are required or taken.
Pre-hire considerations
Employers and employees considering a switch to part-time scheduling or job sharing should
review the following recommendations:
•
Update the job description of the present position to include each job function to get a
clear picture of how the job might be shared or altered to accommodate a part-time work
schedule.
•
Consider what type of arrangements will be needed to facilitate communications among
job partners or between full-time and part-time employees and supervisors, and that such
communications can be made effectively.
•
Consider alternate part-time schedules, such as reduced hours every weekday, or fewer
full work days per week. Review the schedules and choose the best to fit into your
current employee scheduling, as well as to ensure peak time coverage to satisfy the needs
of the business.
•
Consider appropriate pay systems, such as an hourly rate, or a reduced salary rate. Keep
in mind that an employee’s status as exempt from overtime or minimum wage
considerations will likely change if he or she is paid less than the required minimums
under the Fair Labor Standards Act, and could result in an unintended violation of the Act
(see Chapter 14, Wages and hours).
Employers must keep in mind that the classification of an employee as part-time may not have
any effect under other areas of the law. For example, workers’ compensation coverage extends to
all employees on the job, not just those who work full-time. Unemployment compensation also
covers all employees who are not “casual” laborers, defined as those who work less than 20
calendar days per year. Federal anti-discrimination laws also apply to all employees, regardless
of the number of hours they work per week.
Temporary/leased employees
Definition
Employee leasing is a concept growing in popularity and it is particularly popular in the
State of Florida. Employee leasing is a different concept than a staffing (or “temp”
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agency.) Ordinarily, a company decides to reduce administrative burdens by entering
into an agreement with an employee leasing company. Once it does so, the company’s
workers become employed by the leasing company, which thereafter handles
administrative details of employment, including payroll, tax and immigration reporting,
benefits, unemployment taxes, and workers’ compensation. The individual employees are
“leased back” to the original employer. The employer, as a client of the leasing company,
is able to maintain control of the daily work activities of the employees, but is not
required to spend as much time or money on administrative responsibilities of the
employment relationship, such as payroll, benefits administration, and the like. The
services provided by leasing companies cover a broad spectrum and are usually set out in
a written contract between the leasing company and the client employer.
Temporary employees are employees of the staffing company, but work for
client/employers of the staffing company. Some temporary employees are short-term
assignments to the staffing agency’s client (as short as one-day), others are longer-term
relationships. Some staffing agency employees work for the client/employer in “temp to
perm” situations, where, after a certain period of time, if the employee’s performance is
satisfactory, the client employs the employee. The staffing agency then ceases to be the
employer.
Regardless of the designation given to this group of workers, the main legal issue of
concern to employers is whether or not a particular temporary or leased employee is one
of their “employees” for purposes of various employment laws. Under many employment
laws, the leasing company and the client/employer will be regarded as “joint employers”
– in other words, both can be responsible for violations of employment laws.
In general, courts tend to look at the right of control over the daily activities of the
employee. The company which exercises the right of control is, in many cases, deemed to
be the employer. Other factors which may be considered include which company pays the
employee wages, which company the employee considers to be the employer, and which
company has the power to modify employment conditions.
Most staffing agencies and leasing companies work with their clients pursuant to a
written agreement. Liability for violations of certain employment laws is often
specifically defined under the agreement. Employers who are considering using
temporary employees or entering into a leasing arrangement should carefully consider the
terms of any agreement they are asked to sign to be sure they understand their liabilities
and responsibilities to such workers. Of course, the leased or temporary employees are
not bound by the written agreement, which is between the staffing agency or leasing
company and the employer. In the event of a dispute, an employee may try to sue either
or both employers.
Discrimination
Employers must be aware that temporary, part-time or leased employees are entitled to
the same protections against discrimination as regular employees. Title VII, ADA and
ADEA allow both the employer and the temporary agency to be sued if the two
companies had joint control over the employee. In fact, many employment agencies, such
as temporary help services, are specifically covered by both Title VII and the ADEA.
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Various courts have found that joint employers can each be held responsible for illegal or
improper actions taken by only one of the employers. Therefore, as previously suggested
herein, any employer who is contemplating a joint employer relationship should carefully
scrutinize any written agreement establishing such an arrangement, to be certain they
understand any potential liability for the actions of the joint employer. And, as a practical
matter, it would be worthwhile to gain whatever background information is available
regarding the potential joint employer, to determine if they have a history of having to
defend legal actions or, worse, a history of being found liable for illegal or improper
conduct toward employees.
The Equal Employment Opportunity Commission (EEOC) has issued guidelines on the
liability under civil rights laws of employers using contingent workers. The EEOC uses
the term “contingent” workers to refer to temporary or part-time employees, as well as
employees who are provided by a temporary employment agency or contract firm. In
preliminary text to the guidelines, the EEOC cites statistics to indicate that temporary
help services employ over 2 million individuals nationwide. According to a survey by the
Bureau of Labor Statistics, individuals employed by temporary agencies are more likely
to be female and/or African American. Contingent workers do not include independent
contractors. See Chapter 12, Independent contractors.
Contingent workers may be employed by the staffing firm, the client employer, or both.
Client employers are liable for on-the-job discrimination if it occurs at the jobsite during
employment or training of the contingent worker. On the other hand, the staffing firm
may be liable if discrimination occurred in the job assignment, or in the payment of wages
or benefits. For example, a staffing company that places men in the more lucrative
positions or into those jobs with greater responsibility, but places equally qualified
women in lower paying or less prestigious positions, they could be found liable for
discrimination. If they place Caucasian or African-American staffers in identical
positions, but pay the Caucasians at a higher rate, in that instance the staffing company
could be found liable for discrimination as well. If the staffing firm merely handles
administrative matters, such as payroll, liability will not be imposed on the firm for
discrimination suffered on the job.
A copy of the EEOC guidelines can be found at the EEOC website at www.eeoc.gov or
by calling the EEOC at (202) 663-4900.
Family and Medical Leave Act
The FMLA makes specific reference in the Final Regulations by the Department of Labor
to temporary help agencies. The regulations provide that the agency will ordinarily be
responsible for providing required FMLA notices, leave and job reinstatement, even
though both the agency and the employer must count the employee for purposes of
coverage under the FMLA.
Employers also need to be aware that when using temporary or contingent employees, the
employee’s total employment (with staffing agency and client/employer the employee
was placed with) may be used for determining whether the employee has met the length
of service requirements under the FMLA. If a temporary employee requests FMLA leave
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from a client/employer for whom the employee has worked less than 12 months, the
employer should not assume the employee is ineligible.
National Labor Relations Act
Again, the law provides that if the employer and the agency are joint employers, both
controlling the daily activities of the employee, then they can be held liable for unfair
labor practices committed by either one of them. An employer may escape liability if it
can show that it had no knowledge of any unfair labor practice by the agency, or that it
took prompt steps to stop the illegal action once it became aware of it.
Under certain circumstances, temporary employees may have the right to vote in a union
organization election. If it is determined by the National Labor Relations Board that the
temporary employees have a “community of interest” with other employees, they will be
permitted to vote. In general, temporary employees who have been working for the same
employer for more than a brief length of time, and those who have no specific
termination date, may be said to have the community of interest in union representation
to entitle them to vote.
Employers who are not unionized can still be charged with unfair labor practices by the
National Labor Relations Board. For instance, if a temporary employee attempts to
initiate a union organizing effort, he or she is protected from termination for the union
activity by the National Labor Relations Act. Firing the temporary employee, or
requesting a replacement from the staffing agency, may subject the employer to an unfair
labor practice charge.
Wages and hours
Both the employer and the agency can be liable for minimum wage and overtime
violations if they both control the work of the employee. However, both are also entitled
to take credit for payments made by the other in meeting these obligations under the
FLSA. For example, if the employer pays the employee their straight hourly rate and the
agency, for whatever reason, pays the “half-time” or “time-and-a-half” for any overtime
wages due to the employee, there will be no cause of action against the employer for any
wage and hour violation because, when the employer payments and the agency payments
are totaled, together they represent the full wages – straight time and overtime – owed to
that worker.
OSHA/workplace safety
All employers have a general duty to maintain a safe workplace for employees. Whether
or not a temporary employee is an employee under OSHA depends on several factors,
including:
•
responsibility for wages
•
control of the temporary employee’s activities
•
power to modify the employment conditions.
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Immigration Reform and Control Act (IRCA)
IRCA requires employers to verify the employment eligibility and identity of all new
hires, including those obtained through a temporary employment service or leasing
company. You may delegate this function to a temp agency or leasing company, but you
are ultimately liable for I-9 compliance. If you obtain the worker from an agricultural
association, agricultural employer, or farm labor contractor, then that entity must
complete the verification process and I-9 form. To be safe, however, you should always
obtain an I-9 form even in cases where another entity may jointly employ that person. In
addition, if you become aware that a contractor or staffing agency is employing an illegal
immigrant on your property or project, you must take immediate steps to remove the
illegal alien or fact the prospect of criminal sanctions for harboring or concealing an illegal
alien. Based on the changing focus on immigration law compliance, employers can be
liable for using unauthorized workers if they know or should know the worker is not
legal. Constructive knowledge alone can be enough to subject employers to fines and
penalties and in extreme cases, criminal sanctions. While politics ultimately stymied any
permanent immigration reform, it is clear from the 2008 activity by federal agencies such
as ICE (Immigration Control and Enforcement) that employers who knowingly hire or
retain illegal immigrant workers will face criminal prosecution, and punishment could
include heavy fines and even incarceration.
Unemployment compensation
Florida law creates an obligation on the part of the temporary employee to notify the
employment agency whenever they are available for new work assignments. Otherwise,
the employment relationship between the temporary employee and the agency will end
when the job assignment is completed. A failure to notify the agency when available for
work will be considered a voluntary quit, and the temporary employee will be ineligible
for unemployment compensation benefits. §443.101, Fla. Stat. Leasing companies may
require employees to enter into similar agreements. What this means is that if you “lease
back” your employees from a leasing agency and terminate one of them, the employee
may be required by the leasing company to report to it for a new work assignment within
a certain period of time or face denial of unemployment benefits.
Casual labor
“Casual labor” is a term used to describe a particular and limited type of temporary
employment which is short in duration and has duties incidental to the business of the
employer. If an employee is actually a casual laborer, an employer can disregard certain
statutory requirements and responsibilities. However, employers must be aware that the
mere designation of a particular individual as a casual laborer will not necessarily mean
that the employee is a casual laborer. In two areas of the law, unemployment
compensation and the Fair Labor Standards Act, the term “casual laborer” is specifically
defined – and, if the individual does not meet the statutory definitions, the employee
cannot be properly designated as casual labor.
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Definition
Under Florida unemployment law, an individual can be termed a “casual” laborer
only if all three of the following conditions are met:
1. the work must be occasional, incidental or irregular, not to exceed 200
hours in duration
2. services cannot be rendered for more than ten calendar days, whether they
are consecutive or not, during a period of one calendar month, or two
consecutive calendar months
and
3. the services must be for “casual” labor purposes, not in the regular course
of the employer’s trade or business.
Unless the individual meets these tests for “casual” labor, the employer must pay
unemployment tax for the employee. For further discussion of other statutory
exceptions which exist under Florida’s unemployment law, see Chapter 24,
Unemployment compensation.
Federal Fair Labor Standards Act
Temporary employees are protected by the Fair Labor Standards Act (FLSA). In
most cases, both the client employer and the staffing firm can be held responsible
for compliance with both the minimum wage and overtime provisions of the
FLSA. Although the staffing firm generally will handle payroll, both the staffing
firm and the client employer should each do their parts to avoid FLSA violations.
The staffing firm only knows the hours the client employer reports that its
temporary employees have worked from week to week. If the client employer
fails to accurately report hours, or engages in unlawful practices such as requiring
temps to work off of the clock, the staffing agency will most likely be unaware of
such activities. It may have the impression that employees are being paid
lawfully when in fact, they are not.
Leasing companies may be even more in the dark with respect to the lawfulness
of their client employers’ pay practices. Since leasing companies often “inherit”
the employees of established companies, they may also inherit the client
employer’s misclassified employers and systemic unlawful practices (for
example, automatic docking for meal breaks even when employees are unable to
take their full breaks).
Payment for all hours “worked” may be of particular significance for the
temporary employee, particularly if training for a new employment assignment is
required. Time spent in mandatory training time is considered time worked for
which employees must be paid. However, the Department of Labor regulations
provide that training time may be unpaid if certain specific criteria are met.
Among the criteria that must be met for the time to be unpaid are that the
employee must understand the time is non-compensable, the employee does not
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displace any of the employer’s regular workers, and the employee is not
necessarily entitled to a job at the completion of the training.
Client employers should review any complaints by temporary or leased
employees about paychecks or failure to be paid for all working time, since they
are likely to be jointly liable for any FLSA violations.
The only “casual” employment exempt from the FLSA is in the domestic service
area, such as babysitting. The exemption has been interpreted to apply, as a
general rule, to babysitting which does not exceed 20 hours per week.
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Chapter 12
Independent contractors
The issue of an individual’s status as an employee, independent contractor or laborer arises in
four separate areas on the part of employers under either federal or state law. In Florida, the issue
is specifically addressed under state law in the areas of unemployment compensation and
workers’ compensation. Under federal law, the issue arises under the tax withholding
requirements of the Internal Revenue Code and the minimum wage and overtime requirements,
as well as the recordkeeping requirements, of the federal Fair Labor Standards Act. It is
important to note that a worker may be considered an independent contractor for purposes of one
law, but not another.
For purposes of unemployment compensation, the ultimate test of an independent contractor is
whether the employer has the right of control over both the work contracted and the conduct of
the worker. If not, then the worker is significantly more likely to be an independent contractor
and is exempt from unemployment compensation.
Factors which may be considered include, but are not limited to:
•
whether the worker uses his or her own equipment – an independent contractor ordinarily
provides all the equipment necessary to complete the job
•
whether the worker can select or refuse assignments from the company or hire assistants
– a true independent contractor should be able to contract to complete any job they
choose as well as to turn down a job and may hire his or her own employees or assistants
to complete any portion or all of the work necessary for the job
•
whether the worker can arrange his or her own work schedule – a true independent
contractor works the days and hours he or she chooses; what is important is that the work
contracted to be performed is completed in a timely manner
•
whether the worker receives training from the party who contracts for his or her services
– an independent contractor ordinarily uses his or her own methods and relies on his or
her own expertise and does not need training
•
whether the worker is paid hourly, by the week or by the month – independent
contractors are normally paid by the job
•
whether the worker can be fired at will – where an independent contractor is performing
according to the contract terms, he or she usually cannot be discharged without notice
without creating liability for breach of contract
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•
whether the public knows that the individual is an independent contractor and not an
employee – the general public is usually aware that an individual is not employed by the
company.
Workers’ compensation
The Florida Workers’ Compensation Act, contains an extensive list of factors to be considered in
establishing the employee status of an individual.
In order to meet the definition of independent contractor, at least four of the following criteria
must be met:
•
the independent contractor maintains a separate business with his or her own work
facility, truck, equipment, materials, or similar accommodations
•
the independent contractor holds or has applied for a federal employer identification
number, unless the independent contractor is a sole proprietor who is not required to
obtain a federal employer identification number under state or federal regulations
•
the independent contractor receives compensation for services rendered or work
performed and such compensation is paid to a business rather than to an individual
•
the independent contractor holds one or more bank accounts in the name of the business
entity for purposes of paying business expenses or other expenses related to services
rendered or work performed for compensation
•
the independent contractor performs work or is able to perform work for any entity in
addition to or besides the employer at his or her own election without the necessity of
completing an employment application or process
•
the independent contractor receives compensation for work or services rendered on a
competitive-bid basis or completion of a task or a set of tasks as defined by a contractual
agreement, unless such contractual agreement expressly states that an employment
relationship exists.
If four of the criteria listed above do not exist, an individual may still be an independent
contractor and not an employee based on full consideration of the nature of the individual
situation with regard to satisfying any of the following conditions:
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•
the independent contractor performs or agrees to perform specific services or work for a
specific amount of money and controls the means of performing the services or work
•
the independent contractor incurs the principal expenses related to the service or work
that he or she performs or agrees to perform
•
the independent contractor is responsible for the satisfactory completion of the work or
services that he or she performs or agrees to perform
•
the independent contractor receives compensation for work or services performed for a
commission or on a per-job basis and not on any other basis
•
the independent contractor may realize a profit or suffer a loss in connection with
performing work or services
•
the independent contractor has continuing or recurring business liabilities or obligations
•
the success or failure of the independent contractor’s business depends on the relationship
of business receipts to expenditures.
An individual claiming to be an independent contractor has the burden of proving that he or she
is an independent contractor for purposes of Florida’s Workers’ Compensation Law.
For further exceptions to the coverage requirements of the Florida Workers’ Compensation Law,
see Chapter 440, Fla. Stat.
Employees under the
Internal Revenue Code
For purposes of federal tax reporting and withholding, it is necessary to determine whether or not
an individual who provides services is an employee or an independent contractor.
In general, anyone who performs services is an employee, if the person or entity for whom the
services are performed controls what will be done and how it will be done. If the person or
entity for whom the services are performed, only controls the final results and not how the result
is accomplished, the person performing services is generally an independent contractor.
If an independent contractor is wrongly classified as an employee, the person or entity for whom
the services have been provided may be liable for back-up withholding, such as Medicare and
Social Security taxes and the payment of fines and interest, and back payments to benefits
programs.
In determining whether or not an individual is an employee or independent contractor, the IRS
reviews and considers a combination of factors. The presence or absence of any one factor will
not dictate the characterization of an individual as employee or independent contractor. The
determination is very fact specific. The IRS factors fall into three categories set forth below:
1. Control of behavior
Factors indicating control of how a task is to be performed that indicate employee status
include:
•
Instructions that the business gives to the worker. The important factor is the
right to control details of the job whether or not the control is actually asserted.
Examples of instructions are as follows:
when and where to do the work
the order and sequence of the work
other workers who must work with the individual to complete the job
requiring certain workers to perform specific functions
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•
the equipment or tools that must be used to complete the work
designation of the supplier for materials.
Training that the business gives in order that the worker will perform services in a
particular manner.
2. Control of finances
Financial control factors that indicate employee status include:
•
The individual is financially dependent on the business.
•
The individual is not required to make a financial investment in the performance
of the work, such as furnishing tools and materials.
•
The expenses of individual are directly reimbursed by the business. In contrast, if
the individual bills and collects expenses, along with a fee, in connection with a
particular job, this indicates independent contractor status.
•
The individual is paid on a hourly, weekly or other guaranteed basis.
•
The individual cannot experience a loss in the performance of his or her job. In
contrast, if decisions by the individual can affect his or her profit or loss on a job,
he or she is likely to be an independent contractor.
3. Control of relationship
Factors that indicate the parties’ relationship include:
•
Contracts setting forth the status intended by the parties – have the parties entered
into a contract of employment or does the contract state that the individual is an
independent contractor and if so, do the contract’s terms reflect an independent
contractor relationship?
•
The benefits provided – if individuals are entitled to paid vacation, sick days,
health insurance or other forms of employee benefits, this indicates employee
status (however, in some occupations and industries, employers may choose to
cover independent contractors on their workers’ compensation).
•
The duration of the relationship – if individuals are hired for an indefinite period
of time and in fact, work for the same employer for years at a time, this is a strong
indication of employee status.
•
If an individual is hired for a specific project, even if long-term, this usually
indicates independent contractor status.
•
Performance of “key” aspects of the business – if a person performs functions that
are integral to the business’s operations, this ordinarily indicates employee status.
Generally, if an individual is determined to be an employee, income, social security and
Medicare taxes must be withheld on the wages paid, and the employer must pay federal
unemployment taxes. However, there are limited exceptions for employees of certain exempt
144
non-profit organizations and for ministers, who may be exempt from one or more taxes.
Additionally, certain employees, called statutory employees, who would otherwise be considered
independent contractors are treated as employees for social security and Medicare taxes and
federal unemployment tax purposes.
Tax withholding is not required for payments to an independent contractor, who should be
required to provide a Social Security Number or preferably a Federal Employer Identification
Number (FEIN). If this information is not provided, back-up withholding is required.
Employers should use caution when considering whether to pay an employee as an employee for
some purposes and as an independent contractor for others. This may raise a “red flag” with the
IRS and is not a sound practice from a legal standpoint
Federal Fair Labor Standards Act
Under the FLSA, all individuals whose work is controlled or directed by an employer are
considered to be “employees,” and are entitled to the wage and hour protections of the statute.
The FLSA has a broad interpretation of who is considered an “employee.”
In order to be classified as an independent contractor under the FLSA, the following factors
should be considered:
•
the amount of investment the individuals have made in their business, such as amount
paid for equipment and materials – where there is greater investment, the individual is
more likely to be classified as an independent contractor
•
the nature and degree of control which the hiring firm has over the individuals or their
business – where the hiring firm has greater control over the details of the individual’s
work, that individual is less likely to be classified as an independent contractor
•
the individual’s opportunities for profit or loss – employees ordinarily do not realize a
profit or loss in the business, but independent contractors can realize a profit or suffer a
loss
•
the permanency of the relationship between the individuals and the hiring firm – an
independent contractor is usually hired to do one job of limited or indefinite duration,
without an expectation of continuing work
•
the extent to which the services provided by the individuals are an integral part of the
business of the hiring firm – an independent contractor’s services are usually separate
from the client’s business
•
the degree of independent judgment exercised by the individuals to achieve success in
their business – an independent contractor is the master of his work, completing the job
with few (if any) instructions as to the details or methods of the work.
None of the foregoing factors is dispositive on its own. The Department of Labor will consider
all these factors in making a determination and decide which status the greater number of factors
indicate. Written agreements between the parties as to independent contractor status are helpful
if an employer wants to take the position that a worker is an independent contractor. However,
the mere existence of a written agreement does not establish that the worker is an independent
145
contractor. The Department of Labor will analyze the actual relationship between the parties, not
what the agreement says, in making its decision.
There are statutory exemptions under Florida law for certain types of work relationships,
including real estate sales, who may be deemed independent contractors if certain conditions are
met. Other individuals who work primarily off the employer’s premises may be exempt from
wage and hour requirements but not IRS, unemployment or workers’ compensation laws. For a
further discussion of statutory exemptions under the FLSA see page 163, Outside sales
employee exemption.
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Chapter 13
Telecommuting
Telecommuting is a workplace option that permits employees to work at an alternative worksite,
such as the home, for one or more days per week. Partial or total substitution of telecommuting
for an employee’s daily commute to work has been made possible largely through the use of
computer technology. Although the term was coined in 1973, the concept is now being used by
large and small companies alike, which has advantages for both employer and employee.
The telecommuting “virtual office” might consist of a cellular phone, notebook computer,
facsimile and voicemail capabilities. Since these items are now widely available and affordable
to most employees and companies, employees can work virtually anywhere. An employer
considering telecommuting as an option for employees might expect the following benefits:
•
increased productivity (up to 25%)
•
increased job satisfaction
•
reduced absenteeism
•
lower employee turnover
•
potential savings in fixed expenses such as office rental, utilities, and employee parking
•
improved customer service
•
improved employee morale
•
reduced employee stress and related medical expenses.
Many large companies have implemented telecommuting programs and the State of Florida has
legislation in place which authorizes and encourages telecommuting for state employees.
Telecommuting can also be one way of providing accommodation to individuals with
disabilities, but does not necessarily replace the need for physical workplace modifications.
However, a qualified employee or potential employee with a disability who is offered the option
of working at home may become a valued and productive employee through a telecommuting
arrangement that better accommodates the individual’s disability.
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Telecommuting
Examples of jobs easily
adapted to telecommuting
Employers should first identify the job categories for which telecommuting would be
appropriate, rather than immediately selecting the individuals. Certain types of jobs are more
easily adapted to telecommuting, such as:
•
accountant
•
engineer
•
sales agent
•
appraiser
•
auditor
•
consultant
•
data entry
•
journalist
•
financial analyst
•
lawyer
•
programmer
•
researcher
•
systems analyst
•
writer
•
designer.
Certainly, many other jobs are adaptable to telecommuting. Employers should review the job
functions in the business and consider whether particular administrative and support positions
can be accomplished away from the office. As a general rule of thumb, if an employee can close
their office door for up to eight hours and effectively accomplish their job without the need for
face-to-face contact with other employees, that job is probably adaptable for telecommuting.
Management employees may also be successful telecommuters, and will not lose their exempt
status under the Fair Labor Standards Act, provided they can still meet the duties test for exempt
status as required under the FLSA. See Chapter 14, Wages and hours for the specific
guidelines for exempt status.
For nonexempt telecommuters, employers need to take steps to ensure such employees keep
accurate hours of their work for pay and other purposes. Hourly telecommuting employees
working remotely (at home or another offsite location) must record all their hours of work. It is
acceptable to allow employees to keep handwritten records of their time, but this often leads to
under or over-reporting of hours. Employers may want to consider an electronic timekeeping
system for nonexempt telecommuters, for example, that requires the employee to call a phone
number to electronically record starting and stopping times each day, including meal breaks.
Selecting the telecommuter
After identifying the job positions, an employer should consider and select individuals who will
be able to work by telecommunicating. Employees who make good telecommuters are generally
those who:
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•
volunteer for telecommuting
•
are self-motivated and attain work goals without substantial direction
•
have received consistently successful performance evaluations in the recent past
Telecommuting
•
have a history of dependability on the job
•
can function without direct supervision
•
can work in isolation
•
are well organized with good time management skills
•
have the appropriate job skills and knowledge
•
can provide an appropriate work space at home where they can work undisturbed
•
have, or are capable of, gaining the required expertise in the use of the computer
technology needed to make telecommuting successful
•
can initiate and maintain contact with their supervisor
•
can plan their work according to designated timetables.
While the foregoing are often components to successful telecommuting relationships, employers
should ensure that this arrangement is not offered to employees arbitrarily or in a manner that
could be portrayed as discriminatory. Employees should also understand that telecommuting is
not guaranteed for any particular period. If the company’s workforce changes or the employee’s
job duties change, it may become impractical to continue to allow an employee to telecommute.
Supervising the telecommuter
For a telecommuting program to succeed, management support is essential. Some managers may
be reluctant to allow telecommuting, because it is a change in the way they have supervised
employees in the past. However, with proper training, these same managers can learn to provide
the necessary supervision within the telecommuting concept. The goal is to recognize that under
the right circumstances, many employees can perform as well working remotely as when
working in an office environment and some may actually do better.
Effectively supervising the telecommuter requires strong management skills. When choosing the
right supervisor to manage the telecommuting program, employers should focus on the qualities
discussed below.
Organization
Make sure supervisors understand the time and resources required to complete tasks. In
addition, supervisors must be particularly adept at distributing work among employees
when one or more of the employees are telecommuting.
Communication
Supervisors must be able to communicate to employees what needs to be done, when it
must be done, and who is responsible for seeing the project through to completion. The
best method of communication, written or verbal, will depend on the individual
telecommuter and supervisor. The time managers spend in effective communication of
their expectations will dictate the quality of the work produced by the telecommuter.
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Telecommuting
Timetables
Supervisors must be able to develop with the telecommuters a method of communicating
attainable and timely goals. Telecommuters who clearly understand the workload will be
more focused in their work if they are required to maintain and follow a timetable. At a
minimum, the timetable should list tasks or projects for completion and a time when they
must be finished. The bottom line is that telecommuters need to clearly understand what
is expected of them and when goals are not met or performance is unacceptable, they
need feedback.
Performance reviews
Supervisors should set up periodic reviews to monitor progress on projects or tasks for
which the telecommuter is responsible. Any unsatisfactory performance should be
brought to the employee’s attention immediately in writing so that work habits can be
improved. If the employee is written up or receives another type of written counseling,
the employer should obtain the employee’s acknowledgment that the document was
received. Effective supervisors will be able to manage for performance and results, as
opposed to managing by observation alone. Since telecommuters must be supervised
based on their performance, and not their activities or conduct in the workplace,
supervisors must be able to monitor and evaluate performance without being in close
proximity to the employee.
Reciprocal communications
Supervisors must be able to set up avenues for the telecommuters to communicate with
each other when necessary for the completion of certain projects. The ability to
“network” with other telecommuters will also help reduce any feelings of isolation for the
telecommuter. If possible, the telecommuter should be expected to come into the office
on certain days for meetings and interaction with other employees and supervisors.
Supervisors should also invite the participation of telecommuters in office activities, such
as holiday celebrations, working lunches, and after-work get-togethers.
Safety concerns
Employers are responsible for providing a safe workplace to all employees under the General
Duty clause of the Occupational Safety and Health Act (OSHA). When the workplace is not
directly controlled by the employer, such as a home office, the employer is required to take
“reasonable” steps to prevent foreseeable hazards, depending on the particular circumstances.
Under OSHA, as well as some state workers’ compensation laws, employers may require a fire
and safety inspection of the home office, and should mandate the use of proper electrical
equipment, such as grounded wiring and surge protectors. Occasional inspection of the home
office by the employer may be advisable to ensure that safety hazards which may develop are
eliminated before an accident occurs. Such inspections should be conducted only with
appropriate advance notice to the telecommuting employee and should involve only the
immediate work area. It is a good practice to create a safety checklist for home workers to
document the areas evaluated in the employee’s home. At a minimum, employees should be
given a checklist of safe practices they must commit to maintaining, and be asked to complete
and submit checklists periodically.
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Telecommuting
Only accidents or injuries in the designated work area are generally regarded as covered by
workers’ compensation. Other areas in the home and adjacent to the home are not covered.
Injuries or accidents in the work area suffered by an employee who is not performing work at the
time will also ordinarily not be covered by workers’ compensation.
Setting up the home office
Employees who are selected for telecommuting must be able to set up an appropriate work space
at home. The space need not be an entire separate room, but should be well-defined, in a safe
location, and away from distractions. Adequate space must be available for files, office supplies,
and telecommuting equipment. Other considerations include lighting, security of work materials,
comfort and safety.
Employers may consider providing some office furniture, such as a comfortable chair and desk.
Many employers provide necessary computer and other telecommunications devices, but it is
advisable to remind employees that such equipment is to be used for work-related purposes.
A service maintenance policy for employer-provided equipment should be considered to provide
for quick and cost-effective service in case of equipment failure. Verify that existing insurance
coverage of company equipment will apply to the telecommunications equipment off-premises.
If not, the employer should obtain the necessary level of coverage to protect its investment in
employer-provided equipment.
Part-time telecommuting
Informal telecommuting should also be encouraged, and need not require the complete set-up of
a home office. For instance, many professionals prefer to work on specific projects at home, by
using an employer-provided portable computer or even personal home computer equipment. The
occasional use of telecommunications in such a manner is fairly well established in many
industries, and will continue to increase.
State employees
The State of Florida has enacted legislation which encourages telecommunications among state
employees. Fla. Stat. §110.171 requires the state Department of Management Services to
establish a telecommuting program for use by the various state agencies. The program requires
the use of a written agreement, a fire safety inspection of the home office, and prohibits business
meetings with the public at the home office.
Employer/telecommuter
written agreement
The employer should enter into a written agreement with its telecommuters, which provides, at a
minimum, the points recommended on page 152, Employer/telecommuter written
agreement checklist.
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Telecommuting
EMPLOYER/TELECOMMUTER
WRITTEN AGREEMENT CHECKLIST
The employee will be covered by the employer’s workers’ compensation
coverage when at home if the employee is injured while performing job duties in
the designated work area.
The employee is required to hold any client or business meetings at the official
work office, and not at home.
The employer will not be responsible for the cost of utilities other than those
specifically agreed upon, such as the cost of additional telephone lines.
The employer should consider requiring a fire and safety inspection of the home
worksite before telecommuting begins. (Employers should provide and insist on
the use of a UL approved surge protector, and a grounded outlet for
telecommuting equipment.)
The employer will provide itemized pieces of equipment, and any necessary
upgrades to the equipment, as determined by the employer, with the
understanding that any equipment provided remains the property of the company,
is subject to the same policies as similar equipment located at the employer’s
place of business, and must be returned in good condition immediately upon
request or at termination. Employees should understand they are required to use
all communications media in accordance with Company rules.
The employee will be responsible for securing, with a lock or other security
device, the telecommunications equipment provided by the employer, and will be
responsible for any damages to the equipment, which are the result of failure to
secure. The employee will also be responsible for the safeguarding of records,
files, correspondence, and other business papers.
The employee will be responsible for regular back-up and maintenance of
computerized files, unless a network system of routine back-up is provided.
The employer has the right to inspect the home worksite, with adequate notice, to
ensure that the equipment is being properly maintained. Visits should be
scheduled in advance during normal business hours.
The employee should be reachable within reason during the employee’s regularly
scheduled working hours, whatever those hours are. If the employee does not
have a regular schedule or set hours, employer and employee should come to an
understanding that works for them as to how the employee can be reached if
needed and whether the employee needs to call in periodically or carry a cell
phone or pager.
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Chapter 14
Wages and hours
The subject of wages and hours in Florida is governed mostly by federal laws. Some applicable
Florida laws are also discussed in this chapter.
Use the following section to determine whether your organization is covered by the federal Fair
Labor Standards Act (FLSA). If it is, the sections in this chapter that refer to the FLSA will
apply to your organization.
Fair labor standards laws
The FLSA is federal legislation that was enacted in 1938 and has been amended several times. It
prescribes minimum wage, overtime, child labor, and recordkeeping standards.
Who is covered
Enterprise coverage
A business that is a covered enterprise is subject to the FLSA with respect to all of
its employees. To qualify as a covered enterprise, a business must have:
•
two or more employees (which could include an owner) who are engaged
in commerce, are engaged in the production of goods for commerce, or are
handling, selling or otherwise working on goods or materials that have
been moved in or produced for commerce
and
•
an annual gross sales volume of at least $500,000.
Note: A “mom and pop” exemption from enterprise coverage exists if the only
regular employees are the owner of the company or the parent, spouse, child or
other member of the immediate family of the owner.
Organizations that qualify as covered enterprises, regardless of sales volume, are
as follows:
•
Public agencies.
State and local public agencies typically perform government functions
and are covered by the FLSA. Special rules and regulations apply (for
example, allowing compensatory time off in lieu of cash wages for
overtime hours worked, as discussed further below).
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Wages and hours
•
Hospitals, nursing homes and residential institutions that care for sick
or mentally ill individuals.
Any hospital or nursing home is covered.
•
Schools.
Preschools (including child care facilities), elementary schools, secondary
schools, institutions of higher education and schools for gifted or
handicapped children.
Individual employee coverage
If an organization is not a covered enterprise as described above, its individual
employees may still be covered by the FLSA. An individual is covered if he or
she is engaged in interstate commerce, produces goods for interstate commerce,
or works in activities closely related and directly essential to the production of
goods for commerce.
Enforcement
The FLSA is enforced by the Wage and Hour Division of the U.S. Department of Labor.
Government investigators have the authority to inspect and transcribe an employer’s
records, to question employees, and to otherwise determine whether the FLSA has been
violated.
Liability
The Secretary of Labor, an individual employee, or a group of employees may sue
an employer to collect past due minimum wages or overtime. In addition, the
employer may be liable for liquidated damages in an amount equal to past due
wages, plus attorney’s fees and costs.
Statute of limitations
Generally, a two-year statute of limitations applies to FLSA suits to collect pastdue wages. The date of the alleged violation must have been within 2 years of the
date the suit was filed. In the case of a “willful” violation, however, the suit is
subject to a three-year statute of limitations.
Civil penalties
For repeated or willful violators of the minimum-wage or overtime provisions of
the FLSA, the FLSA provides for a civil penalty of up to $1,100 for each
violation. Civil penalties up to $11,000 may be imposed for each minor
wrongfully employed.
Criminal penalties
Willful violations of the FLSA can result in criminal prosecution. First offenders
are subject to a fine not to exceed $10,000. Second offenders are subject to both
the fine and a maximum prison term of six months.
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Wages and hours
Minimum wage
Employees covered by the FLSA must receive a minimum wage rate of $7.25 for each hour of
work effective July 24, 2009. Tipped employees may be paid a direct cash wage of at least $2.13
per hour and credited for tips received. The employer must be able to show that the employees
receive at least the minimum wage each hour of work when tips and direct wages are combined.
In Florida as of January 1, 2010 the minimum wage is $7.25 for each hour of work. As of
January 1, 2010 tipped employees in Florida must be paid a direct hourly wage of at least $5.12
and be credited with tips sufficient to bring their total pay up to the applicable minimum wage.
Youth Opportunity Wage
Employers can hire individuals under age 20 and pay them at a rate of $4.25 per hour for
the first 90 days of employment. After 90 days, the individual’s hourly rate must be
increased to at least the current minimum wage. Employers cannot take any action
against current employees, including a reduction of their hours or wages, in order to take
advantage of the Youth Opportunity Wage.
Overtime
Neither federal nor Florida law prohibits an employer from requiring employees to work
overtime as needed.
The FLSA requires the payment of an overtime premium for all hours worked over 40 in a
workweek for the same employer, unless the employee is exempt from overtime under one of the
employee groups which qualify for exemption under the law. See page 161, Exempt vs. nonexempt for further information on exemptions.
The overtime hours must be paid at one and one-half the employee’s regular rate of pay.
An exception is available for hospital and nursing home employees. Pursuant to an agreement or
understanding with the employees, overtime for hospital and nursing home employees may be
calculated on the basis of a 14-day period rather than a 7-day period. Overtime must be paid for
hours worked in excess of 8 hours daily and for those worked in excess of 80 hours during the
14-day period.
For example, in the established 14-day period, if a hospital employee works 24 hours (3 days at 8
hours per day) one week and 48 hours (6 days at 8 hours per day) the next week, overtime is not
due. The total hours for the 14-day period is only 72 hours, and the employee did not work more
than 8 hours in one day.
The only Florida statute governing overtime states that ten hours of labor is a legal day’s work,
and when any person employed to perform “manual labor” of any kind by the day, week, month,
or year performs ten hours of labor, he or she must be considered to have performed a legal day’s
work and is entitled to extra pay for all the work done in excess of ten hours of daily labor unless
a written contract has been signed by the employer and employee requiring a lesser or greater
amount of labor to be performed daily. Although there is little case law interpreting this statute,
one appellate court has stated that the statute does not apply to “hourly” employees. The same
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Wages and hours
court questioned the constitutionality of the statute on the grounds of vagueness because the
statute did not define the terms “manual labor” or “extra pay.”
Regular rate
Overtime is computed on the basis of the employee’s “regular rate,” determined by
dividing the employee’s total weekly compensation by the total hours worked during the
workweek. Payments such as shift premiums, production bonuses, attendance bonuses,
on-call pay, and other payments will increase the regular rate of pay. All compensation
must be included in computing the regular rate unless specifically excluded by the FLSA.
Exclusions from the regular rate
The FLSA excludes the following payments from the regular rate computation.
•
gifts, including some Christmas bonuses
•
paid leave for absences due to:
vacations, holidays, illness, voting
jury service
reporting to a draft board
attending a funeral of a family member
inability to reach work because of inclement weather
staying home with an ill spouse or child
•
expense reimbursements
•
discretionary bonuses
•
benefit plan contributions
•
radio and television talent fees satisfying government regulations
•
premium payments for overtime work
•
some grants of stock options.
Compensable working time
Time spent by employees engaged in incidental activities may or may not have to be treated as
compensable working time. In general, the FLSA treats time spent in activities that are primarily
for the benefit of the employer as compensable, while time spent primarily for the benefit of the
employee is not. The application of this general rule to specific situations is discussed below.
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Wages and hours
Rest periods
Rest periods are considered to be primarily for the benefit of the employer, and short
periods of less than 20 minutes for coffee and snack breaks are compensable hours
worked.
Meal periods
A meal period of at least 30 minutes, during which the employee is completely relieved
of all duties, is not compensable. An employee who is required to answer telephones is
not relieved of duties during the meal period if he or she continues to be responsible for
telephone calls.
Medical attention
Time spent by employees in waiting for and receiving medical attention is compensable
if the medical attention is received during working hours and:
•
the medical attention is received on the plant premises
or
•
the employer directs that medical attention be obtained elsewhere.
Physical examinations
Time spent by employees receiving a physical examination that is required for continued
employment is compensable. Time spent on tests, such as drug screens, by applicants
seeking employment is not compensable.
Travel time
Normal commuting to and from work is not compensable work time. However, travel
between a “normal” workplace, such as an office, and another place of assignment, is
counted as hours worked, as is travel between one assignment and another during a
workday.
Travel between home and the place of assignment on a one-day trip to another city by an
employee who normally has a fixed place of work is hours worked. If the employee
leaves from the normal place of work rather than from home, the travel between home
and the normal place of work need not be counted as hours worked. If the travel is by
public transportation (for example, by plane, train or bus), the time spent traveling
between home and the departure point, such as an airport, need not be counted as hours
worked.
Overnight out-of-town travel by public transportation is counted as hours worked to the
extent that it occurs during normal working hours, even if the traveling is done on
weekends and holidays. Overnight out-of-town travel as a passenger outside normal
working hours is not counted as hours worked, if the employee is not otherwise working
while traveling. If the employee is required to drive a vehicle in connection with this
travel, all of the travel time must be considered hours worked (except for bona fide meal
periods).
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Wages and hours
If the employee is allowed to use public transportation for the trip but instead uses an
automobile for personal reasons, the Company may count as hours worked either:
•
the time spent driving to the destination
or
•
the time that would have been considered hours worked if the employee had used
public transportation.
On-call time
Whether on-call time is compensable depends on the extent to which the employee’s
personal time is restricted. If employees who are on call must remain on the employer’s
premises, or so near that they are not free to do as they choose, the on-call time is
compensable. If, however, employees who are on-call must only leave a telephone
number where they can be reached, or must carry a beeper, the on-call time is generally
not compensable. Reasonable restrictions on the employee (for example, a no-drinkingalcohol rule) will not convert on-call time into compensable hours worked.
Compensatory time off
Private employers
For nonexempt employees, a private sector employer cannot establish a
“compensatory time off” program which will meet the current FLSA overtime
requirements. Proposals to ease the stringent rules now in place have languished
in Congress, and no change is foreseeable in the near future.
Public employers
In general, federal, state and local government employers may grant paid
compensatory time-off to their employees in lieu of paying them cash for hours
worked over 40 in a week. In order for the compensatory time-off to be
legitimate, it must allow at least one and one-half hours of compensatory time for
each hour of overtime worked. There are certain limitations as to the formation of
such an agreement and to the quantity of compensatory time-off that may be
accrued. Where the public employer fails to observe such limitations, the
employer must pay overtime compensation to the employee at the time and onehalf rate.
While a compensatory time-off agreement need not be in writing, the employee
must knowingly agree to such an arrangement as a condition of employment. A
written policy is advisable.
Additionally, most public employees may not accrue more than 240 hours of
compensatory time-off. However, an employee who accrues compensatory timeoff because of work in a public safety activity, emergency response activity, or
seasonal activity may accrue up to 480 hours of compensatory time-off. “Public
safety activity” generally refers to law enforcement officers and fire fighters.
“Emergency response activities” typically refer to the dispatch of emergency
vehicles, rescue work, and ambulance services. “Seasonal activities” typically
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Wages and hours
include work during periods of increased demand which are regular and recurring
in nature.
Finally, the public employer must permit an employee who has accrued
compensatory time-off to use such time within a reasonable period after the
employee has requested to use it, unless the use will unduly disrupt the
government’s operations. Whether compensatory time-off is granted within a
reasonable period of time will depend upon the government’s workload as well as
the specific facts and circumstances of each case. The employer may refuse the
employee’s request where it would place an unreasonable burden on the
government’s ability to provide services of acceptable quality and quantity during
the time requested such as an inability to provide emergency care or police
protection.
Unauthorized overtime
Employers often wish to enforce a “no overtime without prior authorization” policy in
order to control costs. However, the existence of such a policy will not necessarily
prevent an employee from being entitled to overtime pay. If the employee performed the
work, and the employer knew or had reason to know of the work, overtime pay will be
required.
The employer must have actual or implied knowledge of the overtime work, but if the
work gets done after hours, the employer will, in most cases, be assumed to have known
about the overtime work. In any event, an employer must never have supervisory
personnel encourage employees to work “off the clock” which is a clear violation of the
FLSA.
Attendance at
meetings and training programs
Generally, attendance at meetings, lectures and training programs need not be counted as
compensable time if all of the following apply:
•
attendance is outside the employee’s regular working hours
•
attendance is voluntary (attendance is not voluntary if the employee is led to
believe that his or her present employment situation will be affected by nonattendance at such meetings)
•
no productive work is done
and
•
the meeting or training session is not directly related to the employee’s job
(training sessions are compensable when they are designed to make the employee
handle his or her present job more effectively, as opposed to providing the
employee new skills which would qualify him or her for a different job).
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Wages and hours
Note
If an employee on his own initiative attends an independent school, college or
independent trade school after hours, the time is not hours worked even if the courses are
related to his work.
Changing clothes before and after work
If an employee is required to put on special clothing at the beginning of the shift, and
change out of it at the end of the workday, the time spent is paid time if the employee
cannot perform his or her job without the special clothing. For example, if the employer
requires employees to wear burdensome protective clothing which cannot be worn home,
then time spent changing clothes at the beginning and end of the work day is
compensable. Time spent walking between the work area and such a clothes-changing
area also is counted as hours worked.
Civic and charitable work
If an employee is directed or requested by his employer to do work for a civic or
charitable purpose, or the employee performs such work while required to be on the
employer’s premises, the time spent must be counted as hours worked. For example, an
employee who is directed by the employer to participate in or attend a charitable function
must be paid for the time. However, when the employee voluntarily spends time at such
activities outside his or her regular working hours, the time need not be counted.
Waiting time while on duty
When employees are idle during their regular workday because of interruptions beyond
their control, the time spent waiting should be counted as working time if it is
unpredictable and of short duration so that the employees are unable to use the time as
their own.
Example
A factory worker must be paid for time spent talking to fellow employees while
waiting for the machine she operates to be repaired.
Example
Time spent by a clerk reading a book while waiting for a large copy job to be
completed by the copier is paid time.
However, if the employee is completely relieved from duty for a specified period
of time, long enough for the employee to effectively use such time for his or her
own purposes, the time spent waiting until he or she is required to report back for
duty is not considered working time.
Example
A truck driver need not be paid for time spent waiting if he is notified that he is
completely relieved from duty for the two hours it takes to unload his truck.
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Wages and hours
Paperwork completed at home
Time spent by employees making out reports at home required by the employer should
generally be counted as hours worked if the paperwork is an integral part of an
employee’s work and necessary to his or her position. This holds true even if other
employees can successfully complete similar paperwork within working hours.
Exempt vs. non-exempt
An exempt employee is not entitled to overtime premium pay. Regulations under the FLSA
provide rules for determining whether or not an employee is exempt. Non-exempt employees are
paid overtime for all hours worked over 40 per week and must be paid at least the hourly
minimum wage set by federal law.
Complete minimum wage
and overtime exemptions
The most common exemptions from the minimum wage and overtime requirements are
those available for executive, administrative, professional, and outside sales employees.
To qualify for these exemptions under the current regulations, the following criteria must
be satisfied.
Executive employee exemption
Employees must be paid on a “salary basis” at a rate of at least $455 per week and
must meet all of the following tests.
•
Primary duty
Managing an enterprise or department or subdivision.
•
Supervision
Customarily and regularly directs the work of two or more full-time
employees or the equivalent.
•
Authority
Can hire or fire, or makes suggestions or recommendations that are given
particular weight concerning hiring, firing, or other status changes of
employees.
Administrative employee exemption
Employees must be paid on a “salary basis” or a “fee basis” at a rate of at least
$455 per week and must meet all of the following tests.
•
Primary duty
Performs office or nonmanual work directly related to management or
general business operations of the employer or the employer’s customers.
(Exemption also applies to certain academic administrators in an
educational establishment.)
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Wages and hours
•
Discretion
Exercises discretion and independent judgment with respect to matters of
significance.
Professional employee exemption
Employees must be paid on a “salary basis” or a “fee basis” at a rate of at least
$455 per week and must meet all of the following tests.
•
Primary duty
Performs work requiring advanced knowledge in field of science or
learning customarily acquired by a prolonged course of specialized
intellectual instruction.
•
Intellectual
Performs work that is predominantly intellectual in character.
•
Discretion
Consistently exercises discretion and judgment.
(Teachers, lawyers and physicians are excepted from the salary requirement and
have their own duties requirements for this exemption. Creative professionals,
employees who perform original and creative work in an artistic field, must meet
the salary/fee requirement).
Computer employees
Exempt computer employees are:
•
computer systems analysts
•
computer programmers
•
software engineers
•
other similarly skilled workers
who are paid either on an hourly basis (at least $27.63 per hour) or on a salary
basis (at least $455 per week) and whose primary duty is one of the following:
•
the application of systems analysis techniques and procedures, including
consulting with users, to determine hardware, software or system
functional specifications
or
•
the design, development, documentation, analysis, creation, testing, or
modification of computer systems or programs, including prototypes,
based on and related to user or system design specifications
or
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Wages and hours
•
the design, documentation, testing, creation, or modification of computer
programs related to machine operating systems
or
•
a combination of the above duties, the performance of which requires the
same level of skills.
Outside sales employee exemption
Exempt outside sales employees are those:
•
whose primary duty is making sales of goods or services, or obtaining
orders or contracts for services or the use of facilities
and
•
who are customarily and regularly engaged in this activity away from the
employer’s place of business.
There is no salary requirement for this exemption.
Highly compensated employee exemption
The new exemption for a highly compensated employee requires all of the
following:
•
paid on a “salary basis” or a “fee basis” at a rate of at least $455 per week
•
“total annual compensation” of at least $100,000 (including both salary
and commissions, nondiscretionary bonuses, and other nondiscretionary
compensation earned in a 52-week period)
•
primary duty includes performing office or non-manual work
and
•
customarily and regularly performs any one or more exempt duties or
responsibilities of an executive, administrative, or professional employee.
Others
Complete minimum wage and overtime exemptions are also available for:
•
employees of amusement or recreational establishments having seasonal
peaks
•
seamen on non-American vessels
•
employees in the fishing industry
•
certain agricultural employees
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Wages and hours
•
employees of local weekly, semi-weekly, or daily newspapers with a
circulation of less than 4,000
•
casual baby-sitters or companions to ill or aged persons.
Partial minimum wage exemption
Subminimum wages may be paid to employees in the following categories by obtaining
the necessary certificate from the Department of Labor:
•
learners
•
apprentices
•
handicapped workers
•
messengers
•
students in retail or service establishments
•
students in agriculture
•
students employed by educational institutions.
Complete overtime exemption
An overtime exemption (but no minimum wage exemption) is available for the following
employees:
164
•
employees who are employed by motor carriers, who are subject to regulation by
the Secretary of Transportation, and who perform work connected with certain
large or hazardous-cargo motor vehicles
•
employees of rail carriers
•
employees of air carriers subject to Title II of the Railway Labor Act
•
outside buyers of poultry and dairy products
•
seamen
•
announcers, news editors, and chief engineers of radio or television stations in
small communities
•
salesmen, partsmen, or mechanics employed by automobile, truck, or farm
implement dealers
•
salesmen employed by trailer, boat, or aircraft dealers
•
drivers and drivers’ helpers who make local deliveries and are paid on a trip rate
or similar basis according to a plan pre-approved by the Department of Labor
Wages and hours
•
agricultural employees and certain employees engaged in occupations related to
agriculture
•
taxicab drivers
•
domestic service employees who reside in the household
•
employees of motion picture theaters.
Partial overtime exemption
The FLSA also provides for partial overtime exemption for a variety of specific
industries, including wholesale petroleum distribution, retail establishments with certain
commission-paid employees, green leaf tobacco and commercial cotton. The exemptions
are narrowly interpreted, with the employer required to prove that it is entitled to the
exemption.
Recordkeeping requirements
The FLSA requires that the following records be made and maintained. See also Appendix A,
Recordkeeping requirements.
Records to be preserved for three years
•
Payroll records (ledgers, W-2s, and payroll registers).
•
Employment contracts and agreements.
•
Sales and purchase records (total dollar volume of sales or business and total
volume of goods purchased).
Records to be preserved for two years
•
Time cards.
•
Wage rate tables or schedules.
•
All records of deductions from pay, assignments, and garnishments.
•
Order, shipping and billing records.
Payroll records must
include the following information
•
Name and address of the employee.
•
Date of birth – if under age 19.
•
Sex of employee and designation of occupation.
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Wages and hours
•
Workweek start (time of day and day of week).
•
Regular rate of pay, basis of pay, and exclusions.
•
Hours worked each workday and total hours worked each workweek.
•
Daily and weekly straight-time and overtime earnings.
•
Additions to or deductions from earnings.
•
Wages paid each pay period.
•
Date of payment and the period covered.
Wage payment
Florida law provides that payment of wages may be by check, draft, note, or other order of
payment. The instrument must be negotiable and payable in cash on demand without discount at
an established place of business within the state, the name and address of which must appear on
the instrument. The maker or drawer must, of course, have sufficient funds or credit to insure
payment for at least 30 days from the issuance of the instrument.
Payment of wages by coupons, tickets, tokens, punch-outs, or other devices in lieu of cash must
be payable upon demand in United States currency by any legal holder on or after the 30th day of
issuance.
Direct deposit of employee’s wages
An employer may deposit wages or salary owed to an employee directly into that
employee’s account at a financial institution by electronic or other medium, provided that
direct deposit has been authorized in writing by the employee and the employee has
designated in writing the institution at which deposit is to be made. No employer shall
terminate an employee for refusing to authorize such a direct deposit of salary or wages.
Wage payment upon termination
There is no Florida law requiring payment of an employee at the same time as
termination of employment. Based on contract principles, wages due should be paid no
later than the next regular payday although the statute does not address this.
Vacation pay
There is no Florida law requiring that an employee receive compensation in lieu of
accrued vacation time, unless there is an agreement between the employer and the
employee.
Unclaimed wages
Payroll checks over $10 issued to employees but remaining unpresented by them after
more than one year are considered unclaimed property in Florida, pursuant to Florida
Statute § 717.115. Such unclaimed property is generally subject to the custody of the
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Wages and hours
Florida Department of Financial Services. Employers are required to report unclaimed
property to the Department.
Wage rate discrimination
Wage rate discrimination on the basis of sex is prohibited by Florida law and by federal law
under the Equal Pay Act.
Garnishment and
wage assignment in Florida
The Florida employer must look to both federal and state law when dealing with garnishment
and wage assignment. Both bodies of law contain significant exemptions and/or restrictions.
Definitions
Garnishment
Garnishment is a statutory, court-enforced process whereby a creditor may reach
his debtor’s property or money which are in the possession or under the control of
a third person. For our purposes, this third person or “garnishee” is the employer.
The property in the employer’s possession will normally be wages owed to an
employee, the “debtor.”
Wage assignment
Wage assignment is a voluntary agreement which does not involve the court. In a
wage assignment an employee agrees to allow the employer to forward to a
creditor some or all of wages earned by the employee.
Disposable earnings
“Disposable earnings” means the amount of pay after legally-required deductions
such as taxes withheld.
Restrictions
The Consumer Credit Protection Act
The federal Consumer Credit Protection Act normally limits the amount which
may be garnished to the lesser of:
•
25% of the employee’s weekly disposable earnings
or
•
the amount by which the employee’s weekly disposable earnings exceed
30 times the federal minimum wage (i.e. the amount in excess of $217.50).
Exceptions to this provision are:
•
lawful, court-issued support orders
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•
bankruptcy orders issued under Chapter 13 of the bankruptcy laws
•
any federal or state tax liabilities.
Discharge
Federal law prohibits an employer from discharging any employee because of the
fact that his earnings have been subject to garnishment for a single debt.
Bankruptcy
The federal Bankruptcy Code prohibits employers from discriminating against an
individual because of his or her status as a debtor or bankrupt under the
Bankruptcy Act.
Exemption for “head of family”
Florida law provides special protections against the garnishment of wages of any
person who is a head of a family. The term “head of family” includes any natural
person who is providing more than one-half of the support for a child or other
dependent. All of the disposable earnings of a head of family whose disposable
earnings are less than or equal to $500 a week are exempt from attachment or
garnishment. Disposable earnings of a head of a family which are greater than
$500 a week may not be attached or garnished unless such person has agreed
otherwise in writing. In any event, the amount attached or garnished shall not
exceed the amount allowed under the Consumer Credit Protection Act.
Exception for amounts due
for alimony or child support
Florida law provides that if the garnishment is for alimony or child support, then
the “head of family” exemption does not apply and the employer must comply
with the garnishment.
Exemption for pension and profit sharing plans
Florida law provides that any money payable to a participant or beneficiary in a
retirement or profit sharing plan qualified under the Internal Revenue Code may
be exempt from all claims of creditors of that beneficiary or participant. The
exemption is not valid against claims made under a “qualified domestic relations
order” (QDRO) or if the garnishment or attachment is for the purpose of alimony
or child support.
A Florida resident who receives a pension from the United States government
may file an affidavit stating that the pension money received is necessary for the
maintenance or support for the pensioner or for the pensioner’s family. The Court
will then order the release of any money garnished to date.
Income deduction orders
Florida employers are required to honor court orders from other states directing
employers to deduct child support payments from employee wages, in accordance with
Florida Statute § 88.50211. In the past, employers were advised to require that out-of168
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state orders be converted to Florida state court orders before commencing deduction from
an employee paycheck. As of July 1, 1997, employers must honor income deduction
orders from other states immediately upon receipt. Employers may be penalized for
failure to honor income deduction orders.
Florida Statute § 88.5041 was also created to provide employers with immunity from
civil liability for compliance with income deduction orders. An employer is protected
from liability to an individual or an agency regarding the withholding of child support
payments.
Requests for information
Employers are subject to fines of up to $500 for each refusal to provide information
regarding an employee suspected of owing child support, according to Florida Statute §
409.2578. Under the law, Florida state agencies may submit written requests for
information to employers, such as amount of compensation or benefits available to an
individual. Employers should provide this information within 30 days of the request. If
employers fail to provide the requested information, the agency may apply for a court
order. In such a case, the employer may be liable for reasonable attorney’s fees and costs
incurred by the agency in securing the order. All fines collected are to be paid to a trust
fund for child support enforcement.
The garnishment process
The “writ”
The “writ” is a court order to the employer which states the amount owed to an
employee’s creditor and requires the employer to answer within 20 days. The
answer should include:
•
whether the employer is indebted to the employee for wages
•
the amount of wages if any
•
what personal property of the employee the employer has in his
possession, if any
•
any information the employer has concerning any other person who owes
money to the employee or who may have any other property of the
employee.
Effect of writ
Receiving the writ makes the employer liable to the employee’s creditor to the
extent of the wages payable or for any personal property of that employee which
is in the employer’s possession. Any property identified by the answer should be
retained by the employer until the entire amount of the debt is collected. In the
case of a “continuing” writ, the employer must make periodic payments from the
employee’s wages until the debt is paid subject to the restrictions listed above.
The court documents will identify in the heading if the writ is continuing,
requiring periodic payments.
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Wages and hours
Failure to answer
If the employer fails to answer the writ of garnishment as required, the employer
may become liable for payment of all or part of the debt owed by the
employee.
Fees and costs
Costs, expenses, and attorney’s fees incurred by the employer in obtaining
representation to respond to a writ of garnishment are to be paid by the employee.
Upon demand, the court will release a $100 fee (paid by the creditor when
applying for the writ) to cover an employer’s attorney’s fees. Additionally,
employers responding to writs of garnishment can collect up to $5 against the
salary/wages of the debtor to cover administrative costs for the first deduction and
up to $2 for each subsequent deduction.
Collection of student loans
Students loans provided under the federal Higher Education Act are in default after 180
days without payment. The government has set up a collection program which bypasses
the usual garnishment procedures. The federal Debt Collection Improvement Act
provides for garnishment of up to 15% of an individual’s wages for collection on a
defaulted student loan. The garnishment process under the federal Act does not require a
separate court order for enforcement. Certain collection agencies (verify through U.S.
Department of Education) have been authorized to collect defaulted student loans, and
only have to meet limited procedural requirements. An employer receiving notice from a
collection agency of a defaulted student loan must begin garnishment as soon as possible.
The dollar amount of the garnishment will depend on the amount of the employee’s
disposable income.
The amounts garnished are sent directly to the collection agency, but need not be sent
more than once per month. When the loan has been repaid in full, the employer will
receive a release notice and instructions to discontinue garnishment.
Employers can be sued by the collection agency for failure to comply with the
garnishment process on a defaulted student loan. If successful, the agency can recover the
amounts which should have been garnished, plus interest, attorney’s fees and costs, and
punitive damages.
Employers may not retaliate against an employee because of a student loan garnishment.
Employees who are discharged or disciplined for wage garnishment for a student loan
can sue the employer for reinstatement, attorney’s fees and costs, back wages and
punitive damages.
If the individual leaves employment, the employer must notify the collection agency by
completing a form provided for that purpose. A sample of the form is reproduced on page
171.
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Wages and hours
EMPLOYER NOTICE OF CHANGE IN EMPLOYMENT
– SAMPLE –
On behalf of (Employer name), I hereby notify the collection agency that (Employee
name and Social security number) has left employment.
Date of termination: ________________________________________________
Last known address: _______________________________________________
Subsequent Employer name & address (if available): _____________________
________________________________________________________________
________________________________________________________________
________________________________________________________________
Signature line of individual completing the form: ________________________
Date: ___________________________________________________________
Telephone number: ________________________________________________
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Government contractors
special wage-hour laws
In addition to the Fair Labor Standards Act, there are other federal wage-hour laws which may
apply to employers who do business with the federal government.
Walsh-Healey Public Contracts Act
The Walsh-Healey Public Contracts Act sets basic labor standards for covered employees
who work on government contracts in amounts exceeding $10,000 which provide for the
manufacture or furnishing of material, supplies, articles or equipment.
The labor standards
The basic labor standards established for covered employers include:
•
payment of a “prevailing wage” rate for all straight-time hours in an
amount set by the Secretary of Labor
•
payment of time and one-half for all hours worked in excess of 40 in a
week
•
prohibition against employment of anyone under 16 years of age
•
prohibition against employment of convict labor
•
maintenance of sanitary and safe working conditions
•
keeping complete payroll records and quarterly records of injury
frequency rates.
Exempt contracts
Unless specifically exempted by statute, all primary and some secondary
contractors must comply with the Act’s labor standards for covered work.
Contracts which are specifically exempt from Walsh-Healey coverage are those
which provide for the purchase of:
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•
“open market” products
•
perishables, including dairy, livestock and nursery products
•
agricultural farm products processed for sale by the producer
•
certain purchases of agricultural products by the Secretary of Agriculture
•
transportation by common carrier under published tariffs
•
goods which are stockpiled to the extent that the goods cannot be
identified as to the time the work was done.
Wages and hours
In addition, administrative exemptions have been granted for:
•
public work construction contracts
•
contracts for rental of real or personal property
•
contracts for public utilities
•
contracts to agents or publishers for delivery of newspapers, magazines or
periodicals
•
contracts exclusively for services.
Subcontractors
Generally, the Walsh-Healey Act does not apply to work performed by
subcontractors, unless it is the normal practice in the industry for the primary
contractor to perform that work himself. Thus, a subcontractor may be covered if
he is doing work which would “normally” be performed by the primary
contractor.
Covered employees
With certain exceptions, the Act covers all employees who do work which is
“necessary or preparatory” to the performance of the contract. This includes work
related to the manufacture, assembly, fabrication, handling or shipment of the
goods, and includes some employees who may only indirectly be involved in
production. Such employees include:
•
technical employees such as lab technicians, draftsmen, and toolmakers
whose work is directly related to the work under contract
•
material handlers, elevator operators, and crane operators whose jobs
involve moving covered articles from one part of the plant to another
•
shipping employees
•
quality control employees who inspect the products under contract
•
dispatchers, expediters and troubleshooters
•
time-study employees
•
tool crib attendants
•
truck drivers who haul materials to the plant or finished products from the
plant to the government agency or the place designated by the agency.
Employees not covered
In general, employees who are not doing work connected with the manufacture,
fabrication, assembly, handling or shipment of the materials, supplies or
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Wages and hours
equipment called for by the contract are not covered by the Act. Among those
who normally would not be covered are:
•
employees who qualify for the executive, administrative or professional
exemption under the Fair Labor Standards Act
•
general office and clerical employees
•
general custodial and maintenance employees, provided they do not clean
or repair the machinery used in producing the goods under contract
•
watchmen, fire protection and engine room employees.
Employees at other worksites
For employers who have a multi-plant operation, the Department of Labor takes
the position that employees who work at one plant on parts or materials which go
into the finished product produced at another plant are covered by the WalshHealey labor standards.
Overtime
If during any part of a workweek the employee performs work covered by the
contract, he is entitled to time and one-half his regular rate for hours worked over
40 in any one week.
Enforcement and penalties
Enforcement of Walsh-Healey labor standards is the responsibility of the Wage
and Hour Division of the Department of Labor. Penalties for noncompliance
include backpay and liquidated damages, withholding the balance of payment on
the contract, cancellation of the contract, and a blacklisting penalty for willful
violations which prohibits the employer from contracting with the federal
government for a period of 3 years.
Davis-Bacon Act
In combination with other federal laws, the Davis-Bacon Act sets employment standards
for “laborers and mechanics” on public construction projects under federal contracts in
excess of $2,000. Contracts awarded under Davis-Bacon will specify the minimum wages
and may provide for fringe benefits to be paid employees performing covered work.
Covered work
Davis-Bacon applies to federal contractors and subcontractors who construct or
repair public works or buildings. According to the Department of Labor,
“construction or repair” includes painting, decorating, cleaning, dredging and
demolition work (not all inclusive). This same definition of covered work applies
to contracts not directly with, but financed by, the federal government.
Covered employees – “site of the work”
The labor standards of Davis-Bacon and related acts apply to employees of
contractors and subcontractors at the site of the work. The meaning of “site of the
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Wages and hours
work” is often in dispute. The Department of Labor defines this term broadly to
include any area where employees prepare materials to be used on the
construction site. It may also apply to truck drivers who haul materials from
adjacent locations. On the other hand, office workers of the contractor or
subcontractor, located on site, may not be covered if they are working on other
projects in addition to the federal contract.
Overtime
Time and one-half must be paid to any employee who works on a government
contract in excess of 40 hours in a workweek.
The Secretary of Labor is responsible for administering and enforcing the labor
standards of the Davis-Bacon Act. The penalties for noncompliance are similar to
those of the Walsh-Healey Act. Additionally, criminal penalties may be imposed
for intentional violation of the overtime requirements.
Service Contract Act
The Service Contract Act of 1965 sets labor standards for employees who provide
services to the federal government under contracts for amounts in excess of $2,500.
Employees working under those contracts must be paid the “prevailing wage” and certain
fringe benefits.
Covered employees
The Act’s labor standards apply to “service employees.” This term is defined to
include “any person engaged in the performance of the contract.”
The definition has been expanded to include employees whose duties are
“necessary” to the performance of the contract. Employees found to be covered
under this expansive definition include:
•
equipment maintenance employees
•
office employees who do clerical work in connection with the contract
•
payroll clerks working on the payroll of the service employees
•
computer operators.
Employees not covered
Employees who qualify for the professional, administrative or executive
exemption under the Fair Labor Standards Act are not covered by the labor
standards of the Service Contract Act.
Covered contractors
The Service Contract Act is applied very broadly. Generally, almost any contract
with the government (other than one covered by Walsh-Healey or Davis-Bacon)
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Wages and hours
is a contract for “services.” The Act specifically excludes certain types of
contracts from its coverage:
•
public construction contracts
•
contracts for transportation of freight or personnel where published tariffs
are in effect
•
contracts for services provided by radio, telephone, telegraph or cable
companies
•
contracts for public utility services
•
individual employment contracts providing for direct services to a federal
agency
•
contracts with the post office for the operation of postal stations.
Coverage under Walsh-Healey
and Service Contract Act
Some contracts in excess of $10,000 may be covered by both the Walsh-Healey
Act and the Service Contract Act. This may occur when the principal purpose of
the contract is to provide services and a tangible product is furnished as a result.
For example, the Department of Labor has taken the position that a contract for
photographic services in excess of $10,000 would be subject to both Acts.
Overtime
Like the Davis-Bacon standard, time and one-half must be paid to any employee
who works in excess of 40 hours in a workweek on a government contract.
The Wage and Hour Division of the United States Department of Labor is
charged with the Service Contract Act’s administration and enforcement.
Penalties for noncompliance include backpay for employees, liquidated damages,
contract cancellation and loss of eligibility for future government contracts.
Q. Aren’t all salaried employees exempt from overtime provisions?
A. No, to be considered exempt, the employee must meet all of the requirements of the
exemption categories, including type of work. See Exempt vs. non-exempt on page 161
for each category’s requirements.
Q. Can an employer refuse to compensate an employee for unauthorized overtime?
A. Usually no. If the employer knew or reasonably should have known of the overtime work
and permitted it or allowed it to occur, the time is compensable, even if not specifically
authorized.
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Wages and hours
Q. Can an employer discharge an employee for having a number of garnishments against
wages?
A. An employer cannot discharge an employee for having garnishments against wages for any
one debt, but if the employee has garnishments for multiple debts, this restriction on
discharge does not apply.
Q. Are rest breaks or meal periods required? Are they compensable?
A. Neither meal nor rest periods are required in Florida, unless the employee is a minor child. If
rest breaks are provided, they must generally be considered paid time. If meal periods are
provided, they must generally be considered paid time if they are less than 30 minutes in
duration. If 30 minutes or more, they are not paid time unless the employee is on duty during
the meal period or is subject to frequent interruptions of a job-related nature.
Take a look at the information provided at:
•
www.dol.gov/esa/whd/
•
U.S. Department of Labor Wage and Hour Division Office
400 West Bay Street, Room 956
Jacksonville FL 32202
(866) 487-9243
Sunset Center, Room 255
10300 Sunset Drive
Miami, FL 33173-3038
(866) 487-9243
1001 Executive Center Drive, #103
Orlando, FL 32803
(866) 487-9243
Austin Laurel Bldg, Suite 300
4905 W. Laurel Ave.
Tampa, FL 33607-3838
(866) 487-9243
•
Check the blue pages of your local phone book for other wage/hour offices in your area.
For more information regarding Student Loan Garnishments:
U.S. Department of Education
Administrative Wage Garnishment Branch
404-562-6013
E-mail: [email protected]
177
Wages and hours
178
Chapter 15
Child labor
Florida and federal law regulate the employment of minors age 17 or younger by restricting the
occupations in which they can work and the number of hours they can work each day. Although
there are parallels between Florida’s child labor law and the federal child labor law, Florida’s
law imposes additional requirements on employers. In fact, Florida’s child labor law is
significantly more restrictive with regard to hours of work and employment in “hazardous
occupations.” A thorough review of Florida’s law and the applicable federal regulations is
strongly recommended prior to employing anyone age 17 or younger.
Child defined
Florida’s child labor law defines “child” or “minor” as any person 17 years of age or younger,
but parts of the law do not apply if:
•
the person is or has been married
•
a court has removed the person’s status of being under age
•
the person is serving, or has served, in the United States Armed Forces
•
a court has found it to be in the best interest of the child to work and specifically
approves the employment of that child, including the terms and conditions thereof
•
the person has graduated from an accredited high school or holds a high school
equivalency diploma.
The occupation restrictions provided in Florida law are not intended to prevent minors of any age
from receiving certain types and/or categories of career education.
Proof of age
Any employer is required to obtain and keep on record during the entire period of the minor’s
employment proof of age for all children that they employ. This requirement may be satisfied by:
•
a photocopy of the child’s birth certificate
or
•
a photocopy of the child’s driver’s license
or
179
Child labor
•
an age certificate issued by the district school board of the district in which the child is
employed, certifying the child’s date of birth
or
•
a photocopy of a passport or visa which lists the child’s date of birth.
Permitted occupations for all children
Occupations in which children of any age may be employed:
•
as pages in the Florida legislature
•
by the entertainment industry, under certain circumstances
•
in domestic or farm work in connection with their own homes or directly for their own
parent(s) or guardian(s), or in the herding, tending and management of livestock, during
the hours they are not required to be in school.
Prohibited occupations for all children
In Florida, no person under 18 years of age, whether married or a high school graduate, shall be
employed in any of the following occupations:
180
•
in places where alcoholic beverages are sold at retail (with some limited exceptions)
•
in or around explosive or radioactive materials
•
on any scaffolding, roof, superstructure, residential or nonresidential building
construction, or ladder above six feet
•
in or around toxic substances or corrosives, including pesticides or herbicides, unless
proper field entry time allowances have been followed
•
any mining occupation
•
in the operation of power-driven woodworking machines
•
in the operation of power-driven hoisting apparatus
•
in the operation of power-driven metal forming, punching or shearing machines
•
slaughtering, meat packing, processing or rendering
•
in the operation of power-driven bakery machinery
•
in the operation of power-driven paper products and printing machines
•
manufacturing brick, tile, and like products
•
wrecking or demolition
Child labor
•
excavation operations
•
logging or sawmilling
•
working on electric apparatus or wiring
•
firefighting
•
operating or assisting to operate a tractor over 20 PTO horsepower, any trencher or
earthmoving equipment, fork lift, or any harvesting, planting, or plowing machinery, or
any moving machinery
•
any other occupations which have been determined or declared by the department to be
hazardous and injurious to the life, health, safety or welfare of a minor.
Certain occupations are not prohibited if the person qualifies as a student learner or has
completed training as a student learner as defined by the US DOL (see Student learners on
page 183).
Children under 14 years of age
Florida prohibits the employment of minors under the age of 14, with limited exceptions.
Children age 11 and above may be employed in the sales and distribution of newspapers.
Note that the child-labor restrictions of the federal Fair Labor Standards Act do not apply to any
child employed as an actor or performer in motion pictures or theatrical productions, or in radio
or television productions. Florida’s Child Labor Law states:
Children within the protection of our child labor statutes may,
notwithstanding such statutes, be employed by the entertainment industry
in the production of motion pictures, legitimate plays, television shows,
still photography, recording, publicity, musical and live performances,
circuses, and rodeos, in any work not determined by the department to be
hazardous, or detrimental to their health, morals, education, or welfare. A
state permit is required.
Children 14 and 15 years of age
Hours
Generally, minors under the age of 16 may not be employed before 7 a.m. or after 7 p.m.
when school is scheduled for the following day, or for more than 15 hours per week when
school is in session. They cannot work for more than 3 hours on any school day unless
they are enrolled in a career education program or if there is no session of school the
following day. During holidays and summer vacations, they may not work before 7 a.m.,
after 9 p.m., for more than 8 hours in a day, or for more than 40 hours per week.
Days per week
No more than six consecutive days per work week.
181
Child labor
Breaks/meals
Thirty minute meal break required after four consecutive hours of work.
Exceptions to hours of work restrictions
•
Children with exemptions from school attendance.
•
Children enrolled in a public educational institution who qualify on a hardship
basis, such as necessity or family emergency.
•
Children in domestic service in private homes, children employed by their
parents, or pages in the Florida Legislature.
Prohibited occupations
In Florida, no person 15 years of age or younger may be employed in the following
occupations or situations:
182
•
in connection with power driven machinery, except power mowers with cutting
blades 40 inches or less
•
in any manufacturing entity that makes or processes a product with the use of
industrial machines
•
in the manufacture, transportation, or use of explosive or highly flammable
substances
•
in sawmills or logging operations
•
on any scaffolding
•
in heavy work in the building trades
•
in the operation of a motor vehicle (exceptions include the operation of a
motorscooter which the minor is licensed to operate and the operation of a tractor,
under certain circumstances)
•
in oiling, cleaning or wiping machinery or shafting or applying belts to pulleys
•
in repairing of elevators or other hoisting apparatus
•
in freezers or meat coolers or in preparation of meat for sale, except wrapping,
sealing, labeling, weighing, pricing, and stocking, when performed in another area
•
in the operation of power-driven laundry or dry cleaning machinery, or any
similar power-driven machinery
•
spray painting
Child labor
•
alligator wrestling, working in connection with snake pits or similar hazardous
activities
•
door-to-door selling of magazine subscriptions, candy, cookies, etc., except
merchandise of nonprofit organizations
•
use of meat and vegetable slicing machines.
Children 16 and 17 years of age
Hours
Minors 16 and 17 years of age may not be employed before 6:30 a.m. or after 11:00 p.m.
or for more than 8 hours per day when school is scheduled on the next day. When school
is in session, they may not work more than 30 hours per week. On any school day minors
16 and 17 years of age who are not enrolled in a career education program shall not be
gainfully employed during school hours.
Days per week
No more than six consecutive days per work week.
Breaks/meals
Meal break of at least 30 minutes if a minor works more than 4 consecutive hours.
Exceptions to hours of work restrictions
•
Children who have graduated from high school or have received a high school
equivalency diploma.
•
Children with exemptions from school attendance.
•
Children enrolled in a public educational institution who qualify on a hardship
basis, such as necessity or family emergency.
•
Children in domestic service in private homes, children employed by their
parents, or pages in the Florida Legislature.
Student learners
Individuals who qualify as student learners are not prohibited from working in certain
occupations which are otherwise restricted to them by virtue of their age. To qualify, the
individual must meet the following criteria:
•
16 to 18 years of age
•
enrolled in a youth vocation training program under a recognized state or local
educational authority
183
Child labor
•
employed under a written agreement which contains the name of the Student Learner, and
is signed by the employer, school coordinator, principal and parent or legal guardian. The
agreement must provide that:
the work in the occupation declared particularly hazardous will be incidental to
the training
the work will be intermittent and for short periods of time and under the direct
and close supervision of a qualified and experienced person
that safety instruction will be given by the school and correlated by the employer
with on-the-job training
a schedule of organized and progressive work processes to be performed on the
job will be prepared.
Only certain occupations, otherwise prohibited for individuals under age 18, are permitted under
this exception for Student Learners.
Penalties
Violation of Florida child labor laws is a second-degree misdemeanor, with penalties which can
include fines of up to $2,500 per violation and possible imprisonment. Each day during which
the minor is illegally employed is considered a separate violation. Before a fine can be imposed,
the Florida Department of Business and Professional Regulation must give written notice to the
employer of the violation and will provide a period of time for correction.
Contact information
Florida Department of Business and Professional Regulation:
1940 North Monroe Street, Tallahassee FL 32399
[email protected]
Customer Contact Center: (850) 487-1395
Required poster
Any person who employs a minor must post a poster notifying minors of the provisions of the
child labor law.
Q. If a minor has dropped out or otherwise left school without graduating, do the
restrictions on employment when school is in session still apply?
A. Yes. The only exceptions to the hours of employment restriction are those specifically stated
in the law, such as for minors who graduate or receive an equivalency diploma, or those who
are granted written exemptions by the school superintendent or the Department of Business
and Professional Regulation. In addition, the law provides that married persons and those
serving in the Armed Forces are not “minors” for purposes of the hourly restrictions.
184
Child labor
Q. Does a minor have to be paid for break time?
A. An employer may, but is not required to pay wages to a minor for their break time.
Q. What records do I have to keep on minors I employ?
A. Employers are required to keep waiver authorizations, proof of age documents and proof of
exemption from minor status for all employees who are under the age of 18. These records
must be maintained for the duration of the minor’s employment. Unless the minor is exempt
from the FLSA, the records must be maintained until the minor turns 19.
185
Child labor
186
Chapter 16
Employee handbooks
An employee handbook is a written group of materials that contains an employer’s work rules
and policies. Handbooks may be elaborate and professionally printed booklets, or may be a
simple compilation of loose materials.
Whether or not an employer needs a handbook can be a difficult question for a small business.
Whether to have a handbook depends on the number of employees an employer has, as well as
the laws to which the employer is subject (which will dictate whether it is legally necessary for
the employer to have certain policies communicated to employees), and how important it is to
the employer’s operations to have its basic policies, procedures and work rules communicated in
written form. A handbook for any size company should be carefully prepared. Handbooks
downloaded for free from the internet or “borrowed” from another employer can sometimes
harm more than they help an employer. Part of the purpose of a handbook is to provide legal
protection to the employer. Poorly drafted policies or ones that run afoul of state or local laws
may actually come back to haunt a company.
Another crucial consideration is how often the handbook should be updated. Certainly,
handbooks should be kept up to date, not only with actual employer practices and policies, but
also appropriate laws. Generally, it is a good idea to update a handbook every one to two years,
but this doesn’t mean the entire handbook needs to be reprinted. If only a handful of policies
have been changed since the last handbook was distributed, it may be enough to distribute
changes as addenda. If an employer chooses to update in this manner, it should require
employees to sign an acknowledgement of receipt of the changes, just as it would require an
acknowledgment of receipt of a complete handbook.
What a handbook should accomplish
When drafting an employee handbook or manual, it is important to consider what it should (and
should not) accomplish.
A handbook should:
•
establish a positive image of the company
•
communicate important information to employees
•
promote the equitable treatment of employees and express that it is part of the company’s
code of conduct.
•
provide guidelines for supervisors and managers in order to ensure the consistent
application of company policies
187
Employee handbooks
•
increase employee commitment to the company
•
include any legally required policies, for example, no-harassment and equal employment
opportunity policies with clear appropriate discussion of the employer’s commitment to a
harassment and discrimination-free working environment.
A handbook should not:
•
be merely a set of rules imposed on employees
•
overeducate employees about their legal rights and possible causes of action they might
have under employment laws
•
tie the hands of management when faced with unexpected or unusual situations
•
be a contract between the company and its employees
•
be rigid or overly detailed
•
antagonize, criticize or otherwise “talk down” to employees
•
bury important policies or language deep in the handbook so that an employee can argue
in litigation that he or she never saw the policy and didn’t know about it.
Disclaimers
A strong statement disclaiming the creation of an employment contract and reinforcing
the doctrine of employment-at-will should be provided in every employee handbook to
reduce the possibility of claims against the company.
Although Florida courts have not yet ruled that handbooks amount to employment “contracts,”
other state courts have done so. The following are a couple of suggested disclaimer statements to
avoid the potential for an employee to argue that language in an employee handbook is binding or
creates any enforceable rights against the employer:
188
•
“Please keep in mind as you read or refer to this Handbook that its contents are not
intended to create a contract between the Company and any employee. Nothing in this
Handbook binds the Company or any employee to any specific procedure, policy,
benefit, working condition, or definite period of employment. Policies in this handbook
may be changed at any time, with or without advance notice to employees. You are
employed at-will, meaning that as an employee, you are completely free to leave the
Company whenever you choose, and for any reason. The Company has the same right to
end the employment relationship.”
•
“The policies and procedures covered in this Manual are not intended to be all-inclusive.
This Manual and the policies contained herein do not in any way constitute, and should
not be construed as, a contract of employment, either express or implied, or a promise of
employment between you and the Company. Nothing in this Manual binds the Company
Employee handbooks
to any specific procedures, policies, benefits, working conditions, privileges of
employment, or definite period of employment. Policies in this handbook may be
changed at any time, with or without advance notice to employees. As an employee, you
are completely free to leave at any time you choose, and we have the same right to end
the employment relationship.”
Without a disclaimer, there is a danger of creating an employment contract or create false
expectations that may make it difficult to discipline or terminate employees when work rules or
policies are not followed.
However, when drafting a disclaimer, make certain that it will be easily understood by
employees. The disclaimer should not include legalistic language nor should it be hidden in the
back of the handbook. The disclaimer should be one of the first things the employee sees when
reviewing the handbook. It is also a good idea to provide a receipt for employees to sign, which
contains an identical at-will disclaimer on which the employee acknowledges that he or she
received and read the handbook and is responsible for complying with the policies therein.
Because the signed receipt is one of the most important documents in your defense to most
employee charges or claims, be certain to keep a copy of the signed receipt in the employee’s
personnel file and in any other centralized filing location that will ensure its safe keeping.
Without a signed document that proves the employee received a copy of your handbook, it may
be difficult to convince a court or jury that the employee knew and understood what was
expected of him or her.
A sample receipt statement follows on page 190.
189
Employee handbooks
RECEIPT STATEMENT
– SAMPLE –
I have received a copy of the Employee Handbook and have either carefully read it or had it read
to me. I understand that I am responsible for compliance with the policies in the handbook and
that if there is anything I do not understand, it is my responsibility to ask. I understand that this
Handbook supersedes all other Handbooks which I may have been given previously and that any
provision of this Handbook may be amended or revised at any time by the Company with or
without notice to employees.
I further understand that this Employee Handbook does not guarantee my employment for any
period of time and does not create a contract of employment. I also understand that my
employment with the Company is at-will, meaning it can be terminated by the Company or by
me at any time, for any reason or no reason, and with or without notice.
Date: ____________________
Employee’s Signature: ______________________________________________
Supervisor’s Signature: ______________________________________________
190
Employee handbooks
Updates and revisions
Generally, handbooks should be reviewed at least once every year to two years. As the size of
the business grows, it may also be necessary to include policies and procedures on additional
laws as the number of employees increases. See Chapter 2, Compliance thresholds for an
overview of the number of employees required for coverage by many federal and state laws.
Companies should make modifications to employee handbooks in writing. The handbook should
include language that makes clear the employer’s right to make revisions to the handbook. It is
always a good idea to have an attorney review changes or additions before they are implemented.
Handbook uses
If you’re undecided about whether to invest the time in creating a handbook, consider some of
the other uses for a handbook in addition to communicating important information to employees.
Provided the appropriate content is there, the handbook can serve a number of purposes:
•
Communication
A handbook can provide a means through which employers can clearly communicate the
company’s policies and procedures to its employees. By having written policies and
procedures that are distributed to every employee, a company can avoid ambiguities as
well as misunderstandings.
•
Motivation
A handbook can provide employees with a sense of their importance to the business, if
information about company goals is provided. In many situations, an employee handbook
can even be used to make everyone feel that they are part of the “team,” and thus build
employee morale.
•
Reference
With a well-written handbook, everyone knows the rules of the workplace. If an
employee violates a rule, reference to the handbook can make discipline easier. In
addition, the handbook’s rules can provide objective evidence to support a termination or
discipline or to defend an unemployment compensation claim by a terminated employee.
•
Protection
When discrimination and unemployment claims are brought against the business, a
handbook with well-drafted policies will show an investigator that clear, reasonable rules
of conduct in the workplace were communicated to employees and objectively enforced.
•
Avoid unionization
A handbook can also be a key factor in avoiding unionization. It provides a forum for a
non-unionized company to state that it is dedicated to remaining non-union and will do
everything in its legal power to remain so. The handbook also provides a vehicle through
which a company can emphasize its policies regarding solicitation and distribution of
union materials as well as its restrictions on the use of employee bulletin boards for
solicitation purposes.
191
Employee handbooks
More importantly, a well-drafted employee handbook can be used as a union avoidance
tool simply by providing employees with a sense of security by letting them know that
the employer respects their rights and values their contribution to the business. By
providing problem-solving procedures and establishing the company’s commitment to a
safe and productive working environment, an employee handbook can be of great value
in keeping employees content, in letting them know they have legitimate avenues to make
complaints and express concerns, and thus avoid unionization.
Tips on drafting handbooks
An effective handbook must be clear, concise, and must accurately reflect the policies and
procedures currently followed by the company. Employers should consider the following tips
when drafting employee handbooks and manuals.
192
•
Be general and don’t provide an excessive amount of detail, especially on such things as
health benefits, 401k and similar plans, because the terms under which you offer these
benefits may change.
•
Do not use mandatory language. Use words such as “may” instead of “will.” Avoid
terms such as “permanent employees.”
•
Reserve the right to modify provisions. The handbook should clearly state that the
employer has the right to change policies included in the handbook at any time, with or
without advance notice to employees.
•
Include a conspicuous disclaimer. The disclaimer should be at the front of the handbook
and in a different typeface as the rest of the handbook.
•
Include an employee acknowledgment page that contains a reminder regarding the “atwill” nature of employment at your company.
•
Review/update handbook periodically.
•
Make reasonable efforts to follow your handbook. A handbook is obviously of no value
if the policies contained in it are not properly implemented by management. Companies
must make a concerted effort to educate managers and supervisors about the contents of
the employee handbook and, when the handbook is drafted, must ensure that the policies
as written are consistent with the way they are applied.
•
Specify who is covered by various policies where appropriate.
•
Keep it simple. The language in the handbook should be clear and concise.
•
Get legal advice.
•
Include a receipt statement.
Employee handbooks
Suggested topics for employee
handbooks (and some sample policies)
Topic
Sample language
Address and
telephone records
Provide addresses and telephone numbers for pertinent members
of management and departmental offices.
Attendance
We require regular attendance. If you must be absent for reasons
beyond your control, unless the absence is during a Companyapproved leave of absence, notify your supervisor not less than
two hours prior to the beginning of your shift. In case of an
emergency, we will permit notification of less than two hours,
but notification must be prior to the beginning of your shift.
Failing to notify your supervisor prior to the beginning of your
shift will result in an unexcused absence. Falsifying the reason
for your absence when notifying your supervisor can result in
immediate discharge. Excessive absenteeism or tardiness will
result in disciplinary action and may result in termination. Also,
mention to employees the consequences of being “no-call, no
show.” Most employers consider this grounds for discipline or
discharge, and will terminate employees who miss two or more
days without calling in for job abandonment.
Benefits
Determine what benefits you will provide and include them in
your handbook. Keep the information basic, and refer employees
in the policies to those in the company who can provide more
detailed information on benefits terms, for example, the HR
director or office manager.
Bulletin boards
We post important information on the official Company Bulletin
boards. Please be sure to read them regularly. These bulletin
boards are limited to Company business only. It is a violation of
our rules, and can lead to discipline, for anyone to post notices
there or to deface or remove any notice posted on those bulletin
boards. Employees may post notices on the bulletin board
located at (specify one location), but must first obtain approval
from the Personnel Department if you have a notice you want to
post.
193
Employee handbooks
Topic
Company
communications
policy
Sample language
We provide telephones, voicemail systems, and computers,
including electronic mail systems (email) for Company business
use only, and excessive personal use of these devices is
prohibited. In addition, use of these items in violation of the
Company’s policy on solicitation and distribution of literature or
our policy against harassment is strictly prohibited.
Communication through these devices and on company
equipment and systems is subject to monitoring by the Company,
and the use of discriminatory, hostile, suggestive, or otherwise
inappropriate language is strictly prohibited. The Company
reserves the right to monitor any communication sent or received
using company systems or equipment. Violation of these rules
will be considered grounds for disciplinary action, up to and
including discharge.
Complaint and
problem-solving
procedure
Occasionally you may experience dissatisfaction with your job,
or misunderstandings may arise. This happens in any work
environment. We encourage a quick and reasonable resolution
of any such problems or complaints. Discuss your problem first
with your immediate supervisor, and feel free to put it in writing.
If the problem is not resolved between you and your supervisor
(or if you wish to bypass a discussion with your supervisor),
simply request a meeting with an individual in the Human
Resource department.
Civil or criminal
action policy
Indicate that any action against persons or property of the
Company that lead to termination of employment does not
preclude the Company from taking civil and/or criminal action
against the employee.
Customer
satisfaction
Set forth all Company policies pertaining to customer service and
satisfaction.
Disciplinary rules
and regulations
See sample disciplinary rules on page 220.
Disclaimer
See page 188.
194
Employee handbooks
Topic
Sample language
Dress and
appearance
We require employees to maintain a professional appearance and
attitude at all times. Traditional business attire continues to be
appropriate in any company office. However, jackets and ties are
not required. Comfortable alternatives, such as collared shirts and
neat and pressed casual pants are also permitted. Clothes which
distract from a business environment are not appropriate, such as
jeans, tee-shirts, sweatshirts, athletic footwear and sandals. Each
employee has a responsibility to ensure that business casual dress
continues to project a professional image on behalf of the company.
Drugs and alcohol
An applicant or employee who tests positive for an illegal drug or
has such substances present in their system while at work or on
company premises or company business will be subject to
termination, or in the case of applicants, elimination from
consideration for employment. Such individuals cannot
immediately enter a drug rehabilitation program and seek
assistance to avoid the possibility of discipline or termination by
claiming she/he is now in rehabilitation and is no longer using
drugs illegally.
Use or abuse of alcohol on work time, on work premises, while
operating a vehicle on company business, or while otherwise
performing work for the company is strictly prohibited.
Employee
handbook review
checklist
Including a checklist of Company policies for the employee to
initial as having reviewed provides further documentation that the
employee has knowledge of pertinent policies in the event of a
charge or suit.
Employment of
relatives
We do not employ persons related by blood or marriage where one
of the employees will be in a position to exert influence over any
condition of employment of the other, or where the positions of the
two related employees might create an appearance of impropriety.
(Optional)
195
Employee handbooks
Topic
Sample language
Equal Employment
Opportunity
We do not discriminate against anyone because of their sex, race,
color, age, handicap, religion, citizenship, national origin,
marital status or any other protected category applicable under
federal, state or local law, in any aspect of employment
opportunity. Our policy of equal employment opportunity and
nondiscrimination extends to recruitment, employment,
advancement and promotion, compensation and benefits
administration, training and development, and other personnel
actions.
Fraternization
Management personnel will not date or establish romantic
relationships with employees whom they supervise, manage or
otherwise are within their realm of influence. Also, nonmanagement employees in sensitive computer, payroll or other
similar positions may not date or have romantic relationships
with employees affected by their duties. Adherence to this policy
will prevent the perception of favoritism among employees. If a
situation involves a management employee, the management
employee involved will be responsible to bring the matter to the
attention of his or her supervisor so that the situation is
addressed. (Optional)
Handbook receipt
See page 190.
Holidays
List those holidays recognized by the Company as days the
office is closed. If the holidays on which the business is closed
may vary from year to year, and the policy should advise
employees that a list of holidays will provided annually. The
policy should also cover what happens when a holiday falls on a
weekend day. For employers whose operations require that some
employees must work on holidays, it may be advisable to include
in the policy that employees needed to work on holidays will be
notified as far in advance as practicable.
196
Employee handbooks
Topic
Sample language
Hours of work
The normal work week hours are 12:00 a.m. Monday to 11:59
p.m. Sunday; however, your actual work schedule may vary.
Working hours and meal periods are scheduled according to the
needs of the Department and the needs of the Company. It is the
employee’s responsibility to ask the Supervisor or Department
Head about the employee’s specific work schedule to insure that
the employee is ready for work at his/her designated time.
Inclement weather
List the procedure for notifying employees of office closings for
inclement weather. For example, this may involve an automated
“call-in” number for employees or provide that they must call
their direct supervisor, for example.
Interviews
As a means of protecting yourself and the Company, employees
are not permitted to give interviews to individuals representing
themselves as attorneys, peace officers, investigators, reporters,
or someone who wants to “ask a few questions.” All information
requests by members of the media must be directed to (e.g.) the
CEO or Company president.
Leaves of absence
The Company is not subject to the federal or state Family and
Medical Leave Act at this time. However, we have established
the following medical leave policy for our employees…
Method of wage
payment
We distribute paychecks on the 5th and 20th of each month.
Each employee is responsible for picking up his or her own
paycheck on the normally scheduled pay day. If the scheduled
day falls on a weekend or holiday, you will be paid on the
following business day. Any questions about your pay amount
or deductions should be brought to the attention of the Office
Manager immediately.
Military leave of
absence guidelines
Employees who require time off from work to fulfill military
duties will be treated in accordance with applicable requirements
of state and federal laws. They are expected to notify their
Supervisor or Department Head of upcoming military duty by
providing a copy of their orders as soon as possible.
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Employee handbooks
Topic
Off-duty
employees
Sample language
Except during a reasonable period of time before and after work
hours, we do not allow employees to remain at or return to the
building for any purpose. Exceptions will be allowed to attend to
Company business, such as picking up paychecks or submitting
insurance forms, etc.
Nonemployees are not allowed on Company property unless on
official Company business. Trespassing is prohibited.
These rules will be strictly enforced. Violations will be
considered grounds for disciplinary action, up to and including
discharge.
Overtime
The Company may periodically schedule overtime or weekend
work in order to meet production needs. We will attempt to give
as much advance notice as possible, and we expect that all
employees who are scheduled to work overtime will be at work,
unless excused by their supervisor. All overtime work must be
pre-approved by your supervisor or Department Manager.
Working overtime without your supervisor’s or Department
Manager’s approval may result in discipline, up to and
including termination.
Payroll deductions
List any and all regular or potential deductions from your
employees’ pay so as to protect yourself from a wage and hour
liability.
Performance
evaluations
During an employee’s introductory period, his/her Supervisor
evaluates job performance on an on-going basis. After that, an
employee will normally be evaluated on an annual basis. At the
discretion of the Supervisor, performance appraisals may be
performed more frequently.
Personnel files
All records and files of the Company are property of the
Company and considered confidential. Information included in
files will normally include employment application and/or
resume, I-9 form, emergency contact information, and so forth.
No employee is authorized to copy or disclose any file or record.
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Employee handbooks
Topic
Sample language
Promotion and
transfer
The Company considers qualified, current employees first for
promotions whenever appropriate. If employees are interested in
another position within the Company, they must notify their
Supervisor, Department Head or Human Resources.
Proposed policies
Consider establishing a procedure for submission and
consideration of policies proposed by the employees that is set
forth in the employee handbook.
Safety and health
The Company is sincerely interested in the health, safety and
welfare of each employee. In order to ensure a safe working
environment, we need your cooperation. Cooperation means
maintaining a clear and orderly working environment.
Employees should report any unsafe working conditions and all
accidents to a management official immediately. Do not attempt
to use unsafe or broken equipment.
A first-aid kit is located in the Personnel Office. You should
obtain necessary protective equipment, including disposable
gloves and privacy masks, from this kit before rendering first aid.
Learn the location of the nearest fire extinguisher and the nearest
fire exit at all times. Never hang material, clothes or equipment
on the fire extinguisher, and keep all fire exits and aisles clear.
Any suggestions you may have concerning the safe operation of
the Company would be appreciated. Safety meetings will be held
on a regular basis, where concerns and suggestions can be
discussed.
Searches
The Company reserves the right to investigate potential
violations of our Drug-Free Workplace Policy and require
personnel to undergo substance abuse screening, including
urinalysis, blood tests or other appropriate tests and, where
appropriate, searches of all areas of Company and grounds,
including but not limited to work areas, personal articles, lockers,
vehicles, etc. Employees will be subject to discipline, up to and
including discharge, for refusing to cooperate with searches or
investigations, refusing to undergo testing or to submit to
screening, or for failing to execute consent forms when required
by the Company.
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Employee handbooks
Topic
Sexual and other
forms of
impermissible
harassment
Sample language
The workplace is for work; harassment disrupts the work
environment. The Company prohibits harassment of any kind
within the workplace. The Company’s goal is to provide a
workplace free of tensions created by racial, ethnic, sexist,
religious, or age-based remarks or animosity, unwelcome sexual
advances, requests for sexual favors, or other conduct of a sexual
nature.
Any employee affected by any type of verbal or physical
harassing conduct is urged to notify a supervisor, the Personnel
Department, or any other member of management immediately.
The Company will promptly investigate any claims of
harassment and will take appropriate action. All claims will be
kept as confidential as possible.
Smoking
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Florida law prohibits smoking in an enclosed indoor workplace,
except under limited circumstances. For more information, see
Chapter 33, Smoking in the workplace. Employees are
prohibited from smoking in any of our buildings, but (optional)
may smoke outside in the designated smoking area only.
Employee handbooks
Topic
Solicitation and
distribution of
literature
Telephone calls
Sample language
Everyone has probably found themselves in a difficult situation
when asked to make a purchase or donation to support some sort
of fund-raising drive or cause. Even though most of these
projects are worthwhile causes, they can disrupt normal
Company operations as well as put unnecessary pressure on
employees to participate. Also, if nonemployees are involved,
this activity can also involve trespass. The following rules must
be followed to ensure that everyone’s rights and obligations are
upheld:
•
Solicitation or distribution of literature by nonemployees
on Company property is prohibited at all times.
•
Solicitation or distribution of literature by employees on
Company property during the working time of either
employee is prohibited.
•
Distribution of literature by employees on Company
property in nonworking areas during working time, which
in any way interferes with work, is also prohibited.
•
Distribution of literature by employees on Company
property in working areas is prohibited at all times.
Telephones are for Company business use only. Employees
should refrain from making or receiving personal calls on these
phones except in urgent personal matters. An employee is not
permitted to make personal long distance calls on any Company
telephones. Cell phone use must also be limited to breaks.
Employees may not have their cell phones on during work time,
unless the cell phone must be used for Company business or
work-related purposes.
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Employee handbooks
Topic
Sample language
Time cards
Each nonexempt or hourly employee is given an individual time
card which is used to punch your daily starting time and quitting
time. You must punch in not more than 10 minutes before you
are to start work and punch out not more than 10 minutes after
you are to stop work. These cards provide the office with a
record of the hours an employee works and, therefore, must be
accurate and reflect only the hours worked. Making entries on
another employee’s time card or “punching” another’s time card
is prohibited. Any deliberate falsification of your time card or
anyone else’s time card is a very serious offense and may be
considered grounds for termination. All changes on time cards
must be initialed by your supervisor and signed by the employee.
Under no condition are you to work without recording your time
on the time card. Never work off-the-clock.
Unions
This is a non-union Company. This means that all our employees
are free to deal with us without any third party coming between
us. We consider this union-free operation a high compliment to
us and to our employees, indicating that our employees feel no
need for third-party representation.
We believe that a union would not work to your benefit and that
where there are unions, there is often trouble, strife, and discord
because of the way unions operate. It is therefore our Company’s
intention to oppose unionism by proper and legal means if the
need should arise.
Vacations, holiday
pay, and sick pay
Determine your relevant policies and procedures and set them
forth explicitly. Explain how paid time off is accrued, whether
the Company permits unused, whether the Company permits
unused, accrued time to be carried over from one year to the
next, and what happens to unused, accrued time upon
termination.
Welcome
Welcome to the Company! We are pleased that you are joining
us and we know that your contributions will assist us in
remaining a leader in this community and in our industry.
As an employee of the Company you will want to know what
you can expect from us and what we expect from you. This
handbook outlines the benefits, practices and policies of our
Company which are important to you.
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Chapter 17
Employee personnel files
Most of the information collected about employees should be kept confidential. Employers
should designate only a few individuals to have access to company personnel files, and the files
should be kept in a location that is not readily accessible to those without a need to access such
information. Under the terms of the Americans with Disabilities Act, medical information may
not be used in making employment decisions. Such information should be kept separately from
other personnel records, and EEOC regulations mandate that medical information must be kept in
a locked file or cabinet.
File basics
There are no federal or Florida laws that dictate what must be in a personnel file. The contents of
personnel files are likely to vary widely by industry or business. Basic information will probably
include:
•
employment application (and resume, if applicable)
•
performance evaluations
•
attendance records
•
disciplinary records
•
insurance election forms
•
employee handbook receipts
•
necessary tax forms, such as IRS W-4s
•
payroll information
•
emergency contact information and employee’s current address and telephone numbers.
Medical information of any kind should be kept out of the personnel file. This includes requests
for leaves of absence based on underlying medical conditions, such as requests for leave under the
federal Family and Medical Leave Act, and notes from physicians listing work restrictions based
on health concerns or conditions. In most cases, workers’ compensation report of injury and
claim forms should not be kept in personnel files. Benefit claim and explanation of benefits forms
generated for health and disability insurance purposes may also inadvertently disclose medical
information which should be kept in a confidential manner, apart from personnel files.
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Employee access
Private employers
Florida has no statute which requires employees of private employers to have access to
their personnel files. Therefore, there is no general legal right of a private sector employee
to review or copy anything in his or her personnel file unless the employer consents. Of
course, employers must recognize that any documents or records maintained in an
employee file are subject to production and review through the discovery process in the
event an employee seeks to enforce certain rights through litigation or an administrative
process.
Medical records
Employees do have the right to obtain certain medical information. Under the
Occupational Safety and Health Act, employers are required to maintain accurate
records of employee exposures to potentially toxic materials or harmful physical
agents which are required to be monitored or measured under the Occupational
Safety and Health Act. These regulations provide employees and their
representatives with an opportunity to observe the monitoring and measuring of
toxic materials and to have access to certain medical records. For a complete
discussion refer to Chapter 34, Safety in the workplace.
Employees also have the right to copies of records of positive test results under
the Florida Workers’ Compensation Act if they test positive for drugs or alcohol
under the employer’s testing policy.
Confidentiality
The Americans with Disabilities Act requires that employers maintain strict
confidentiality procedures regarding medical information. Even if medical
information does not directly identify an individual, absence records or other
factors may allow identities to be the subject of speculation. Once the information
is out, there is no guarantee that the grapevine won’t disseminate it more broadly.
This possibility increases with the most sensitive information, such as mental
health, HIV, or other serious illness. Also, the potential for harm to the individual,
and to the Company’s trust, in these situations is great. Company procedures
must carefully limit disclosures of medical information to a strict need-to-know
basis.
Public employers
In contrast to the private sector, state and federal employees do have a legal right of
access to their employment records. Employees of federal agencies can, on request, obtain
information about themselves contained in any system of records maintained by a federal
agency. In the case of state employees, persons having custody of public records must, at
reasonable times, make these records available to anyone wishing to inspect them. Some
information or records, however, are exempt according to state statute.
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Written policy regarding personnel files
Having a written policy on personnel files can help employers avoid problems and ensure that
supervisors and human resources personnel are consistent when it comes to maintaining the files,
accessing them, and responding to employee requests.
Since private sector employers are not legally obligated to allow employees to review their
personnel files, we generally recommend against stating in a handbook or elsewhere that
employers do so. If the employer wishes to have such a policy, however, it is important to
provide for some type of supervision in order to maintain the integrity of these records and to
indicate whether employees are permitted to remove or copy anything from their files. There
should be a general prohibition against employees removing anything from their files.
Personnel files should also be periodically reviewed and updated with new information. Not
every record relating to a particular employee belongs in the employee’s personnel file. Some
records should be kept separately, for example, I-9 Forms.
Proper documentation can be invaluable in defending a company’s decisions relating to a
particular employee. However, poor documentation can be worse than none at all. Consequently,
documentation should be accurate, concise and factual, and employers should keep in mind that
any documents created may be discoverable in a later lawsuit or administrative procedure.
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206
Chapter 18
Employee performance reviews
Regular employment evaluations are critical for all employees, even those who are very senior in
their position. Each business should have an evaluation policy and stick to it. One of the biggest
mistakes employer’s make is pushing evaluations off because they are too busy or because
nothing has changed with an individual’s performance since their last evaluation.
Employee evaluations have other benefits as well. Performance evaluations signify to the
employee a company’s interest in their work, a willingness to look at their abilities and skills in
context of the larger organization, to address concerns and give praise and encouragement.
These assessments can also be an effective means of preventing discrimination claims because
employees are regularly advised of where they stand with the employer, thus preventing
surprises in the future. They can also be used as documentation for patterns of poor performance,
misconduct or violations of company policies. If the evaluations are properly documented, they
can head off discrimination claims or at least provide a good defense. On the other hand, if the
evaluation is merely perfunctory and does not inform the employee of how he or she is actually
doing, then it can come back to haunt the employer when a discrimination claim is filed.
Too often, supervisors or managers who evaluate employees have received no instructions
concerning how to evaluate employees. Unfortunately, those who evaluate employees often
check “satisfactory” or “good” without giving very much thought to whether these terms are
correct. It is not uncommon for the person filling out a performance evaluation to use the same
comments for virtually all employees. Such use of the performance review is relatively
meaningless, unreliable and leaves the employer ripe for a lawsuit.
Supervisor training
A well-trained supervisor can be an excellent first line of defense to many legal claims. Anyone
within an organization who has evaluation responsibilities should receive training on how to
complete the evaluation tool and process in a meaningful way that will both accurately describe
the employee’s performance and inform them of future expectations.
Ideally, supervisors and managers who evaluate employees should receive personal training on
how to evaluate an employee in relationship to their written job description and complete the
evaluation tool. Those with evaluation responsibilities need to understand that the objective of
providing employees evaluations is to acknowledge the positive performance of employees and
provide guidance for the employee to improve their performance in areas where it is deficient.
To do so, the evaluation must be constructive. The errors which most often occur in evaluating
employees include excessive leniency, the tendency to avoid the ends of a rating scale (like
“superior” or “poor”), and the inclination on the part of some managers or supervisors to rate an
employee in each area on the basis of an overall impression, rather than on the basis of how the
employee has performed in each specific area. The evaluator’s ratings and comments on the
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evaluation should include objective (as opposed to subjective) goals for the individual. For
example, telling an employee that they need to improve their attitude is generally too subjective
to measure. But, if an employee has a bad attitude, this typically will affect parts of his/her job,
which can be more objectively measured. It is these areas that should be addressed in a
performance review.
Evaluators also need training on what to do when there is a performance problem. A corrective
action or performance improvement plan may be included as part of the evaluation process. It is
often helpful to have an employee participate in preparing a corrective action or performance
improvement plan. By doing so, the evaluator increases the likelihood that the employee will
“buy in” to the goals. Additionally, it is more difficult for an employee to claim that they did not
understand what was required of them if they participate in drafting the plan.
If formal training for supervisors and managers is not feasible, at a minimum, those conducting
the evaluation process should receive written instructions which clearly outline the system’s
importance and purpose, as well as the need for objectivity, honesty, accuracy, fairness and
constructive feedback. The instructions should include a directive to review the job description
before evaluating a current employee, a description of each item contained in the evaluation, and
what constitutes the rating given. For example, if an employee is to receive an “excellent” for
attendance, they must not have missed more than 2% of their scheduled shifts in the last
performance year. If the evaluation provides for comments, evaluators should be trained on how
write objective and factual statements, avoiding statements that reflect opinions; particularly if
they are negative. Evaluators should not be discouraged from writing comments, as often times
this is a good way to document changes in performance between evaluation periods. Many
employers require that if a supervisor is going to give a poor rating or if a rating has dropped
significantly from the last evaluation, that the supervisor include objective comments to justify
the score.
Upon receipt of the training, the supervisor or manager should sign a form acknowledging that
he or she has read the instructions and will comply with them. The signed form should be placed
in the supervisor’s personnel file.
Self-evaluation forms
When preparing for the evaluation process, the evaluator may want to provide an employee with
an optional self evaluation tool before providing the completed performance review. The
employee may be asked to evaluate items such as their strengths, challenges, ideas on how the job
can be improved, areas for growth or goals for the next evaluation period. The employee should
receive the self evaluation form well in advance of the evaluation meeting so they have time to
provide meaningful input. The self evaluation completed by the employee and the final
evaluation from the employer should be exchanged simultaneously prior to the evaluation
meeting. The point of this exercise is that both the employer and employee engage in the
evaluation process without influencing the content of one another’s evaluation document. This
can also be an effective way to guide the discussion during the evaluation meeting since both the
employer and employee will have a prior opportunity to review one another’s evaluation forms.
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Evaluation forms
Evaluation forms should reflect the prioritized traits contained within the job description as well
as additional characteristics which every employee is evaluated upon regardless of position.
Prioritized traits should mirror the requirements and essential functions of the job as written in
the job description. An employee should know from the inception of employment with the
company what traits will appear in their evaluation. General employment characteristics such as,
attendance, punctuality, ability to meet deadlines, and the ability to accept supervision fall within
general traits for which all employees should be evaluated. Often, the evaluation will be broken
into sections to reflect the distinction between the prioritized traits of the job and general
employment characteristics. A “canned evaluation form” is generally not appropriate,
particularly for skilled and management positions.
The rating choices on any form should be specifically related to the area of performance
evaluated. Regardless of whether an employer chooses to use a point system or a descriptive
system, such as poor, meets expectations, or excellent, the evaluation tool should define what
each value or term means. For example, in order to receive the highest score of a 5 for
punctuality, an employee must not have been late more than two times during the evaluation
period. Utilizing open terms such as “unsatisfactory,” “satisfactory,” “good” or “excellent” are
often too general and allow for too much variance and discretion among those using the
evaluation tool. If using those terms, put their use in context for the evaluator. In some
instances, it should be remembered that a choice of “not observed” or “not applicable” should be
available to the supervisor.
Areas for evaluation
As stated above, at a minimum an employer should evaluate each employee based upon
the prioritized traits contained within the job description and the general employee
characteristics which apply uniformly to anyone working within the organization. Some
examples of general employee characteristics include:
•
Job commitment – such as the willingness to assume responsibility, display of a
positive working attitude, and demonstration of pride in the quality of ones work
product.
•
Judgment – such as the ability to make well-founded and informed decisions, the
ability analyze challenges on the job, evaluate alternatives, and the ability to seek
guidance when necessary.
•
Initiative – such as the ability to work independently, to take on new projects
without being asked, and making sustained efforts to overcome obstacles.
•
Leadership – such as the ability to positively influence or motivate co-workers,
the willingness to assist peers, and ability to work cooperatively with others.
•
Professionalism – such as the ability to perform their job duties with integrity
and honesty, accept criticism in a positive manner, and work cooperatively to set
goals for improvement.
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•
Time management: such as the ability to prioritize work assignments, manage
deadlines, and complete job duties in a timely and efficient manner.
Reviewing compensation
The evaluation form is also a good place to document salary changes. If an employee receives a
raise based on performance, it is appropriate for the evaluation to reflect this. Employers should
be cautious about giving merit or performance raises when the employee’s evaluation does not
appear to support this. It is a common argument for an employee who has filed a legal claim to
point out that their performance was not poor enough to keep them from receiving a merit
increase. That is not to say an employer cannot give a merit increase to a weak performer, but
the amount or percent should be reflective of the evaluation. For example, an employer evaluates
all of the assembly line workers annually, the top performers might receive a 7% increase in
salary, while those who need improvement only receive 2%.
Review by objective person
It is important that the employer have a system of checks and balances in place as supervisors
and managers complete the evaluation process. Part of the process should include who will
review the form before it is presented to the employee. If there is a senior manager who does not
directly supervise the employee, an EEO compliance officer, or a personnel department within
the organization, this is a natural fit to make the final review. If, however, the organization is
light on the management side, at least one other manager should perform an objective review of
the evaluation. If the person reviewing the evaluation is not familiar with the job description, a
copy should accompany the draft.
Remember to take steps to ensure the confidential nature of the evaluation process, particularly
when routing drafts between those reviewing the document. If the evaluation is completed on a
computer, it is wise to password protect the document and only provide the password to those
with a need to access to information. If the evaluation is handwritten, the draft should be kept in
a secured location until it is in final form. Discarded drafts should be shredded. When the
evaluation is routed as a hard copy, it should be placed in a sealed envelope or folder marked
“confidential.” Care should be taken when routing hard copy evaluations via interoffice mail,
when possible managers should hand deliver the document to the reviewer.
Meaningful evaluations
The review must be honest and candid. Supervisors should refrain from being unnecessarily
harsh or excessively lenient. A strong evaluation embodies a balance of praise for a job well
done, clear indicators where there is room for improvement, and the steps required to achieve
goals set for the next evaluation period. While it may be uncomfortable to tell an employee their
performance is not fully meeting company expectations, not to inform them may have far
reaching repercussions if the employee is later demoted or terminated for repeated patterns of
deficiency. An employee cannot begin to improve their performance if they are not put on notice
that a problem exists. While delivering “bad news” can be difficult, nothing is more damaging to
an employer’s position in a lawsuit than to have favorable evaluation reports in a personnel file
that do not accurately reflect the employee’s performance.
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Employee acknowledgment
Employees should have the opportunity to review the final evaluation and make comments
regarding the performance ratings and descriptions of their work. A comments section may be
provided at the bottom the evaluation form or a separate form is also acceptable. Regardless of
the form used for comments, there should be a signature spot for the employee to acknowledge
that they had an opportunity to review their evaluation and provide comments. For example, “I
certify that I have received a final copy of this performance evaluation. I have had the
opportunity to review this evaluation, discuss the information contained within, and provide
comments regarding my performance. My signature does not directly reflect agreement with the
contents of this evaluation.”
Additionally, the person conducting completing the evaluation form should also meet personally
with the employee to discuss the contents of the document. The employee should have the
opportunity to review the final evaluation before the meeting so they can make comments and
prepare for a conversation about their performance. The evaluation review meeting should
include the evaluator, employee and either another manager, EEO officer or personnel official.
This is particularly important if the evaluation contains performance concerns, if the employee is
being placed on probation, or being demoted.
During the meeting, the employee should have an opportunity to concur or disagree with the
evaluation traits as rated. An employee should not be surprised by what they are evaluated on
even if they disagree with the ratings or conclusions of the evaluator. This is also a good time to
gather information about how the job is being performed in relationship to the job description. If
the employee states they are routinely doing activities not within their job description this should
be a red flag to the employer that it is time to review the position to see if the needs of the
business have changed and the duties in the job description must be modified to reflect this. It
may also be an indication of performance issues with other staff who are not meeting their
obligations causing their peers to help them complete the work. This may signal to the employer
that the workload has increased and it is time to add staff or reassign job duties.
The performance evaluation is another opportunity for the employer and employee to work
together and set goals for the next evaluation period. Even if the employee is doing well, they
should still have goals to work toward. A good performance evaluation may indicate to the
employer, that the employee is ready and able to take on more challenges. If the performance
documented in the current evaluation demonstrates severe concerns, however, it may be
necessary to implement a corrective action plan, extend a probationary period, or place a nonprobationary employee back on probation. Regardless of the situation, the employer and
employee should agree and both sign a document indicating the goals, expectations, time line,
and repercussions for failure to improve.
Although implicit in the above statements, it is essential that all performance evaluations be
carefully completed and documented. The use of the evaluation process and tool should be
consistently applied among all employees. Signed copies of the original evaluation should be
kept in the employees personnel file along with any supporting documents for that evaluation
period. This may include items such as the employee comments, a corrective action, or goal
setting sheet. Proof of consistency and documentation are important when an employer is faced
with a discrimination or termination lawsuit.
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212
Chapter 19
Discipline
The objective of any disciplinary program is to provide an effective means for enforcing
reasonable company rules and policies. To be effective, the administration of discipline must be
consistent. By consistent application of disciplinary measures, an employer can reduce its
exposure to litigation and develop a positive working relationship with its employees.
Discipline implementation program
A discipline program sets various steps an employer should go through in handling a violation of
company rules. Of course, there may be steps which are not applicable to each employer, and
adjustments in the procedure may be necessary in particular cases. An employer should use the
program to get supervisory staff thinking in terms of the consistent application of rules, resulting
in uniform discipline and fundamental fairness to employees. The procedures outlined below will
lead to the maintenance of complete and accurate records of all disciplinary actions, which will
prove valuable if an employer’s decision is called into question.
Employers have many options in setting up a discipline program. Below are some steps which
you may want to include in your program. The number of times each step is undertaken is within
the employer’s discretion. Consistent enforcement, however, is the key to an effective discipline
program.
•
recognition of problem
•
counseling
•
verbal warning
•
written warning
•
probation
•
termination.
While some employers also utilize steps such as demotion and suspension, these tools may
prove to be unsuccessful where animosity or resentment from the employee is anticipated.
Disciplinary demotions tend to be very public, and can be considered humiliating. The resulting
resentment usually outweighs any positive effect on behavior that may occur. The same factors
apply to disciplinary suspensions. In addition, suspensions hurt employees financially, much as
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Discipline
if you were imposing a fine for breaking rules. While certainly lawful, it is rare that these forms
of discipline accomplish the goal of correcting poor behavior.
•
Conduct a preliminary investigation
Once it is suspected that an employee has engaged in misconduct, the employee’s
supervisor or an appropriate management official should immediately conduct an initial
investigation. The investigator should determine who was involved, what the problem is,
and whether the incident has affected production. If any adverse consequences have
resulted from the misconduct, corrective action should be taken immediately. In this way,
the impact of the misconduct can be minimized. In addition, this initial investigation will
give company officials sufficient information to follow up on in a later, more detailed
investigation.
•
Interview employee accused of misconduct
As soon as possible after the event, an interview should be conducted with the employee
suspected of misconduct. The person handling the interview should be the employee’s
supervisor or another representative of management. The interview should be conducted
in a private area, away from other employees, such as a supervisor’s office. If an
employee is suspected of severe misconduct, the individual conducting the interview
might consider having additional supervisory or management personnel present, to
corroborate the interviewer’s version of the session if it later becomes an issue. The
employee, depending upon the circumstances, may have a right to have a witness present
during this interview. (For a more detailed explanation of this right and its consequences
for employers with a unionized workforce, see page 473, Employee’s right to a
witness (Weingarten rights).)
The employee should be given the opportunity to explain what happened and why it
happened. This includes identification of all witnesses the employee feels might have
some knowledge of the facts. At the conclusion of the interview, the employee should be
told that someone will get back to him or her after the investigation is completed. If the
employee is suspected of serious misconduct, the employer may wish to consider
suspending the employee, with or without pay, during the course of the investigation.
Detailed and accurate notes of this interview, and all other aspects of the
investigation, should be made by the interviewer.
•
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Interview all witnesses
Once the employee interview is completed, all other witnesses who might have
knowledge of the facts should be interviewed. As with the interview of the accused
employee, these interviews should take place as soon as practicable after the event in
question. The interviews should be conducted separately and in a private area, away from
other employees. Again, detailed notes of these interviews should be kept by the
interviewer. If the misconduct in question is severe, the employer may wish to take
signed statements from the witnesses.
Discipline
•
Decision-making process
Once the investigation of the suspected misconduct is completed, the data should be
reviewed by the personnel department or management staff. The personnel file of the
employee in question should be reviewed with an eye toward identifying aggravating or
mitigating circumstances. A review of files involving previous similar misconduct should
indicate how previous incidents were handled. (A system for arranging and maintaining a
filing system of this type is discussed on page 216, The recordkeeping system).
If it is determined that misconduct occurred and discipline is warranted, a Disciplinary
action record (see page 219) should be completed by the employee’s supervisor. In
completing this or a similar form, the employee’s name, job classification, department,
and supervisor should be identified.
In filling out the disciplinary action record, the following information should be provided:
•
the violation date
•
the date of the disciplinary action
•
an abbreviated reason for discussion, describing the events surrounding the
incident and/or the rules and policies violated by the employee’s conduct
•
the action taken, or nature of the discipline to be administered.
If the discipline is a final warning, it should clearly state that future offenses will result in
discharge.
A complete factual account of the incident should also be in writing, including a list of
witnesses and all original statements taken. This written account should be placed in the
employee’s personnel file.
Prior to communicating the results of an investigation to an employee and prior to the
administration of discipline, all decisions should be approved by the personnel director or
some other management official. This management review is a method for ensuring the
adequacy of the investigation and the appropriateness of the disciplinary action or
decision.
•
Communicating the discipline decision
When the employee is informed of the discipline decision, he should be allowed to review
the Disciplinary action record (page 219). The offense should be explained, and all the
company rules or policies violated should be identified. The nature of the discipline
imposed must be clearly explained to the employee. In addition, the employee must
understand exactly what action the company will take if another violation of company
rules occurs. Finally, the employee should be asked to sign the disciplinary action record.
If he refuses, it should be explained to him that the sole purpose of the signature is to
document that he saw the disciplinary action record and had it explained to him. It does
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Discipline
not represent the employee’s agreement with the discipline imposed. The employee
should be told that if he wishes to make any comments, he may write them in the space
provided. As with the other steps outlined above, detailed notes of this meeting should be
made.
•
Appeal process
A company with a sufficiently large management staff may wish to consider allowing
employees to appeal discipline decisions more severe than a written warning to a high
ranking management official not involved in the discipline process. Having a third party
review the facts is still another check on the consistency of discipline decisions.
If an appeal is allowed, the employee must initiate it by giving written notice to the
designated management official within a reasonable time (for example, five working days).
Late appeals should not be allowed unless unusual circumstances exist. The designated
management official should review all notes of the investigation, and the type of discipline
that has been imposed on employees under similar circumstances in the past. In sum, the
goal is to determine whether the discipline is fair and consistent with past practice. The
decision should be issued within a few days after the notice of appeal is filed.
The recordkeeping system
The most important element of employee discipline is to enforce company rules consistently.
One way to do this is to review the discipline imposed in the past for similar circumstances to be
sure that future discipline is consistent and fair.
For this reason, an efficient recordkeeping system is crucial. To be effective, the system should
track the nature of the offense and the discipline administered. This section briefly explains how
to set up such a recordkeeping system.
A separate file should be maintained for each company rule or policy, for example, there should
be a file for “insubordination,” one for “absenteeism,” one for “gambling,” and so on, until a
separate file exists for each possible employee offense. Every time an employee receives
discipline for violating a company rule or policy, a copy of the disciplinary action record
generated should be placed in the corresponding file. In this way, all discipline imposed on
employees for similar offenses will be in one file for easy reference and comparison. If more than
one company rule or policy is violated by an employee’s misconduct, one copy of the
disciplinary action record should be placed in each corresponding file. It might also be wise to
make some notation in the file when an employee’s alleged misconduct is investigated, but no
discipline is imposed. In this way, the employer will have a record of the mitigating
circumstances relied upon in making the decision not to impose discipline on an employee. A
copy of the disciplinary action record should also be placed in the employee’s personnel file.
Here is one example of how this filing system might work. Assume the company’s attendance
policy states that any employee who fails to call in to report an absence within the first 90 days
of employment will be discharged. Assume further that an employee, Joe, is scheduled to work
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Discipline
the 7:00 a.m. to 3:00 p.m. shift this particular week. On Tuesday, Joe fails to show up for work
and does not call in to explain his absence. Joe’s supervisor, knowing the company rule for
probationary employees, initially determines that he should terminate Joe. Upon investigation,
the supervisor ascertains that Joe’s parents came to visit and he stayed home from work to be
with them. Joe is terminated. The supervisor places a copy of the disciplinary action form in the
appropriate file for easy reference in the future.
Now, change the facts just slightly. Suppose, upon investigation, the supervisor discovers that
Joe’s father had emergency surgery that day and this was the reason for Joe’s absence and his
failure to call the plant. If the supervisor decides not to discipline Joe, an explanatory note from
the supervisor to the appropriate file will indicate that on at least one previous occasion
emergency medical treatment for a family member was accepted as an explanation for a technical
violation of an attendance rule. It is just as important to note the circumstances surrounding an
incident for which an employee was not disciplined as it is to note the circumstances surrounding
the decision to discipline an employee. This will ensure consistent enforcement of company
rules.
It is important to note that this filing system should not be a substitute for the company’s
personnel filing system. It is an additional system which will help guide supervisors and the
personnel department in enforcing company rules and policies in a consistent manner.
Discipline dos and don’ts
Do
•
Make certain your supervisory employees are familiar with your discipline
policy, and are trained in applying progressive discipline.
•
Use objective criteria in making employment decisions whenever possible.
•
Be consistent in the use of discipline or other employee counseling.
•
Document verbal, as well as written, warnings.
•
Be direct and honest with employees during periodic job performance evaluations
(see Chapter 18, Employee performance reviews).
•
Check the disciplinary record of an employee prior to making an employment
decision concerning him or her.
•
Investigate any rumors, allegations, or other information regarding harassment of
any type (particularly sexual harassment) in the workplace.
•
Use written personnel policies and employee handbooks since they give
employees notice of the rules and help ensure that the rules will be consistently
enforced.
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Discipline
•
Check for wage and hour compliance, particularly the designation of salaried
employees, before the Department of Labor does (see Chapter 14, Wages and
hours).
•
Designate one person or department to monitor discipline and termination of
employees.
•
Consider a demotion, instead of termination, if the employee’s problems are
performance-related and no animosity or resentment on the part of the employee
is anticipated.
•
Prepare job descriptions, and refer to them in disciplinary actions and
performance reviews. You must review and update them frequently however, or
they will be of little value.
Don’t
218
•
Don’t permit a job performance problem to get out of hand before taking
appropriate action.
•
Don’t lose your temper during disciplinary or discharge interviews. On the other
hand, don’t apologize.
•
Don’t ignore employee allegations of mistreatment or harassment by a coemployee or supervisor.
•
Don’t discipline or discharge an employee in violation of public policy, such as
filing a workers’ compensation claim, for performing jury duty, for testifying
under subpoena, for refusing to work under unsafe conditions, etc.
Discipline
SAMPLE – DISCIPLINARY ACTION RECORD
Employee Name: __________________________________________________________
Today’s Date: _______________________ Violation Date: ______________________
Job Site: _________________________________________________________________
Reason For Discussion: _____________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
Employee’s Version of the Events: ____________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
Action Taken: ____________________________________________________________
________________________________________________________________________
________________________________________________________________________
Comments: _______________________________________________________________
________________________________________________________________________
________________________________________________________________________
Employee’s Signature: _______________________________ Date: ________________
Supervisor’s Signature: ______________________________ Date: ________________
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Discipline
SAMPLE – DISCIPLINARY RULES AND REGULATIONS
The Company expects its employees to observe “common sense” rules of honesty, good
conduct, general job interest, safe practices, and to adhere to generally accepted customs of good
taste. In our Company, as in any group of common purpose, rules are necessary. These rules set
forth certain practices which will not be tolerated. It is difficult, if not impossible, to categorize
all types of prohibited conduct. This list is not intended to be all-inclusive.
220
•
Falsifying time cards, personnel, production or other Company records.
•
Refusal to carry out assignments relating to the work of the Company.
•
Theft, misappropriation, or concealment of property from fellow employees, the
Company or customers of the Company or theft of government property.
•
Deliberate waste of, damage to, or attempted damage to, materials, supplies, products,
property or equipment.
•
Fighting on Company premises.
•
Violation of safety practices which could cause serious injury or death to self or fellow
workers.
•
Being absent from work on 3 consecutive days without proper notification to the
Company.
•
Reporting for work or working under the influence of alcohol or drugs; possessing, selling,
or consuming any alcoholic beverages; or possessing, selling or using illegal drugs of any
kind. (This rule is not applicable to the legal use of drugs prescribed by a physician.)
•
Possession of cameras or the taking of photographs, making sketches or writing
descriptions of any Company property or products without prior permission of the
Company.
•
Immoral, indecent, or illegal conduct on Company property.
•
Giving or taking a bribe of any nature as an inducement to obtain or retain a position.
•
Leaving Company premises during working hours without permission from a supervisor
or authorized Company representative.
•
Willful acts or gross negligence resulting in actual or potential serious injury to another
employee, or resulting in actual or potential serious damage to Company property.
•
Entering working areas of the Company’s premises unless on duty and scheduled for
work, or otherwise on Company business, or refusal to leave the premises when placed
Discipline
on disciplinary suspension and requested to leave by an authorized Company
representative.
•
Defacing Company bulletin boards or the material posted on them, or posting or removing
notices of any kind on the bulletin boards or Company property without approval of the
Company.
•
Failure to properly report an accident.
•
Deliberate misrepresentation of facts to a supervisor or any other Company
representative concerning any work-related matters.
•
Coercing, bribing, inciting or otherwise inducing employees to engage in any practice in
violation of Company rules.
•
Possession of weapons, ammunition, firearms, firecrackers or other similar items on
Company premises.
•
Insubordination (willful, deliberate refusal to follow direction, order, or assignment by
Company official) or using abusive language to Company supervisors.
•
Sleeping while on duty.
•
Using abusive language or threats to fellow employees.
•
Leaving work area without supervisor’s permission.
•
Handling personal affairs during working time without receiving permission from a
supervisor to handle emergencies.
•
Inefficiency, lack of initiative on the job or unsatisfactory work performance.
•
Loitering.
•
Unreported absence.
•
Tardiness.
•
Speeding or reckless driving on Company property.
•
Creating or contributing to unsanitary conditions.
•
Attempting to perform electrical or other repairs unless authorized by the Company to
do so.
•
Engaging in horseplay or any physical activity that would cause inattention to duties.
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Discipline
•
Operating machines, tools or equipment by anyone who has not been specifically
assigned to these by a supervisor.
•
Stopping work or preparing to leave work before the specified time for breaks, lunch, or
quitting time, or returning late from lunch or breaks.
•
Smoking in prohibited areas.
•
Misuse of Company property.
•
Gambling in any form on Company property.
•
Committing any act that is contrary to the Company’s standards of conduct.
•
Refusal to wear hard hats, safety shoes, safety glasses or other required personal
protective safety equipment.
•
Performing personal work at the Company.
•
Obtaining materials or tools under fraudulent orders or misrepresentations.
•
Violation of safety and health rules or other policies.
•
Violation of no-solicitation/distribution policies.
•
Violation of the Company’s harassment policy.
In addition to the prohibited conduct listed, common sense standards of acceptable conduct also
apply.
Normally, if a problem develops, the employee’s supervisor will attempt to correct it with a
verbal warning. If improvement is not made, a written warning may result. If disciplinary
problems continue, the employee may be given a final warning, suspended, placed on probation,
or terminated. Any of these forms of discipline can be applied or omitted at the Company’s
discretion, depending on the circumstances. Particular forms of discipline may be repeated, if
necessary. This in no way infers any contractual obligation to follow any certain procedure.
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Chapter 20
Resolving employee disputes
Alternate Dispute Resolution (ADR) is a procedure, whether formal or informal, for employers
to resolve disputes with employees without resorting to full litigation and the courts. Even
though various approaches to ADR have been around for years, many employers are now
considering the implementation of some form of ADR program in order to resolve employee
disputes in what many consider to be a more timely and cost effective method than relying on the
courts.
Arbitration
Unionized employers
For many years, employees with membership in unions have been provided grievance
procedures where they are allowed to present and argue their side of an employment
dispute, short of litigation. The establishment and terms of a grievance procedure are
subject to and the result of the collective bargaining process. Generally, it is the union
and not the individual employee that determines if a matter will be taken to arbitration. If
the matter is not referred to arbitration, the employer’s last response under the process is
normally considered final and binding on the parties.
A typical grievance procedure includes a series of progressive steps and timeframes for
the employee to present claims and the employer to respond. If the dispute is not earlier
resolved, the last step of a grievance procedure usually calls for final and binding
arbitration. Arbitration is a more informal process than a trial, and generally takes far less
time and expense to reach a conclusion. The concept of “final and binding” means that
the decision of the arbitrator (or panel of arbitrators in some cases) is the last word on the
dispute and both the employer and employee must abide by the decision. In very limited
circumstances the decision of the arbitrator may be appealed through the courts. In
general, however, courts are hesitant to reverse the award of an arbitrator since to do so
would be inconsistent with the underlying concepts in support of arbitration – namely
faster and lower cost resolution.
Nonunion employers
Although not required, many nonunion employers have adopted internal employee
complaint resolution procedures which allow for the parties to voluntarily utilize final
and binding arbitration rather than resort to the time, expense and disruption of a court
proceeding. However, this procedure usually requires the mutual consent of the
employer and employee or the matter proceeds to litigation.
223
In other cases, nonunion employers have opted to require all employees to deal with
certain employment disputes through an internal complaint procedure that, in addition to
a progressive series of steps, ends in final and binding arbitration. The main difference in
this process and that usually utilized in a unionized setting is that the individual employee
typically has the right to request the matter be referred to arbitration as compared to it
being the decision of the union.
When considering whether to adopt arbitration as a means to resolve employee disputes,
employers should be aware that arbitrators:
•
receive a fee for their services from one or both parties
•
have more latitude to determine the manner in which the process will proceed in
contrast to the strict rules of procedure which govern litigation
and
•
may tend to “split the baby” in reaching a final decision rather than declare a clear
winner and loser in the case.
In addition, there are certain matters that are not appropriate for arbitration given the
likely impact a bad decision would have on an employer. For example, a class action
discrimination claim where the courts apply a strict set of rules to decide the
appropriateness of and membership in a class as well as preserving full appeal rights.
Employers should be aware that there are a number of federal and Florida state laws and
court cases which apply to the enforceability and validity of arbitration agreements.
They deal with issues that must be in an arbitration agreement such as waiver of trial by
jury, time limits to bring claims, remedies and damages available, division of costs and fees
of arbitration, qualifications of arbitrators, selection of arbitrators, etc. And to further
complicate this topic, there is growing support in Congress to pass some form of
“Arbitration Fairness Act” to amend, in part, the Federal Arbitration Act in order to
render invalid and unenforceable any arbitration agreement covering an employment
dispute (as well as consumer, franchise and civil rights disputes) that had not yet arisen at
the time the agreement was entered into. In other words, employment disputes would be
subject to arbitration only if both the employer and employee agree to do so after the
dispute arises.
Due to these complexities, it is imperative that you consult with appropriate counsel
before attempting to create, implement and enforce any complaint resolution procedure
that calls for final and binding arbitration.
Mediation
In contrast to arbitration, where a dispute is finally resolved by a third party, mediation is a
process where the resolution of a dispute is left to the mutual agreement of the parties with the
assistance of a neutral third person called a mediator. Mediation is much more informal than
224
either arbitration or litigation since the process is designed to facilitate communication between
the parties and work toward compromise and settlement where possible. However, there is no
requirement that the parties reach agreement since the matter will simply revert to the litigation
or arbitration process if not voluntarily resolved. In other words, the parties remain free to end
mediation at anytime where an impasse is reached and return to whatever process they have
chosen to resolve their dispute.
A good mediator encourages and facilitates the resolution of a dispute between the parties. Apart
from an initial meeting where the parties are asked to state their positions with some opportunity
for either party and the mediator to ask questions or seek clarification, the parties usually retire
to separate rooms and the mediator goes back and forth to discuss the strengths and weaknesses
of each party’s position, evidence, the likelihood of prevailing at trial, damage calculations and
present offers of settlement. It is an informal and nonadversarial process with the objective of
helping the disputing parties reach a mutually acceptable and voluntary agreement. The ultimate
decision to settle, however, resides with the parties and not the mediator.
It is important to note that all mediation communications are confidential and cannot be used in
subsequent or ongoing proceedings.
Court-ordered mediation
Courts in Florida have long recognized the value of having the parties attempt to resolve
their differences through the informal mediation process and commonly order the parties
in litigation to mediate their claims at a reasonable point in the case and prior to trial. If
the mediation is court ordered, a violation of the confidentiality provisions applicable to
mediations may subject the mediation participant to sanctions by the court, including, but
not limited to, costs, attorney’s fees, and mediator’s fees.
Agency mediation
When a charge of discrimination is filed by an employee against an employer, both the
Florida Commission on Human Relations and the Equal Employment Opportunity
Commission encourage both parties to voluntarily engage in mediation with a few
exceptions. Charges ineligible for mediation include class and systemic charges or those
filed solely under the Equal Pay Act. The EEOC also retains authority to withhold
charges from mediation in cases where it serves the public interest to investigate the
charge. In order for mediation to take place, both parties must agree to take part in the
process and are allowed to be represented by counsel, if they so choose.
When mediation is agreed to by the parties, the mediator is selected and paid for by the
agency so the process is at no charge to the participants. The same confidentiality
provisions apply to all participants as well as the mediator which means that the
mediator will not share any information derived during the mediation with the agency or
the person conducting the investigation. The general view is that face-to-face meetings are
the most productive, however, the agencies have agreed to allow both parties and their
representatives to conduct mediation via teleconference or individual telephonic exchanges
through the mediator.
225
If the parties reach agreement, the terms are set forth in a written Negotiated Settlement
Agreement which is considered as binding and enforceable as any other written contract.
The Florida Commission on Human Relations website contains the following reasons to
mediate employment claims:
•
mediation is free
•
mediation is fair and neutral
•
mediation is confidential
•
mediation improves communication
•
mediation saves time and money
•
mediation helps to uncover the real issues in your workplace
•
mediation avoids litigation
•
mediation leads to cooperation in the workplace
•
mediation lets you create your own solution.
226
•
The American Arbitration Association website is located at www.adr.org
•
The Equal Employment Opportunity Commission website is located at www.eeoc.gov
•
The Florida Commission on Human Relations website is located at
http://fchr.state.fl.us/
Chapter 21
Termination
Termination is the final step in the discipline process. Make sure that before proceeding with
termination you have read Chapter 19, Discipline.
It is the long-established rule in Florida that employment that does not specifically obligate both
the employer and the employee for a definite period of time is terminable at will by either party.
This means that, as a general rule, an employer is free to discharge an employee at any time, with
or without cause. It is important to remember, however, that not all employment relationships are
“at-will.” Even the notion of “at-will” employment can be superseded by state, local and federal
laws and regulations, employment agreements or by a collective bargaining agreement.
Exceptions to employment at-will
In recent years, many discharged employees across the country have filed suits against their
former employers, arguing that the employment at-will doctrine is no longer viable. Many states
have established exceptions to the doctrine. Despite this trend, Florida courts have held firm to
the employment at-will rule which continues to be applied in Florida without substantial change
or modification. However, it is expected that the rule will continue to be challenged by
employment suits based on exceptions made in other states.
The Florida Legislature has carved out exceptions to the at-will doctrine in the passage of the
private and public sector whistleblower’s acts. These laws prevent employers from retaliating
against employees who report, or attempt to report, violations of law by the employer. For more
information see Chapter 22, Whistleblowing.
Public policy exception
This exception to the rule of employment at-will has been applied in a variety of
circumstances. The term “public policy” has never been precisely defined, and its
importance to employment decisions has been left for the courts to determine on a caseby-case basis. On this basis, courts have held that it is unlawful to discharge an employee
for such reasons as refusing to commit perjury, refusing to commit an illegal act, or
reporting an illegal act.
Implied contract exception
Verbal assurances of continued employment made by the employer or obtained from such
sources as employee handbooks or the employer’s employment policies have been
rejected by Florida courts. Nonetheless, employers should avoid making such assurances
and even include statements to the contrary in the employee handbook and any written
employment contracts that nothing stated or contained therein constitutes a promise of
continued employment for any period of time.
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Termination
Intentional infliction of emotional distress
Some courts have ruled that employees may sue their employer for intentional infliction
of emotional distress if the employer terminated the employee with the intention to harm,
hurt, or embarrass the employee. Florida employers may be liable for intentional
infliction of emotional distress in an employment termination context if the employer’s
conduct in terminating the employee is outrageous and causes the employee to suffer
emotional distress. The employer’s behavior, however, must be severe and intolerable to
a reasonable person. Florida courts have routinely dismissed employee claims of
intentional infliction of emotional distress in employment situations.
Defamation
Employers can face liability, if a supervisor or manager communicates false information
about an employee to another person . Communicating the information to other relevant
members of management or a prospective employer seeking an employment reference on
a prior employee is acceptable, as long as the information being communicated is
truthful. Companies need to be aware of the potential for defamation claims when
investigating allegations of workplace harassment.
Elements of a defamation claim
•
Publication of a false statement.
•
About another person.
•
To a third party.
•
The person about whom the statement was made suffered damages as a
result of the publication.
The fact that the communication was truthful is an absolute defense to a claim of
defamation.
Libel/slander
An employee may sue for slander when the words spoken or written by the
employer about the employee are in and of themselves damaging to the employee.
Qualified privilege
One of the employer’s possible defenses to a claim for defamation is qualified
privilege. An employer is qualified or conditionally privileged to make statements
about an employee if the following elements are met:
228
•
the statement is made in good faith, meaning it is genuinely believed to be
a true statement
•
the speaker has an interest in the subject or a duty to speak about the
subject
•
the listener has a corresponding duty or interest
Termination
•
the communication was made on a proper occasion
•
the communication was published in a proper manner.
For example, a supervisor who informs the personnel director of an employee’s
reason for termination is protected by the qualified privilege. Both the supervisor
and the personnel director have legitimate business interests in knowing the
reason for termination. Even if these statements could arguably be defamatory,
they are protected by the qualified privilege.
Preventing a charge of defamation
•
Restrict communication of information to those with a “need to know.”
•
Limit access to personnel files.
•
Maintain documentation of employee discipline, exit interviews,
investigations, etc. This will support the truth of a statement (truth is an
absolute defense to a defamation claim).
•
Maintain confidentiality to the extent possible during an investigation, but
never promise the employee complete confidentiality.
•
Develop a post-employment reference policy and disseminate the policy to
all supervisors/managers who are permitted to give a reference.
•
Limit the number of management officials who are permitted to give a
reference and inform all managers/supervisors of this policy and its
importance.
•
Verify that the party requesting the information has a bona fide need to
know.
•
Do not volunteer information – respond only to questions asked by the
prospective employer.
•
Document all requests for employment references including who made the
reference, to whom it was given, when the reference was made, why it was
made, and the information provided.
•
Avoid “off the record” conversations regarding employees. Do not share
opinions and conclusions about an investigation about an employee with
another employee or witness.
For more information concerning how to prevent a defamation claim when
providing a reference, see Chapter 3, Hiring, section, Reference checks, page
33.
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Termination
Background and references checks
Under Florida law, an employer who discloses information about a former
employee to a prospective employer upon request is immune from civil liability
for disclosure or its consequences. The employer is immune unless it is shown by
clear and convincing evidence that the information disclosed was knowingly
false, or violated any civil right of the former employee protected under state law.
Florida financial institutions
A person may provide employment information to a financial institution about an
employee’s known or suspected involvement in a violation of any state or federal
law, rule or regulation which has been reported to state or federal authorities. No
person shall be subject to civil liability for providing such employment
information unless the information provided is false and the person providing the
information does so with reckless disregard for the truth.
Fraudulent misrepresentation
A number of courts have permitted employees to sue their employers for fraudulent
misrepresentation. An employee must show all of the following:
•
a false statement of fact was made by the employer
•
the statement was known by the employer to be false at the time it was made
•
the employer intended to cause the employee to enter into an employment
contract
•
the employee relied on the false representation in entering the employment
relationship
In Florida, when an employee or applicant acts in reliance on an employer’s
representations and suffers damage as a result of those acts, the employee or applicant
can sue.
Judicial proceedings
Any person who testifies in a judicial proceeding in response to a subpoena may not be
terminated from employment because of the nature of the person’s testimony or because
of absences from employment resulting from compliance with a subpoena.
Jury duty
An employer may not dismiss, or threaten to dismiss, an employee who has been
summoned to or has accepted to serve on a jury because of the nature or the length of that
person’s service. For violation of this law, the employer may be held in contempt of court
and sued for compensatory and punitive damages and attorney’s fees. §40.271, Fla. Stat.
Some counties and/or municipalities may have regulations pertaining to employees
serving on juries.
230
Termination
Political activities of employees
An employer may not discharge or threaten to discharge an employee because of the way
that employee voted in any state, county, or municipal election. Likewise, an employer
may not discharge or threaten to discharge any employee for failing to vote in a state,
county, or municipal election.
Termination procedures
It is strongly recommended that all employers have a written policy concerning the termination
of an employee’s employment. Where an employee handbook specifies the procedures for
termination, they should be followed. Review the handbook to make sure that there has been
compliance with all procedures.
In every termination situation, consider the following:
•
Review and investigate any matters which are uncertain.
•
Unless the conduct of an employee requires immediate termination, give the employee
ample opportunity to correct the problem. In most cases, you should follow the
established disciplinary process, reserving termination as the final step in the process or
for the most egregious offenses.
•
Evaluate the possibility of a discrimination claim, including:
the employee’s age
whether the employee is pregnant
the composition of the remaining workforce from the standpoint of protected
categories
whether the employee will be replaced, and by whom
the employee’s tenure
whether the documentation in the personnel file supports the termination
whether the employee recently filed a workers’ compensation claim or any other
type of claim with a federal or state agency
whether the justification for the termination is consistent with past practice and
procedure.
•
Whether the employee is likely to bring a claim.
•
Whether the termination would impact employee morale and/or employer credibility.
•
Whether the employee’s supervisor has a history of poor employee relations.
•
Whether the employee could be successful in a different job under a different supervisor.
231
Termination
•
Whether the employee has made efforts to improve performance.
•
Whether the business operations will suffer from the termination of the employee.
•
Whether another manager or supervisor agrees with the decision to terminate.
•
If you anticipate legal issues, whether legal counsel agrees with the decision to terminate.
Termination conference
The decision to have a termination conference should be considered very carefully.
Many employers feel that they owe the employee the opportunity to be heard or use the
termination conference as an opportunity to retrieve company property, however if not
properly handled, the termination conference can lead to an unpleasant situation, and,
depending on what is said and documented, can pose problems for an employer in the
event an employee files suit based on their termination.
Problems often arise out of improper handling of this final conference with the employee.
Supervisors and employees may become angry and hostile. These guidelines should be
followed.
232
•
Review employment history briefly with the employee, commenting on specific
problems that have occurred and the attempts to correct those problems.
•
Within the first few minutes of the conference, tell the employee that he or she is
being terminated. Do not drag out the ultimate announcement.
•
Explain the decision briefly and clearly.
•
Avoid counseling at this point – it should have already been done.
•
Do not compliment the employee in an effort to avoid hurting his or her feelings.
•
Do not fail to give an explanation for the termination. Give the true reason and all
reasons. What is stated as the reason for termination can be of great importance if
litigation occurs. In some cases, failing to state the true reason for the termination
or stating reasons that are inconsistent with those later stated has been held to be
evidence of bad faith or discrimination. It is possible to say too little or too much,
depending on the circumstances, so careful consideration should be given to the
completion of any documentation. If the termination involves a controversial or
complicated matter, it may be a good idea to obtain legal advice concerning what
to say in the separation notice.
•
Explain fully any benefits, including COBRA (see Chapter 27, COBRA/health
care continuation) and unemployment compensation (see Chapter 24,
Unemployment compensation), that the employee is entitled to receive. Tell
the employee when the benefits will be received. If the employee is not going to
receive certain benefits, explain why.
Termination
•
Let the employee have an opportunity to have his or her say, and pay close
attention to what is said, but do not argue with the employee in an effort to justify
the decision.
•
The decision to terminate an employee should never be based on a discriminatory
reason. There should be one or more business related reasons for the termination.
When an employer is firing a pregnant employee, an older employee, a minority
employee, or some other employee where the potential problem of a subsequent
claim or lawsuit is obvious, it is essential that the person conducting the
conference not make any reference to anything which could indicate that the
reason for the termination decision is an employee’s protected classification.
•
During the course of a termination conference, the conversation should never
include references to sex, age, race, religion, national origin or disability.
•
Be organized and prepared for the interview and give the impression that you are
confident that the right decision has been made.
•
Attempt to obtain an employee’s agreement that job performance has not been
satisfactory.
•
Take brief notes. After the meeting write detailed notes of what the employee has
been told, and what the employee said. All employer representatives in attendance
should sign the document.
•
At the time of actual discharge, make sure there is another managerial employee
present.
•
Make sure the procedure used in conducting the discharge and exit of the
employee are the same as those used in the past.
Termination agreements
If an employer believes that an employee will sue upon termination, or if there are
considerable problems involved with terminating an employee, or if there is a major
dispute between the employer and the employee, consideration should be given to the
possibility of seeking a written termination agreement with the employee. In this
agreement, the employer might agree to provide additional severance pay or a favorable
change in the way certain benefits will be paid in return for the employee’s agreement to
release the employer from any claims that the employee might have or claim to have
against the employer. Such an agreement should be prepared by the employer’s lawyer,
and it is preferable for the employee to obtain the assistance of a lawyer in finalizing the
agreement. This kind of agreement is certainly not right for every situation and should
not be used without careful consideration and legal advice.
Older workers
The Older Workers Benefit Protection Act set the standards which govern an
older worker’s waiver of rights under the Age Discrimination in Employment Act.
This federal law requires that any release agreement or severance agreement to
waive an employee’s right to sue must be “knowing and voluntary.” This law
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Termination
specifies certain minimum standards which must be met if the waiver is to be
effective (see page 110, Older Workers Benefit Protection Act).
Non-compete agreements
See page 457, Restrictive covenants – Non-compete agreements and other
post-employment restrictions.
Wage payment after termination
There is no Florida law which requires payment to an employee immediately upon
termination, or within any time period after termination. Wages for hours worked,
however, which are due to an employee who has been terminated, should be paid at the
next regular pay period.
Severance pay
Florida law does not require the payment of severance pay in lieu of notice of
termination. Employers can offer severance pay to a terminated employee if they choose,
but the employer must be aware that subsequent employees may also expect similar
treatment, and failure to treat all employees consistently could be used as evidence in a
discrimination claim.
Post-termination
All money or benefits owed other than wages (See this page, Wage payment after
termination) to the employee should be paid promptly and the employee’s COBRA
benefits should be explained (see Chapter 27, COBRA/health care continuation).
This may make the employee feel better about the situation. The failure to pay promptly
may add to the employee’s feeling that he or she is being treated unfairly.
Reference checks
An employer should have a policy concerning what information the employer will release about
a former employee when a job reference is requested. Most employers are no longer willing to
give the “full story” on former employees. Because of the litigious climate that surrounds
employment, job references should be handled only by human resource employees who have
received training as to what information should be shared with individuals seeking a reference.
Employers benefit from having information regarding applicants’ prior employment. Many
employers’ unwillingness to share information with someone seeking a reference can make it
very difficult for other employers to obtain accurate information to evaluate applicants. Ensure
your personnel department is trained on the rules for reference checks. See page 33, Reference
checks.
Under Florida law, an employer who discloses information about a former employee’s job
performance to a prospective employer upon request is immune from civil liability for disclosure
or its consequences. The employer is immune unless it is shown by clear and convincing
evidence that the information disclosed was knowingly false, or violated any civil right of the
former employee protected under state law.
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Termination
If your policy limits the information to be given to prospective employers, it should also be
specified that the employer to whom the reference is being given should not take the limitation of
information to be a positive or negative statement, but that this is simply the policy of the
employer.
Employers should also pay careful attention to the handling of unemployment compensation
claims filed by former employees. What the former employee states as the reason for the
employee’s termination can become significant in a subsequent legal proceeding if the
employee’s story changes in a subsequent proceeding. For an employer, an unemployment
compensation hearing can be a useful tool to find out precisely the position of the former
employee which may subsequently be asserted by the employee in the event of litigation against
the employer.
Replacing a terminated employee
Employers should pay special attention when replacing a terminated employee. It is always
important to try to find the most qualified employee. However, you should be mindful that
replacing an employee with another person of the same race, sex, national origin, marital status,
religion, age, or disability will better insulate against a claim of discrimination. In Florida, an
individual’s sex, race, national origin, marital status, and age are considered “protected”
characteristics because those characteristics are subject to protection under federal and/or state
law.
The following checklist is intended to provide additional guidance on protecting the company
from discrimination charges or complaints from terminated employees.
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Termination
CHECKLIST OF FACTORS FOR
TERMINATING “PROTECTED” EMPLOYEES
Yes No
Does the individual replacing the employee share the “protected”
characteristic? (same age, race, sex, etc.)
Does the Company Official making the termination decision share any of the
employee’s protected characteristics?
How long has the employee worked for the Company? Particularly in a
potential age discrimination situation, how many additional years of
employment are necessary for the employee to become fully vested in any
benefit or retirement plans.
Do you have hard evidence of the employee’s poor performance, including
several documented warnings? Check recent performance evaluations to
make sure they accurately reflect the performance problems.
Have there been recent changes in supervision of the employee that could
account for a sudden decrease in performance or perceived performance?
Check your company’s past practice before termination to make sure that
other employees, outside the protected group, have been terminated for
similar reasons. Have other employees been given options, such as demotion
or other jobs within the company, in lieu of termination? If so, you should
consider offering the same to the employee with protected status.
In the case of a management employee, written warnings and adherence to a
“formal” termination procedure is even more important. However,
performance evaluations might be more subjective, because management
skills are often defined by the evaluator. In such cases, it is usually wise to
speak with the individual who provided the evaluations or written warnings
to determine the precise nature of their performance as perceived by the
evaluator.
Consider any personal or health considerations, or other identifiable factors
which may be contributing to the performance problems of the protected
employee.
Check your company’s past records to determine if a “pattern or practice” of
discrimination against employees with the same protected characteristic is
present.
Check that no significant salary increases or promotions have been given to
the employee recently, which might tend to negate the company’s position
that poor performance caused the employee’s termination.
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Termination
Consider a Severance Agreement, including a release of claims, if the facts
warrant. Consult an employment attorney in drafting such an agreement to
ensure that all contingencies are covered.
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Termination
238
Chapter 22
Whistleblowing
Private employment
Florida’s Private Sector Whistleblower Act was enacted to protect employees of private entities
(that employ at least ten persons) who report or refuse to assist employers who violate laws
designed to protect the public, and provides as follows:
•
An employer may not take any retaliatory action against an employee because the
employee has:
Disclosed, or threatened to disclose, to any appropriate governmental agency,
under oath, in writing, an activity, policy or practice of the employer that is in
violation of a law, rule, or regulation. Before the protections of this section of the
Act will apply, the employee must, in writing, bring the activity, policy, or
practice to the attention of a supervisor or the employer and allow the employer a
reasonable opportunity to correct the activity, policy, or practice.
Provided information to, or testified before, any appropriate governmental agency
or person conducting an inquiry regarding the violation of a law, rule, or
regulation by the employer.
Objected to, or refused to participate in, any activity, policy, or practice of the
employer which is in violation of a law, rule, or regulation.
•
“Retaliatory personnel action” means the discharge, suspension, or demotion by an
employer of an employee or any other adverse employment action taken by an employer
against an employee in the terms and conditions of employment.
•
The term “employee” does not include independent contractors.
•
The term “supervisor” means any individual within an employer’s organization who has
the authority to direct and control the work performance of the affected employee or who
has managerial authority to take corrective action regarding the violation of law, rule, or
regulation of which the employee complaints.
•
“Employer” is defined as any private individual, firm, partnership, institution, corporation
or association that employs ten or more persons.
An employee who has been the object of a retaliatory personnel action in violation of this act
may institute a civil action in a court of competent jurisdiction within two years after discovering
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Whistleblowing
that the alleged retaliatory personnel action was taken, or within four years after the personnel
action was taken, whichever is earlier.
Cases analyzing the Florida Private Whistleblower Act indicate that written pre-suit notice to the
employer is not a prerequisite to recovery for employees who objected to, or refused to
participate in an activity of the employer which was in violation of law or otherwise provided
information to or testified before any appropriate governmental agency conducting an inquiry
into the legality of the employer’s practices.
Where an employee is successful in a civil suit, the court may order relief that includes:
•
an injunction restraining continued violation of this act
•
reinstatement of the employee to the same position held before the retaliatory personnel
action, or to an equivalent position
•
reinstatement of full fringe benefits and seniority rights
•
compensation for lost wages, benefits, and other remuneration
•
any other compensatory damages allowable at law.
Public employment
The Whistle-blower’s Act, which can be found at §112.3187, Fla. Stat., generally applies to
public employers in Florida. Examples of agencies covered by the public whistleblower statute
include:
•
state, regional, county, local, or municipal government entities, whether executive,
judicial or legislative
•
any official, officer, department, division, bureau, commission, authority, or political
subdivision therein
•
any public school, community college, or state university.
In addition, coverage extends to “independent contractors” defined as a person, other than an
agency, engaged in any business and who enters into a contract, including a provider agreement,
with an agency. The Act prohibits covered agencies and independent contractors working for
agencies from dismissing, disciplining, or taking any other adverse personnel action against an
employee or independent contractor who reports to an appropriate agency:
•
violations of law on the part of a public employer or independent contractor that create a
substantial and specific danger to the public’s health, safety or welfare
or
•
240
information alleging improper use of government office, gross waste of funds, or any
other abuse or gross neglect of duty on the part of an agency, public officer or employee.
Whistleblowing
“Adverse personnel action” means the discharge, suspension, transfer, or demotion of any
employee or the withholding of bonuses, the reduction in salary or benefits, or any other adverse
action taken against an employee within the terms and conditions of employment by an agency
or independent contractor as defined.
Further, an agency or independent contractor cannot take any adverse personnel action that
affects the rights or interests of a person in retaliation for the person’s disclosure of information
under the Act. However, the foregoing restrictions are not applicable when an employee or
person discloses information known by the employee or person to be false.
A person who has been retaliated or discriminated against in violation of the Act may, after
following the required administrative and/or internal procedures, bring a civil action against his
employer to obtain:
•
reinstatement to the same or equivalent position
•
reinstatement of full fringe benefits and seniority rights
•
compensation for lost wages, benefits, and other remuneration caused by the retaliation
•
payment of reasonable litigation costs, including attorney’s fees
•
issuance of an injunction, if appropriate.
Federal laws
The federal False Claims Act has been in place since 1863, but employees have been using the
Act recently to recover large amounts of money from their employers, sometimes with the help
of the federal government. Under this federal Act, an employee may file suit against his or her
employer for suspected fraud against the federal government. The Act permits an employee to
receive from 15% to 25% of any monies collected by the government in settlement of the claim or
as compensation for overcharges made by the employer to the government. The Attorney
General of the United States is authorized under the Act to intervene on behalf of the
government, and then becomes primarily responsible for the prosecution of the case. However,
even if the Attorney General intervenes, the employee is still entitled to recover a percentage of
amounts received by the government in settlement or otherwise. Employers who do business
with the federal government need to be aware that disgruntled employees have this additional
option available to them. The Act also prohibits retaliation against an employee who files an
action under the Act, or who testifies, or otherwise assists the government in an investigation
under the Act.
Compliance with Sarbanes-Oxley
The Sarbanes-Oxley Act of 2002 (SOX) applies generally to publicly traded companies and
imposes a number of reporting and disclosure requirements that are designed to provide more
transparency with respect to a company’s financial condition and strengthen corporate
governance in the aftermath of Enron and its progeny.
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Whistleblowing
Significantly, Section 806 of SOX prohibits a publicly traded company, as well as any officer,
employee, contractor, subcontractor or agent of the company, from taking any adverse
employment action or to discriminate against an employee in the terms and conditions of
employment because they “lawfully” provide information, cause information to be provided, or
otherwise assist in any investigation of conduct of the employer which the employee
“reasonably believes” to constitute a violation of:
•
the federal criminal statutes prohibiting mail, wire, bank or securities fraud
or
•
any rule or regulation of the Securities and Exchange Commission (SEC)
or
•
any provision of federal law relating to fraud against shareholders.
Employees are protected from such retaliation under SOX if they provide such information or
assistance to:
•
any federal regulatory or law enforcement agency
or
•
any member of Congress or any Congressional committee
or
•
any person with “supervisory authority” over the employee (or any other such person
working for the employer who has authority to “investigate, discover, or terminate
misconduct”).
The Department of Labor delegated enforcement authority over the whistleblower provisions of
SOX to OSHA. The complaint, investigation and relief procedures as well as court review is
beyond the scope of this review. However, an aggrieved employee must commence an action not
later than 90 days after the alleged violation has occurred.
Section 1107 of SOX imposes criminal penalties, including possible imprisonment for up to ten
years, for retaliation against an employee for providing “truthful” information to a law
enforcement officer relating to the commission or possible commission of any federal offense
whether or not the offense is a violation of SOX.
Supervisor training is necessary
An employer may be held liable under SOX even if the employee is incorrect in asserting
that a violation of law has occurred, so long as the employee’s belief that a violation has
occurred is reasonably held. Further, SOX protects any employee who brings such
information to the attention of a supervisor or any other person within the company who
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Whistleblowing
has authority to remedy misconduct. Publicly-traded employers will need to train
managers and supervisors to ensure that they are aware that retaliation against employees
who provide such protected information is unlawful.
Internal procedures should also be developed to ensure that protected information is
properly reported to responsible officials of the company, including implementation of a
Corporate Responsibility Policy as a part of the company’s overall efforts to ensure
compliance with legal requirements, as well as to communicate to employees the
company’s internal business ethics requirements.
State remedies are not precluded
A prevailing employee is entitled under SOX to “all relief necessary to make the
employee whole,” specifically including reinstatement with seniority rights, back pay
with interest, and any “special damages” sustained “as a result of the discrimination,” to
include litigation costs, expert witness fees and reasonable attorney fees. SOX
specifically provides that nothing in it “shall be deemed to diminish the rights, privileges
or remedies of any employee under Federal or State law, or any collective bargaining
agreement.” Thus, additional remedies beyond those provided for in SOX may be
available under state law.
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Whistleblowing
244
Chapter 23
Plant closing or
mass layoff
The Worker Adjustment and Retraining Notification Act (WARN) requires employers who
anticipate a “plant closing” or “mass layoff” to give advance notice. This notice period is
intended to provide workers an opportunity to find new employment or obtain job training before
their termination. Employers who fail to provide the required notice under WARN are liable for
back pay and benefits for the period for which notice was not given, in addition to civil money
penalties. WARN requires covered employers who anticipate a plant closing or mass layoff to
provide such notice to affected employees (or their bargaining representatives), the state’s
agency designated to carry out rapid response activities, and the chief elected local government
official.
Who is covered
WARN generally applies to employers with 100 or more employees. Specifically, employers of
100 or more employees, excluding part-time employees, or employers of 100 full- or part-time
employees who altogether work at least 4,000 straight-time hours per week, are subject to the
Act. WARN also can apply to public and quasi-public entities if such an entity is engaged in
business and is organized separately from the regular government. This includes having its own
governing body and independent authority to manage its own personnel and assets. Examples
may include regional transportation authorities and independent municipal utilities.
Key definitions
A “plant closing” is a permanent or temporary shutdown of a single site of employment, or a
shutdown of one or more operational units within a single site of employment, in which at least
50 employees, excluding part-time employees, suffer an “employment loss” during any 30-day
period.
A “mass layoff” is an employment loss (termination or layoff exceeding six months) which is
not a plant closing and which involves, in any 30-day period, 33% of the employees, excluding
part-time employees, where at least 50 employees are affected, or which results in an
“employment loss” of at least 500 employees.
An “employment loss” is defined as a termination (other than discharge for cause, voluntary
termination, or retirement), a layoff exceeding six months, or a reduction in hours of work of an
individual employee of more than 50% during each month of any six-month period.
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Plant closing or mass layoff
A “part-time employee” is an employee who is employed for an average of fewer than 20 hours
per week or who has been employed for fewer than six months in the 12-month period
proceeding the date a notice is required.
How the law works
Notice required
Parties notified
Generally, employers must provide at least 60 days’ notice prior to any covered
plant closing or mass layoff. Most affected employees are entitled to notice. The
term “affected employees” means those who may reasonably be expected to
experience an employment loss as a consequence of a proposed plant closing or
mass layoff. The WARN Act does not require employers to give notice to those
employees that strike or are part of the bargaining unit involved in the labor
negotiations that led to a lockout, temporary workers, and non-employees
assigned to, or contracting with, the business.
As an alternative to notifying each individual employee, an employer must notify
the “employee representative” as defined by the National Labor Relations Act or
the Railway Labor Act. The employer must also notify the chief elected official of
the unit of local government within which the layoff or closing will occur, as well
as the state dislocated worker unit (the Florida Department of Labor and
Employment Security). If more than one unit of local government is involved, the
notice must be provided to the chief elected official of the unit to which the
company paid the highest taxes in the previous year.
Sale of business
WARN can apply when an employer sells a part of its business or its assets. For
purposes of WARN, the employees of the seller becoming employees of the buyer
do not trigger notice obligations. However, if a plant closing or mass layoff
results from the sale, then WARN would apply. Whether the seller or the buyer is
responsible for giving notice depends on when the plant closing or mass layoff is
to occur. Generally, if it occurs before or on the day the sale becomes effective,
then the seller is responsible. If it is after the day the sale becomes effective, then
the buyer is responsible. If an employee is offered, but refuses, employment with
the buyer, this is considered a voluntary departure and does not constitute an
employment loss. However, this situation could constitute constructive discharge
if employment with the buyer would result in a significant change in wages,
benefits, working conditions, or position.
Required notification period reduced
Under some circumstances, WARN allows a company to provide less than 60
days’ notice of a mass layoff or plant closing. An employer qualifying for one of
the following reductions in the 60-day notification period must provide as much
notice as practicable under the circumstances. Also, the notice must contain a
brief statement summarizing the reason(s) why giving the normal 60 days of
notice was not possible.
246
Natural disasters
Under the natural disaster exception, an employer may give less than 60
days’ notice of a plant closing or mass layoff that results from a natural
disaster such as a flood, earthquake, drought, or storm. The employer can
give notice after the event if it can establish that the closing or layoff is a
direct result of the natural disaster.
Faltering company
The faltering company exception is to be construed narrowly and applies
to plant closings. Unlike the other exceptions, however, it does not apply
to mass layoffs. Under the faltering company exception, the notice period
may be reduced if, at the time notice would have been due, the employer:
•
was actively seeking capital or business that would have prevented
the plant closing
and
•
reasonably believed that giving notice would have prevented it
from obtaining the needed capital or business.
However, should an employer attempt to rely on the faltering company
exception, it will not be able to restrict its analysis to the financial
condition of the facility, operating unit, or site to be closed. In addition, a
causal connection must exist between the ultimate reduction in work force
and the employer’s failure to obtain capital or business.
Unforeseeable business circumstances
The unforeseeable business circumstances exception is intended to apply
to situations where a plant closing or mass layoff is caused by some
“sudden, dramatic, and unexpected” event that, at the time notice would
otherwise have been due, was:
•
not reasonably foreseeable
and
•
outside the employer’s control.
Whether or not business circumstances were reasonably foreseeable
depends on the employer’s business judgment and what a similarlysituated employer facing the same situation would foresee. Examples of
such situations would include the unexpected termination of a major
contract, a strike at the business of a major supplier, or an unannounced
government-ordered closing.
247
Extension of layoff period
If an employer needs to extend the date of the plant closing or mass layoff beyond
the date or period in the original notice, additional notice is required. This notice
should contain the following:
•
If the action is postponed for less than 60 days, it should reference the
earlier notice, the reason for postponement, and the new anticipated date
or 2-week period for the action. The notice must be given as soon as
possible and in an effective manner.
•
If the action is postponed for 60 days or more, you must give a new notice
that complies with the normal 60-day notice requirements.
Aggregation of
employment losses under the Act
Employment losses of smaller groups of employees occurring at one employment
site may be combined in certain situations. In order for the requisite number of
employment losses to trigger WARN obligations, these employment losses must
occur during any “rolling” 30-day period. For example, if an employer lays off
40 workers and then lays off the remaining 20 workers 25 days later, WARN
would apply and notice would be required for both sets of employees. Under
some circumstances the 30-day window is enlarged to 90 days. Specifically, if 2
or more groups suffer employment losses at a single site of employment within 90
days, and neither group alone is large enough to trigger WARN obligations, the
groups will be aggregated.
An employer is not required to give notice if it can show that the individual events
occurred as a result of separate and distinct actions and causes and not the
employer’s attempt to evade its WARN obligations. Therefore, when an
employer makes a reduction in force, it must look forward and backward 90 days
from each employment loss to determine whether WARN obligations arise and
notice must be given.
Method of notice
Notice must be delivered in a reasonable manner such that affected employees will receive the
written notice at least 60 days before separation. Verbal notice will not meet these requirements.
First class mail and personal delivery are viable options. If the notice is mailed, it is not effective
until it is received.
Content of notice
Once an employer determines which employees are entitled to 60-days notice, it must determine
what type of notice is required. While any notice must include certain information, other content
requirements vary depending on whether the employees are represented by a collective
bargaining representative.
248
Affected employees
Notice to employees who are not represented by a bargaining agent must contain:
•
whether the planned action is expected to be permanent or temporary, and, if a
plant is being closed, the notice must include a statement to that effect
•
the expected date the plant closing or mass layoff will commence, as well as the
date that the affected employee will be laid off or terminated (or set forth a twoweek window during which the terminations will occur)
•
an indication as to whether or not bumping rights exist
•
the name and telephone number of a company official who can be reached for
further information.
Notice to individual employees must be written in clear and specific language such that
employees can easily understand the terms.
Collective bargaining representatives
Notice to collective bargaining representative(s) of affected employees must contain:
•
the name and address of the employment site where the plant closing or mass
layoff will occur, and the name and telephone number of a company official who
can be reached for further information
•
•
the expected date of the first separation and the anticipated layoff schedule if the
layoffs are to occur on more than one date
•
the job titles of the positions that are to be affected and the names of the workers
currently holding those positions.
Dislocated worker unit
and local chief elected official
Notice to dislocated worker unit and local chief elected official must contain:
•
the name and address of the employment site where the plant closing or mass
layoff will occur, and the name and telephone number of a company official who
can be reached for further information
•
•
the expected date of the first separation and the anticipated layoff schedule if the
layoffs are to occur on more than one date (or a two-week window during which
all layoffs will occur)
249
•
the job titles of the positions that are to be affected and the names of the workers
currently holding those positions
•
an indication as to whether or not bumping rights exist
•
the name of each union representing affected employees and the name and
address of the chief elected officer of such representative.
State agencies and local governments
The WARN regulations also provide that notices to state agencies and local government
officials may simply include:
•
the name and address of the employment site
•
the name and telephone number of a company official to contact for further
information
•
the expected date of the first separation
•
the total number of affected employees.
If the employer provides this short form notice, the employer also must make available to
government officials the information that would have been included in the full notice. A
failure to provide the necessary information upon request is deemed a failure to give the
required notice.
Enforcement
Civil actions
A worker who experiences a loss of employment without timely notice of mass layoff or
plant closing as required by the Act can bring a lawsuit against the employer. The
employer may be required to pay wages for every day of violation. In addition, the
employer may be liable for benefits under employee benefit plans, including medical
expenses that would have been covered by the benefit plan had the employment loss not
occurred.
Jurisdictional provision
Lawsuits against an employer may be brought by a local government, employees, or the
representatives of employees. An employer can be sued in any federal district in which it
does business, or where the violation occurred.
Maximum liability
An employer can be liable to an employee for a maximum of 60 days, or one-half of the number
of days the employee worked for the employer. Employer liability for failing to conform to the
Act’s notice requirements with respect to a unit of local government is limited to $500 per day
for each day of violation up to the ceiling of 60 days.
250
The remedies provided for in the Act are the exclusive remedies for any violation of the Act.
Federal courts have no power to prohibit or postpone mass layoffs or plant closings.
Liability reduced
Wages paid by the employer to an employee during any period of violation will reduce the
employer’s liability. At least one federal Circuit court has confirmed that an employer does not
violate WARN if it offers pay and benefits to affected employees for the 60-day notice period.
If an employer credits an employee with service under a defined benefit pension plan, the
employer’s liability is correspondingly reduced with regard to the plan. The employer’s liability
also may be reduced at the discretion of the court.
Costs and attorney’s fees
A prevailing party in a lawsuit filed under the Act may, in the discretion of the court, recover
reasonable costs and attorney’s fees.
State or local laws
In addition to obligations under WARN, some states and municipalities have adopted plant
closing or mass layoff laws. None of these laws can reduce an employer’s obligation under
WARN, but they may place additional obligations to employers covered by WARN. Moreover,
these laws may place the same or additional obligations imposed by WARN on employers not
covered by WARN.
Review the materials on the U.S. Department of Labor website at:
•
www.doleta.gov/ programs/factsht/warn.htm
or contact the DOL at:
•
U.S. Department of Labor
Employment and Training Administration
Office of Work-Based Learning
Room N-5426
200 Constitution Ave., NW
Washington DC, 20210
(202) 219-5577
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252
Chapter 24
The Florida Unemployment Compensation Law (the Act) was enacted to encourage employers to
provide more stable employment and to accumulate funds systematically to provide temporary
wage replacement benefits for those individuals who become unemployed through no fault of
their own. Beginning in October 2000, unemployment claims and taxes became administered by
the Florida Department of Revenue under the “Agency for Workforce Innovation.” Unemployed
individuals who meet specified requirements are eligible to receive benefits under the Act. The
amount of benefits for which an unemployed individual is eligible varies, depending upon the
employee’s wages prior to being unemployed (wages includes all payments for services,
including bonuses and commissions). Benefits are paid out of an Unemployment Compensation
Trust Fund, which is funded by contributions from covered employers. Whenever an individual
receives benefits, the former employer’s account may be debited. In addition, the employer’s
future unemployment taxes will increase, and the claim may affect the employer’s future tax for
up to three years.
The Act provides procedures for determining whether individuals are eligible for benefits.
Employers are permitted to participate in these proceedings. Because an employer’s contribution
increases when a former employee receives benefits, it is to the employer’s advantage to contest
claims whenever a former employee should not receive benefits. In addition, an employer should
consider using the contest procedures as a means of gathering information and as a defense
mechanism whenever a former employee has filed, or is likely to file, a discrimination charge or
other lawsuit against the employer. On the other hand, however, it also provides the employee
an opportunity to provide testimony adverse to the employer and, truthful or not, this testimony
becomes a matter of record.
Who is covered
Every new business is required to report its initial employment to the Department by the month
following the calendar quarter in which it begins employing individuals by filing an Employer
Status Report, LES Form UCS-1. The Department of Revenue determines if the employer is
covered under the Act. The Act’s coverage is broad and applies to the following employers.
•
Any employer that had a quarterly payroll of $1,500 or more during any calendar quarter
in the current or preceding calendar year, excluding wages paid to any employees listed
in Exemptions on page 254.
•
Any employer who employed at least one individual for some portion of at least 1 day in
each of 20 different calendar weeks (whether consecutive or not) during the current or
preceding year, excluding any employees listed in Exemptions below.
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•
Employers of state employees, including county and city employees, but excluding
elected officials of the state, members of the Legislature, judges, nontenured state policy
makers, and temporary employees employed in emergencies.
•
Religious, charitable, and educational organizations which employed at least 4 different
individuals in each of 20 different weeks (whether consecutive or not), regardless of
whether they were employed at the same time, excluding church ministers and other
employees who work directly for the church or for organizations principally supported by
the church.
•
Agricultural employers who paid wages of at least $10,000 to agricultural employees
during any calendar quarter in either the current or preceding calendar year or who
employed at least 5 agricultural employees (at the same time or different times) for some
portion of one day in each of 20 different calendar weeks (whether consecutive or not) in
the current or preceding calendar year.
•
Persons who employ domestic help and who had a cash payroll of at least $1,000 in any
calendar quarter “in the current calendar year or the preceding calendar year to
individuals employed in such domestic service.”
•
An Native-American tribe or tribal unit.
Exemptions
In determining whether an employer is covered under the Act, certain categories of employees
are not included if they spend at least 50% of their time in a pay period performing exempt work.
Among the more significant types of employment that are exempted are the following:
•
The performance of casual labor or labor not performed in the regular course of the
employer’s business. This is work that is occasional and incidental.
•
Students who are employed by the school.
•
Newspaper carriers under the age of 18.
•
Student nurses and interns.
•
Insurance agents and real estate salespersons who are paid solely by commission.
•
Independent contractors. The test of an independent contractor is whether the employer
has the right of control over the work contracted and the conduct of the employee. If not,
then the employee is an independent contractor and is exempt.
For more information, see Chapter 12, Independent contractors.
•
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Nonresident aliens who are temporarily present in the United States and who are nonimmigrants as that term is defined by the Immigration and Naturalization Act (see
Chapter 8, Immigration).
•
Employees leased from an employee leasing company. These employees are considered
employees of the leasing company and not the client company.
This list is not exhaustive, workers performing other services may also not be covered by
unemployment compensation laws.
Employer contributions
The initial tax rate is 2.7% of the first $7,000 in wages paid to each employee per year and
$8,500 effective January 1, 2010. The rate remains 2.7% until the employer has reported for 10
quarters, then the rate is calculated depending on how successful the employer is in preventing
his account from being charged. The maximum contribution, however, is 5.4%. Once an
employer is notified of the contribution rate, it has 20 days to file an application for review and
redetermination of the rate.
Employers are required to file tax reports with the Department of Revenue. Failure to do so can
result in the imposition of a penalty and increased tax rates. Also, if an employer fails to make a
required report or to pay a contribution owed under the Act, he may be prevented from
employing individuals until such time as he makes the report or pays the contribution. Correct
and timely filing of reports and payments will save you money. Filing of reports and payment of
taxes can be done electronically. Certain employers are required by law to file and pay
electronically, unless they obtain a waiver from the Department of Revenue.
Eligibility for benefits
To establish a monetarily eligible unemployment compensation claim, a person must have
worked and earned wages during the first four quarters of the previous five completed quarters
prior to filing a claim. This period of time is called the “base period.” The base period changes
every three months at the beginning of each new quarter starting in January, April, July and
October.
To qualify monetarily, a person must:
•
have been paid wages in two or more calendar quarters in the base period
•
have total base period wages of at least 1-1/2 times the wages in the quarter having the
highest earnings
•
have at least $3,400 total wages in the base period.
In addition to monetary qualification, an unemployed individual is eligible for benefits if the
following criteria are met and if the individual is not disqualified for one of the reasons set out in
Disqualification from benefits on page 256. Requirements for eligibility are as follows:
•
has filed a claim
•
has registered for work and continues to report to the Department of Revenue
•
is able to work and is available for work, unless unavailability is due to jury duty
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•
has served a one-week waiting period after filing a claim for which no benefits are paid
•
is totally or partially unemployed.
There is no time limit for filing for unemployment compensation benefits after separation from
employment. However, it is to the employee’s benefit to file as soon as possible after separation,
since the base period for computing the amount of unemployment benefits is the first four
quarters of the last five completed quarters prior to filing.
If an employee is discharged for unsatisfactory work performance during an established
probationary period of employment which does not exceed 90 days he may still be awarded
benefits, but the employer’s account will not be charged for unemployment benefits. The
employer must notify the Department of Revenue that the employee was discharged during a
probationary period within 10 days of the mailing date of the Form UCB-412 (Determination of
Unemployment Compensation Claim).
Calculation of unemployment benefits
An unemployed individual is paid benefits which are calculated with regard to his or her wages
paid during a base period. The base period consists of the first four of the last five calendar
quarters that an individual worked. Weekly benefits are l/26th of the total wages paid during the
high quarter.
For example, suppose the employee worked for several years for your company. The base period
for calculating benefits is the first four of the last five quarters. Reported wages for each of the
last five quarters were as follows:
•
3rd Quarter 2007
$4,800
•
4th Quarter 2007
$6,400
•
1st Quarter 2008
$5,400
•
2nd Quarter 2008
$4,800
•
3rd Quarter 2008
$5,200
In this example, the high quarter is 4th Quarter 2007, so that will be the amount of wages which
are used to determine unemployment benefits. Weekly benefits will be $246.15, since that is the
amount equal to 1/26 of $6,400.
Disqualification from benefits
An individual can be disqualified from receiving unemployment benefits for the following ten
reasons.
1. Voluntary termination
Benefits are not paid to employees who voluntarily quit work without good cause
attributable to the employing unit. However, if an employee has good cause to quit, he or
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she can collect unemployment benefits. The following examples show some of the types
of personal reasons appeals referees found to be “good cause” to quit.
•
An employee who took an unauthorized leave of absence to respond to a
legitimate family emergency was found entitled to benefits because his leaving
was not voluntary.
•
A mother who stayed home for over a week when her son came down with
chicken pox was entitled to benefits.
•
A department store janitor who had been out of work for 26 days was found to be
eligible for benefits. The employee was arrested and was jailed during the period
but was released and all charges against him were dropped. The Court held that
the employee had not left his employment voluntarily.
•
An employee who was subjected to harassment during employment was found to
have left work for good cause, and was entitled to benefits.
•
An overworked employee, who repeatedly asked for help, was awarded benefits
for voluntarily leaving employment with good cause attributable to the employer.
An individual who quits without good cause will be disqualified from receiving
unemployment benefits.
Employees can also obtain benefits in some cases by alleging their resignation was a
“constructive discharge.” The employee must prove her working conditions were so
intolerable that a reasonable person would feel “forced” to resign.
2. Misconduct
Benefits are not payable if the employee was discharged or suspended for misconduct
connected with work. For benefits to be denied, the employer must be able to show
“gross misconduct.” Gross misconduct is defined to include, “conduct evincing such
willful or wanton disregard of an employer’s interest as is found in deliberate violation or
disregard of standards of behavior which the employer has the right to expect of his
employee” or “carelessness or negligence of such a degree or recurrence as to manifest
culpability, wrongful intent, or evil design or to show an intentional and substantial
disregard of the employer’s interests or of the employee’s duties and obligations to his
employer.”
Disqualification from benefits because of gross misconduct continues for the full time of
claimant’s unemployment and up until he or she has been re-employed and earned at least
17 times the weekly benefit amount. This disqualification cannot last more than 52
weeks. The disqualification length will depend on the circumstances in each case or the
seriousness of the misconduct.
Examples
•
Disregard of employer’s interests and refusal to assist fellow employees – A
restaurant dishwasher walked off the job twice because of disputes that arose on
the job. The first occasion occurred after the employee had requested training as a
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cook and was refused. The second incident occurred when the employee refused
to carry bus pans from the dining area for a waitress. At a hearing, the Appeals
Referee found that the two incidents amounted to misconduct.
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•
Failure to report to work and entering premises in an intoxicated state and
refusal to seek treatment – The fact that an employee was staggering, his speech
was slurred, he told the doctor at the clinic he had been drinking, and the
employee’s breath smelled of alcohol, was enough evidence to support a finding
of misconduct, which resulted in a loss of benefits. But in another case involving
substance abuse even a finding of “misconduct” did not result in denial of
benefits. The Court held that an alcoholic or drug addict may be eligible for
benefits because of the nature of his illness of alcoholism or drug addiction.
However, the employer’s account was not charged.
•
Failure to carry out employer’s instruction – An employee had repeatedly left
her cash register open and failed to put change in the cash register. The employee
had been repeatedly instructed on proper procedures and failed to follow the
instructions. Therefore she was not entitled to benefits. An employee’s refusal to
work in a freezer also constituted misconduct. There was no showing of medical
or health reasons sufficient to prevent the employee from working in the freezer.
The Court further stated that “working conditions that are not to an employee’s
liking are not sufficient reasons for quitting unless ‘the conditions constitute
unfair or unreasonable demands... such that a reasonably prudent person would
leave.’”
•
Absenteeism – Florida courts have stated that “an employer has a right to expect
reasonable work habits from an employee. Continued absenteeism, which
hampers the operation of a business, constitutes an intentional disregard of the
employer’s vital interests, and of the employee’s duties, and amounts to
misconduct.”
•
Tardiness – Incidences of tardiness should be thoroughly documented, and the
employee notified that tardy arrival may result in discipline, up to and including
termination. However, employers should be aware that the Unemployment
Commission does not often label occasional tardies as “misconduct.”
•
Refusal of transfer – An employee refused a transfer to a position with the same
management classification as her current position and with the same pay and
hours of work. The employee was discharged and refused unemployment benefits
because her actions were found to be “misconduct connected with work.”
However, if the transfer would have drastically increased the employee’s
commute, or the transfer had been to a lower-paying job, the employee might
have prevailed on her claim, due to the substantial change in terms and conditions
of her employment.
•
Poor performance or unsatisfactory conduct – Poor performance (poor quality
of work) and unsatisfactory conduct has been found not to be misconduct. In
general, if an employee cannot perform the duties of a job because of inability,
this does not disqualify the employee from receiving benefits. However, if it can
be established that the claimant is capable of performing the job and has done so
previously, disqualification can result.
•
Insubordination – An employee who intentionally disobeyed a foreman’s order
and who disregarded the foreman’s threat of suspension was discharged. This
insubordination was found to be misconduct connected with employment and
disqualified the claimant from unemployment benefits. In another case, an
employee was properly denied benefits because she was insubordinate to her
superior and created a disturbance at her workplace by shouting obscene language
at the superior in the presence of other employees and customers. However,
profane language used by an employee in a private meeting with the supervisor
outside the presence of other employees and customers would be less likely to
constitute misconduct.
•
Sleeping on the job – The employee was found asleep during working hours and
observed sleeping by his supervisor, the shop steward and another employee. The
following day, the employee was discharged for sleeping on the job. The
employee was disqualified from receiving unemployment benefits.
•
Negligence – A registered nurse was discharged for failing to properly record
medications administered to patients. An employee, who drove a gasoline-filled
tank truck, had been involved in several traffic accidents and also tended to
exceed the speed limit. Both employees were ineligible for benefits.
•
Theft of company property – In cases where the theft is proven and supported
by competent testimony and/or evidence, unemployment benefits will be denied.
However, in cases where theft is not proven or backed up by substantial evidence,
the employer’s account can be charged and unemployment benefits granted.
•
Failure to work overtime – Failure to work overtime is not, in itself, a
disqualifying factor for unemployment benefits. However, failure to work
overtime when it is a part of a job description can disqualify a claimant.
•
Fighting on the job – The determination of benefit qualification in a case
involving a claimant who was discharged for fighting on the job is made by using
the “reasonable person” test. That is to say, “would a reasonable person have
acted in the same manner?”
•
Testing positive for drug use in violation of the employer’s written drug
policy – A Florida law provides that a positive drug test, performed under the
provisions of the Florida Drug-Free Workplace Act, will serve to establish
ineligibility for unemployment benefits.
Unfortunately, the Unemployment Commission does not appear to be concerned
with making it easy for the employer to maintain a drug-free workplace. A recent
case allowed unemployment benefits to an employee who had tested positive for
drug use after an accident. He was terminated, and filed for unemployment
compensation benefits. The employer argued that benefits should be denied since
the employee was terminated for misconduct. The Commission held that the
employer had failed to prove that its drug-free workplace policy met all the
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requirements set up by law because it failed to provide a copy of documents
certifying the laboratory.
This decision means that employers should attend unemployment hearings armed
with two additional items to insure that unemployment benefits are not awarded to
a claimant who has been fired for drug use. Employers should obtain and bring a
copy of the laboratory’s certification by HRS and/or NIDA, as well as a copy of
the certification provided to the employer from either the state’s self-insurance
unit, or a workers’ compensation insurance carrier.
3. Suitable employment
The claimant fails to apply for or to accept suitable employment or to return to customary
self-employment when directed by AWI.
4. Labor dispute
The claimant is engaged in a labor dispute with the employer under the National Labor
Relations Act.
5. Benefits from another state
The claimant is receiving benefits from another state’s unemployment compensation
program.
6. Voluntary leave of absence
The claimant is on voluntary leave of absence.
7. Retirement, pension or annuity
The claimant is receiving retirement, pension, or annuity payments which exceed any
unemployment benefits available.
8. Criminal offense
The discharge is the result of a work-related act which is a criminal offense and for which
the employee is convicted and is subject to imprisonment or for any dishonest act in
connection with the individual’s employment.
9. False or fraudulent representation
The claimant makes false or fraudulent representations in order to obtain benefits. The
telephone number for reporting suspected unemployment fraud is 800-342-9909.
10. Alien
The claimant is an alien not currently authorized to work by the U.S. Department of
Labor.
Benefits under the Act
The Act provides that benefits shall be paid to any individual who is unemployed and eligible for
benefits. An individual is deemed totally unemployed in any week during which he performs no
services and earns no wages. An individual is deemed partially unemployed in any week of less
than full-time work in which he earns wages less than his weekly benefit amount.
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The weekly benefit amount is equal to l/26 of total wages paid for a quarter base period during
which wages were highest. Weekly benefits will be at least $32 but not more than $275. The
weekly benefit amount, once established, remains the same for that worker.
Individuals who obtain part-time employment while they are receiving benefits can earn up to 8
times the minimum wage without a reduction in the unemployment benefit received.
Benefits are payable as long as the individual reports that he or she is able and available for
work, has not refused suitable work, and is searching for work. An individual can continue to
receive benefits until the lesser of 25% of their base period wages, or $7,150, have been paid.
An extension of benefits is available under special circumstances.
In addition, Florida is using funds from the American Recovery and Reinvestment Act to
increase payments by $25 per week. This will continue through July 3, 2010 for claims filed no
later than December 26, 2009. Also, federal law has extended benefits an additional 33 weeks,
for a total of 59 weeks of coverage for Floridians.
Filing a claim
The first step in this process is for the employee to file a claim for benefits with the local
unemployment office. An initial notice of claim, Form LES UCB-412 (Determination of
Unemployment Compensation Claim), is mailed to the individual’s most recent employers.
Employers should respond within ten days from receipt of the UCB-412 if they wish to protest a
claim. Otherwise, the employer’s account will be charged, if the application meets the criteria for
collecting unemployment. Deadlines are strictly enforced.
In reviewing the application, the local unemployment office frequently contacts the employer by
phone in order to ascertain information concerning the claim. After an interview with the
claimant and after attempting to obtain information from the employer, the local claims office
prepares and mails form UCB-45, Determination Notice. If an employer disagrees with this
decision, the employer can request that the decision be reconsidered by the local office or appeal
to an Appeals Referee. Again, any action - by either the employer or the employee to appeal the
initial determination must be timely.
Appeals
Upon receiving UCB-45, the employer or claimant may file an appeal. An appeal must be filed
with the local claims office, in writing, within 20 days from the date of mailing of the decision. If
the 20th day is a Saturday, Sunday, legal holiday, or other day when the post office is closed, the
filing period is extended to the next business day. Appeals from employers normally consist of a
letter to the local office explaining the reasons for the appeal. Once such a letter is received, the
local office completes UCA-1 which is sent to Tallahassee.
The appeal must be specific giving important facts and reasons why you disagree with the
determination and must be filed within the time limits. If you have a protest, a prompt reply is
important. If you do not file within the allotted time, the Appeals Referee will not have the
jurisdiction to decide your appeal. A Notice of Hearing will be sent to both parties informing
them of the time, date and location of a hearing to review the issues involved.
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Each party must be given at least 10 days notice prior to the hearing. The employer should attend
the scheduled hearing. Although at one time hearings were held with the parties present before
the appeals referee, today almost all appeal hearings are held telephonically. The employer is
asked to provide a phone number where it can be reached the date and time of the hearing. If the
employer fails to answer the phone when called or is otherwise unavailable when contacted by
the appeals referee, it will usually lose the appeal.
A party may also appeal other actions of the Department of Revenue including:
•
the liability of your employing unit
•
the coverage of employees of the employing unit
•
your experience rating (tax rate) computation
•
charges to your employment record for benefits paid to former employees
•
reimbursement charges against certain governmental and nonprofit organizations.
Hearing
At the hearing each party has the right to:
•
testify in his/her own behalf
•
present documents (if a telephone hearing is scheduled, each party must mail, fax or
deliver copies of the documents to the hearing officer and other parties, in advance of the
hearing date, so that they can refer to the documents during the hearing)
•
have his/her own witnesses testify (at a telephone hearing, have your witnesses present at
your location)
•
question opposing parties and witnesses
•
explain evidence
•
make a statement at the end of the hearing
•
examine documents which may be accepted into evidence from the claimant’s benefit
file.
If a party wishes to present a witness, it is up to the party to arrange with the witness to be
present at the hearing. It is important that this witness have firsthand knowledge of the
incidents involved. Employers should choose witnesses carefully to ensure competent evidence
is presented. Hearsay may be used to support other evidence, but is not sufficient by itself.
Most documents and affidavits are hearsay and not sufficient to prove what occurred. An
employer who must rely on business records should provide a witness who can testify how the
records were prepared and vouch for their authenticity. Once the hearing is closed, no additional
evidence will be accepted
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If a witness will not appear voluntarily, the party may request that a subpoena be issued. The
request for a subpoena must be delivered to the office of the Referee with sufficient time for the
subpoena to be served prior to the hearing. Employers are responsible for proper service of
requested subpoenas including the payment of a witness fee.
At the hearing, the Appeals Referee lists the documents in the claim file, and any documents
presented by each party prior to or at the hearing. The parties are required to bring the original
and two copies of all documents they will present. If the hearing is telephonic, all documents
must have been provided to the appeals referee and the employee in advance. If an employer
intends to submit business records, it should have a person present who can testify to their
authenticity. The Appeals Referee makes a tape-recording of the entire hearing for agency
reference. The parties may also make their own recordings if they wish or purchase a copy
of the tape made by the Referee. Employers should obtain a copy of the taped proceedings if
there is a possibility of further action by the employee.
After hearing both sides, the Referee will render a Decision (Form LES UCA-7) and mail it to
the parties. This decision includes findings of fact and conclusions of law. If a party disagrees
with the decision, it may file an appeal with the Unemployment Appeals Commission.
Further appeals
An application for review of an Appeals Referee’s decision must be filed within 20 days after
mailing of the Notice of Appeals Referee’s decision. An written request for review can be filed
by mailing or faxing the request directly to the Unemployment Appeals Commission, or by filing
the request for review online at https://www.uac.fl.gov/Appeal. aspx. If mailed, the postmark
date will be the filing date. If faxed, hand-delivered, delivered by courier service other than the
United States Postal Service or submitted via the Internet, the date of receipt will be the filing
date.
This application must be made in writing and include the following:
•
claimant’s name and social security number
•
name and mailing address of employer or employers involved
•
decision docket number of case being appealed
•
the signature of the person filing the appeal.
Each party will receive written notice of the pending review by the Commission. The review will
be limited to matters within the official record, the tape-recording of the hearing before the
Referee and, if approved by the Commission, additional evidence. Additional evidence will be
made part of the record and considered only if it was discovered after the Appeals Referee’s
hearing. The Commission will review the previous decision to determine if the findings are
supported by competent, substantial evidence in the record and that the appeals referee’s legal
conclusions are sound. Each party is entitled to file a document called a “brief,” setting forth its
position and an argument to support it. Upon receiving an appeal, the Commission will send out
a pamphlet to each party specifying procedures for filing briefs and motions.
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After the submission of all documents, the Commission will render a written order which is
mailed to each of the parties. If, after reading the Order of the Commission, either party wishes,
it may appeal within 30 days to the District Court of Appeals for the district in which it resides.
Information on such an appeal will be provided with the decision of the Commission. At this
point the hearing testimony must be transcribed at the expense of the appealing party to produce
the record on appeal. The District Court will review the evidence and testimony and deliver a
decision. This decision may be appealed further to the Florida Supreme Court.
Q. Can an employer enter into an agreement with the employee to provide that the
employee not apply for unemployment benefits in the event of a termination of the
employment relationship?
A. No, Florida law specifically provides that an agreement by an employee to waive
unemployment benefits is invalid. However, if the employee signs a well-constructed
severance agreement, the document can be used as evidence that the employee voluntarily
resigned employment and is therefore ineligible for unemployment compensation.
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•
To view or download forms, visit www.floridajobs.org.
•
Employers can call the Employer Information Center at (800) 482-8293 or the
Department of Revenue Taxpayer Services at (800) 352-3671. Workers filing claims can
call the Agency for Workplace Innovation at (850) 245-7105.
Chapter 25
Employee benefits
Information on the Employee
Retirement Income Security Act (ERISA)
What plans are covered
The Employee Retirement Income Security Act of 1974 (ERISA) covers most private
sector employee benefit plans. Such plans are voluntarily established and maintained by
an employer, an employee organization, or jointly by one or more such employers and an
employee organization. Retirement plans – a type of employee benefit plan – are
established and maintained to provide retirement income or to defer income until
termination of covered employment or beyond. This type of plan is covered in more
detail in Chapter 26, Retirement plans.
This chapter covers other employee benefit plans, called welfare benefit plans. These are
established and maintained to provide medical, surgical, or hospital care or benefits, or
benefits in the event of sickness, accident, disability, death or unemployment, or vacation
benefits, prepaid legal services, day care centers, scholarship funds, apprenticeship and
training benefits, or other similar benefits. The primary focus of this chapter will be the
rules and regulations governing health plans.
In general, ERISA does not apply to welfare benefit plans that are established or
maintained by governmental entities, churches or plans maintained solely to comply with
applicable workers compensation, unemployment, or disability laws.
Basic requirements
ERISA requires plans to provide participants with plan information including important
information about plan features and funding. It provides fiduciary responsibilities for
those who manage and control plan assets and requires plans to establish a grievance and
appeals process for participants to get benefits from their plans and gives participants the
right to sue for benefits and breaches of fiduciary duty.
There have been a number of amendments to ERISA, expanding the protections available
to health benefit plan participants and beneficiaries. One such amendment, the
Consolidated Omnibus Budget Reconciliation Act (COBRA), provides some workers and
their families with the right to continue their health coverage for a limited time after
certain events, such as a voluntary or involuntary loss of a job, reduction in the hours
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Employee benefits
worked, transition between jobs, death, divorce, and other life events. COBRA is covered
in more detail in Chapter 27, COBRA/health care continuation.
Another amendment to ERISA is the Health Insurance Portability and Accountability Act
(HIPAA) which provides important protections for employees and their families who
have preexisting medical conditions or who might otherwise suffer discrimination in health
coverage based on factors that relate to an individual’s health. HIPAA is covered in more
detail in Chapter 28, Health care portability (HIPAA).
There are numerous federal mandates ERISA health plans must comply with:
•
The Newborns’ and Mothers’ Health Protection Act (Newborns’ Act) includes
important protections for mothers and their newborn children with regard to the
length of hospital stay following childbirth. The Newborns’ Act requires that
group health plans that offer maternity coverage pay for at least a 48-hour
hospital stay following childbirth (96-hour stay in the case of a Cesarean section).
•
The Women’s Health and Cancer Rights Act (WHCRA) includes protections for
individuals who elect breast reconstruction in connection with a mastectomy.
WHCRA provides that group health plans and insurance issuers that provide
coverage for medical and surgical benefits with respect to mastectomies must also
cover certain post-mastectomy benefits, including reconstructive surgery and the
treatment of complications (such as lymphedema).
•
The Mental Health Parity Act (MHPA) provides for parity in the application of
aggregate lifetime and annual dollar limits on mental health benefits with dollar
limits on medical/surgical benefits. A plan that does not impose an annual or
lifetime dollar limit on medical and surgical benefits may not impose such a dollar
limit on mental health benefits offered under the plan. MHPA does not apply to
benefits for substance abuse or chemical dependency. Health plans are not
required to include mental health benefits in their benefits package. MHPA only
applies to those plans that do offer mental health benefits.
Under ERISA, health coverage must be provided to dependent children if a court order
directing the coverage satisfies certain requirements. If the employer or plan
administrator receives a court order directing that health care be provided for a dependent
child of an employee, a written plan procedure should then be followed to determine if
the order is a Qualified Medical Child Support Order (QMCSO). To be “qualified,” the
order must include the parent/employee’s name and last known address, the child’s name
and mailing address, the type of coverage required, the period of time to which the order
applies, and the plans subject to the order. The insurer must provide that children
covered by a QMCSO receive immediate access to the health plan coverage, as well as
continued participation until the QMCSO is no longer in effect. In addition, the
employer must withhold any required contribution from the employee’s pay, if
applicable, to cover the child(ren), which must be remitted to the insurer.
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Employee benefits
ERISA requires that employers not discriminate as to coverage under an employerprovided health plan on the basis of Medicaid eligibility. In addition, adopted children
must be covered as of the date of placement for adoption with no preexisting condition
restrictions. An insurance company or health maintenance organization (HMO) may not
discriminate against dependent children on the basis of illegitimacy, residence, or status as
a dependent on the parent/employee’s tax return.
ERISA welfare benefit plans must be provided through a written plan document that
outlines:
•
the plan’s eligibility requirements
•
the benefits provided under the plan
•
how benefits are funded
•
the standard of review for benefit determinations
•
the plan’s claims procedures
•
the plan’s named fiduciaries and procedures for allocating responsibilities
•
plan amendment and termination procedures
•
required federal mandates
•
subrogation and reimbursement language
•
coordination of benefits provision.
Although plan documents provided by insurance companies may contain some of these
required provisions, it is unusual for an insurer’s document to provide all required
language. For that reason, many employers use a “wrap” document that fills in any
missing required language. Another important use for a wrap document is the ability to
bundle all health and welfare plans under this one wrap document and allow an employer
to file one Form 5500 rather than a separate Form 5500 for each benefit.
Reporting and disclosure requirements
The following documents are just some of the documents which must be furnished to
participants and beneficiaries:
•
Summary Plan Description (SPD) – a plain language explanation of the plan
features and the participants’ rights and responsibilities under the plan.
•
Summary of Material Modification (SMM) – apprises participants of changes
to the plan or to the information required to be in the SPD.
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Employee benefits
•
Summary Annual Report (SAR) – an outline in narrative form of the
information contained in the Form 5500.
•
Initial COBRA notice – notice of right to purchase temporary extension of
coverage when coverage is lost due to a qualifying event (covered in more detail in
Chapter 27, COBRA/health care continuation).
•
COBRA election notice – notice to qualified beneficiaries of their right to elect
COBRA coverage upon occurrence of a qualifying event (covered in more detail in
Chapter 27, COBRA/health care continuation).
•
Certificate of Creditable Coverage – notice from employee’s former group
health plan documenting prior group health plan creditable coverage (covered in
more detail in Chapter 28, Health care portability (HIPAA)).
Reporting to government agencies
Welfare plans must file the Form 5500 series, Annual Return/Report with the
DOL (which then shares it with the IRS), unless they have less than 100
participants as of the first day of the plan year and are unfunded, fully insured, or
a combination of insured and unfunded. All welfare plans that are unfunded, fully
insured, or a combination of insured and unfunded (i.e., not funded via a VEBA
trust) are not required to have an annual audit. Additional exceptions exist for
certain other welfare arrangements of non-multiemployer plans, certain
apprenticeship plans and certain dependent care assistance plans.
Penalties and liability
Both the U.S. Department of Labor and the Internal Revenue Service are authorized to
enforce violations under ERISA and the Code, respectively. The remedies and penalties
vary with the conduct, but generally result in excise taxes or other penalties. In some
cases, both the Department of Labor and Internal Revenue Service are authorized to
assess penalties for the same act. Under ERISA, criminal penalties are also provided
which include both fines and imprisonment where:
•
there is intentional violation of reporting, disclosure or recordkeeping
requirements
or
•
fraud, force or violence or the threat of violence are involved
or
•
a person convicted or imprisoned for criminal acts serves a benefit plan in any
capacity.
The recovery of plan benefits with attorney’s fees and costs (at the discretion of the
court) is available to plan participants and beneficiaries. The restoration of plan assets at
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Employee benefits
personal cost to plan fiduciaries, such as trustees, may be enforced by the Department of
Labor if plan losses are caused by a violation of fiduciary responsibilities. Finally,
discrimination that is intended to interfere with, deprive, or retaliate against an
employee’s ERISA rights is prohibited. Employees may sue for equitable relief such as
back pay, reinstatement of job and benefits, attorney’s fees and costs.
Liability can arise from a plan design that is discriminatory, failure to document or file
required reports, failure to provide required documents to plan participants or to respond
to inquiries from participants, failure to monitor the performance of plan assets, or failure
of a fiduciary to monitor the performance of its delegates, or others making decisions
under the employer’s benefit plans.
ERISA and the provisions of the Code that apply to employee benefits are extremely
complicated. Effective compliance requires a basic understanding of the operations of
both ERISA and the Code. For more information, consult a benefit plan attorney.
This federal law prohibits discrimination on the basis of age with regard to employee benefit
plans with these exceptions.
•
Where equal cost is involved for both younger and older workers. Under this principle,
employers are required to ensure that either:
the benefits provided to the employees are equal; that is, the actual amount of the
benefits available is the same regardless of age
or
the costs of the benefits provided to the employees are equal; that is, the cost for
benefits provided to older workers is no less than the cost for younger workers.
Employers should be prepared to show that any differences in benefit levels for
older workers are based on the higher cost of such benefits.
•
A voluntary early retirement plan implements a reduction in force by targeting older
workers who meet age and service requirements. The Act approves setting a minimum
age as a condition of eligibility for early retirement plans, provided the plan is created for
legitimate business reasons not in violation of the Age Discrimination in Employment
Act.
•
Severance pay is reduced by certain types of pension benefits. As an incentive for
employers to provide health benefits for retirees, the Act also allows such retiree health
benefits to be deducted from severance pay up to certain statutory limits.
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Employee benefits
The ADA is a federal law that requires employers to provide equal access to group health
insurance programs, and prohibits discrimination in benefits on the basis of a disability (see page
112, Americans with Disabilities Act (ADA)).
Family and medical leave
This area is impacted by both federal and state law and is covered in Chapter 29, Family and
medical leave.
Florida’s Child Care Health Insurance Act
Florida law requires all group, blanket or franchise health insurance policies providing coverage
on an expense-incurred basis to an employee and his family, to provide coverage for child health
supervision services from the moment of a child’s birth until 16 years of age. These child health
supervision services are exempt from any deductible provision in effect in the insurance policy.
The Act defines “child health supervision services” as physician-delivered or physiciansupervised services at specific intervals of age (birth, 2 months, 4 months, 6 months, 9 months,
12 months, 15 months, 18 months, 2 years, 3 years, 4 years, 5 years, 6 years, 8 years, 10 years,
12 years, 14 years and 16 years) where a history, physical examination, developmental
assessment and appropriate immunizations and laboratory tests are conducted.
Child Care Executive Partnership Act
In an effort to encourage employers and local communities to provide child care facilities or
other benefits to employees, the Child Care Executive Partnership Act provides for the
availability of matching state funds for local efforts to establish quality child care. Purchasing
groups or “pools” from each community will collect funds from local governments, employers
and charitable foundations. Those funds will then be matched by state or federal funds to be used
for the development of child care options, and to provide subsidies to low-income working
parents to pay for child care. In some cases, parents will pay a fee for the use of the funds,
depending on a sliding fee scale.
State funds cannot be used to substitute for efforts currently made by employers or other
contributors to the community child care purchasing pool. The Florida Legislature will annually
review the effectiveness of the purchasing pools.
Take a look at the materials provided at:
•
www.dol.gov/ebsa
or contact:
•
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Employee Benefits Security Administration
200 Constitution Ave., N.W.
Employee benefits
Washington, DC 20210
(866) 444-3272
•
Atlanta Regional Office
61 Forsyth Street, S.W., Suite 7B54
Atlanta, GA 30303
(404) 562-2156
•
Miami District Office
8040 Peters Road, Bldg H, Suite 104
Plantation, FL 33324
(954) 424-4022
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Employee benefits
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Chapter 26
Retirement plans
Retirement plans are governed by federal laws which provide a myriad of technical rules
governing such plans, specifically the Internal Revenue Code of 1986, as amended (the Code)
and the Employee Retirement Income Security Act of 1974, as amended, 29 U.S.C. §§ 1001
(ERISA). ERISA was enacted in 1974 to address public concern that funds of private retirement
plans were being mismanaged and abused. Since its enactment in 1974, ERISA has been
amended frequently to address the changing needs of employees and their families.
The administration of ERISA is divided among the U.S. Department of Labor, the Internal
Revenue Service of the Department of the Treasury (IRS), and the Pension Benefit Guaranty
Corporation (PBGC). Title I, which contains rules for reporting and disclosure, vesting,
participation, funding, fiduciary conduct, and civil enforcement, is administered by the
Department of Labor. Title II of ERISA, which amended the Internal Revenue Code to parallel
many of the Title I rules, is administered by the IRS. Title III is concerned with jurisdictional
matters and with coordination of enforcement and regulatory activities by the Department of
Labor and the IRS. Title IV covers the insurance of defined benefit pension plans and is
administered by the PBGC.
A qualified retirement plan is one that meets the requirements of ERISA and the Internal
Revenue Code and as such, enjoys the following tax benefits:
•
the employer can deduct contributions made to the plan on the corporate income tax
return
•
employees are not taxed on contributions made to the plan on their behalf when made
•
plan assets accumulate on a tax-deferred basis
•
distributions from a qualified retirement plan can continue to enjoy tax deferred treatment
if transferred to another eligible retirement plan.
From the employer’s point of view, retirement compensation can be used to accomplish goals
similar to those achieved through currently taxable compensation without being subject to
payroll taxes:
•
recruiting quality employees
•
creating incentives
•
rewarding performance
•
instilling company loyalty
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Retirement plans
•
sharing company gains.
ERISA retirement plans
Retirement Plans can be broken down into two basic categories: defined benefit plans and defined
contribution plans.
A defined benefit plan is a plan funded by the employer, that promises participants a specific
monthly benefit at retirement. The plan may state this benefit as a flat dollar amount or more
often, as a formula based on factors such as the participant’s age, salary and years of service.
The benefits usually are not payable until normal retirement age. The amount that must be
contributed annually to a defined benefit plan to provide the promised benefits is determined by
an actuary and must comply with the minimum funding standards under the Internal Revenue
Code. In a defined benefit plan, the investment risk is borne by the employer, not the
employee.
The PBGC guarantees payment of certain retirement benefits for participants in most private
defined benefit plans if the plan is terminated without enough money to pay all the promised
benefits. Employers sponsoring these defined benefit plans must pay an annual premium to the
PBGC based on the participant count at the end of the plan year.
In general, defined benefit plans are more complex than defined contribution plans and thus more
costly to establish and maintain.
Defined contribution plans are plans in which the contribution is defined, but the amount of
retirement benefit is not. In such plans, each participant has his or her own account balance. The
benefit at retirement depends on the amounts contributed to the plan and the investment
performance of such accounts over time. In a defined contribution plan the risk associated
with having enough retirement income is borne by the employee, not the employer. It is
partly for this reason that so many defined contribution plans allow the employee to direct the
investment of his or her plan account. The government does not guarantee benefit payments for
defined contribution plans.
Specific types of
qualified retirement plans
Profit-sharing plan
A profit-sharing plan is a defined contribution plan established by an employer to permit
employees to share in the profits of the company on a tax-deferred basis. Despite the
name, a profit-sharing plan may receive contributions from the employer even in years
when the employer does not have profits.
Under a profit sharing plan, the contribution formula is discretionary. Whether and how
much to contribute is left to the employer’s discretion, but the plan can include a
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Retirement plans
specified employer contribution. The plan must, however, provide a definite formula for
allocating such employer contributions among the participants.
Employer contributions under a profit sharing plan can be allocated in several ways. One
of the most common allocation formulas is one based on a compensation ratio method.
Under this method, the employer contribution is allocated to each eligible participant in
the ratio that such participant’s compensation bears to the compensation of all eligible
participants. Alternatively, the allocation formula can be designed to favor higher paid
employees by providing an additional allocation on compensation that is not considered
for Social Security benefits. A third method of allocation is the age-weighted method
which allocates contributions based on the participant’s age and compensation. This
method usually favors older and more highly paid individuals and involves complex
calculations that may require consultation with an actuary.
Distributions from a profit sharing plan generally are made only for events such as
retirement, death, termination of employment, disability or attainment of age 59 , as
defined by the plan. A profit-sharing plan may also permit hardship distributions to
participants.
401(k) plan
A 401(k) plan is a type of profit-sharing plan and has become the plan of choice for many
businesses. A 401(k) plan includes a cash or deferred arrangement which permits an
employee to avoid current income taxation if the employee agrees to defer cash
compensation to a 401(k) retirement account established under the plan. Sometimes, the
employer matches these contributions based either on a specific formula or a
discretionary one. For example, an employer may match an employee’s 401(k)
contributions dollar for dollar on the first 4% of compensation contributed. Matching
contributions or profit sharing contributions, if they are made, are also not taxable income
to employees in the year for which the contribution is made. There is an upper limit on
401(k) deferrals – for 2009, employees can contribute up to $16,500 in 401(k) deferrals,
and an extra $5,500 for employees 50 and over.
A 401(k) plan must pass special nondiscrimination tests not applicable to other plans.
These tests require that the 401(k) contributions and matching contributions not
discriminate in favor of highly-compensated employees (those who earned in excess of a
dollar amount in the prior year – $105,000 in 2008 indexed for inflation). If a 401(k) plan
fails to meet the requirements of the nondiscrimination testing, some contributions made
on behalf of highly compensated individuals may have to be returned and included in
income. The higher the rate of participation in the plan, the less likely such returns will
be necessary. In order to assure a better result in nondiscrimination testing, many
employers have adopted automatic contribution features for their 401(k) plans. Under
this provision, an employee who does not make an affirmative election to participate or
not participate in the plan will be automatically enrolled in the plan and have a default
401(k) contribution made at a rate specified by the plan.
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Retirement plans
In an effort to increase participation in 401(k) plans, the IRS published proposed
regulations effective for plan years beginning on and after January 1, 2008, that make
automatic contribution features even more attractive for employers. If an employer
adopts a Qualified Automatic Contribution Arrangement (QACA), the plan will be
deemed to have passed the 401(k) nondiscrimination testing and thus will not have to
make refunds. Under a QACA arrangement certain minimum levels of matching or profit
sharing contribution and vesting must be met in exchange for the exception from
nondiscrimination testing.
A cash or deferred arrangement may permit after-tax contributions, (deposits from an
employee’s paycheck after income taxes are deducted). Interest or investment income
earned on after-tax contributions is not taxed until these amounts are distributed. Aftertax contributions are included in the special nondiscrimination tests.
Stock bonus plan
A stock bonus plan is a specialized form of profit-sharing plan designed to invest in
employer securities. In a stock bonus plan, contributions are made in employer
securities. Distributions are made in the form of employer stock, although the plan may
distribute cash unless the participant elects a stock distribution.
ESOP
An “employee stock ownership plan” (ESOP) is a specialized form of stock bonus plan.
An ESOP can borrow money to buy employer securities either from the plan sponsor or
a shareholder. The employer agrees to make contributions to the ESOP in an amount
sufficient to repay the loan. The stock purchased with the loan is allocated to
participants over the loan repayment period.
Money purchase pension plan
A money purchase pension plan is an individual account plan, similar to a profit-sharing
plan, except that the employer is obligated to make annual contributions based on the
formula written in the plan, regardless of whether it has profits. Because deduction limits
became the same for money purchase plans and profit sharing plans beginning in 2002,
there is no longer a tax benefit to the employer in maintaining both a money purchase plan
and a profit sharing plan. Because it is otherwise similar to a profit-sharing plan, both
money purchase pension plans and profit-sharing plans must state explicitly which
variety of plan they are, so that there can be no question about the continuing funding
obligation of the money purchase pension plan.
As with a profit-sharing plan, what the employee receives is determined by the
contribution made for his or her individual account, the investment results, and his or her
share of any forfeitures (if the plan so provides).
Most money purchase pension plans use an allocation formula that is a percentage of
compensation. However, as with profit-sharing plans, other allocation formulas are
permitted. Unlike a profit sharing plan, participants cannot have a 401(k) account in a
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Retirement plans
money purchase plan. Distributions from a money purchase plan can only be made on
account of retirement, termination of employment, disability, death, and, starting in 2007,
upon the attainment of age 62.
Hybrid benefit plans
A growing number of businesses are adopting retirement plans that have both defined
benefit and defined contribution plan features. There are a number of such plans, often
referred to as hybrid plans. In recent years, one of the most popular hybrid plans has
been the cash balance plan. A cash balance plan is a defined benefit plan that defines the
benefit in terms that are more characteristic of a defined contribution plan. In other
words, a cash balance plan defines the promised benefit in terms of a stated account
balance. The way a cash balance plan works is the employer contributes to the
employee’s individual account a contribution credit and an interest credit. The
contribution credit can be expressed as a percentage of pay or a flat dollar amount. The
interest credit is a specified rate tied to either some index like the consumer price index or
the rate on U.S. Treasury bills. Increases and decreases in the value of the plan’s
investments do not directly affect the benefit amounts promised to the employee. When a
participant becomes entitled to a benefit under a cash balance plan, the benefits that are
received are defined in terms of the account balance. The participant can elect to receive
his benefits in a lump sum benefit or an annuity.
Other types of hybrid plans are pension equity, life cycle, floor offset, new
comparability profit sharing and target benefit plans.
Defined benefit pension plans
A defined benefit plan provides for a stated monthly retirement benefit calculated based
on a specific formula. The benefit formula can take many forms.
•
flat benefit – a specific dollar amount per month for life
•
flat percentage – a specific percentage of average salary per month for life
•
unit benefit – a percentage of average salary multiplied by the number of years of
service per month for life. This is the most commonly used approach because it
rewards longevity.
The benefit formula may provide for a cost-of-living increase, but most do not.
Pension plans are funded by calculating the amount of money that will be needed at
retirement to finance the projected benefit and then calculating what contributions must
be made each year to pay for the benefits. Pension funding must be made based on
statutory requirements, and the amount for each year must be determined by a certified
pension actuary.
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Retirement plans
SIMPLE plans
The Small Business Job Protection Act of 1996 created a simplified retirement plan for
small businesses called the Savings Incentive Match Plan for Employees (SIMPLE).
SIMPLE plans are available only to businesses with fewer than 100 employees that do
not have any other type of employer-sponsored retirement plan. A SIMPLE plan can be
operated either through an Individual Retirement Account (IRA) for each employee or a
401(k) plan. Employers who set up SIMPLE IRA plans will have simplified reporting
requirements. In the case of a 401(k) plan, the plan does not have to satisfy the nondiscrimination tests, although the SIMPLE-401(k) plan continues to be a qualified plan
under Code Section 401(a) for all other purposes.
In 2009, participants in a SIMPLE plan can defer up to $11,500. Anyone under 50 years
of age at the end of 2009, can contribute up to $5,000 to an IRA for 2009. If you are
over 50 years of age before 2010, you can contribute up to $5,000 to an IRA for 2009.
A SIMPLE plan may be set up in two different ways:
1. The first method provides an employer match on the employee deferral
contributions on a dollar for dollar basis for an amount of up to 3% of the
employee’s compensation. A lower percentage of match (up to only 2%, for
instance) can be elected for no more than two out of five plan years for a
SIMPLE-IRA.
2. A second method provides for a plan which requires the employer to make a nonelective contribution of 2% of compensation for each eligible employee.
Loans from plans
Participant loans are most commonly permitted in defined contribution plans and must meet the
following standards:
278
•
loans must be made available to participants on a reasonably equivalent basis
•
loans cannot be made available to highly-compensated employees, officers and
shareholders in an amount greater than the amount available to other employees, although
a uniform percentage limit may be applied (for example, no more than 50% of the
account balance)
•
loans must be made in accordance with a written loan provision contained in the plan
document, summary plan description or separate loan policy that identifies the person or
the office authorized to administer the loan program and describes various important
features of the loan program such as the application procedure, how an interest rate will
be selected, and other similar factors
•
loans must bear a reasonable rate of interest
•
loans must be secured by adequate collateral, which may include up to 50% of the
participant’s vested account balance.
Retirement plans
Note that a loan to a plan participant will have unfavorable tax consequences for the participant
(because it will be treated as a distribution) unless the loan is repaid within five years or less.
The loan can be for a period longer than five years if it is for the acquisition of the participant’s
principal residence. The loan amount cannot exceed the lesser of $50,000 or one-half the present
value of the participant’s vested account balance. Special rules apply in the case of multiple
loans to the same participant.
Qualified Domestic
Relations Orders (QDRO)
Plan benefits are not assignable or transferable to anyone other than the participant. Benefits are
also not subject to creditors under most circumstances. QDROs are an exception to the general
rule.
ERISA allows distributions to be made from any type of retirement plan under the terms of a
Qualified Domestic Relations Order or QDRO. A QDRO is an order from a court on a matter
involving domestic relations, such as divorce, legal separation or child support. The order
provides for payment of all or part of an individual’s pension benefits or plan account to a
spouse, former spouse or dependent child.
QDROs must meet requirements under the Internal Revenue Code including:
•
the order must be a judgment from a court, signed by a judge, which relates to child
support, alimony payments or marital property rights under state domestic relations law
•
the order must refer to the existence of the right of a spouse, child or former spouse to
receive a portion of the employee’s benefits under the retirement plan (the individual with
the right to a portion of the benefit is called the alternate payee)
•
the order must provide the name and last known mailing address of both the employee
and the alternate payee
•
the order must indicate the dollar amount or percentage of benefits to be paid to the
alternate payee
•
the order must indicate the number of payments which are to be made, or the period of
time to which the order applies
•
the order must clearly indicate to which retirement plan it applies, not simply the name of
the employer or a reference to all benefit plans
•
the order cannot require the plan to provide benefits to the alternate payee in excess of
those provided to the employee
•
the order cannot require payments to an alternate payee if benefits are already being paid
to another alternate payee of the same employee.
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Retirement plans
ERISA plans are required to have written procedures in place which explain what is done when a
QDRO is received by the plan administrator. These written procedures must be made available to
employees upon request.
Fiduciary duty
Plan fiduciaries have special responsibilities under ERISA. Failure to meet these responsibilities
may result in personal liability.
Who is a fiduciary and what are his duties
Many of the actions involved in operating a plan make the person or entity performing
them a fiduciary. Using discretion in administering and managing a plan or controlling the
plan’s assets makes that person a fiduciary to the extent of that discretion or control.
Thus, fiduciary status is based on the functions performed for the plan, not just a
person’s title. A fiduciary includes any person who:
•
exercises any discretionary authority or discretionary control over the
management of the plan or its assets
or
•
renders investment advice for a fee or has the authority to do so
or
•
has discretionary authority or responsibility in the administration of the plan.
Fiduciaries must:
•
manage the plan solely in the interest of plan participants and beneficiaries and
for the exclusive purpose of providing plan benefits
•
act prudently
•
diversify plan investments
•
abide by plan provisions
•
pay only reasonable plan expenses.
A plan’s fiduciaries will ordinarily include the trustee, investment advisor, all individuals
exercising discretion in the administration of the plan, all members of the plan’s
administrative committee, and those who select committee officials. Attorneys,
accountants and actuaries generally are not fiduciaries when acting solely in their
professional capacities. The key to determining whether an individual or an entity is a
fiduciary is whether they are exercising discretion or control over the plan.
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Retirement plans
A number of decisions are not fiduciary actions but rather are business decisions made by
the employer. For example, the decisions to establish a plan, to determine the benefit
package, to include certain features in a plan, to amend a plan, and to terminate a plan are
business decisions. When making these decisions, the employer is acting on behalf of its
business, not the plan, and, therefore, is not a fiduciary. However, when an employer (or
someone hired by the employer) takes steps to implement these decisions, that person is
acting on behalf of the plan and, in carrying out these actions, is a fiduciary.
Identifying plan fiduciaries is very important since a fiduciary is personally liable for any
losses sustained by a plan due to a breach of the fiduciary’s or co-fiduciary’s duty.
Fiduciaries are prohibited from engaging or causing the plan to engage in certain
transactions known as “prohibited transactions.” The term “prohibited transactions”
refers to dealings with parties who may be in a position to exercise improper influence
over the plan. In addition, fiduciaries are prohibited from engaging in self-dealing and
must avoid conflicts of interest that could harm the plan.
Individuals who are prohibited from doing business with the plan (called “parties-ininterest”) include the employer, the union, plan fiduciaries, service providers, and
statutorily defined owners, officers, and relatives of parties-in-interest.
Some of the prohibited transactions are:
•
a sale, exchange, or lease between the plan and party-in-interest
•
late deposit of participants’ salary deferrals
•
errors in loan administration
•
lending money or other extension of credit between the plan and party-in-interest
and
•
furnishing goods, services, or facilities between the plan and party-in-interest.
Other prohibitions relate solely to fiduciaries who use the plan’s assets in their own
interest or who act on both sides of a transaction involving a plan. Fiduciaries cannot
receive money or any other consideration for their personal account from any party doing
business with the plan related to that business.
A person is only a fiduciary to the extent he/she has responsibility for the functions
described above. Thus, a person is a fiduciary only with respect to those aspects of the
Plan over which he/she exercises authority or control.
As an additional protection for plans, those who handle plan funds or other plan
property generally must be covered by a fidelity bond. A fidelity bond is a type of
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Retirement plans
insurance that protects the plan against loss resulting from fraudulent or dishonest acts of
those covered by the bond.
Reporting and disclosure requirements
The following documents are just some of the documents which must be furnished to
participants and beneficiaries:
•
Summary Plan Description (SPD) – a plain language explanation of the plan
features and the participants’ rights and responsibilities under the plan.
•
Summary of Material Modification (SMM) – apprises participants of changes
to the plan or to the information required to be in the SPD.
•
Individual Benefit Statement – Statement informing participants of their
accrued benefits or account balances, the percentage of vesting, and for individual
account plans, the value of each investment.
•
Summary Annual Report (SAR) – an outline in narrative form of the
information contained in the Form 5500.
•
Blackout Period Notice – Sometimes called a “Sarbanes Notice,” this is advance
notice to participants and beneficiaries in an individual account plan of a period of
more than three consecutive business days during which their normal rights to
direct the investment of the assets in their accounts, or to obtain plan loans or
distributions, are restricted. A regularly scheduled limitation or restriction, such
as a restriction on trading in and out of particular types of funds, is not considered
a blackout period if it has been properly disclosed.
In July of 2008, the Department of Labor issued proposed regulations that would require
the disclosure of certain plan and investment-related information, including fee and
expense information, to plan participants and beneficiaries in participant-directed
individual account plans (for example, 401(k) plans). The proposed regulations are
intended to ensure that all participants and beneficiaries in such plans have the
information they need to make informed decisions about the management of their
individual accounts and the investment of their retirement savings. The proposals would
establish uniform, basic disclosures in a form that encourages and facilitates a comparative
review among investment choices.
Reporting to government agencies
All qualified plans must file the Form 5500 series, Annual Return/Report with the DOL
and the IRS. For plans with 100 or more participants, this filing must be accompanied by
an independent qualified public accountant’s report.
Defined benefit plans are subject to additional filing requirements with the PBGC. This
includes the Form 1 series submitting the required pension insurance premium payment.
The PBGC also requires the filing of various notices including notice of reportable event
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Retirement plans
and notice of underfunding. The PBGC reporting requirements are many and complex
and should be reviewed with the assistance of counsel and/or the plan actuary.
283
Retirement plans
284
Chapter 27
COBRA/health care continuation
COBRA
COBRA (Consolidated Omnibus Budget Reconciliation Act) is a federal law which establishes a
legal obligation for most employers to extend group health plan privileges to employees who
would otherwise lose coverage due to a qualifying event.
Who is covered
Employers
All employers maintaining a group health plan are affected by COBRA unless:
•
the employer engaged fewer than 20 employees (counting full-time and
part-time) on at least 50% of its typical business days during the previous
calendar year. Small employers have the option of counting employees by
pay period rather than every business day. Part-time employees are
counted as partial employees. For example, if a full-time employee works
8 hours a day and a part-time employee works 4 hours a day, the part-time
employee would count as one-half of an employee for purposes of the 20
employee threshold. Also, for purposes of the 20 employee threshold,
employees of all companies that are in a controlled group with the
employer must be counted. (In general, a controlled group of employers is
a parent-subsidiary or brother-sister group of companies with at least 80%
common ownership.)
•
the plan is a government plan or a church plan.
Only health care plans and benefits are covered by COBRA including the
following:
•
medical
•
dental
•
vision
•
hearing
•
prescription drugs
•
Health Maintenance Organizations
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•
Healthcare Flexible Spending Accounts (FSAs). Limited COBRA
coverage is available to the end of plan year in which the qualifying event
occurs, if as of the date of the qualifying event, the maximum benefits
under the health FSA available for the remainder of the plan year are
greater than the amount the health FSA could require to be paid for
COBRA coverage to the end of the year.
•
Employee Assistance Plans (EAPs), but only if they provide “medical”
benefits such as treatment for drug or alcohol abuse, etc. For example, an
EAP that provided assistance in dealing with personal problems affecting
mental and physical health was found to provide medical benefits and was,
therefore, subject to COBRA.
Disability income plans and life insurance plans or benefits are not included.
COBRA rights must be offered for each separate plan.
Employees
Any employee who is covered by a group health plan on the day before a
“qualifying event” is a “qualified beneficiary” (explained below) covered by
COBRA, unless that employee was terminated for “gross misconduct.” If a plan
extends coverage to part-time, seasonal, probationary, retired or disabled
employees, then these employees are also protected by COBRA. Employees who
first become entitled to Medicare (meaning actually enrolled) before a qualifying
event are not excluded from COBRA coverage.
“Qualified beneficiaries” also include dependent children, and spouses or
surviving spouses of covered employees if they were covered under the plan on
the day before a “qualifying event” (explained below), unless the covered
employee was terminated for “gross misconduct.” A child born to or adopted or
placed for adoption with a qualified beneficiary who was a covered employee
during a COBRA continuation period is also a qualified beneficiary. COBRA
coverage may end for qualified beneficiaries who first become entitled to
Medicare after electing COBRA coverage.
Qualifying events
“Qualifying events” under COBRA are events which would cause an automatic loss of
coverage under the health plan.
A qualifying event occurs if a covered employee loses coverage under the Plan because
either one of the following happens:
•
the employee’s hours of employment are reduced
or
•
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the employee’s employment ends for any reason other than his or her gross
misconduct.
A qualifying event occurs if a covered spouse of an employee loses coverage under the
Plan because any of the following happens:
•
the employee dies
or
•
the employee’s hours of employment are reduced
or
•
the employee’s employment ends for any reason other than his or her gross
misconduct
or
•
the employee becomes entitled to Medicare benefits (under Medicare Part A, Part
B or both)
or
•
the employee becomes divorced or legally separated from his or her spouse.
A qualifying event occurs if the covered dependent children of an employee lose
coverage under the Plan because any of the following happens:
•
the parent-employee dies
or
•
the parent-employee’s hours of employment are reduced
or
•
the parent-employee’s employment ends for any reason other than his or her gross
misconduct
or
•
the parent-employee becomes entitled to Medicare benefits (under Part A, Part B
or both)
or
•
the parent-employee becomes divorced or legally separated from his or her spouse
or
•
the child stops being eligible for coverage under the Plan as a “dependent child.”
287
If an employer offers retiree medical benefits under its group health plan, filing for
bankruptcy is also a qualifying event with respect to affected retiree participants.
Any of the foregoing events is a qualifying event only if it causes a covered employee or
his or her covered dependents to lose coverage during the initial COBRA continuation
coverage period.
The COBRA “continuation coverage period” generally starts on the day after the date of
the “qualifying event” even if coverage is actually lost at a later date. Alternatively, a
health plan may specifically provide that the continuation coverage period will
commence as of the date of the loss of coverage. The qualifying event also triggers the
employer’s and/or health plan administrator’s requirement to notify the qualified
beneficiary that COBRA continuation coverage privileges are available. The qualified
beneficiary has a 60-day election period (measured from the date coverage is actually lost
or the date the qualified beneficiary is provided notice of his or her right to elect
continuation coverage, if later) to elect COBRA continuation coverage (for more
information, see page 290, Notices).
Second-chance COBRA election
In certain cases, employees who are eligible to receive trade adjustment assistance under
the Trade Act of 2002 are entitled to a “second-chance” COBRA election. To be eligible,
the individual must have lost plan coverage due to a job loss that resulted in trade
adjustment assistance, and failed to elect COBRA during his or her initial COBRA
election period. In addition, the petition for trade assistance benefit certification may not
have been filed before November 4, 2002.
The new election period begins on the first day of the month in which the individual is
certified for trade adjustment benefits, and must be made within six months of the initial
loss of health coverage. The election period runs for 60 days, and if chosen, coverage
begins on the first day of the election period. The maximum period of coverage is based
on the date of the original qualifying event.
Leaves of absence under the
Family and Medical Leave Act
Leave approved under the Family and Medical Leave Act (FMLA) does not constitute a
qualifying event. However, a qualifying event does occur on the last day of the FMLA
leave if the employee:
•
is covered on the day before FMLA leave begins
•
does not return to work at the end of the FMLA leave
and
•
in the absence of COBRA coverage, will lose health care coverage.
The qualifying event occurs on the last day of the FMLA leave (if the employee does not
return to work) even if the employee failed to pay his or her portion of the premium or
288
declined to continue coverage during the FMLA leave. An employee’s right to COBRA
coverage may not be conditioned upon his or her reimbursement of the premiums paid by
the employer for coverage during the period of FMLA leave. In addition, the date of the
qualifying event is not affected by any state or local law that may require coverage for a
longer period of time than that required under the FMLA.
For more information, see Chapter 29, Family and medical leave.
Continuation coverage periods
The maximum continuation coverage periods are:
•
18 months for employees and other qualified beneficiaries if the qualifying event
is the termination of employment of the employee or a reduction in hours
•
29 months if at any time within the first 60 days of COBRA coverage, the
employee or any qualified beneficiary of a covered employee is determined to be
disabled by the Social Security Administration – and the employee or qualified
beneficiary notifies the plan administrator before the end of the initial 18-month
COBRA period and within 60 days of the Social Security Administration
determination
•
36 months for qualified beneficiaries affected by all other qualifying events.
Paying for continuation coverage
Generally, qualified beneficiaries must pay the entire cost of COBRA continuation
coverage. The premium charged may not exceed 102% of the premium (including both
the employee and employer paid portions) attributable to similarly situated active
employees. For the additional 11 months of extended COBRA coverage due to a
disability determined by the Social Security Administration, the premium charged may
not exceed 150% of the premium paid for an active employee.
The qualified beneficiary must pay the initial COBRA premium within 45 days of
making the COBRA election. The initial premium paid must include the amount
necessary for coverage retroactive to the date of the qualifying event. Thereafter, each
premium must be paid according to the payment schedule required by the health plan and
within the grace period (which must be at least 30 days from the due date) allowed for
receipt of premiums.
Termination of continued coverage
The continuation coverage period will end automatically if:
•
the Company stops providing group health benefits to its employees (if the
Company is a controlled group member, all other controlled group members must
also not provide group heath benefits)
or
289
•
required premiums are not paid within the grace period which must be at least 30
days from the due date under the plan
or
•
the qualified beneficiary becomes a covered employee, or a covered dependent
under another group health plan not subject to a preexisting exclusion or
limitation, or becomes entitled to Medicare
or
•
the maximum period for continued coverage is reached
or
•
a qualified beneficiary who extended coverage due to a disability is determined by
the Social Security Administration to be no longer disabled.
COBRA permits continuation coverage to be terminated when a qualified beneficiary
becomes covered under any other group health plan after the end of the COBRA election
period. However, an employer may not deny COBRA benefits to an employee or other
qualified beneficiary, such as a spouse or child, who is already covered under another
health plan at the time of his or her COBRA election.
Notices
Under COBRA, four written notices are required to be provided by the plan administrator
as follows:
1. A “general notice” of COBRA rights and obligations must be sent to employees
and their covered spouses within 90 days of commencement of health plan
coverage.
2. A “continuation coverage election notice” (also known as a “qualifying event
notice”) must be given to each covered employee or qualified beneficiary by the
plan administrator within 14 days after the plan administrator receives notice from
the employer or qualified beneficiary of the occurrence of a qualifying event.
(The employer must notify the plan administrator within 30 days of the qualifying
event.) It is important to note that each qualified beneficiary has a separate
election right and the notices must be sent so that they reach each qualified
beneficiary. A notice sent to the covered employee or employee’s spouse is
sufficient notice for dependent children residing with the individual to whom such
notice was sent. Plans should keep complete and accurate records of all notices
required by COBRA.
3. A “unavailability of continuation coverage notice” must be provided by the plan
administrator within 30 days of receipt of a request for COBRA continuation
coverage from an individual, if the plan administrator determines that the
individual is not eligible for coverage. Such notice must also be provided to any
290
person who might have an expectation that they will be receiving a qualifying
event notice.
4. As soon as practicable after a plan administrator determines that COBRA
coverage is being terminated before the end of the maximum coverage period, a
notice of “termination of continuation coverage” must be provided to each
qualified beneficiary explaining why and when the coverage is being terminated.
In addition to the notices that must be provided by the plan administrator, covered
employees, covered dependents and qualified beneficiaries must also notify the plan
administrator of certain events, such as divorce, legal separation, a child ceasing to be a
dependent, the occurrence of second qualifying event, or a determination of disability by
the Social Security Administration, or cessation of such disability. The plan should
establish reasonable procedures to be followed by individuals when notifying the plan
administrator of such events, and such procedures need to be disclosed in the plan’s
summary plan description.
Penalties
The Department of Labor, on behalf of participants may assess a fine of up to $110 per
day for a COBRA notice violation, accruing until the notice is issued. Each notice failure
carries its own fine, so fines can become significant. Additionally, an excise tax may be
assessed by the Internal Revenue Service against an employer for failure to comply with
any of COBRA’s provisions. The excise tax is equal to $100 per day per covered
beneficiary. The Internal Revenue Service is given the authority to waive the excise tax if
the failure to comply is due to “reasonable” cause.
Florida Health Insurance
Coverage Continuation Act
Florida law provides for continuation of health insurance benefits for employees of small
employers not covered by federal COBRA. In many respects, other than coverage, the Florida
law mirrors federal law. (FSA 627.6692)
Who is covered
Covered employers
Florida law requires insurance carriers who provide group health insurance to
employees of any employer in the state who employs fewer than 20 employees to
provide continuation coverage.
Employees
All employees who are provided coverage under a group insured health plan
offered by a Covered Employer and are not otherwise covered by COBRA are
covered, unless the employee was terminated for “gross misconduct.”
291
Qualified beneficiaries
A covered employee, his or her spouse and dependent children who are covered
under a group insured health plan offered by a Covered Employer on the day
before the qualifying event (as defined below).
Qualifying events
“Qualifying events” include the same events that would cause an automatic loss of
coverage under the health plan if the plan were covered by COBRA.
Additionally, if a covered employee is in the military reserve or National Guard and is
called to active duty and the employee’s employment is terminated either after or during
active duty, the termination is a separate qualifying event, distinct from the qualifying
event which may have occurred when the employee was called to active duty. Likewise,
if such employee is called to active duty and during the period of active duty, dies,
divorces or legally separates, or a dependent child ceases to be a dependent, such events
are qualifying events distinct from the qualifying event that may have occurred when the
employee was called to active duty. If a qualified beneficiary in the military reserve
National Guard has elected continuation coverage and is subsequently called up to active
duty and becomes eligible for TRICARE, the 18 month maximum coverage period (or
such other applicable coverage period) is suspended during TRICARE. Within 63 days
after the TRICARE coverage terminates, the qualified beneficiary may elect to continue
the remainder of his or her continuation coverage under the group health plan.
Election period
Within 63 days after a qualifying event occurs, the qualified beneficiary must give
written notice to the insurance carrier.
Within 14 days of receipt of the notice, the insurance carrier must send, by certified mail,
an election form and a notification of premium payments and due dates.
The qualified beneficiary must elect continuation of health insurance coverage within 30
days after receiving the forms from the carrier. Carriers who are delinquent with the
required forms must presume that the qualified beneficiary would have timely elected
coverage and must provide continuation coverage at the carrier’s expense, until the notice
is actually received by the qualified beneficiary.
Premium payment
The premium to be paid by the qualified beneficiary for continuation coverage may not
exceed 115% of the premium paid (including both employee and employer paid portions)
for an active employee covered by the group health plan. During the 11-month
extension due to a disability determined by the Social Security Administration, the
premium charged may not exceed 150% of the premium paid for an active employee.
Qualified beneficiaries must pay an initial premium for the period beginning on the date
coverage would otherwise have terminated through the end of the month during which
the election for continuation coverage is made.
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After election, premiums are billed to the qualified beneficiary and due on the first of the
month, with a 30-day grace period.
Period of continuation
Upon election by a qualified beneficiary, insurance coverage must continue until:
•
the expiration of 18 months after the date upon which the coverage would have
ceased without continuation (the 18-month period of coverage may be extended
11 months, for a total of 29 months, if the qualified beneficiary was determined to
be disabled at the time of the qualifying event by the Social Security
Administration and the qualified beneficiary notifies the insurance carrier of the
disability determination within 60 days of the determination and prior to the end
of the original 18 month period)
or
•
the termination of insurance coverage for non-payment of premium
or
•
the date a qualified beneficiary becomes covered under another group health plan,
to the extent that the new plan does not exclude or limit benefits for a preexisting
condition of the beneficiary
or
•
the date a qualified beneficiary becomes entitled to benefits under part A or part B
of Title XVIII of the Social Security Act (Medicare)
or
•
the date the employer terminates coverage for all employees.
Notice to employees
Insurance carriers are required to provide the initial notice of continuation coverage rights
to qualified beneficiaries of group health plans, and include a description of the rights and
procedures of continuation coverage in policies, contracts, certificates of coverage and
plan booklets.
Under Florida law, the carrier has responsibilities of notice and provision of required
election forms. A carrier may not require a Covered Employer to undertake those
responsibilities in the law as a condition of providing group health coverage.
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Review the materials available at:
•
www.dol.gov/ebsa/compliance
•
U.S. Department of Labor’s Employee Benefits Security Administration (EBSA)
National office (866) 444-EBSA (3272)
Atlanta Regional Office
61 Forsyth Street, S.W., Suite 7B54
Atlanta, GA 30303
(404) 302-3900
Miami District Office
8040 Peters Road, Bldg H, Suite 104
Plantation, FL 33324
(954) 424-4022
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Chapter 28
Health care
portability
(HIPAA)
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) has a significant
impact on the medical coverage provided by employer-sponsored group health plans. Among
other provisions, HIPAA:
•
requires group health plans to provide portability of coverage by limiting exclusions
based upon preexisting conditions
•
prohibits such plans from denying coverage to individuals or charging higher premiums
based on health status
•
guarantees renewability of coverage to certain individuals.
Employers who violate HIPAA’s portability provisions may face monetary penalties and/or
lawsuits for failing to meet these requirements.
Definitions
•
Creditable coverage
This is a period of qualifying coverage by another health plan, which must be counted
toward fulfilling a subsequent plan’s period of preexisting condition exclusion (PCE).
Under most circumstances, individuals must be credited with previous coverage under
another group health plan, individual health insurance, COBRA, public health plan,
Medicaid or Medicare. The individual is entitled to a “certificate of creditable coverage”
defining the period of coverage from the previous plan. The individual provides this
certificate to his new plan to confirm the prior health care coverage.
•
Enrollment
To enroll means to sign up for health care coverage under a group health plan.
•
Enrollment date
The enrollment date is the earlier of:
the first day of coverage or the date the individual enrolls in the plan
or
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Health care portability (HIPAA)
if there is a waiting period or affiliation period, the first day of any waiting period
or affiliation period (for health maintenance organizations (HMOs)).
If an individual changes his benefits package options under a plan, the individual’s
enrollment date remains the same.
•
Group health plan
A group health plan is a plan (including a self-insured plan) of, or contributed to by, an
employer or employee organization to provide medical care (directly or through
insurance, reimbursement or otherwise) to employees, their families, the employer or
others associated with the employer.
•
Health insurance coverage
Health insurance coverage means benefits consisting of medical care (provided directly,
through insurance or reimbursement or otherwise) under any hospital or medical service
policy or certificate, hospital or medical service plan contract, or HMO contract offered
by a health insurance issuer. It does not, however, include certain “excepted benefits”
such as:
coverage only for accident (including accidental death and dismemberment)
disability income insurance
liability insurance, including general liability insurance and automobile liability
insurance
coverage issued as a supplement to liability insurance
workers’ compensation or similar insurance
automobile medical payment insurance
credit only insurance (mortgage insurance)
coverage for on-site medical clinics.
In general, certain limited scope dental and vision benefits or long term care benefits are
also excepted benefits, if they are provided under a separate policy, certificate, or contract
of insurance, or are otherwise not an integral part of the plan. If the participant has the
right not to receive coverage for benefits or has to pay an additional premium for those
elected benefits, the benefits are not an integral part of the plan.
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•
Health insurance issuer
Health insurance issuer means an insurance company, insurance service, or insurance
organization (including an HMO) that is required to be licensed to engage in the business
of insurance in a state and that is subject to state law regulating insurance.
•
Late enrollee
A late enrollee is a participant or beneficiary who enrolls under the plan after the first
available enrollment period, or a “special enrollment period.”
•
Placement or being placed for adoption
Placed for adoption means the assumption and retention by an individual of a legal
obligation for total or partial support of a child in anticipation of adoption of such child.
•
Preexisting condition
This is a medical condition (regardless of the cause of the condition) for which medical
advice, diagnosis, care or treatment was recommended or received prior to the enrollment
date. Many group health plans exclude an individual’s preexisting conditions for up to 12
months. Under HIPAA, a plan must give an individual credit for some prior periods of
continuous health care coverage, thus reducing the exclusionary period.
•
Waiting period
The waiting period is the period that must pass before an individual is otherwise eligible
to enroll for coverage under the plan’s terms.
Health insurance portability
Portability is a concept rather than an accurate description of what the law requires. Employees
do not, as the term “portability” suggests, take their old insurance coverage with them when they
no longer participate in a health plan. Instead, health insurance may be loosely described as
“portable” because the law places limits on preexisting condition exclusions (PCEs) that group
health plans may impose on new enrollees.
Limitations on imposing
preexisting condition exclusions
A group health plan (or a health insurance issuer offering group health insurance
coverage) may impose a preexisting condition exclusion (PCE) with respect to a
participant or beneficiary only if the following requirements are met:
•
Six-month look-back rule
The PCE must relate to a condition (whether physical or mental), regardless of the
cause of the condition, for which medical advice, diagnosis, care, or treatment
was recommended or received within the six-month period ending on the
enrollment date. Medical care or treatment also includes taking a prescribed drug
during the look-back period, even if prescribed more than 6 months before the
enrollment date.
•
Twelve-month look-forward rule
The PCE cannot extend more than 12 months after the enrollment date (except
that an 18-month exclusion may be imposed against a late enrollee).
•
Reduction of exclusion period by creditable coverage
The period of the preexisting condition exclusion must be reduced by the number
of days of creditable coverage the individual has as of the enrollment date.
However, prior periods of creditable coverage generally do not count toward
fulfilling the PCE if the individual experienced a break in coverage of 63 days or
more.
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Also, plans must have written procedures for providing certificates upon request.
Effective for plan years beginning on or after July 1, 2005, the plan must provide a
general notice as part of any written application materials and must explain specific terms
of any PCE.
In order to impose a PCE, a group health plan must first provide a general notice to notify
a participant in writing:
•
of the existence and terms of the preexisting condition exclusion
•
explain how a participant may demonstrate creditable coverage (and any
applicable waiting period)
and
•
explain the participant’s right to assistance in obtaining certificates from prior
plans, including the identification and contact information of the person who will
provide such assistance.
In addition, for individual notices, no individual notice will be required for any individual
whose PCE is eliminated by creditable coverage. The General notice of PCE sample
language follows on page 299.
298
GENERAL NOTICE OF PCE
This plan imposes a preexisting condition exclusion. This means that if you have a medical
condition before enrolling in our plan, you might have to wait a certain period of time before the
plan will provide coverage for that condition. This exclusion applies only to conditions for
which medical advice, diagnosis, care, or treatment was recommended or received within a sixmonth period. Generally, this six-month period ends the day before your coverage becomes
effective. However, if you were in a waiting period for coverage, the six-month period ends on
the day before the waiting period begins. The preexisting condition exclusion does not apply to
pregnancy nor to a child who is enrolled in a plan at any time within 30 days after birth,
adoption, or placement for adoption.
This exclusion may last up to 12 months (18 months if you are a late enrollee) from your first
day of coverage, or, if you were in a waiting period, from the first day of your waiting period.
However, you can reduce the length of this exclusion period by the number of days of your prior
“creditable coverage.” Most prior health coverage is creditable coverage and can be used to
reduce the preexisting condition exclusion if you have not experienced a break in coverage of at
least 63 days. To reduce the 12-month (or 18-month) exclusion period by your creditable
coverage, you should give us a copy of any certificates of creditable coverage you have. If you
do not have a certificate, but you do have prior health coverage, we will help you obtain one from
your prior plan or issuer. There are also other ways that you can show you have creditable
coverage. Please contact us if you need help demonstrating creditable coverage.
All questions about the preexisting condition exclusion and creditable coverage should be directed
to ___________________ at Address ________________________or Telephone Number
________________.
299
A group health plan cannot impose any PCE relating to pregnancy as a preexisting
condition.
A plan’s PCE may not apply to a newborn or adopted child if that child has creditable
coverage on at least one day of the 30-day period following his/her birth, adoption or
placement for adoption and is enrolled in the plan within 30 days of the birth, adoption or
placement for adoption. Also, genetic information alone, without diagnosis of a specific
related condition, cannot be treated as a preexisting condition.
Example
An employee works for Company X. Both the employee and his spouse are
covered under Company X’s group health plan. On September 1, 2004, the
couple’s first child, a boy, is born with Down’s syndrome. The baby boy is
enrolled in Company X’s group health plan on September 24, 2004. Since the
child has coverage under Company X’s group health plan within 30 days of
his/her birth, the plan cannot impose a preexisting condition exclusion on the child
because of his Down’s syndrome.
Creditable coverage
Under the Act, health care coverage is primarily made portable by requiring group health
plans to reduce the period of any preexisting condition exclusion by the days of creditable
coverage applicable to the participant or beneficiary as of his/her enrollment date. Periods
of creditable coverage with respect to an individual shall be established or verified
through the presentation of certificates of creditable coverage.
In general, creditable coverage means coverage of an individual under any of the
following:
300
•
a group health plan
•
another group or individual health insurance policy
•
Medicare
•
Title XIX of the Social Security Act (Medicaid), other than coverage consisting
solely of benefits under Section 1928 (the program for distribution of pediatric
vaccines)
•
Chapter 55 of Title 10 of the United States Code (medical coverage for members
of the uniformed services)
•
a medical care program of the Indian Health Service or of a tribal organization
•
a state health benefits risk pool
•
a Federal Employee Health Benefit Program
•
a public health plan (as defined in regulations)
•
a health benefit plan under Section 5(e) of the Peace Corps Act
•
State Children’s Health Insurance Program (SCHIP).
A period of creditable coverage is not counted if there is a break in coverage of at least 63
days (other than any applicable waiting period or affiliation period) between the end of
the creditable coverage period and the participant’s or beneficiary’s enrollment date
under the new creditable coverage.
Example
Jane was covered under Company X’s group health plan for 16 months. On June
15, 2008, she was terminated by Company X and chose not to accept COBRA
coverage. On August 15, 2008, Jane was hired by Company Y, which has a group
health plan. Jane will not be subject to any preexisting condition exclusion under
Company Y’s plan, because she will be able to present a certificate of creditable
coverage showing more than 12 months of applicable creditable coverage, and
there was less than a 63-day gap in her health coverage.
Example
Assume in the example above that Jane was not hired by Company Y until
August 20, 2008. In this case, Jane will be subject to any preexisting condition
exclusion imposed under Company Y’s plan, because her coverage under
Company X’s plan is not creditable, due to the break in coverage of more than 63
days.
Example
Bob was covered under Company A’s group health plan for two years. On March
1, 2008, Bob resigned from Company A and elected continuation coverage under
COBRA. Bob’s COBRA coverage ended on September 1, 2008. On October 31,
2008, Bob was hired by Company B, which has a group health plan. Bob will not
be subject to any preexisting condition exclusion under Company B’s plan,
because he has more than 12 months of creditable coverage (COBRA coverage
counts as creditable coverage), and there was less than a 63-day gap in his health
coverage.
Example
Sam was covered under Company C’s group health plan for a period of seven
months prior to his termination on May 1, 2008. On June 1, 2008, Sam was hired
by Company D and enrolled in its group health plan, which has a 12-month
preexisting condition limitation. Because Sam has only seven months of creditable
coverage, he will be subject to a 5-month preexisting condition exclusion under
Company D’s plan.
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Methods of crediting coverage
Standard method
Under this method, the group health plan counts periods of creditable coverage
without regard to the specific benefits provided under such coverage.
Alternative method
Under this method, the group health plan determines whether creditable coverage
exists for certain types of benefits based upon the scope of coverage provided
under the prior plan. This determination may be made based upon the five
categories set forth below:
1. mental health
2. substance abuse treatment
3. prescription drugs
4. dental care
5. vision care.
A plan may apply a different PCE period for each category of benefits and
creditable coverage for a specific category may apply only to that category. If a
plan applies this method, it must do so uniformly with respect to all participants.
Plans using this alternative method must provide and distribute to all participants
upon enrollment a disclosure statement describing this method and its effect,
including an identification of the categories used. This is a relatively complicated
method of crediting coverage and you should consult with an attorney before
implementing it.
Certification of creditable coverage
Group health plans must automatically furnish certificates of creditable coverage to plan
participants when:
•
their coverage ends (or would end in the absence of continuation of coverage
under COBRA or applicable state law)
•
upon request while covered
•
upon request for up to 24 months after coverage ends.
The plan may request certification of creditable coverage from new enrollees and/or seek
additional information from other group health plans regarding the creditable coverage of
new enrollees.
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Certification requirements
A group health plan must furnish a plan participant, without charge, with
certification of coverage in the form described below on each of the following
occasions:
•
Automatically, at the time a plan participant ceases to be covered under
the plan (or would cease to be covered if not for continuation coverage
under COBRA or applicable state law). For a participant electing COBRA
coverage, the certificate generally should be provided to the participant at
a time consistent with notices required under COBRA. For a participant
not entitled to elect COBRA coverage, the certificate should be provided
within a reasonable period of time after coverage ends.
•
For a plan participant who elected continuation coverage under COBRA,
an automatic certificate is provided at the time such COBRA coverage
ends. This can be satisfied if the automatic certificate is provided within a
reasonable period of time after coverage ends (or after expiration of any
grace period for nonpayment of premium).
•
Upon request by or on behalf of a plan participant while covered and up to
24 months after cessation of coverage. After receiving a request, the plan
must provide the certificate within a reasonably prompt period of time.
The group health plan must maintain written procedures for dealing with each of
these situations.
Note
For an insured plan, the health insurer will often fulfill these obligations.
However, the employer sponsoring the plan should verify that a written agreement
is in fact in place under which the health insurer agrees to provide certificates, so
that the employer will not be violating the certification requirements if the insurer
fails to provide certificates.
Form and content of the certificate
The certification of creditable coverage must be a written certificate containing
the following information:
•
The date the certificate is issued.
•
The name of the group health plan that provided the coverage described in
the certificate.
•
The name of the participant or dependent with respect to whom the
certificate applies, and any other information necessary for the plan
providing the coverage specified in the certificate to identify the
individual.
•
The name, address, and telephone number of the plan administrator or
issuer required to provide the certificate.
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•
The telephone number to call for further information regarding the
certificate (if different from the plan administrator’s phone number).
•
Either:
a statement that the individual has at least 18 months (546 days)
of creditable coverage, disregarding days of creditable coverage
before a significant break in coverage
or
•
the date any waiting period (and affiliation period, if applicable)
began and the date creditable coverage began.
The date creditable coverage ended, unless the certificate indicates that
creditable coverage is continuing as of the date of the certificate.
and
•
An educational statement explaining:
the restrictions on the ability of an issuer to impose a PCE
(including the ability of an individual to reduce a PCE by
creditable coverage)
special enrollment rights
the prohibitions against discrimination based on a health factor
the right to individual health coverage
the fact that state law may require additional protections to
individuals in that state
and
where to get more information.
No written certificate must be provided if all of the following conditions are met:
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•
The individual is entitled to receive a certificate.
•
The individual requests that the certificate be sent to another plan or issuer
instead of the individual.
•
The plan or issuer that would otherwise receive the certificate agrees to
accept the information through means other than a written certificate (for
example, by telephone).
•
The receiving plan or issuer receives such information from the sending
plan or issuer in such form within the required time period.
Rules related to certification
•
A plan may provide a single certificate for a participant and the
participant’s dependents, if the period of coverage is identical for each
individual.
•
The certificate should be sent by first-class mail to the last known address
of the participant and the participant’s spouse. If a dependent’s last known
address is different from the participant’s last known address, you must
mail a separate certificate to the dependent’s last known address.
•
If the individual entitled to receive a certificate designates another
individual or entity to receive the certificate, you may provide the
certificate to that designated individual or entity.
If separate certificates are being provided by mail to individuals who reside at the
same address, separate mailings of each certificate are not required.
Demonstrating creditable
coverage through other means
•
•
If the accuracy of a certificate is in question or a certificate of creditable
coverage is not available, an individual may demonstrate creditable
coverage (and any waiting or affiliation periods) through the presentation
of documents or other means. The plan may not consider an individual’s
inability to obtain a certificate to be evidence of the absence of creditable
coverage. Documents that may establish creditable coverage in the
absence of a certificate include:
explanations of benefits (EOBs)
pay stubs showing payroll deduction for health coverage
a health insurance identification card
a certificate of coverage under a group health policy
records from medical care providers indicating health coverage
third-party statements verifying periods of coverage
other relevant documents that evidence periods of health coverage.
The plan must take into account all information that it obtains or is
presented on behalf of an individual. The plan must make a
determination, based upon the relevant facts and circumstances, whether
the individual has creditable coverage and is entitled to offset all or a
portion of any preexisting condition exclusion period.
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•
A plan shall treat the individual as having furnished a certificate if he:
attests to the period of creditable coverage
presents relevant corroborating evidence of some creditable
coverage during the period
and
cooperates with the plan’s efforts to verify the individual’s
coverage. (Cooperating with the plan includes, among other things,
providing a written authorization for the plan to request a
certificate on the individual’s behalf.)
Notification of
preexisting condition exclusion
A plan seeking to impose a preexisting condition exclusion is required to disclose
to the individual, in writing, its determination of the length of any preexisting
condition exclusion period that applies to the individual as well as the basis for
such determination (including the source and substance of any information on
which the plan relied). In addition, the plan is required to provide the individual
with a written explanation of any appeal procedures established by the plan and
with a reasonable opportunity to submit additional evidence of creditable
coverage. A plan is not required to provide this notice if the plan does not impose
any preexisting condition exclusion on the individual or if the plan’s preexisting
condition exclusion is completely offset by the individual’s prior creditable
coverage.
Special enrollment periods
HIPAA requires group health plans to establish special enrollment periods for certain
individuals. As set forth above, an individual who enrolls for coverage in a group health
plan after the first period in which he/she is eligible to enroll in the plan generally can be
exposed to an 18-month preexisting condition exclusion as a “late enrollee.” However,
any individual who enrolls in a group health plan during one of the special enrollment
periods set forth below is not considered a “late enrollee” and is, therefore, subject only
to a 12-month preexisting condition.
Individuals losing other coverage
A group health plan shall permit an employee or dependent who is eligible, but
not enrolled for coverage under the terms of such plan, to enroll for coverage
under the plan if each of the following conditions is met:
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•
The employee or eligible dependent was covered by a group health plan or
had other health insurance when the coverage was previously offered.
•
The employee stated in writing at such time that enrollment was declined
because of coverage under another group health plan or other health
insurance coverage (if the plan sponsor required such a statement and
provided notice of such requirement).
•
The previous coverage:
was COBRA coverage that has now been exhausted
or
was not COBRA coverage but was terminated as a result of loss of
eligibility for such coverage or because employer contributions
toward such coverage were terminated.
Note
“Loss of eligibility” does not include loss of coverage for failure to pay
premiums or termination of coverage for cause (for example, filing
fraudulent claims under the plan, intentional misrepresentation of facts
related to coverage, etc.). However, an individual reaching a lifetime
maximum under the plan may have a loss of eligibility that may trigger
special enrollment.
•
The employee or eligible dependent requests to be enrolled in the new
coverage no later than 30 days after the prior coverage ceases (a special
enrollment period).
Example
At the time an employee first becomes eligible to enroll in his current
employer’s (Company X’s) group health plan, the employee has COBRA
continuation coverage through his previous employer. As required by the
plan sponsor, the employee gives written notification at the time he is first
eligible to enroll in Company X’s group health plan that he is presently
covered under his previous employer’s COBRA plan. The employee’s
COBRA coverage ends on April 10, 2008 (the end of his/her 18 months of
COBRA). On May 1, 2008, the employee seeks to enroll in Company X’s
group health plan. Since the employee sought coverage under Company
X’s group health plan within 30 days after his COBRA continuation
coverage was exhausted, the employee is not a late enrollee, and thus is
subject only to a 12-month preexisting condition exclusion period. (This
example does not consider the effect the employee’s prior creditable
coverage would have on the 12-month preexisting condition exclusion
period.)
•
The employee or eligible dependent either becomes eligible or loses
coverage under Medicaid or a State Children’s Health Insurance Program
(SCHIP), or requests to be enrolled in the plan no later than 60 days after
the Medicaid or SCHIP coverage ceases.
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Dependent beneficiaries
HIPAA requires a group health plan that provides coverage to dependents to
establish a dependent special enrollment period under certain circumstances. In
general, if an individual eligible for coverage under the terms of the plan, but not
covered, gains a dependent through marriage, birth, adoption, or placement for
adoption, the group health plan must provide a special enrollment period during
which the individual, the new dependent, and any other eligible dependent may be
enrolled in coverage under the plan. HIPAA provides that a dependent special
enrollment period shall be a period of not less than 30 days and shall begin on the
later of the date dependent coverage is made available by the plan or the date of
the marriage, birth, adoption, or placement for adoption. If an individual enrolls
himself or a dependent during the first 30 days of a dependent special enrollment
period, the coverage shall become effective on the following dates:
•
in the case of marriage, not later than the first day of the first month
beginning after the date the completed request for enrollment is received
•
in the case of a dependent’s birth, as of the date of such birth
•
in the case of a dependent’s adoption or placement for adoption, the date
of such adoption or placement for adoption.
Example
Amy is hired on September 3, 2007, by Employer X, which has a group
health plan in which an employee can elect to enroll either for employeeonly coverage, employee-plus-spouse coverage, or family coverage. Amy
is married and has no children. Amy does not elect to join Employer X’s
plan on October 1, 2007. On February 16,2008, a child is placed for
adoption with Amy and her spouse. As a result, Employer X must create
a Special Enrollment Period for Amy and her dependents. As long as Amy
completes the required written forms for enrollment by March 16, 2008,
she can enroll in Employer X’s plan with employee-only coverage,
employee-plus-spouse coverage, or family coverage, effective as of
February 16, 2008.
Notice of special enrollment rights
On or before the time an employee is offered the opportunity to enroll in a group
health plan, the plan is required to provide the employee with a description of the
plan’s special enrollment rules under the statute. The plan determines who is
entitled to special enrollment (a plan offering domestic partner coverage may be
obligated to extend special enrollment to a domestic partner who loses other
coverage). The Department of Labor suggests the following model notice:
If you are declining enrollment for yourself or your dependents
(including your spouse) under [Name of Plan] because of other
health insurance or group health plan coverage, you may be able
to enroll yourself and your dependents in this plan if you or your
dependents lose eligibility for that other coverage (or if the
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employer stops contributing towards your or your dependents’
other coverage). However, you must request enrollment within
[insert “30 days” or any longer period that applies under the plan]
after your or your dependents’ other coverage ends (or after the
employer stops contributing toward the other coverage).
In addition, if you have a new dependent as a result of marriage,
birth, adoption, or placement for adoption, you may be able to
enroll yourself and your dependents. However, you must request
enrollment within [insert “30 days” or any longer period that
applies under the plan] after the marriage, birth, adoption, or
placement for adoption.
To request special enrollment or obtain more information, contact
[insert the name, title, telephone number, and any additional
contact information of the appropriate plan representative].
It is recommended that you require any request for special enrollment be made in
writing.
Prohibition against
discrimination based on health status
Eligibility for coverage
A group health plan cannot establish eligibility rules that discriminate against any
individual with respect to coverage or continued coverage or premium amounts based on
any of the following factors:
•
health status
•
medical condition (including both physical and mental illness)
•
claims experience
•
receipt of health care
•
medical history
•
genetic information
•
evidence of insurability
•
disability of the enrollee or his dependents.
These requirements, however, should not be construed to require a group health plan to
provide particular benefits other than those provided under the terms of such plan or
coverage. Moreover, a group health plan is entitled to limit the amount, level, extent, or
nature of the benefits provided as long as such limitations do not discriminate among
similarly situated individuals. Thus, for example, a group health plan could choose not to
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cover experimental medical procedures or choose to limit the benefits ($500,000 lifetime
maximum benefits for each individual) for experimental medical procedures, provided
this limitation applies equally to all similarly situated individuals.
Premiums
Under HIPAA, a group health plan or insurance company cannot require an individual to
pay a higher premium than the premium charged to a similarly situated individual
enrolled in the plan on the basis of any health-related factor which may apply to the
individual.
A group health plan may offer premium discounts, rebates, and adjustments to
deductibles or co-payments in exchange for adherence to health promotion and disease
prevention programs such as weight loss or smoking cessation programs, if offered as part
of a wellness program that adheres to the requirements of the regulations.
Genetic Nondiscrimination Act of 2008
The Genetic Nondiscrimination Act (GINA) was passed in 2008 and will become
effective for group health plans on November 30, 2009. GINA amends the HIPAA
Portability rules by adding new restrictions on the use of genetic information with respect
to the administration and issuance of group and individual health plan coverage. It
prohibits:
•
group health plans and issuers from setting group premium or contribution
amounts based on an individual’s genetic information
•
individuals or their family members from being required to undergo genetic testing
•
the collection of genetic information for underwriting purposes
and
•
the collection prior to enrollment or coverage under a health plan for purposes of
determining eligibility for coverage or the imposition of preexisting condition
exclusions.
Genetic information includes any information about an individual’s own genetic tests, the
genetic tests of an individual’s family members, and/or the manifestation of a disease or
disorder in the individual’s family members.
GINA prohibits an employer from offering a premium reduction to employees who
complete a health risk assessment prior to enrollment that includes questions about family
medical history.
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Guaranteed renewability under
multi-employer plans and multiple
employer welfare arrangements
Multiple employer group health plans are generally plans that are established for the purpose of
offering health benefits to the employees and dependents of two or more employers. Multiemployer plans (maintained according to one or more collective bargaining agreements) and
multiple employer welfare arrangements (MEWAs) may not deny an employer whose employees
are covered under the plan, continued access to the same or different coverage under the terms of
such a plan, other than for the following reasons:
•
nonpayment of premiums
•
fraud or other intentional misrepresentation of material fact by the employer
•
noncompliance with material plan provisions
•
cessation of coverage in a geographic area
•
the plan offers benefits through a provider network but no covered individual under the
plan still lives, resides, or works in the network’s service area
•
failure to meet the terms of or renew a collective bargaining agreement or to employ
individuals who are covered under the collective bargaining agreement.
General exceptions
•
HIPAA requirements generally do not apply to government plans or to a group health
plan for any year in which the plan has fewer than two employee participants on the first
day of the plan year.
•
The requirements do not apply to a group health plan in relation to its provision for the
following excepted benefits:
accident insurance
disability income insurance
liability and supplemental liability insurance benefits
workers’ compensation
automobile medical insurance
credit-only insurance
coverage for onsite medical clinics
311
•
•
other similar insurance that provides secondary or incidental medical care benefits
as specified in the Treasury Regulations.
The requirements do not apply to a group health plan in relation to its:
provision for Medicare supplemental and similar insurance
limited-scope dental or vision benefits
long-term care benefits or home health care benefits
community-based care benefits
other similar limited benefits specified in the Treasury Regulations, if such
excepted benefits are offered separately (provided under a separate insurance
policy).
The requirements also do not apply to coverage for only a specified disease or illness and
to hospital indemnity or other fixed indemnity insurance if such excepted benefits under a
group health plan are:
provided under a separate insurance policy
not coordinated with group health plan benefits
and
paid upon an event without regard to whether or not the event triggers the
payment of benefits under a group health plan.
Penalties for noncompliance
HIPAA imposes a tax on group health plans which fail to furnish HIPAA certificates or fail to
comply with HIPAA’s portability requirements of the law, including the new provisions of the
Genetic Nondiscrimination Act of 2008 (GINA).
Amount of the tax
An employer whose group health plan fails to meet the requirements (or the plan, in the
case of a multi-employer plan) faces a penalty tax of $100 for each day of the
noncompliance period for each affected individual. The noncompliance period begins on
the date the failure occurs and ends on the date of correction.
Example
An employer maintains a group health plan that covers 100 individuals. The plan
has a failure that affects all 100 individuals and lasts for 30 days before it is
corrected. The failure results in a tax of $100 a day for each affected individual.
Thus the employer owes a total tax of $300,000 ([$100 x 30 days] x 100 affected
individuals).
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Limitations on amount of the tax
•
No tax is imposed during any period if the IRS determines that the employer or
insurer was not aware that the health plan was not in compliance, and could not
have discovered the non-compliance by the exercise of reasonable diligence.
•
No tax is imposed if the failure is due to reasonable cause and is corrected within
30 days of the date it is (or should have been) discovered.
•
Generally, the minimum excise tax for compliance failures, if discovered after
notice of examination, is $2,500. However, if a violation is “more than de
minimis” then the minimum excise tax is increased to $15,000.
•
For unintentional failures, the tax is capped at the lesser of $500,000 or 10% of
the amount paid or incurred by the employer during the preceding tax year for
group health plans (or for multi-employer plans, the lesser of $500,000 or 10% of
the amount paid by the trust to provide medical care during such taxable year).
•
In the case of a group health plan of a small employer (an employer that employs
an average of more than 2 but fewer than 50 employees) that provides fully
insured health insurance coverage solely through a contract with a health
insurance issuer, no tax shall be imposed by this section on the employer on any
failure that is solely because of the health insurance coverage offered by such
insurer.
•
The IRS has the discretion to reduce the amount of a tax penalty if it finds the
penalty to be excessive in relation to the failure and if the failure is due to
reasonable cause, and not willful neglect.
Employee Benefits Security Administration (EBSA), Department of Labor:
•
www.dol.gov/ebsa/
•
Toll-free 1-866-444-EBSA (3272).
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CERTIFICATE OF GROUP HEALTH PLAN COVERAGE
– SAMPLE –
1. Date of this certificate: _________________________________________________
2. Name of group health plan: _____________________________________________
3. Name of participant:___________________________________________________
4. Identification number of participant: ______________________________________
5. Name of individuals to whom this certificate applies: _________________________
___________________________________________________________________
6. Name, address and telephone number of plan administrator or issuer responsible for
providing this certificate: _______________________________________________
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
7. For further information, call: ____________________________________________
8. If the individual(s) identified in line 5 has (have) at least 18 months of creditable
coverage (disregarding periods of coverage before a 63-day break), check here and skip
lines 9 and 10.________________________________________________________
9. Date waiting period or affiliation period (if any) began: _______________________
10. Date coverage began: __________________________________________________
11. Date coverage ended (or if coverage has not ended, enter “continuing”):__________
Note:
Separate certificates will be furnished if information is not identical for the participant and each
beneficiary.
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STATEMENT OF HIPAA PORTABILITY RIGHTS
IMPORTANT – KEEP THIS CERTIFICATE. This certificate is evidence of your coverage
under this plan. Under a federal law known as HIPAA, you may need evidence of your coverage
to reduce a preexisting condition exclusion period under another plan, to help you get special
enrollment in another plan, or to get certain types of individual health coverage even if you have
health problems.
Preexisting condition exclusions. Some group health plans restrict coverage for medical
conditions present before an individual’s enrollment. These restrictions are known as
“preexisting condition exclusions.” A preexisting condition exclusion can apply only to
conditions for which medical advice, diagnosis, care, or treatment was recommended or received
within the 6 months before your “enrollment date.” Your enrollment date is your first day of
coverage under the plan, or, if there is a waiting period, the first day of your waiting period
(typically, your first day of work). In addition, a preexisting condition exclusion cannot last for
more than 12 months after your enrollment date (18 months if you are a late enrollee). Finally, a
preexisting condition exclusion cannot apply to pregnancy and cannot apply to a child who is
enrolled in health coverage within 30 days after birth, adoption, or placement for adoption.
If a plan imposes a preexisting condition exclusion, the length of the exclusion must be reduced
by the amount of your prior creditable coverage. Most health coverage is creditable coverage,
including group health plan coverage, COBRA continuation coverage, coverage under an
individual health policy, Medicare, Medicaid, State Children’s Health Insurance Program
(SCHIP), and coverage through high-risk pools and the Peace Corps. Not all forms of
creditable coverage are required to provide certificates like this one. If you do not receive a
certificate for past coverage, talk to your new plan administrator.
You can add up any creditable coverage you have, including the coverage shown on this
certificate. However, if at any time you went for 63 days or more without any coverage (called a
break in coverage) a plan may not have to count the coverage you had before the break.
Therefore, once your coverage ends, you should try to obtain alternative coverage as soon
as possible to avoid a 63-day break. You may use this certificate as evidence of your
creditable coverage to reduce the length of any preexisting condition exclusion if you enroll
in another plan.
Right to get special enrollment in another plan. Under HIPAA, if you lose your group health
plan coverage, you may be able to get into another group health plan for which you are eligible
(such as a spouse’s plan), even if the plan generally does not accept late enrollees, if you request
enrollment within 30 days. (Additional special enrollment rights are triggered by marriage, birth,
adoption, and placement for adoption.)
Therefore, once your coverage ends, if you are eligible for coverage in another plan (such
as a spouse’s plan), you should request special enrollment as soon as possible.
Prohibition against discrimination based on a health factor. Under HIPAA, a group health
plan may not keep you (or your dependents) out of the plan based on anything related to your
315
health. Also, a group health plan may not charge you (or your dependents) more for coverage,
based on health, than the amount charged a similarly situated individual.
Right to individual health coverage. Under HIPAA, if you are an “eligible individual,” you
have a right to buy certain individual health policies (or in some states, to buy coverage through
a high-risk pool) without a preexisting condition exclusion. To be an eligible individual, you
must meet the following requirements:
•
You have had coverage for at least 18 months without a break in coverage of 63 days or
more;
•
Your most recent coverage was under a group health plan (which can be shown by this
certificate);
•
Your group coverage was not terminated because of fraud or nonpayment of premiums;
•
You are not eligible for COBRA continuation coverage or you have exhausted your
COBRA benefits (or continuation coverage under a similar state provision); and
•
You are not eligible for another group health plan, Medicare, or Medicaid, and do not
have any other health insurance coverage.
The right to buy individual coverage is the same whether you are laid off, fired, or quit your job.
Therefore, if you are interested in obtaining individual coverage and you meet the other
criteria to be an eligible individual, you should apply for this coverage as soon as possible
to avoid losing your eligible individual status due to a 63-day break.
State flexibility. This certificate describes minimum HIPAA protections under federal law.
States may require insurers and HMOs to provide additional protections to individuals in that
state.
For more information. If you have questions about your HIPAA rights, you may contact your
state insurance department or the U.S. Department of Labor, Employee Benefits Security
Administration (EBSA) toll-free at 1-866-444-3272 (for free HIPAA publications ask for
publications concerning changes in health care laws). You may also contact the CMS
publication hotline at 1-800-633-4227 (ask for “Protecting Your Health Insurance Coverage”).
These publications and other useful information are also available on the Internet at:
http://www.dol.gov/ebsa, the DOL’s Consumer Information interactive web pages – Health
Elaws, or http://www.cms.hhs.gov.
316
Chapter 29
The federal, state and even some county and municipal governments may require you, as an
employer, to provide your employees with family and medical leave.
Federal coverage
The Family and Medical Leave Act (FMLA) became effective on August 5, 1993. The
Department of Labor (DOL) published final regulations on January 6, 1995, which went into
effect on June 30, 1995. In early 2008, the FMLA was amended to add certain types of militaryrelated leave to its coverage. On January 16, 2009, new FMLA regulations took effect
implementing those amendments as well as making other changes to the existing FMLA
regulations. FMLA allows eligible employees to take up to 12 work-weeks of unpaid leave each
year for family, medical, or military exigency reasons, and up to 26 work-weeks of military
caregiver leave. FMLA requires covered employers to grant such leave and to return the
employee to his or her position or an equivalent position upon timely return from leave.
Coverage and eligibility
The Act covers public and private employers and educational agencies. Private employers
are covered if they employed 50 or more employees for 20 or more weeks in the current
or preceding calendar year.
Employees must meet eligibility requirements before they are entitled to leave. To be
eligible, an employee must:
•
work for a covered employer
•
have worked for the employer for at least 12 months during the prior seven years
(longer if a break in service resulted from National Guard or Reserve military duties)
•
have worked at least 1,250 hours over the past 12 months
•
work at a location where at least 50 employees are located within 75 miles.
Leave
Assuming you are a covered employer, you must allow an eligible employee to take up to
12 weeks of unpaid leave for one or more of the following reasons:
•
the birth of a child, to care for the newborn child, or placement for adoption or
foster care
317
•
to care for an immediate family member with a serious health condition
•
because of the employee’s own serious health condition that makes the employee
unable to perform the functions of his or her job
•
because of a “qualifying exigency” arising out of the fact that the employee’s
spouse, son, daughter, or parent is on active military duty or on call to active duty
status in support of a contingency operation
•
to care for a covered servicemember who is suffering from a serious injury or
illness related to certain types of military service, provided that the employee is
the spouse, parent, child or next of kin of the servicemember (up to 26 weeks
instead of 12).
Spouses employed by the same employer are entitled to a combined total of 12 weeks of
leave under certain circumstances.
In some situations, employees may take FMLA leave on an intermittent or reduced leave
basis, such as when medically necessary or with your approval. An employee may
request intermittent leave because of his or her own serious health condition, to care for a
seriously ill child, spouse or parent, and for the military-related types of leave mentioned
above. The employee must make a reasonable effort to schedule all medical treatment in a
manner that will not be disruptive to the business. You may require the employee on
foreseeable leave to transfer to an alternative position, more compatible with intermittent
leave, which has equivalent pay and benefits. However, it must be emphasized you
cannot require an employee to take an alternate position instead of taking FMLA leave.
You may require employees to use any accrued paid leave, such as sick or vacation time,
concurrently with unpaid FMLA leave.
Serious health condition
The final regulations define a serious health condition as an illness, injury, impairment or
physical or mental condition that involves one of the following:
318
•
inpatient care in a hospital, hospice or residential medical facility
•
a period of incapacity of more than three consecutive calendar days that also
involves continuing treatment by a health care provider
•
any period of incapacity because of pregnancy or for prenatal care
•
any period of incapacity or treatment for such incapacity because of a chronic
health condition, such as asthma
•
a period of incapacity that is permanent or long-term because of a condition for
which treatment might not be effective
•
any period of absence to receive multiple treatments for a condition that would
likely result in a period of incapacity of more than three consecutive calendar days
without such treatment.
Notice requirements
Employer
•
General notice – If you are a covered employer, you must place
information about the FMLA in any handbooks that you give to
employees and post a notice explaining the FMLA to employees and
applicants, regardless of whether the employees or applicants are currently
eligible for leave. Should you not have a handbook, you must provide the
notice to all new hires. The posted notice must be large enough to be read,
and may be required to be posted in another language, if the majority of
the workforce is not literate in English, but in another language. The
posted notice must be prominently displayed where it can be readily seen
by employees and applicants for employment. Postings of this notice may
be done electronically provided employees have access to a computer. A
penalty of $100 may be levied against an employer for failure to post the
notice. A copy of the poster may be obtained through the Department of
Labor’s website (www.dol.gov).
•
Eligibility notice – Prior to January 16, 2009, employers had only one
designation requirement to employees seeking FMLA leave. New FMLA
regulations effective January 16, 2009, however, break this process into
multiple steps that require the use of multiple notices.
Once an employee requests FMLA leave, or when an employer acquires
knowledge that employee’s leave may be for a FMLA reason, the
employer must notify the employee of the employee’s eligibility to take
FMLA leave (whether the employee works at an eligible site, has worked
at least 12 months, and has worked at least 1250 hours). Employers must
provide this notice of eligibility within five business days of the
employee’s request for leave or the employer’s other notice of the need for
leave, absent extenuating circumstances. This notice may be oral or in
writing, but a written notice is advised.
If the employee is not eligible, the notice must state at least one
supporting reason (for example, an ineligible worksite, insufficient number
of months employed or hours worked).
An eligibility notice must be provided at the commencement of the first
instance of each FMLA-qualifying condition in the applicable 12-month
period. All FMLA absences for the same qualifying reason in the same
FMLA year are considered a single leave, so eligibility notices need not be
provided for such absences.
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•
Rights and responsibilities notice – If an employee is generally eligible
for FMLA leave, at the same time an employer provides the eligibility
notice, it must also provide a written notice of “Rights and
Responsibilities” under the FMLA. This notice may be combined with
the eligibility notice above, and provides additional information to the
employee, including:
whether certification of the need for leave will be required, as well
as the deadline to return such certification
whether documentation is required to establish the relationship to a
family member for whom the leave is sought to care for
the employee’s obligations regarding the payment of health
insurance premiums while on leave, including the consequences of
failure to make such payments, as well as the employee’s potential
obligation to reimburse the employer for health insurance
premiums paid on the employee’s behalf if the employee does not
return to work for certain reasons
the employee’s right or obligation to make use of paid forms of
leave concurrently while on FMLA-protected leave, and the
conditions that must be met in order to use paid leave
whether the employee is considered a “key” employee, and if so,
the potential that reinstatement may be denied upon return
requirements for periodic status reports while the employee is on
leave
the employer’s chosen method for calculating the FMLA leave
year (for example, calendar year, fiscal year, or rolling year)
the maximum amount of leave available during a FMLA leave year,
and the date the leave year commenced
and
the employee’s right to reinstatement to the same or an equivalent
job upon return from a FMLA-protected leave.
Like the eligibility notice, absent extenuating circumstances, you must
provide this written notice within five business days after the employee
gives notice of the need for leave.
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•
Designation notice – Once an employer has received sufficient
information to determine whether an employee’s requested leave is
covered by the FMLA, the employer must, absent exigent circumstances,
notify the employee within five business days whether the leave is
designated as FMLA leave.
The designation notice informs employees of one of five circumstances:
•
the leave is approved
or
•
more information is necessary to determine if the leave can be
approved
or
•
the leave is denied
or
•
the FMLA does not cover the leave request
or
•
the employee has exhausted his or her FMLA leave entitlement for
that 12-month period.
If the leave request is approved, the employer must designate how much
leave is expected to be taken (if known), whether paid leave may be taken
concurrently with the FMLA leave, and whether a fitness-for-duty
certification will be required before the employee may be permitted to
return to work.
If more information is necessary for an employer to make a coverage
determination, the employer must advise what information is needed and
give the employee at least seven calendar days to provide it, or notify the
employee that a second or third medical opinion, at the employer’s
expense, is required. If an employee fails to meet these requests, the
employer may deny the FMLA leave.
The new FMLA regulations permit retroactive notice if an employer fails
to provide timely notice and the delay does not cause employee harm or
injury. If, however, an employer fails to provide a written designation
notice, the new regulations make clear that such failure can be considered
“interference” with an employee’s FMLA rights, for which the employee
can seek damages.
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Employees
Employees must provide you with 30 days advance notice of the need to take
FMLA leave when the need for leave is foreseeable, but they do not need to
mention the FMLA specifically by name. When the need for leave is
unforeseeable, employees are required to give notice as soon as possible and
practical taking into account all the facts and circumstances in the individual case.
You may require employees to provide medical certification to support their need
for medical leave for their own serious health condition or that of a family
member. The DOL has published a medical certification form for this purpose.
When your employee has provided at least 30 days notice, the employee should
return the medical certification before the leave begins. When this is not possible,
the employee must provide the requested certification within the time frame you
require (which has to be at least 15 calendar days after your request), unless it is
not practicable under the particular circumstances to do so despite the employee’s
diligent, good faith efforts. If the employee never returns the requested medical
certification, you may choose not to treat the leave as a FMLA leave. If the
certification form is incomplete or insufficient in any respect, you must notify the
employee in writing of the additional information required and give the employee
seven days to cure the deficiency.
The company’s healthcare provider, as well as a human resource professional,
leave administrator or management official (but not the employee’s direct
supervisor) may contact the employee’s healthcare provider to clarify or verify
the information contained in the certification form. You may also require a second
or third medical opinion, at the company’s expense.
Finally, you may require employees to provide a “fitness-for-duty” certification
when they are ready to return to work.
Maintenance of health benefits
You are required to maintain health insurance coverage for employees on FMLA leave in
the same manner as if they continued employment. If employees regularly pay a share of
the insurance premium, they should continue to make such payments while on leave.
You must continue health care coverage for an employee on FMLA leave for a grace
period of at least 30 days following the due date of the employee’s payment. If the
employee returns to work following the leave period, the employee is entitled to
immediate reinstatement of insurance coverage. Because the law requires immediate
reinstatement of insurance benefits to an employee upon return from leave, even if they
have not been paying for coverage during leave, you should pay the premiums on the
employee’s behalf during the period of leave and attempt to recoup them upon the
employee’s return. If you decide to cancel coverage because the employee failed to make
premium payments, you must provide written notice at least 15 days before cancellation.
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If the employee fails to return from leave, you may be entitled to recover payments made
to continue the employee’s health insurance coverage.
Job restoration
Upon return from leave, eligible employees are entitled to be restored to their former job
or to an “equivalent” position. Equivalent is defined as a similar job with similar pay,
benefits and other terms and conditions of employment. However, employees who are
not capable of performing the essential functions of their regular position at the end of the
FMLA leave lose reinstatement and restoration rights under FMLA.
You may deny or prorate payment of a bonus or other payment based on achievement of
a goal (e.g. hours worked, products sold, or perfect attendance) that the employee fails to
achieve due to FMLA absences, provided such payment is denied or not made to
employees on equivalent leave status for non-FMLA reasons. For example, a policy
denying a perfect attendance bonus to anyone taking an unpaid leave of absence would
affect both FMLA and non-FMLA absences equally.
In some situations, a “key” employee may be denied reinstatement after FMLA leave
ends. A “key” employee is a salaried employee and among the highest paid 10% of
employees located within 75 miles of the particular worksite. You have specific duties to
notify the employee of his or her status as a “key” employee when FMLA leave is
requested. Should you decide not to return the employee to his or job, you would need to
show that it was necessary to prevent “substantial and grievous” economic injury to the
company.
Military leave amendments to FMLA
Recent amendments to the FMLA include provisions for employees in need of leave to
care for a close family member who sustains an injury or illness in connection with active
duty in the armed forces and leave to handle a “qualifying exigency” involving a call to
active duty for a close family member.
Family leave to care for an
injured or ill military servicemember
An eligible employee who is the spouse, son, daughter, parent, or next of kin of a covered
servicemember is entitled to a total of 26 workweeks of FMLA leave during a 12-month
period to care for the servicemember. The term “next of kin” means nearest blood relative
(other than parent, spouse, son or daughter).
This form of leave is available when the servicemember has suffered a serious injury or
illness in the line of active duty and is undergoing medical treatment, recuperation or
therapy, or is in outpatient status or on the “temporary disability retirement list.” Leave
may be taken when the employee is “needed to care for” the injured servicemember
(including providing psychological comfort), and may be taken intermittently or in a
single block, for up to 26 weeks during one 12-month period only. During that 12-month
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period, the employee’s maximum total FMLA leave (including this form of leave) is 26
weeks.
Active duty leave
In addition to leave to care for an injured servicemember, effective January 16, 2009,
FMLA also allows an eligible employee to take up to 12 weeks for a “qualifying
exigency” arising out of the fact that the employee’s spouse, son, daughter, or parent is
on active duty or has been notified of an impending call or order to active duty in the
Armed Forces in support of a contingency operation. This is not an additional 12 weeks
of leave, but simply a new basis for an eligible employee to take their existing 12 weeks of
FMLA leave.
Active duty leave is limited to members of the federal Reserve components, the National
Guard, and certain retired members of the Regular Armed Forces and retired
Reserve while serving on active duty status. It is not available to family members of the
Regular Armed Forces on active duty status.
There are eight situations that may constitute a “qualifying exigency” triggering an
entitlement to this form of leave:
•
Short-notice deployment – If a covered military family member is notified of a
deployment of seven or less days, an eligible employee may take up to seven days
of leave for any reason related to that deployment.
•
Military events – Leave to attend any official ceremony, program or event
sponsored by the military, and to attend family support and assistance programs
and information briefings sponsored by the military, military service
organizations, or the American Red Cross.
•
Child care and school activities – Eligible employee may take leave to arrange
for child care or attend certain school functions of the son or daughter of a covered
military family member, including leave to:
arrange for alternative school or childcare
provide childcare on an urgent, immediate need (not regular) basis
enrollment or transfer of a child in a new school or day care facility
and
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attend meetings with school or day care staff regarding discipline, parentteacher conferences, and school counselors. This form of leave is not
intended to be used to meet with staff at a school or daycare facility for
“routine” academic concerns.
•
Financial and legal arrangements – Eligible employees are allowed leave to
make or update financial or legal arrangements to address the covered military
family member’s absence while on active duty/call to active duty, such
as preparing or executing a will, powers of attorney, transferring bank account
signature authority, obtaining military identification cards, and securing military
service benefits.
•
Counseling – Leave is available for the employee to attend counseling by a nonhealth care provider. Leave is available where the counseling is needed by the
employee, the covered military member, or the son or daughter of the covered
military member needs counseling, so long as the need for counseling arises from
active duty service or call to active duty.
•
Rest and recuperation – Up to five days of leave is available to spend time with
a covered military family member on rest and recuperation leave during a period of
deployment.
•
Post-deployment activities – Leave is available to attend ceremonies incident to
the return of the covered military family member, including arrival ceremonies,
reintegration briefings and events, and any other official ceremony or program
sponsored by the military for a period of 90 days following the termination of the
covered military member’s active duty status. It is also available for the employee
to take leave to address issues arising from the death of a covered military family
member, such as meeting and recovering the body and making funeral
arrangements.
•
Additional activities – An employer and employee may agree to “qualifying
exigency” coverage of other activities that arise out of a covered military member’s
call or service to active duty/contingency operation. The employer and employee
must agree on coverage, timing, and duration.
Employers may require that a request for “qualifying exigency” leave be supported by a
certification confirming the need for leave. Two forms of documentation may be required:
•
a copy of the covered military family member’s active duty/call to active duty in
support of contingency operations
and
•
a signed statement from the employee describing the facts regarding
each request for leave for each form of QE leave.
Penalties and enforcement
FMLA complaints are investigated in a manner similar to wage and hour complaints. The
Secretary of Labor may bring a court action against an employer to recover damages on
behalf of an employee or group of employees. An employee may also bring suit against
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the employer, but only one such action for damages is available per violation. Civil
lawsuits must be brought within two years of the date of the suspected violation, or
within three years, if the violation was considered intentional or “willful.”
Damages that may be recovered include:
•
wages, benefits or any actual monetary losses by the employee for a period of up
to 12 weeks
•
interest on the amount described above
•
“liquidated” damages equal to the total recovery
•
the employee’s attorney fees.
Other relief such as reinstatement of employment or promotion may also be recovered, if
appropriate.
Separate civil penalties may be assessed against employers for failure to provide any of
the notices required under FMLA. The penalties may not exceed $100 per offense.
You must retain certain records under the FMLA, but no particular order or form is
required. Also, no reports or regular submissions are required by the Department of
Labor, unless specifically requested in connection with an ongoing investigation. Most
records are of the type already required under the Fair Labor Standards Act. The records
include:
•
basic payroll and employee data
•
dates of FMLA taken
•
hours of leave, if FMLA leave is taken in increments of less than one full day
•
copies of employee notices required by FMLA
•
copies of documents describing employee benefits, including policies and practices
on taking paid and unpaid leave
•
premium payments for employee benefits
•
records of any employer/employee disputes regarding FMLA, such as written
statements prepared by employees.
If an employee is otherwise exempt from the recordkeeping requirements of the FLSA,
you do not need to keep a record of the actual hours worked by an exempt employee for
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FMLA purposes, provided that the employee is presumed to be eligible for FMLA
benefits after working 12 months for you.
All medical certifications or other documents must be maintained in a confidential manner,
and separate from personnel files, in compliance with the ADA.
How FMLA affects other employee rights
FMLA and the ADA
There are a number of areas in which the FMLA and ADA provide the same or
different benefits to employees. For example, if an employee becomes a qualified
individual with a disability, a reasonable accommodation might include allowing
the employee to work a part-time schedule with no health benefits. However, if
the employee is also eligible for FMLA leave, the employer may be required to
allow the employee to use a reduced leave schedule until 12 weeks of FMLA leave
time is exhausted, with health benefits maintained throughout the leave period.
When the FMLA leave period is exhausted, the employer would be further
required, under the FMLA, to offer the employee a job position equivalent to that
which the employee held when leave began. If the employee was unable to
perform the equivalent job offered because of the disability, the employer’s
obligations under the ADA could then be satisfied by offering the part-time
schedule, with only those benefits provided to part-time employees, as an
accommodation.
With respect to continuing leave, once an employee’s FMLA leave expires, the
ADA may require an employer to provide additional leave as a reasonable
accommodation unless it is an undue hardship.
FMLA and COBRA
Under the continuation of health benefits required by COBRA, family and medical
leave does not automatically constitute a qualifying event.
The IRS has issued Notice 94-103 which provides guidance on how the
requirements of FMLA affect your obligations under COBRA. The IRS states
that the taking of leave under the FMLA does not constitute a qualifying event.
However, a qualifying event, which triggers COBRA reporting requirements, does
occur if three conditions are satisfied:
1. the employee is covered on the day before FMLA leave begins
2. the employee does not return to work after the leave expires
and
3. the employee will lose health care coverage without COBRA.
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The qualifying event occurs on the last day of the leave. The COBRA maximum
coverage period is measured from this date.
The IRS further states:
•
a qualifying event will still occur if the employee fails to pay his or her
portion of the premium, or if the employee declined to continue coverage
during FMLA leave
•
the date of the qualifying event under COBRA is not affected by any state
or local law that may require coverage for a longer period of time than that
required under the FMLA
•
the employee’s right to COBRA coverage may not be conditioned upon
reimbursement of the premiums paid by the employer for continued
coverage during FMLA leave.
FMLA and the FLSA
Under the FLSA, deductions for time missed from work of less than a day may
affect the status of an employee as an exempt executive, professional, or
administrative employee. However, under the FMLA regulations, you may make
deductions from an employee’s salary for time taken as intermittent or reduced
FMLA leave within a workweek without affecting the exempt status of the
employee, provided all other coverage and eligibility requirements are met.
Other leave policies
You must continue to observe any other current employee leave program that
provides greater family or medical leave rights than those established by the
FMLA. For example, if your leave policy provides an additional leave period than
that required under the FMLA, you should continue to provide the additional
leave. However, any policy can be later modified, as long as it continues to
provide benefits at least as great as those provided under the FMLA.
If your policy provides for an additional leave period, you will not be required to
extend any additional rights provided under FMLA, such as the maintenance of
health benefits, to the extended leave period.
The FMLA does not preempt any state or municipal leave laws that provide
greater family or medical leave rights. However, the federal Department of Labor
will not enforce the state law, and states are not authorized to enforce the FMLA.
You must comply with all of the laws under which you are covered.
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Florida laws
State law
Florida law provides parental or family medical leave for employees of the state in “career
service.” Parental leave means leave for the father or mother of a child, born or adopted.
Family medical leave includes leave requested for the care of a family member, including
child, parent or spouse, due to a serious illness. Any mental or physical condition that
requires constant in-home care is considered a serious illness, as well as accidents,
diseases, or other conditions requiring hospitalization.
Career service employees are individuals working for the state or any committee, agency
or department of the state except those working in “exempt” positions. Exempt positions
are numerous, and include elected and appointed officials, employees of state universities,
temporary employees, executive directors, employees in the Governor’s office and most
policy-making or managerial positions.
Career service employees are entitled to up to 6 months of unpaid leave for serious illness
or the birth or adoption of a child. Public employers may not terminate an employee for
taking leave or require an employee to take such leave.
Upon return from leave, the career service employee must be reinstated to the same job or
to a job equivalent in pay, seniority, retirement and fringe benefits. If paid leave was
substituted for any portion of the total leave period, the employee is entitled to any
additional benefits, such as vacation days, etc., which may have accumulated during the
paid leave period.
County and municipal laws
Check for county and municipal ordinances concerning family and medical leave.
Dade County
On December 17, 1991, the Board of County Commissioners for Dade County
approved a family leave ordinance.
The ordinance requires Dade County businesses or those that do business with
Dade County, with more than 50 employees to provide their employees with
unpaid family leave. During the leave of absence, the employer is required to
maintain group health insurance coverage on the employee.
Covered employers in Dade County are required to provide each employee with
90 days of unpaid family leave during any 24 month period for the following
situations:
•
the birth or adoption of a child
•
to provide care to a family member who has a serious health condition
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•
for the employee’s own serious health condition.
Upon completion of the leave of absence the employer is required to restore the
employee to the position he or she held before the leave or to restore the
employee to “an equivalent position” with equivalent pay and benefits, even if the
employer has suffered a reduction in force during the leave.
Employees who request leave are required to provide reasonable notice and
certification by a health care provider.
Dade employers can refuse to return employees under certain circumstances:
•
the employee sets policy on behalf of the employer, or directs a major
activity of the employer
and
•
the employee performs duties of such a highly specialized nature that the
duties cannot be performed by others
and
•
denial is necessary to prevent “substantial and grievous economic injury”
to the employer’s operations.
The Dade County Equal Opportunity Board has jurisdiction over charges of
violations by employers.
Q. Must you post the required notice about family leave, even if no eligible employees
work at the workplace?
A. Yes, a covered employer must post the required notice at each workplace, since an employee
who is ineligible for leave at the present time may become eligible at a future date.
Q. If I don’t have an employee handbook do I have to draft and pass out a policy on the
FMLA?
A. Yes, you still have to provide information to employees about the FMLA. You may obtain
informational brochures and a FMLA poster from the Department of Labor, which will
satisfy the notice requirements. A copy of the poster can be found on the Department of
Labor’s FMLA home page at www.dol.gov/whd/fmla.
Review the materials provided at:
•
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www.dol.gov/whd/fmla
or contact:
•
Wage and Hour Division Office
3728 Phillips Highway, Suite 219
Jacksonville, FL 32207
(904) 232-2489
•
Sunset Center, Room 255
10300 Sunset Drive
Miami, FL 33173-3038
(305) 598-6607
•
3444 McCrory Place, Suite 155
Orlando, FL 32803-3712
(407)648-6471
•
Austin Laurel Bldg., Suite 3000
4905 W. Laurel Ave.
Tampa, FL 33607-3838
(813) 288-1242
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FMLA NOTICE AND DESIGNATION FORM
– SAMPLE –
(Completed by Employer)
TO: _______________________________________________________________________
FROM: ____________________________________________________________________
DATE: ____________________________________________________________________
DATES OF LEAVE: __________________________ to _________________________
Check appropriate blank.
ELIGIBILITY
1.
Is Employee eligible for Family and Medical Leave Act (FMLA) Leave? ___ Yes ___ No
2.
Does Employee have FMLA leave available?
___ Yes ___ No
DESIGNATION OF LEAVE
3.
Leave of absence is:
(a) ____ not designated as FMLA leave 3
(b) ____ designated as FMLA leave.3, 4
(c) ____ preliminarily designated as FMLA leave. 3, 4
_________________
An eligible employee is one who at the time leave begins (1) has been employed for at least 12 months; (2) has worked at least 1,250 hours of
service in the past 12 consecutive months; and (3) is employed at a worksite where 50 or more employees are employed within 75 miles of that
worksite.
If the response to either question is “No,” the remainder of this form need not be completed. Provide only this page of the form to the employee.
3
FMLA leave is available (1) for the birth of the employee’s child, and to care for the newborn child; (2) for placement with the employee of a
child for adoption or foster care; (3) to care for the employee’s spouse, child or parent with a serious health condition; and (4) for the employee’s
own serious health condition. If leave is not designated or preliminarily designated as FMLA leave, provide only this page of the form to the
employee. Otherwise, continue to next page.
4
FMLA leave shall not exceed 12 workweeks in a rolling 12-month period measured backward from the date of leave. Only that portion of the
leave that does not exceed the 12-week period may be designated or preliminarily designated as FMLA leave.
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INFORMATION REGARDING FAMILY AND MEDICAL LEAVE
4.
You have a right under FMLA for up to 12 workweeks of unpaid leave in a 12-month period. Your leave
of absence will be counted against your FMLA entitlement.
5.
Is medical certification of the serious health condition required?
___ Yes ___ No
If required, you must furnish certification before the leave begins, or if that is not possible, within 15
days of our request for the certification. If you fail to do so, we may: (a) delay the commencement of
your leave; or (b) withdraw any designation of FMLA leave, in which case your leave of absence would
be unauthorized, subjecting you to discipline up to and including termination.
6.
In accordance with the Company’s paid leave policies, you may choose or the Company will require you
to use accrued paid leave during some or all of the leave as follows:
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
7.
Since FMLA requires the maintenance of your health benefits during leave, you need to continue paying
your normal premium during the leave to avoid a lapse in coverage. Your payments are due at the same
time they normally would be made by payroll deduction. If your payment is more than 30 days late, your
group health insurance may be canceled, provided you receive 15 days written notice that coverage will
lapse.
8.
If the Company pays your portion of a premium payment for group health coverage or other benefits
(e.g. life insurance, disability payments) during the leave, the Company reserves the right to recoup these
expenses.
9.
You may be required to reimburse us for our share of group health insurance premiums if you do not
return to work following FMLA leave for a reason other than (a) a serious health condition which would
entitle you to FMLA leave; or (b) other circumstances beyond your control.
10.
You will be required to present a fitness-for-duty certificate before we restore you to employment if you
took leave for your own serious health condition (this does not apply to intermittent leave).
11.
Upon returning from FMLA leave, you will normally be restored to your original job, or to an equivalent
job with equivalent pay, benefits, and other employment terms and conditions.
12.
(a) You are a “key employee” under the FMLA definition.
____ Yes ____ No
(b) If you are a “key employee,” restoration to employment may be denied following FMLA leave on
the grounds that such restoration will cause substantial and grievous economic injury to the
company.
(c) At this time, we _____ have or _____ have not determined that restoring you to employment at the
conclusion of FMLA leave will cause substantial and grievous economy injury to the company.
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Chapter 30
Veterans’ rights
Uniformed Services
Employment and Reemployment
Rights Act of 1994 (USERRA)
In recent years, federal legislation has updated, clarified and in some cases increased the rights of
military personnel returning from uniformed service to regular employment. Employers are
required to promptly reinstate military personnel upon their timely application for reemployment.
However, employers are not required to reemploy an individual whose pre-military employment
was for a brief, non-recurrent period.
The Act has broad anti-discrimination and anti-retaliation provisions. Employers are prohibited
from discrimination with regard to hiring, retention or promotion, on the basis of past, present or
future military service.
Protected employees
The Act’s reemployment provisions apply to individuals who have accumulated up to
five years of absence from employment because of military service. Service beyond five
years is also covered if the extended service is the result of a particularly specialized field
of technical military service.
Applying for reinstatement
The amount of time within which the employee must apply for reinstatement to
employment is controlled, in part, by the length of military service:
•
if the service was less than 31 days, the individual must report for reemployment
on the next regularly scheduled workday following the completion of military
service, provided at least 8 hours have elapsed
•
for service of more than 30 but less than 181 days, the employee must report for
re-employment no later than 14 days following completion of service
•
for service of more than 180 days, the employee has 90 days from completion of
service within which to report for reemployment.
Extensions of time of up to two years are provided by the Act if the individual is
hospitalized or convalescing from an injury caused by the military service.
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Veterans’ rights
Upon request, an employer may require that the employee provide documentation that
establishes the timeliness of his or her request for reemployment. However, if such
documentation is not immediately available, the employer should reemploy the individual
until the documentation is available.
Reinstatement requirements
The type of employment which must be offered to the employee upon return from
military service is also affected by the length of service:
•
if the individual had fewer than 91 days of service, the employer must reemploy
in the same position the individual would have attained if he or she had been
continuously employed (if the employer can prove the individual is not qualified
for the position, the individual must be re-employed in the same position he or she
held prior to military service)
•
if the individual had over 90 days of service, the employer may offer a position
with the same seniority, status and pay as the position which the individual held
before military service, if the employee’s previous job is unavailable
•
if an individual returns with a service-connected disability, not qualified for
employment in the position held before military service, the employer must offer
a position of similar seniority, status and pay for which the employee is qualified
(with reasonable accommodation by the employer).
Protection from discharge
An employee who is reemployed in accordance with the Act’s provisions may not be
discharged except “for cause” for a period of 1 year, if the employee was in service for
over 180 days. If the term of service was less than 181 days, but more than 30, the
employer may not discharge the employee except for cause for a period of up to 6
months. Nonetheless, this provision does not insulate the employee from adverse
consequences that would have occurred had he or she never left, such as a legitimate
layoff or job elimination.
Vacation or leave time
Employees may use vacation or personal leave during military service, if the leave was
accrued prior to the service. However, employers may not require that an employee use
accumulated vacation or personal leave time.
Health care coverage
If the employee is covered by an employer-sponsored health plan, the employer must
offer continuous coverage for up to 24 months (in a manner similar to COBRA) during
the military service. Employers must continue to pay their regular share for the coverage,
if the military service does not exceed 31 days. For service beyond 31 days, the employee
may be required to pay for the health care coverage an amount not more than 102% of the
full premium under the plan.
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Veterans’ rights
Enforcement
Employees may bring a civil action against an employer for reemployment and backpay.
In addition, an employee may recover liquidated damages which equal the backpay
award if the employer’s violation is found to be willful.
The Veterans’ Employment Training Service provides assistance to veterans who have a
complaint. The Service will initiate an investigation and contact the employer.
Vietnam Era Veterans’
Readjustment Assistance Act of 1974
The Vietnam Era Veterans’ Readjustment Assistance Act of 1974 applies to federal contractors
and subcontractors with contracts of $10,000 or more, requiring affirmative action in the hiring
and promotion of disabled and Vietnam era veterans (Chapter 7, Affirmative action). In
addition the Act applies to all employers by requiring that certain reemployment rights be
extended to veterans, reservists, and National Guardsmen.
The application of the reemployment provisions may vary according to the facts of the situation.
Leave of absence and reinstatement
Full-time active duty
A military leave of absence must be granted to permanent full-time or permanent
part-time employees who enlist in the armed forces or who enter active duty in the
armed forces in response to an order or call to service. The employer should
request, for recordkeeping purposes, that a copy of the employee’s military orders
be submitted for inclusion in the employee’s personnel folder. However, the
employer cannot delay the leave of absence until copies of the military orders are
received.
Eligibility for reinstatement
To qualify for reinstatement, the employee must meet the following
requirements:
•
the leave of absence for an enlistee may not exceed five years and
any service in excess of four years must be at the request and
convenience of the federal government. The leave of absence for
an employee called to active duty after beginning employment may
not exceed four years. Periods of additional service imposed by
law cannot affect the veteran’s eligibility for reinstatement.
•
the employee must satisfactorily complete the period of active duty
and furnish a discharge certificate to that effect.
•
application for reinstatement must be made within 90 days after
release from military service or from a hospitalization continuing
after discharge for a period of not more than 1 year.
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Veterans’ rights
•
the employee must be qualified to perform the duties of the former
position. If not qualified for the former position by reason of a
service-related disability, but qualified to perform the duties of
other positions, the employee must be offered a job in the closest
comparable position for which he or she is qualified.
An employer can avoid the obligation of reinstatement if it can be shown
that a change in the employer’s circumstances makes it “impossible or
unreasonable” for the employer to reinstate the employee. The burden of
establishing this affirmative defense rests with the employer.
For example, reemployment may be excused where there has been an
intervening reduction in force that would have otherwise included the
employee. This defense, however, is not established simply by showing
that another employee was hired to fill the reemployment position during
the employee’s absence, even if reemployment would require termination
of the replacement employee.
Rights after reinstatement
The employee who is reinstated is entitled to:
•
the same seniority, status, and pay he or she would have attained if
not absent due to military service
•
fringe benefits equivalent to those granted employees returning
from other leaves of absence, consistent with the employer’s
policies or practices.
Duration of rights
The veteran employee entitled to reinstatement is protected from
discharge, except for cause, for one year following reinstatement.
Medical and life insurance coverage
Company medical and life insurance plans are not required to cover
employees who enter military service or their families, except to the extent
that coverage would continue for other employees on a comparable longterm leave of absence. However, employers must offer COBRA coverage
to employee-reservists called to active duty in the Persian Gulf. A notice
of COBRA rights must be mailed and reservists and their dependents are
entitled to purchase group health coverage at their own expense under
COBRA. Military health plans are not considered to be “group health
plans” which would cut off COBRA continuation rights. Upon the
employee’s return to employment, medical and life insurance coverage
must be reinstated according to the employer’s policies or practices.
Vacation pay
The employee should be paid any vacation pay and granted any vacation
days earned prior to leaving for military duty. While on military leave of
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Veterans’ rights
absence, the employee does not earn additional vacation time. Time spent
on military leave must be counted, however, in determining the
employee’s length of employment for purposes of calculating any vacation
time the employee will be entitled to once he is reinstated.
Salary
Military leave of absence time is not generally paid leave (see page 350,
Florida military leave requirements).
Active duty for training
A military leave of absence must be granted to permanent full-time or permanent
part-time reservist or National Guard employees who are ordered or volunteer to
perform an initial period of active duty for training of 12 consecutive weeks or
more. The U.S. Supreme Court has held that no limit be placed on the length of
time military reservists may be absent for military duty. The employer should
request, for recordkeeping purposes, that a copy of the employee’s military orders
be submitted for inclusion in the employee’s personnel file. However, the
employer cannot delay the leave until the employee provides the orders.
For the reservist or National Guard employee to qualify for reinstatement,
the following requirements must be met:
•
the employee must satisfactorily complete the training duty and
furnish a certificate to the employer to that effect
•
the employee must apply for reinstatement within 31 days after
release from training duty. If hospitalized from the training duty,
the employee must apply for reinstatement within 31 days after
release from hospitalization, but no later than 1 year after the
release date from training duty)
•
the employee must be qualified to perform the duties of the former
position (if the employee is not qualified because of a disability
sustained during training duty, but is qualified to perform the
duties of other positions, he or she must be offered placement in
the closest comparable position).
A change in the employer’s circumstances may make it “impossible or
unreasonable” for the employer to reinstate the employee.
The reservist or National Guard employee who performs initial periods of
short-term active duty for training is entitled after reinstatement to:
•
the same seniority, status, and pay he or she would have attained if
not absent due to military service
and
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Veterans’ rights
•
fringe benefits equivalent to those granted employees returning
from nonmilitary leaves, consistent with the employer’s policies or
practices.
Duration of rights
A reservist or National Guard employee entitled to reinstatement after
short-term active duty for training is protected from discharge, except for
cause, for six months following reinstatement.
Company medical and life insurance plans are not required to cover an
employee on short-term military leave except to the extent that coverage is
provided for other employees on a leave of absence of comparable length.
Upon the employee’s return to active employment, personal medical and
life insurance coverage must be reinstated according to policies and
practices relating to employees returning from nonmilitary leaves of
absence.
Vacation pay
If an employee leaving for military duty will not be returning to work that
year, the employee should receive vacation pay or be allowed to take
earned vacation days prior to the beginning of military leave. Time spent
on a military leave of absence must be counted in determining the
employee’s length of employment for purposes of calculating how much
vacation time he or she will be entitled to accrue following reinstatement.
Salary
Military leave of absence time is not generally paid leave (see page 350,
Weekly drills, weekend
drills or summer training duty
A military leave of absence must be granted to permanent full-time and
permanent part-time reservist or National Guard employees to participate in
weekly drills, weekend drills, or summer training duty.
To qualify for reinstatement, the reservist or National Guardsman must:
348
•
have requested leave to perform training duty in the military
reserves or National Guard
•
report for work on the day after returning from training, unless
circumstances beyond his or her control delay return – if the
employee is hospitalized during the course of training duty, he or
she must report for work after release from the hospital, but not
later than 1 year after the scheduled release date
Veterans’ rights
•
be qualified to perform in his or her former position. If the
employee is not qualified to perform because of a disability
sustained during training duty, he or she must be offered placement
in the closest comparable position for which the employee is
qualified.
After brief training periods as described above, the reservist or National
Guardsman must be returned to work with the same seniority, status, pay
and vacation time as otherwise would have been attained.
Employer medical and insurance plans are not required to cover an
employee performing duties or actions related to military service, except
to the extent that coverage is extended to other employees on a leave of
absence of comparable length.
Vacation pay
The employee cannot be required to use vacation time to pursue reservist
or National Guard training.
Salary
Military leave of absence is generally not paid leave (see page 350,
Reporting obligations
Under the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, companies with
government contracts or subcontracts totaling $10,000 or more are required to file an
annual form, the VETS-100, disclosing:
•
the number of special disabled veterans and the number of veterans of the
Vietnam era in the workforce by job category and hiring location
and
•
the total number of new employees hired during the period covered by the report,
and of that total, the number of special disabled veterans, and the number of
veterans of the Vietnam era.
Special disabled veterans are those with a 30% or higher disability rating from the
Veterans Administration. Employers are permitted to allow veterans to identify
themselves, on the application for employment, in order to be entitled to special
consideration. Any medical information that may be received must be kept confidential,
in medical files separate from personnel files.
Data from the VETS-100 forms is reviewed by the Department of Labor’s Office of
Federal Contract Compliance (OFCCP). The OFCCP will examine whether companies
are in compliance with the Vietnam Era Veterans’ Assistance Readjustment Act of 1974.
Employers not complying may face cancellation of their federal contracts. The VETS349
Veterans’ rights
100 form and the EEO-1 form are separate reports. Companies are required to file both of
these reports.
Florida military leave requirements
Reporting obligations
Insurance policies covering members of the Florida National Guard or any branch of the
military reserve must continue coverage during military service with no change in
premium. If employees elect not to continue coverage during service, coverage must be reinstated upon return from active duty. Employees must request reinstatement within 60
days of returning to employment.
Employees must notify their employers of their military status and intent to continue
insurance or re-instate insurance before leaving employment to report to active duty,
unless the notice is impossible or unreasonable.
Active duty with the Florida National Guard
Florida’s military affairs law applies where USERRA does not. It safeguards the
reemployment rights of National Guard members returning from state active duty.
Employers must provide a paid leave of absence for up to 30 days of active state-ordered
duty, field exercises or other training required of a Florida National Guard member. This
requirement applies to all public employers of the state, county or any city or other
political subdivision.
In addition, all employers, including private and public employers in Florida, are
prohibited from discharging, reprimanding, or in any other way penalizing any member
of the Florida National Guard because of his or her absence by reason of active duty.
Effective July 1, 2009, Florida’s military affairs law was amended to provide returning
Florida National Guard members with:
•
the seniority that the member had at his or her place of employment on the date of
the commencement of his or her state active duty and any other rights and benefits
that would come to the member as a result of such seniority
and
•
any additional seniority that the member would have attained at his or her place of
employment if he or she had remained continuously employed and the rights and
benefits that would come to the member as a result of such seniority.
The law was also amended to extend greater protection by prohibiting employers from
discharging returning members for a period of one year following their return to work,
except for cause. Employers are also prohibited from requiring returning members to use
vacation, annual, compensatory, or similar leave for the period during which they were
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Veterans’ rights
ordered into state active duty. Upon request, however, they must be permitted to such
leave, along with any pay accrued prior to commencement of state active duty service.
Upon completion of state active duty, National Guard members must notify the employer
of their intent to return to work in order to secure statutory protection. The amended law
also specifies the following exceptions to an employer’s reemployment obligation:
•
the employer’s circumstances have so changed as to make employment impossible
or unreasonable
or
•
employment would impose an undue hardship
or
•
the employment from which the member leaves is for a brief, non-recurrent period
and there is no reasonable expectation that such employment will continue
indefinitely or for a significant period
or
•
the employer had legally sufficient cause to terminate the member at the time he or
she left for state active duty.
Any person found in violation of these provisions may be liable for a civil penalty of up
to $1,000 per violation.
Military reserves
Florida law provides that any person who seeks employment must not be denied
employment because of any obligation as a member of a reserve component of the Armed
Forces. In addition, an employee must not be discharged or denied a promotion or other
advantage of employment because of obligations as a reserve member.
Prior to taking any action with respect to employees who volunteer for or who are called
to active duty, Florida employers should carefully examine any existing leave policies,
benefit plans, and collective bargaining agreements for additional obligations with regard
to employees in military service. Employers with specific questions regarding the
granting of leave or reinstatement following active duty should direct questions to a labor
attorney.
Take a look at the information provided at:
•
www.dol.gov/vets/
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Veterans’ rights
or contact:
•
352
Veterans’ Employment and Training Service
107 E. Madison Street, Suite B30
Tallahassee, Florida 32399
(850) 245-7199
Chapter 31
The workers’ compensation system in Florida is designed to cover medical costs associated with
workplace injuries, as well as to provide indemnity benefits to injured workers for their lost time.
Workers’ compensation is basically a “no fault” system of paying injured workers benefits for
accidents that occur on the job. In the vast majority of cases, workers’ compensation is the
“exclusive” remedy for employees who suffer on the job injuries or illnesses. Accordingly, the
employer must realize that the actual manner in which the accident occurred is often times not
that important (except for intentional injuries, violations of safety rules and injuries resulting
from the use of drugs or alcohol). In other words, even if the employee was injured because of
his own negligence or because of the negligence of non-employees, in most cases, the injury will
still be covered.
Who is covered
Number of employees
All employers with four or more employees are required to have workers’ compensation
coverage. In addition, coverage is required for employers with fewer than four employees
in the construction industry. Employers who are not required to secure coverage must
post a notice in a conspicuous place explaining that their employees are not covered.
Subcontractor
If there is a contractor/subcontractor relationship, the employees of the subcontractor are
considered the statutory employees of the general contractor and the general contractor
must purchase workers’ compensation coverage for the employees of the subcontractor.
The only exception to this obligation to purchase coverage is if the subcontractor
purchases the required worker’s compensation coverage. Unless the general contractor
wants to purchase additional coverage, he or she should insist on a current Certificate of
Insurance from the subcontractor as evidence that workers’ compensation coverage is in
force.
If the contractor wants the subcontractor to obtain coverage and in fact receives a
Certificate of Coverage from the subcontractor, it should immediately register in writing
with the workers’ compensation carrier for the subcontractor. If there is such a
registration, the contractor will be entitled to receive written notification from the carrier
of any cancellation or non-renewal of the subcontractor’s policy.
Independent contractor
Unless there is a contractor/subcontractor relationship, the employer is not responsible to
secure workers’ compensation coverage for either the independent contractor or for
353
employees of independent contractors. However, the independent contractor may be
responsible for providing coverage to his or her employees. Factors indicating that the
independent contractor will be responsible for its own coverage include:
•
the individual maintains a separate business with separate facilities, truck,
equipment, and materials, etc.
•
the individual has a federal employer identification number, has applied for such a
number, or is a sole proprietor not required to obtain a federal ID number
•
the individual agrees to perform specific work for a specific amount of money,
and controls the means of performing the work
•
the individual pays the primary expenses related to the work
•
the individual is responsible for satisfactory completion of work and could be held
accountable for a failure to perform
•
the individual receives compensation for work on a commission or per-job basis
•
the individual may realize a profit or loss in connection with the work
•
the individual has continuing business obligations
•
the success or failure of the individual’s business depends on the relationship of
income and expenses.
However, these are only a portion of the factors. For more information, see Chapter 12,
Independent contractors.
For example, if the supposed independent contractor is shown how to do the work, when
to come to work, paid hourly as opposed to by the job, and has taxes deducted from his
paycheck or social security paid, there may well be an employer/employee relationship
for which workers’ compensation coverage is needed (regardless of what a contract
between the parties might state).
Loaned employees
A lent employee is eligible for workers’ compensation benefits from a “borrowing”
employer, even if the employee is not on the payroll, where the employee is performing
some function for the benefit of the employer and the employer has the power to control
the details of the work being performed.
Excluded employees
Certain types of employees need not be provided with workers’ compensation coverage.
For example, an employer does not have to obtain workers’ compensation coverage on:
354
•
licensed real estate workers paid solely by commission
•
domestic servants
•
certain agricultural laborers
•
professional athletes
•
casual employees (see page 138, Casual labor)
•
taxi-drivers
•
horse exercise riders who do not work for a single farm or breeder and are paid by
the job
•
individuals working under a sentence of a court to perform community services
for violating Florida laws
•
volunteers.
Corporate officers are automatically included within the definition of covered employees
but can elect to be excluded by filing specific forms. No more than three officers of
corporations or three partners actively engaged in the construction business may elect
exemption from coverage.
Sole proprietors and partners are automatically excluded, but can be included by filing a
form.
Extent of workers’
compensation coverage
Workers’ compensation extends far beyond the job site.
Traveling
If an employee is injured while traveling for work, he is eligible for workers’
compensation if the injury occurs while the employee is actively engaged in the duties of
his employment. This includes travel unessential to the performance of the job, such as
stopping to grab a soda at a convenience store while making a work-related delivery, but
does not include ordinary home to work commuting.
Recreational or social activities
Recreational and social activities are covered only if they are specifically required and
produce a direct benefit to the employer, such as activities occurring during a mandatory
retreat. Employers should ensure they advise employees in writing that social and
athletic activities sponsored by the Company are strictly voluntary and that participation
is at the employee’s own risk. Some employers require employees participating in
Company activities or on Company sports “teams” to sign waivers.
Activities for “personal convenience”
Injuries while employees are on break are covered if the employee was at a place where
he was reasonably expected to be and the employer has condoned such activity, even
though the injury occurred off the work site. For example, a construction worker who is
355
injured while picking up some coffee at a shop near the construction site, and frequented
by all the workers, could potentially be covered.
Injuries resulting from “horseplay”
Injuries resulting from horseplay on the job may be covered if the employee’s supervisor
tolerates such activity and does nothing to stop it after becoming aware that it occurs. An
example of this would be where injury results from a prank by a worker who frequently
plays such pranks on other workers and has not been disciplined or told to refrain from
such behavior.
On-call injuries
Employees who are “on call” such as policemen and nurses are covered for injuries
occurring in the process of responding to a call. An example might be where the
employee is injured by slipping and falling on wet pavement outside his house while
walking to his car to return to work when called in.
Special provisions have been established for law enforcement officials. They are
considered “on the job” if:
•
they are employed full time and primarily responsible for the prevention and
detection of crime
•
they are on duty at the time of an accident
•
are not engaged in private employment at the time of the injury.
Off premises injuries
Accidents occurring when the employee is traveling to a doctor’s office to obtain medical
care for an on-the-job accident are covered. Even if the doctor’s appointment is not
related to an accident occurring on the job, the injury might still be covered if the trip was
authorized by the employer by, for example, approving that a truck driver make a stop at
a doctor’s office for a check-up while en route to deliver goods to a customer.
Assaults
If a fight breaks out between two employees at the place of employment for reasons
purely personal, the injuries resulting may still be covered if the employment in some
way contributed to the altercation. An example of this may be where employees are
expected to stage a fight at a themed restaurant, and personal hostilities become
heightened to the point the fight becomes real and injuries result.
However, injuries which occur through the willful intention of employees to injure
themselves are not compensable.
Injuries in employer-provided housing
Almost any injury occurring in employer-provided housing is covered. For example,
injuries caused by fire or an employee’s cigarette smoking or shooting by a co-resident
have been covered under the Act.
356
Parking lot injuries
Injuries occurring in employer-provided parking lots are covered, such as an employee
injuring herself when slipping and falling on wet pavement in the parking lot.
Lunch time accidents
Sometimes injuries occurring during periods of time when the employee is at lunch are
covered especially, for example, if the injury occurs in an employer-provided cafeteria or
the employee is allowed to drive a company vehicle to the restaurant.
Injuries occurring to or from work
Injuries occurring to or from work are not covered. However, if the employee was
engaged in a special errand or mission for the employer, such as picking up materials for
a work project while going to or home from work, and is injured, workers’ compensation
applies.
Telecommuting
Employees who work at home will be covered under workers’ compensation if their
injury occurs “in the scope or their employment,” during their normal working hours, and
in connection with their job duties (see Chapter 13, Telecommuting). An example of
this might be where the employee injures her foot when she drops a file box containing
work-related files on it while working at home.
Deviations from employment
Injuries occurring when the employee is deviating from his employment are not
compensable unless specifically approved by the employer or in response to an
emergency and designed to save life or property. For example, an employee who stops
off at the mall to do some shopping between leaving a work-related conference, and
before returning to the office, will not be covered for injuries that result from the detour.
Out of state injuries
Employees who are injured out of state, such as a truck drivers making cross-country
deliveries, are still covered by Florida workers’ compensation if:
•
the contract of employment is made in the state of Florida
or
•
the employee’s employment was principally localized in the state of Florida.
Stress/mental disorder
Nervous or mental injury from stress does not require benefits if not accompanied by a
physical injury. Any compensable mental injuries must have a physical injury as the
major cause.
357
Selecting workers’
compensation coverage
Once it has been determined that it is needed, coverage for workers’ compensation can be
obtained in any number of ways and you should be generally familiar with these different
methods. It should be remembered that the employee cannot be required to pay part of the
workers’ compensation premium. Likewise, the employee cannot be required to sign a statement
that he will not seek to obtain workers’ compensation benefits if injured on the job (such
agreements are invalid). The following is a general summary of the different methods for
obtaining coverage.
Insurance policy
The most widely used method of obtaining protection is to purchase a policy of
insurance. By paying one lump sum annually or periodically over a year’s time, you can
obtain needed coverage. The coverage is obtained from an insurance company or through
a voluntary association of insurance companies formed for employers who are
unacceptable as a standard risk to carriers, known as the “assigned risk pool.” Costs to
employers put in the assigned risk pool are substantially higher. An employer in an
industry with high accident rates, or employers with a history of high workers’
compensation claims are considered to be in the assigned risk pool.
Self-insurance pools or funds
A group of employers may pledge their individual assets to collectively guard against
exposure for paying workers’ compensation benefits. The State Department of Insurance
regulates group self-insurance funds. The department will allow two or more employers
to qualify as a group self-insurer if certain rules are followed in the set up and
administration of the fund. If a deficit develops, an employer will be responsible for
deficits according to his proportion of the overall premiums in the fund. Self-insurers are
also required to carry reinsurance to prevent deficits from occurring.
Individual self-insureds
Individual employers having a net worth of at least $250,000 may choose to insure
themselves as individual, “free standing” self-insureds. This concept of coverage is
controlled by the Department of Labor and Employment Security and allows for
employers to provide workers’ compensation coverage by individually paying benefits.
Often times third party administrators are used by such employers to assist in the
handling of claims and provide other services.
Miscellaneous coverage plans
There are a variety of other plans and policies for workers’ compensation coverage
available that are used less frequently. Some larger companies use what is known as a
“wrap-up” policy which provides workers’ compensation coverage to companies on
particular jobs. Insurance companies and self-insured funds also offer retrospective rating
plans (retro plans) which use employer participation in the payout of some workers’
compensation benefits, which results in savings on overall premium payments.
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Failure to obtain
workers’ compensation coverage
What happens if an employer fails to obtain coverage when otherwise required and an accident
occurs? In such instance, the injured employee can require the employer to pay workers’
compensation benefits individually or can sue in civil court. If suit is filed in civil court, the
employer cannot defend the claim on the basis that the injured employee’s injuries were caused
by himself or a fellow employee or that the injured worker assumed the risk of his employment.
A serious accident would require the payment of millions of dollars in a civil action. In addition,
since workers’ compensation coverage is mandatory for the majority of employers in Florida, the
Division of Workers’ Compensation can close a business down with a “stop work order” until
proof of coverage is provided. The penalty is a minimum of $1,000 and is based on the insurance
premiums which should have been paid, but were not, multiplied by 1.5 for the prior three years.
The Department may also sue the employer in court to recover unpaid penalties or to obtain a
court order prohibiting the employer from conducting business until proper coverage is obtained.
Fraud
Suspected fraud can be reported directly to the Department of Financial Services, Division of
Workers’ Compensation Fraud. The toll free number to report suspected workers’ compensation
fraud is (800) 378-0445. A person reporting fraud will be immune from civil liability or
retaliation for doing so, unless the report was made under false pretenses.
Criminal violations will be enforced against false reporters, those committing fraud within the
workers’ compensation system, and individuals who retaliate against persons reporting fraud.
The employment process
An employer may not refuse to hire an individual based on a past history of workers’
compensation injuries or on a speculation that workers’ compensation benefits will be required
in the future.
Under the American with Disabilities Act (ADA), an employer may not inquire into an
applicant’s workers’ compensation history, such as the existence of prior claims, before making
an offer of employment. However, an employer may ask for such information after a conditional
offer of employment is made before the employee begins work.
If a new employee’s previous injury or condition was severe enough to meet the definition of a
disability under the ADA, the employer may be required to provide a reasonable accommodation
if the individual is otherwise able to perform the essential function of the job. If, on the other
hand, the employee’s injuries, or condition was short-term and/or did not rise to the level of a
“disability” under the ADA, the employee most likely will not be entitled to the protections of
the ADA. See page 112, Americans with Disabilities Act (ADA). However, employers
should bear in mind that employees have protection under the ADA for “perceived disabilities”
or a “record of a disability.”
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Educating supervisory personnel
If there are problems with particular workers’ compensation cases, it is often because the
employee does not know what should be done if an accident occurs or fails to promptly report
and on-the-job injury. Many times, the injured employee’s immediate supervisor fails to take
appropriate action. To prevent this, your supervisors should be educated in the following areas:
Reporting accidents/injuries
The Florida’s Workers’ Compensation Law recognizes any individual in an authoritative
position as the person to represent the employer. If an employee reports an injury to his
supervisor, the law considers the employer to have notice of such injury and to provide
benefits as provided in the workers’ compensation law. If the employer fails to report
such injuries/accidents, the Division of Workers’ Compensation can impose fines. An
employer’s handbook or policies should make clear how the company’s reporting
procedure works, and employers should utilize standard reporting forms in order to keep
good paperwork. Employers should establish policies and procedures pertaining to the
reporting of all injuries to ensure prompt and consistent action in the event of workplace
injuries. (See page 361, Following the accident, for those procedures that must take
place after an injury.)
Medical care
Under the workers’ compensation law, the employer, except in emergency situations, has
the first choice of physician. All health care providers who are referred to employees with
work-related injuries or illness must be certified by the Division of Workers’
Compensation and receive training in cost containment. Accordingly, it is necessary to
advise employees in the employer’s policy manual or handbook that except in the event
of an emergency, they must seek treatment with one of the Company’s authorized
workers’ compensation providers, not their own doctor. Supervisors should not authorize
medical care without approval from management.
Medical and drug expenses (generic or generic equivalent unless brand named
medications are medically necessary) are paid by the workers’ compensation carrier.
Medical expenses may include payment for broken dentures, eyeglasses, and other
prosthetic devices. An employee is free to choose the pharmacy or pharmacist used to
dispense medications.
Educating the worker
Not only is it important to educate supervisory personnel on the general rules of workers’
compensation, it likewise is important to advise the work force of their duties and
responsibilities. Within three days of being notified by the employer or carrier of an accident, the
Division will mail to each injured worker an informational brochure explaining the employee’s
rights, benefits, and obligations. The employer is responsible for providing the following
information before an accident occurs.
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Workers’ compensation coverage posting
By law, the employer must post in a conspicuous place the name of the employer’s
insurance company or self-insured fund and the method of contacting the individual
responsible for paying workers’ compensation benefits. See page 507 for information to
obtain the poster. Be sure to include the required information on the poster.
Safety rules
Employees should be told exactly what expectations are in regard to safety rules and
standards. This includes requirements regarding any personal protective equipment
required for the job (including respirators, safety glasses, hard hats and the like). Benefits
are reduced by 25% if the employee knowingly violates a safety rule that has been
adopted by the employer or knowingly fails to wear a safety device required by the
employer, and an injury results. If an employer has an employee manual, it should
include a written safety policy.
Notice of accident to the employer
An injured worker has 30 days following an accident to report it to supervisory personnel. The
employee’s claim for benefits can be prohibited if timely notice is not provided to the employer,
with certain exceptions.
Following the accident
Following the accident, there are some very definite actions that need to be taken by the
employer. The most important initial action, of course, is to get the injured employee to the
doctor. Following that immediate need, the employer will be called upon to take some procedural
steps to ensure that the injured employee is either timely paid workers’ compensation benefits or
that a claim for benefits is properly and promptly challenged.
Claims procedures
The procedure for receiving workers’ compensation benefits begins with notice from the
employee of an injury on the job. Employees must notify the employer within 30 days
after the accident or injury, unless:
•
the employer already had actual knowledge of the injury
•
the cause of the injury could not be identified as work-related without a medical
opinion, and the employee notified the employer within 30 days of receiving the
medical opinion that the injury was work-related
•
the employee did not know of the obligation to notify of the injury within 30 days
because the employer did not provide the required notice by posting the Division
poster (see page 507 for information on how to obtain the poster)
•
other “exceptional” circumstances justify the employee’s failure to provide timely
notice.
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An employee’s representative or estate may provide the required notice to the employer
in the event of death from an on-the-job injury. If the employee or the employee’s
representative fails to notify the employer as required, the claim for benefits will be
dismissed, unless one of the above exceptions is applicable.
The employer must also notify the state of the injury. The employer’s insurance carrier is
required to provide the Form DWC-1 First Report of Injury or Illness for employers to
report an injury. These forms can also be downloaded from the Florida Workers’
Compensation web site (www.fldfs.com/wc/forms.html).
The Employee Assistance and Ombudsman Office is a state agency created to offer
employee assistance and set up informal conferences to settle disputes before a petition
for benefits is filed. The office has the right to compel the parties’ attendance at a
conference to attempt to resolve disputes. If the parties can’t reach an agreement, the
Ombudsman Office may help the employee file the petition for benefits with the
Division.
Petition for benefits
If, after proper notice, the employer or carrier does not provide benefits, the
employee may choose to file a petition for benefits with the Division of Workers’
Compensation. A petition for workers’ compensation benefits must be served on
the employer and the employer’s insurance carrier by certified mail. It must
include numerous specific items of information. If the petition does not include all
of the required items, it may be dismissed by the Office of the Judges of
Compensation Claims. Employers and insurance carriers may try to get the
petition dismissed by filing a statement or motion for dismissal with the Office or
the assigned judge.
Within 14 days of receipt of a petition by an employee, the requested benefits
must be paid or a Notice of Denial of benefits filed with the Division. Benefits
may be paid initially and denied after further investigation, if the denial is made
within 120 days of receipt of the petition.
Mediation
If the employee’s right to benefits is questioned by the filing of a Notice of
Denial, the assigned workers compensation judge will schedule a mediation
conference to be held within 21 days after the petition is filed. The mediator may
be a lawyer in a private law practice or may be a lawyer employed as a mediator
by the Florida Division of Workers’ Compensation. The mediation may be held
at the office of the state mediator or some other location as agreed to by the
parties.
The mediation process is intended to be informal and its proceedings are
confidential. Both the employer and the employee can be represented by an
attorney during the mediation process. The employer should be present for these
proceedings. Special rules for mediation have been adopted by the Division, and a
copy will be provided to the parties before the proceeding. The parties can also
request a private mediation in order to resolve disputes.
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Lump sum payments
Employers may choose to provide an employee with a lump sum payment instead
of continuing monthly benefits. Settlements may be arranged to cover future
medical expenses and other benefits. A settlement must generally be approved by
the compensation claims judge. Settlements may be entered into at any time after
the employer or carrier files a Notice of Denial, or when the employee reaches
maximum medical improvement. In general, approved settlements are not subject
to modification at a later date.
Final hearing
If the matter cannot be resolved through the mediation process or settlement, the
case will be set for the pre-hearing conference and final hearing. The pre-hearing
conference is usually an opportunity for the parties to put in writing the issues that
will be considered at the final hearing, to name prospective witnesses, and to list
written exhibits. The purpose of the pre-hearing conference is generally to outline
how the final hearing will be conducted. Ordinarily, such pre-hearing conferences
are conducted by filing a written statement; however, the employer should ensure
that all witnesses who might have information on issues to be decided are
properly included in the written statement.
After the pre-hearing conference is held, a final hearing is conducted before the
judge. The final hearing is set no earlier than 30 days from the pre-trial
conference and must be concluded within 45 days after the pre-trial hearing.
There is no jury and the hearings may be open to the public. The judge makes all
rulings and decisions on benefits payable, if any. It is absolutely essential that
an employer representative attend the final hearing. The representative might
not have anything to add to the proceedings, but at least his or her presence gives
an impression of concern about the employee. Often times, the employee is more
honest in his testimony if a representative from the company is in the same room.
After testimony is presented, the judge will issue a decision, usually within 14
days of the hearing date. Copies of the judge’s order are filed with the Division
and mailed to both the employer and the employee.
Appeals
If one or more of the parties do not agree with the judge’s decision, an appeal can
be made within 30 days after the final hearing order. Appeals in workers’
compensation cases are taken to the First District Court of Appeal in Tallahassee,
Florida. No new evidence is taken by the District Court in making its decision;
rather, their opinion is based upon the transcript of the testimony and proceedings
before the judge. The employer is not expected to be present before the appellate
court. Appeals from the decision of the First District Court of Appeal go to the
Florida Supreme Court.
Expedited resolution process
A quicker resolution of claims is available for benefits of $5,000 or less. No
pretrial conference will be held, and the hearing is limited to 30 minutes in length.
The expedited resolution process is also available to other benefit claims when
both parties agree.
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Filing of necessary forms
Notice of accident
Within seven days of receiving knowledge of an accident, the employer must
report the injury to the insurance carrier. Self insureds must notify the Division of
Workers’ Compensation. Florida law requires reporting within 24 hours of an on
the job injury/accident resulting in the death of an employee.
Wage statement
Perhaps the most difficult form for an employer to understand and complete is the
wage statement detailing what the employee’s wages were at the time of the
accident. The wage statement must be filed within 30 days from the date there is
knowledge of an accident.
The employee’s average weekly wage is calculated by averaging weekly
compensation for the 13 weeks preceding the accident. Frequently, the injured
worker has not worked for the employer for 13 weeks prior to the accident. In
such instances, the wages of a similar employee are used. If the injured employee
has not worked for 13 weeks prior to the accident and there are no similar
employees, the full-time weekly wages of the injured employee or the wages
based upon the contract of employment are used.
Investigating the accident
Most often the investigation of workers’ compensation accidents is left to the adjuster for
the insurance company or self-insured fund. The employer should recognize, however,
that it retains an obligation to help and cooperate with the investigation. It is the employer
who knows the injured worker, is familiar with possible witnesses, and can help in
getting physical material relating to the accident.
While the negligence of the employee and the employer is generally not important, the
negligence of third persons or possible product defects is significant in determining
liability. If the employee is injured because of negligence of another person or a defective
product, then the employee can sue for damages. Workers’ compensation benefits paid
can be recovered in part from any amounts the employee receives from such third parties
or manufacturers.
Keeping in contact with the injured employee
Following the initial contact with the injured employee for investigation purposes, the
employer should remain in constant communication. Statistically, it has been shown that
early and continuing contact with the injured worker significantly reduces the period of
disability and minimizes litigation. Continued contact can also help in getting information
as to the claimant’s condition and claimed disability.
Once there has been an indication that the injured employee is represented by an attorney,
direct communication with the employee should stop unless specifically authorized by
the attorney. Accordingly, once you receive notice of a claim or in fact any
communication from an attorney, you should immediately notify your carrier.
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Contact with Division
of Workers’ Compensation
If a dispute does arise between the employer and the employee, the employer may be
contacted by a specialist with the Division of Workers’ Compensation attempting to
resolve the matter. An Employee Assistance and Ombudsman Office official will inform
and assist injured workers, employers, carriers and health care providers. An employee
must first follow the procedures set up for informal resolution of disputes through the
Ombudsman’s Office before filing any petitions or suits to collect unpaid workers’
compensation benefits. Employers are advised to cooperate with the Ombudsman Office
whenever possible, and to attend any scheduled settlement conferences.
Controlling costs
Drug and alcohol testing
Florida’s Workers’ Compensation Law permits employers to require job applicants and
employees to submit to tests for the presence of drugs or alcohol, provided the employer
implements a drug-free workplace program that includes notice, education, and testing.
An employer with the required drug-free workplace program in place receives a workers’
compensation premium rate discount of 5%. However, to be entitled to the premium
discount and to deny benefits to employees who test positive for drugs or alcohol, an
employer must follow the statutory drug free workplace regulations. Generally, with any
question regarding a drug free workplace program and whether you as an employer are
entitled to receive the discount, check with your workers’ compensation carrier. Many
carriers will assist employers in putting together a legally compliant program.
Drug free workplace program
The Florida law allows the employer to choose a number of options and make
other decisions in implementing their drug-free workplace policies. The drug-free
workplace program requirements under Florida’s Workers Compensation statute
are set forth in Section 440.102, Florida Statutes, and Rule 38F-9 of the
Department of Labor and Employment Security, Division of Workers’
Compensation. Some aspects of such a program include:
•
Employers may create a policy allowing it to terminate an employee who
tests positive for drugs or alcohol, but not requiring immediate discharge,
depending on the severity of the incident. Still, employers must be
consistent in the enforcement of their policies. Policies can be set up to
require substance abuse evaluation, counseling, and completion of
rehabilitation programs as a progressive discipline approach for violation
– employers should carefully consider whether to allow “second chances,”
particularly for employers who have contact with the public or are in other
“safety sensitive” positions.
•
Employers may test for any or all of a number of drugs.
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•
Employers are required to conduct applicant testing, reasonable suspicion
testing, routine fitness-for-duty testing, and follow-up testing. Random
testing is permitted but is not required.
•
Annual education for employers regarding drug and alcohol abuse is
required, but a specific format has not been mandated by Florida law, so
employers have flexibility in providing the required information to
employees.
Some of the more significant provisions of the law regulating a drug free
workplace under Florida’s workers’ compensation statutes include:
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•
Prior to testing, all employees and job applicants must be given a written
policy statement notifying them of the details of the program, including
the consequences of testing positive for controlled substances. Employers
with no existing program are required to give 60 days’ notice to
employees prior to implementing testing.
•
An employer must include the notice about drug testing on vacancy
announcements for those positions for which drug testing is required. In
addition, a notice of the employer’s drug-testing policy must be posted in
an appropriate and conspicuous location on the employer’s premises.
Copies of the policy must be made available for inspection during regular
business hours in the employer’s personnel office or other suitable
locations.
•
An employer must require job applicants to submit to a drug test and may
use a refusal to submit to a drug test or a positive confirmed drug test as a
basis for refusing to hire the job applicant. A “job applicant” is defined as
a person who has applied for a position with an employer and has been
offered employment provided they successfully pass a drug test. The
applicant may begin work pending the results of the test. Ideally,
employers should avoid letting an employee start work before receipt of
the test results.
•
An employer must require any employee to submit to testing based on a
“reasonable suspicion” that the employee is under the influence of alcohol
or drugs. Reasonable suspicion includes the information that an employee
has caused, contributed or been involved in an accident while at work.
•
An employer must require an employee to submit to a drug test if the test
is conducted as part of a routinely scheduled employee fitness-for-duty
medical examination that is part of the employer’s established policy or
that is scheduled routinely for all members of an employment
classification or group.
•
Provisions relating to the confidentiality of the information involved in the
drug testing process must be followed.
•
Each test conducted must be conducted by certain laboratories. See page
367, Drug testing labs.
•
Certain requirements apply when a positive test occurs. Positive,
confirmed tests must be reported within three days to the employer’s
medical reviewing officer (MRO). The MRO must contact the employee
or applicant within five working days after receiving the test results and
give the person tested a chance to explain or challenge the positive result.
•
If testing is conducted based on reasonable suspicion, the employer must
promptly detail in writing the basis for the testing. A copy of this
documentation must be given to the employee upon request and the
original kept confidential by the employer and retained for at least one
year.
Florida employers must also be aware of rules issued by the State Agency for
Health Care Administration. The Agency rules establish the qualifications and
required duties of the Medical Review Officers (MROs).
Drug testing labs
Florida employers may use any laboratory licensed and approved by Florida’s
Agency for Health Care Administration.
Managed medical care
A number of insurance carriers are now offering managed care arrangements to
employers, approved by the Florida Agency for Health Care Administration. The concept
of managed care is an arrangement of health care providers and facilities which
coordinates medical care in a manner designed to reduce unnecessary treatment or cost.
Managed care programs must include:
•
a written statement of objectives, including early return-to-work for injured
employees
•
a written statement describing the plan for monitoring an individual’s medical
care
•
written procedures for dealing with substandard medical services
•
provisions for review of licensed medical providers
•
financial incentives to reduce costs without sacrificing quality of service
•
procedures for peer and utilization review, including precertification for nonemergency services
•
plan for dispute resolution
•
an aggressive early return-to-work program for workers
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•
procedures for an employee to obtain a second opinion
•
a program for the selection by employee of a primary care provider.
The employer (in coordination with the adjuster handling the case) should keep in
constant contact with the doctor who is providing care to the employee. Contact should
include monitoring the treatment being provided. Emphasis should be placed on getting
an early return to work date and a determination of maximum medical improvement. If
the injured worker’s attorney objects to the employer talking with the doctor, the
employer should include the attorney in the discussions.
The insurance carrier or employee may request an independent medical examination. If
there is suspicion of overutilization of medical care, the carrier should be notified. The
carrier has a duty to review bills and other claims for payment to identify overutilization.
Importantly, if it is suspected that a doctor is overutilizing medical care, the employer can
request a utilization review by the Division of Workers’ Compensation. The Division
must respond to the request and a written determination must be made within 60 days.
Compensation for injury
In addition to medical benefits, an injured employee is entitled to other benefits, such as lost
wages, which depend in part on the nature and duration of the employee’s injury. Florida law
provides a seven-day waiting period during which no lost wages are paid. The injured employee
must miss 21 days of work before being entitled to retroactive compensation for the first seven
days of lost wages.
Permanent total disability
For catastrophic injury resulting in total permanent disability, an employee is entitled to
lost wages of an amount equal to 2/3 of the employee’s “average weekly wage.” The
average weekly wage is computed using an average wage earned over the past 13 weeks
of employment prior to the injury. The benefits continue for the entire period the
employee suffers from the disability, and is unable to work. An employer or insurance
carrier has a continuing right to conduct annual vocational evaluations and testing in a
good faith attempt to return the individual to employment in some capacity.
The employee is required to report any wages earned and any social security income
received by the employee to the employer or carrier, and the employer is entitled to
withhold benefit payments if the employee refuses to report the information. In addition,
an employee is required to cooperate with the employer or carrier in applying for social
security benefits.
Temporary total disability
For disabilities which are total in effect, but temporary in nature, an employee is entitled
to benefits of 2/3 of the average weekly wage for the period of the temporary disability.
The benefits cease on the earlier of the date that the employee reaches maximum medical
improvement or 104 weeks have passed. Additional benefits are available for training of
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the employee in the use of artificial limbs or other appliances, for a period not to exceed 6
months from the date of the accident.
Temporary partial disability
An employee who has a temporary partial disability can work but has temporary physical
limitations, such as not being able to lift a certain weight or reach for anything above
their shoulders. An employee who is partially disabled for a temporary period of time is
entitled to benefits equal to 80% of the difference between the wages the employee is
able to earn with the disability and 80% of the average weekly wage before the injury.
For example, if the employee made $500 per week prior to the injury, and was only
making $320 per week following the injury, the employee would be entitled to $64 in
weekly benefits.
Benefits cannot exceed 2/3 of the employee’s average weekly wage, and are payable
during the period of disability, up to a period of 104 weeks. At that time, the employee’s
degree of permanent impairment will be determined.
Permanent impairment
After the period of temporary disability passes, or when the employee reaches maximum
medical improvement, the treating doctor will determine the amount of permanent
impairment, if any. If the employee has sustained a permanent impairment from a
catastrophic injury on the job, he or she is entitled to additional benefits based on a
Permanent Impairment Schedule. The benefits are paid weekly at a rate of 50% of the
average weekly wage. Benefits are paid for a period of time equal to three weeks for
every percentage point of permanent impairment.
Some permanently impaired employees will also be entitled to supplemental benefits.
These benefits are paid to employees with impairment ratings of at least 20%, who are
unable to return to work at all, or are able to earn only 80% of the wages earned prior to
the accident. The employee must attempt in good faith to obtain employment equal to the
employee’s ability to work. Supplemental benefits are calculated quarterly and paid
monthly, based on 80% of the difference between the employee’s wages and 80% of the
average weekly wage. These benefits are paid until the employee can earn in excess of
80% of average weekly wage, or for a period not to exceed 401 weeks from the date of
the injury.
Miscellaneous benefits
•
Death benefits are payable to the beneficiary of the employee up to $100,000. In
addition, funeral expenses up to $5,000 will be paid.
•
Federal disability payments will reduce the amount of Florida workers’
compensation benefits which must be paid. The employer must wait for the Social
Security Administration to determine the amount of federal benefit before it can
reduce workers’ compensation benefits.
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•
Unemployment benefits received by the employee will reduce the amount of
temporary partial benefits due. If an employee receives unemployment
compensation, no total disability benefits are payable.
Statute of limitations
A question that frequently arises is how long the various benefits remain open to the injured
worker. Florida has several statutes which limit the periods of time that injured workers can
receive medical care and compensation. Generally, the statute of limitations for receiving further
benefits is two years from the last date the employee receives medical care or is paid
compensation, or two years from the date of the accident if no benefits are paid.
Another form of a statute of limitations relates to wage loss claims. If for a period of two years
the employee is not entitled to wage loss benefits during at least three consecutive months, no
further benefits will be payable. It should be noted that “entitlement to benefits” is the issue in
this instance and not actual payment of wage loss benefits.
The third type of statute of limitations relates to modification of orders that have been entered by
judges. If an order has been entered, a petition for modification can be filed within two years
after the order is mailed to the parties rejecting a claim or within two years of the payment of
compensation under the order.
After the doctor permits
the employee to return to work
Employers should take renewed interest in workers’ compensation after the doctor releases the
injured worker to return to work either in the former job or in a modified position. It is at this
point that the employer is called upon to be one of the primary “players” in the workers’
compensation system.
Employer return-to-work program
The employer’s most important involvement in the workers’ compensation system begins
when the treating physician releases the injured employee to return to work in some type
of a modified or light employment. Only the employer can make a difference in the
system by developing an aggressive rehiring program, especially in the areas of light
work. Such a program can result in significant savings. However, Florida employers are
not required by law to provide light duty or create light duty positions.
Florida law provides penalties for an employer’s failure to rehire an employee within 30
days after receiving notice of the employee’s ability to return to work. Employers with
more than 50 employees may be fined $250 for every $5,000 of premium they pay, for a
maximum of $2,000 per violation. Employees receiving permanent total disability
benefits are not protected under this section of the Florida Workers’ Compensation Law.
Unlike some states, Florida pays a percentage of the difference between what the
employee earned in wages at the time of the injury and what he earns post-injury. If the
employee is making approximately what he was making at the time of his accident or is
offered a job at that wage and refuses it, then no benefits are due. Conversely, if the
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claimant is not working, not offered a job, and is unemployed at least in part because of
his disabilities, wage loss benefits are payable for extended periods of time.
The payment of wage loss benefits can be avoided completely by simply offering a job to
the employee which is within his physical and vocational abilities and pays
approximately what he was making before the injury. If the employee accepts the job, the
benefits payable will be reduced, and may be eliminated entirely. If the job is refused, no
benefits are payable. Either way, the employer wins.
An employee is not required to return to work until so advised. Many times, the physician
advises the insurance provider or even the employer of the return to work date and not the
employee. Therefore, written verification by the employer to the employee of return to
work should be made.
The offered job need not be the exact job the employee was performing at the time of the
injury. Similarly, it need not be the same hours of employment. The job, however, does
need to fit the physical limitations imposed by the doctor and be within the worker’s
vocational abilities. There may be a need to alter the job to fit the employee’s abilities.
The job offered to the injured worker, if refused by the employee, should be re-offered on
a periodic basis. The employee cannot collect benefits if he or she continues to refuse,
unless a judge rules that refusal is justified. However, be aware that an employee may
still have rights to unpaid leave under the Family and Medical Leave Act, provided the
employee is eligible for FMLA leave and suffers from a serious health condition that
makes the employee unable to work.
•
To view or download forms, visit http://www.fldfs.com/wc/.
•
Employers with questions can call the Florida Division of Workers’ Compensation at
(850) 413-3100.
•
Employers with questions related to obtaining workers’ compensation coverage can
contact the State Department of Insurance at (850) 413-3140.
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372
Chapter 32
Drugs and alcohol
in the workplace
Drug-free workplace laws
Legislation was enacted in Florida to promote drug-free workplaces in order to afford employers
an opportunity to maximize their levels of productivity, enhance their competitive advantage,
and reach their desired levels of success without experiencing the costs and delays associated
with work-related accidents caused by employees suffering from drug abuse.
The Florida Workers’ Compensation Drug-Free Workplace Act provides that no workers’
compensation benefits will be paid to an injured employee if the injury was, among other things,
“occasioned primarily by the intoxication of the employee.” If the employee has a positive drug
test result and if the employer has a policy that complies with the statute, it will be presumed that
the injury was occasioned primarily by the intoxication of the employee. If an employee loses a
job or is denied employment as a result of a positive drug/alcohol test, the employee may not
qualify for unemployment compensation benefits. In addition, employers who implement drug
testing in accordance with provisions of the statute are eligible for a discount in insurance
premiums.
The Act provides that an employer who has a drug-free workplace policy in compliance with that
statute must notify its employees that it is a condition of employment for them to report to work
without the presence of drugs or alcohol in their bodies. A positive test result for drugs other
than alcohol is sufficient for an employer to take disciplinary action and deny workers’
compensation benefits. A blood-alcohol level of at least 0.04 percent blood alcohol can trigger
disciplinary action and denial of workers’ compensation benefits.
In order to qualify for and be in compliance with the Act, certain components must be contained
in the employer’s written drug-free workplace policy. The components include the following:
•
A general statement of the employer’s policy on employee drug use, which must identify
the employer’s prohibition of drug use, types of testing required and actions the
employer may take as a result of a positive test result. An employer is required to
conduct the following types of drug tests: job applicant testing, reasonable suspicion
testing, follow-up testing and routine fitness-for duty testing.
•
The Florida law which gives the employer the authority to require drug testing. That law
is found in Section 440.102, Florida Statutes and Rule 38F-9 of the Department of Labor
and Employment Security, Division of Workers’ Compensation.
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Drugs and alcohol in the workplace
374
•
A summation of the drug testing procedures. An employer must use a laboratory that is
licensed by the Florida Agency for Health Care Administration or certified by the U.S.
Department of Health and Human Services. The name and address of the testing
laboratory the employer will be using must also be stated in the policy. The employer is
required to use a certified medical review officer and the officer cannot be an employer of
the testing laboratory. The contact information of the officer must be stated in the policy.
Initial testing cannot begin until 60 days’ notice has been provided of the effective date of
the program, unless the employer had some type of testing program in place prior to 7-190; then no notice period is required. The 60-day notice does not apply to job applicants.
The employer must post a copy of the drug-testing policy in plain view on the premises
and it must be made available for the employees or job applicants during regular business
hours in a suitable location.
•
A statement of confidentiality. All information received by an employer through drug
testing is confidential and may not be used or received in evidence, obtained in discovery,
or disclosed in any public or private proceedings, except pursuant to a written consent
form signed voluntarily by the person tested, if compelled by a hearing officer or a court
of competent jurisdiction, and for determining qualification for unemployment
compensation benefits. Additionally, employers and laboratories conducting drug tests
may have access to employee drug test information and may use such information when
consulting with legal counsel in connection with actions relating to the defense of a civil
action. Information on drug test results shall not be released or used in any criminal
proceeding against the employee or job applicant.
•
A list of over-the counter medications which may alter of affect drug tests results. A list
of the most common medications, by brand name or common name, as well as by
chemical name, which may alter or affect a drug test must be provided to each donor prior
to testing.
•
A statement of the consequences and sanctions for an employee or job applicant who
refuses to submit to a drug test.
•
A listing of employee assistance programs in the area, with addresses and telephone
numbers. Employers must provide the contact information of employee assistance
programs and local drug rehabilitation programs in the area.
•
A statement that an employee or job applicant who is notified by the medical review
officer of a positive confirmed test result may contest the result to the officer within five
working days after receiving notification of the test result.
•
A statement informing the employee or job applicant of his or her responsibility to notify
the laboratory of any administrative or civil action brought pursuant to section 440.102,
Florida Statutes.
•
The types of drugs for which workers will be tested. The employer has the right to
choose any or all drugs listed by the Agency for Health Care Administration.
•
A statement regarding any applicable collective bargaining agreement or contract and the
right to appeal to the public employees relations commission or applicable court.
Employers must also comply with additional rights and responsibilities, including but not limited
to the following:
•
An employer must pay for all drug tests it requires.
•
Within five working days after receipt of a positive confirmed test result from the medical
review officer, employers must notify the employee or job applicant in writing of the
result, its consequences and the employee’s or job applicant’s options.
•
If the employee’s or job applicant’s explanation of the positive test result is
unsatisfactory to the employer, the employer must provide a written statement to the
employee/job applicant as to why the explanation was not satisfactory, along with the
report of the positive test result. This confidential information must be kept by the
employer for at least one year.
•
The employer must provide a copy of the test results to the employee/job applicant if
the employee/job applicant requests a copy.
•
An employer may not discharge, discipline, refuse to hire, discriminate against, or request
or require rehabilitation of an employee/job applicant on the basis of a positive test result
that has not been verified by a confirmation test and by a medical review officer.
•
Collection, transportation and storage of samples shall be conducted with due regard to
the privacy of the individual providing the sample and in a manner reasonably calculated
to prevent substitution or contamination of the sample. The lab shall use chain-ofcustody procedures as established by the Agency for Health Care Administration.
•
An employer shall not discharge, discipline, or discriminate against an employee solely
upon the employee’s voluntarily seeking treatment for a drug or alcohol-related problem
if the employee has not previously tested positive for drug use, entered an employee
assistance program for drug-related problems, or entered a drug rehabilitation program.
•
Employers shall promptly detail in writing the circumstances which formed the basis of a
determination of reasonable suspicion and shall provide this documentation to the
employee upon request. The documentation shall be kept confidential and shall be
retained by the employer for at least one year.
Employees or job applicants also have responsibilities, which include a requirement that they are
to notify the laboratory of any administrative or civil action taken pursuant to Section 440.102,
Florida Statutes, and Rule 38F-9 of the Department of Labor and Employment Security, Division
of Workers’ Compensation.
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Federal Drug-Free
Workplace Act of 1988
Requirements
Under the federal Drug-Free Workplace Act, employers with federal contracts must take
several steps related to controlled substances in the workplace. Although drug testing is
not mandated by this law, the employer must do at least the following:
•
certify to the contracting or granting agency that the employer will meet specified
requirements to ensure their workplace is free of illegal drugs
•
must make a good-faith effort to maintain a drug-free workplace by complying
with these requirements
•
establish a policy prohibiting the unlawful manufacture, distribution,
dispensation, possession, or use of controlled substances in the workplace (no
specific format for the policy is given, however the policy statement must specify
the consequences of its violation)
•
publish the policy and provide a copy to the employees
•
establish a drug-free awareness program to inform employees about:
the dangers of drug abuse in the workplace
the employer’s policy of maintaining a drug-free workplace
any available drug counseling, rehabilitation, and employee assistance
programs
the specific penalties that may be imposed upon employees for drug abuse
violations
•
notify its employees that they are required to report any criminal convictions for
drug-related activities in the workplace and that such notification must be given to
the employer no later than five days after conviction
•
notify the employees that, as a condition of employment on the government
contract, the employees will:
•
376
abide by the terms of the policy
notify the employer of any criminal drug statute conviction for a violation
occurring in the workplace no later than five days after such conviction
notify the government contracting or granting agency of any criminal convictions
of employees within ten days of the employer receiving notice
•
impose a sanction on any employee who is so convicted or must require
satisfactory participation in a drug abuse assistance or rehabilitation program.
Employer penalties
The employer may have a federal contract or grant suspended or terminated and may be
prohibited from further participation in the federal procurement process for up to five
years for violation of this Act. Sanctions can be triggered if the organization falsely
certifies that it abides by the Act, fails to comply with the specifics of the Act, or has such
a large number of employees convicted of illegal drug activity that it appears the firm has
not made a good-faith effort to maintain a drug-free workplace.
Similar state laws on government contracts
Employers doing business with state governments may have similar obligations. In
Florida, preference is given to businesses with drug-free workplace programs in awarding
government contracts. In order to meet the requirements, the business must have a drugfree workplace program and shall:
1. Publish a statement notifying employees that the unlawful manufacture,
distribution, dispensing, possession, or use of a controlled substance is prohibited
in the workplace and specifying the actions that will be taken against employees
for violations of such prohibition.
2. Inform employees about the dangers of drug abuse in the workplace, the
business’s policy of maintaining a drug-free workplace, any available drug
counseling, rehabilitation, and employee assistance programs, and the penalties
that may be imposed upon employees for drug abuse violations.
3. Give each employee engaged in providing the commodities or contractual services
that are under bid a copy of the statement specified in subsection (1).
4. In the statement specified in subsection (1), notify the employees that, as a
condition of working on the commodities or contractual services that are under
bid, the employee will abide by the terms of the statement and will notify the
employer of any conviction of, or plea of guilty or nolo contendere to, any
violation of chapter 893 or of any controlled substance law of the United States or
any state, for a violation occurring in the workplace no later than five days after
such conviction.
5. Impose a sanction on, or require the satisfactory participation in a drug abuse
assistance or rehabilitation program if such is available in the employee’s
community by, any employee who is so convicted.
6. Make a good faith effort to continue to maintain a drug-free workplace.
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Department of
Transportation (DOT) Regulations
Testing procedures for
transportation industry generally
For five DOT agencies, there are DOT-wide regulations dealing with drug and alcohol
testing procedures (such as specimens, laboratories, etc.) and dealing with employee
referral, evaluation, and treatment requirements. These regulations are contained in 49
C.F.R. Part 40 (Procedures for Transportation Workplace Drug and Alcohol Testing
Programs). In addition, individual DOT agencies have supplemental regulations
regarding the particular agency’s rules on drugs, alcohol, and mandatory tests for covered
employees.
FMCSA regulations for drivers
The supplemental drug and alcohol testing regulations which apply to drivers in interstate
commerce are contained in 49 C.F.R. Part 382 (Controlled Substances and Alcohol Use
and Testing). In Florida, pursuant to Section 316.302, Florida Statutes, all owners and
drivers of commercial motor vehicles that are operated on the public highways of the state
while engaged in interstate commerce are subject to the rules and regulations contained in
49 C.F.R. Part 382. Below is a detailed summary of the requirements for covered driver
employees.
Persons covered by regulations
The FMCSA regulations cover a driver, and all employers of a driver, who
operates a commercial motor vehicle in commerce and who is required to hold a
CDL (Commercial Drivers License). This refers to a vehicle which:
•
has a gross vehicle weight rating of 26,001 or more pounds
or
•
has a gross combination weight rating of 26,001 or more pounds inclusive
of a towed unit with a rating of 10,000 pounds
or
•
is designed to transport 16 or more passengers, including the driver
or
•
378
is used in the transportation of materials found to be hazardous for the
purposes of the Hazardous Materials Transportation Act and which require
the motor vehicle to be placarded under the Hazardous Materials
Regulations.
The employer testing a driver must notify the driver as to whether that test is
required by the FMCSA regulations, and the employer must not falsely represent
that a test is required by the regulations.
Information for drivers
The employer must distribute its written substance-abuse policy and educational
materials to drivers, and the employer must retain a signed acknowledgment or
receipt of those materials. The materials provided to drivers must include the
following information:
•
person designated by the Company to answer driver questions about the
materials
•
categories of drivers who are subject to the regulatory provisions
•
safety-sensitive functions during which the driver is required to be in
compliance
•
driver conduct that is prohibited
•
circumstances under which a driver will be tested for alcohol and/or
controlled substances under the regulations
•
procedures that will be used to test for the presence of alcohol and
controlled substances, protect the driver and the integrity of the testing
processes, safeguard the validity of the test results, and ensure that those
results are attributed to the correct driver, including post-accident
information, procedures and instructions
•
the requirement that a driver submit to alcohol and controlled substances
tests administered in accordance with the regulations
•
what constitutes a refusal to submit to an alcohol or controlled substances
test and the attendant consequences
•
the consequences for drivers found to have violated the regulatory
prohibitions, including the requirement that the driver be removed
immediately from safety-sensitive functions, and the required referral,
evaluation, and follow-up procedures
•
the consequences for drivers found to have an alcohol concentration of
0.02 or greater but less than 0.04
•
information concerning:
the effects of alcohol and controlled substances use on an
individual’s health, work, and personal life
signs and symptoms of an alcohol or a controlled substances
problem (the driver’s or a co-worker’s)
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available methods of intervening when an alcohol or a controlled
substances problem is suspected, including confrontation, referral
to any employee assistance program and/or referral to
management.
Safety-sensitive functions
The FMCSA drug and alcohol regulations govern drivers anytime they are
engaged in “safety-sensitive functions” which include:
•
all time at an employer or shipper plant, terminal, facility or other
property, or on any public property, waiting to be dispatched, unless the
driver has been relieved from duty
•
all time inspecting equipment or servicing or conditioning any commercial
motor vehicle at anytime
•
all driving time spent at the driving controls of a commercial motor
vehicle in operation
•
all time, other than driving time, in or upon any commercial motor vehicle
except time spent resting in a sleeper berth
•
all time loading or unloading a vehicle, supervising or assisting in the
loading or unloading, attending a vehicle being loaded or unloaded,
remaining in readiness to operate the vehicle, or giving or receiving
receipts for shipments loaded or unloaded
•
all time repairing, obtaining assistance for, or remaining in attendance
upon a disabled vehicle.
Prohibited conduct
The conduct specifically prohibited by the FMCSA regulations include the
following:
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•
Drug use
No driver shall report for duty or remain on duty requiring the
performance of safety-sensitive functions when the driver uses any
controlled substance, except when the use is according to the instructions
of a physician who has advised the driver that the substance does not
adversely affect the driver’s ability to safely operate a commercial motor
vehicle.
•
Positive test for drugs
No driver shall report for duty, remain on duty, or perform a safetysensitive function, if the driver tests positive for controlled substances or
has an adulterated or substituted specimen.
•
Alcohol concentration
No driver shall report for duty or remain on duty requiring the
performance of safety-sensitive functions while having an alcohol
concentration of 0.04 or greater.
•
On-duty alcohol use
No driver shall use alcohol while performing safety-sensitive functions.
•
Pre-duty alcohol use
No driver shall perform safety-sensitive functions within four hours after
using alcohol.
•
Alcohol use following accident
No driver required to take a post-accident test under the regulations shall
use alcohol for eight hours following the accident, or until he/she
undergoes a post-accident alcohol test, whichever occurs first.
Mandatory testing circumstances
The employer is required to conduct testing of drivers in each of the following
circumstances:
•
Pre-employment testing for drugs is mandatory
Pre-employment testing for alcohol is not required (although it is optional
if all job offerees are required to take an alcohol test).
•
Post-accident
The driver was driving or performing other safety-sensitive functions with
respect to the vehicle and the accident involved the loss of human life or
the driver received a citation for a moving traffic violation arising from the
accident, and the accident either involved bodily injury to any person who,
as a result of the injury, immediately receives medical treatment away
from the scene of the accident, or involved one or more motor vehicles
incurring disabling damage as a result of the accident, requiring the motor
vehicle to be transported away from the scene by a tow truck or other
motor vehicle.
•
Random testing
Annually, the employer must test randomly at the following rates:
for drugs – a number of tests equal to 50% of the average number
of driver positions.
for alcohol – a number of tests equal to 10% of the average number
of driver positions.
The employer may use any scientifically valid selection method (for
example, a random number table or a computer-based random number
generator).
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•
Reasonable-suspicion
Testing is required whenever the employer has reasonable suspicion to
believe that the driver violated the prohibitions described above.
Reasonable-suspicion testing is permitted only when a trained supervisor
or company official has made specific, contemporaneous, articulable
observations concerning the appearance, behavior, speech, or body odors
of the driver.
•
Return-to-duty
Testing and follow-up testing are also required in accordance with the
referral, evaluation, and treatment provisions in the regulations at 49
C.F.R. Part 40, Subpart O. Before returning to duty to perform safetysensitive functions after violating the above rules, the driver must submit a
return-to-duty alcohol test below .02 if the conduct involved alcohol, or a
negative controlled substance test if the conduct involved a controlled
substance. The written follow-up testing plan shall, at a minimum, require
the driver to be subject to six unannounced follow-up tests in the first 12
months of safety-sensitive duty following the driver’s return to safetysensitive functions.
Test methods
Testing procedures include the following features:
•
For drugs – a two-step process with an initial drug urinalysis followed by
a confirmation retest, of initial positives only, utilizing Gas
Chromatography/Mass Spectrometry (GC/MS) at a SAMHSA-certified
laboratory.
•
For alcohol – an initial saliva and/or breath screening with confirmatory
breath test utilizing an evidential breath test device (EBT) and a breath
alcohol technician (BAT).
•
MRO (medical review officer) review of all positive and negative
results.
Consequences related to substance use
In general, disciplinary action is governed by company policy, not FMCSA
regulations. However, the minimum required consequences for a driver violating
the FMCSA regulations are:
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•
removal from performance of safety-sensitive functions
•
referral to a substance abuse professional (SAP) for evaluation, education
and/or treatment as recommended, and further testing
•
return-to-duty testing and follow-up testing if the driver is not discharged
•
alcohol tests between .02 and .04 are governed by a separate regulation
and do not trigger the mandatory referral process for evaluation. Instead, if
an alcohol test result is .02 or greater but less than .04, the driver must be
removed from performing safety-sensitive functions and cannot resume
such functions until the start of the driver’s next regularly scheduled duty
period, but not less than 24 hours following administration of the test.
Required training for supervisors
Persons designated to determine whether reasonable suspicion exists must receive
at least 60 minutes of training on alcohol misconduct and an additional 60
minutes on controlled substance use.
Information from previous employers
The FMCSA regulations require the employer to ask the driver-applicant’s
previous employers for specific information regarding previous tests for alcohol
and controlled substances. According to the driver-applicant’s written
authorization, the employer must inquire about the following information from
the driver’s previous employers during the preceding two years from the date of
application:
•
FMCSA alcohol test results of .04 or greater
•
FMCSA verified positive controlled substance test results
•
refusals to be tested (including verified adulterated or substituted drug test
results)
•
other violations of the FMCSA drug and alcohol testing regulations
•
with respect to an employee who violated a DOT drug and alcohol
regulation, documentation of the employee’s successful completion of the
return-to-duty requirements (including follow-up tests).
If feasible, the above information must be obtained and reviewed by the employer
before the driver first performs safety-sensitive functions. If this is not feasible,
the information must be obtained and reviewed as soon as possible. However, the
employer must not permit the driver to perform safety-sensitive functions after 30
days unless the employer has obtained the information or made and documented a
good faith effort to do so.
The FMCSA requires employers to provide to each applicant a written consent for
the release of the information from the previous employer and requires the
applicant to provide such consent to be considered for employment. The employer
must maintain (for three years) a written, confidential record of the information
obtained or of the good-faith efforts made to obtain the information.
If the information from previous employers shows violations of FMCSA
regulations, the employer may not allow the driver to perform safety-sensitive
functions without obtaining information on subsequent compliance with the
return-to-duty requirements.
383
You must also ask each applicant whether there are any positive test results, or
refusals to be tested, on any pre-employment drug or alcohol test administered in
the past two years by a transportation employer to which the employee applied for
safety-sensitive work covered by the DOT drug and alcohol testing rules. If the
applicant admits to such positive tests, or refusals to be tested, the employer must
not use the applicant for safety-sensitive functions until and unless the applicant
documents successful completion of the return-to-duty process.
Although the ADA is not primarily directed at drug and alcohol use or testing, the statute has
special provisions addressing drug and alcohol abuse. Additionally, the Florida Civil Rights Act
has been interpreted to protect employees who ask for time off from work to enter a
detoxification center for alcohol and/or drugs, if the employer fails to reasonably accommodate
their handicap or retaliates against them for seeking rehabilitation. Employers, therefore, must
take the ADA into account when dealing with employee drug and alcohol use and when drafting
drug-free workplace policies.
One important provision in the ADA specifically excludes from protection individuals who are
“currently engaging in the illegal use of drugs.” On the other hand, former rehabilitated drug
abusers, and individuals “erroneously regarded as” drug abusers, may be considered disabled
under the ADA.
Another provision of the ADA exempts drug tests from the law’s definition of “medical
examination.” However, because alcohol tests are considered medical examinations, alcohol tests
are subject to the ADA’s requirements related to medical examinations.
In other provisions, the ADA places restrictions on employers in connection with seeking
medical information from employees and applicants. The law also requires employers to keep
such medical information confidential.
Illegal use of drugs
The ADA specifically provides that any employee or job applicant who is currently
engaging in the illegal use of drugs is not a “qualified individual with a disability.”
However, because of the broad definition of that phrase, qualified individuals with a
disability may include:
•
individuals who have completed a drug rehabilitation program, or otherwise been
successfully rehabilitated, and are no longer engaging in the illegal use of drugs
•
individuals who are participating in a rehabilitation program and no longer
engaging in the illegal use of drugs
•
individuals who are erroneously regarded as engaging in illegal use of drugs.
An individual’s past illegal drug use will make that person an individual with a
“disability” only if the rehabilitated drug user’s past use substantially limited the person’s
384
ability to perform one or more major life activities. Therefore, “casual” users and former
occasional users of illegal drugs are unlikely to be entitled to the ADA’s protection.
In light of these principles, employers must exercise care not to discriminate against
former illegal drug addicts, although employers are permitted to decline to hire or
continue to employ individuals currently engaging in the illegal use of drugs. This raises
the question as to what does it mean to be “currently engaging in the illegal use of
drugs?” Current use includes:
•
an individual who tests positive on a drug test
•
illegal use of drugs that has occurred recently enough to justify an employer’s
reasonable belief that involvement with drugs is an ongoing problem
•
“current” is not limited to the day of use, or recent weeks or days, but is
determined on a case-by-case basis.
Courts have also been willing to find that drug use within several weeks, or even a few
months, constituted “current” use.
Alcohol abuse
Individuals who abuse alcohol may be considered disabled under the ADA if the person
is an alcoholic or a recovering alcoholic. Also, a person erroneously regarded as being an
alcoholic may qualify for the ADA’s protection.
As with any individual claiming to be a person with a disability, alcoholics must show
that their alcoholism substantially limits their ability to perform a major life activity. In
any event, employers are free to discharge, discipline, or deny employment to an
alcoholic whose use of alcohol adversely affects his or her job performance to the extent
that the person is no longer qualified to perform the job. Again, the Technical Assistance
Manual provides a useful example:
“If an individual who has alcoholism often is late to work, or is
unable to perform the responsibilities of his/her job, an
employer can take disciplinary action on the basis of the poor
job performance and conduct. However, an employer may not
discipline an alcoholic employee more severely than it does
other employees for the same performance or conduct.”
By contrast, an alcoholic who has not violated work rules and who asks for time off for
rehabilitation may be entitled to such an accommodation under the employer’s ADA duty
to make reasonable accommodations to qualified persons with disabilities.
The ADA provides that an employer may hold an alcoholic to the standards of
performance and behavior applied to other employees. Also, an employer may prohibit
employees from reporting to work under the influence of drugs and alcohol, and alcoholic
employees are not exempt from this rule. However, the employer may not discipline
alcoholic employees more severely than non-alcoholic employees who come to work
385
with alcohol in their systems. As always, a consistently applied employment policy is
essential to minimize potential liability.
Policies and testing
The ADA permits employers to implement drug testing, adopt drug-free workplace
policies, and prohibit employees from engaging in illegal use of drugs. Thus, employers
may prohibit employees from using drugs and alcohol while at work, from coming to
work under the influence of such substances, and from working with any amount of
illegally used drugs in their systems. Employees who violate the employer’s drug-free
workplace rules may be disciplined or discharged, and this does not violate the ADA as
long as the such disciplinary action is applied to both disabled and non-disabled
employees.
Because tests for illegal use of drugs are excluded from the definition of “medical
examination,” employers may require a drug test at any time. An employer who does
preemployment drug testing, however, may not require an applicant to disclose
medication he is taking unless the applicant first fails the drug test. While there is no
Florida case prohibiting private employers from doing random drug testing, the Florida
Supreme Court held that, in a collective bargaining environment, a public employer must
bargain with the employees’ representative before it can require random drug testing.
In contrast, however, an alcohol test is considered to be a medical examination, so the
ADA’s restrictions on medical examinations apply to alcohol tests. Therefore, an
employer may not require a pre-employment test for alcohol until a conditional offer of
employment has been made to the applicant (and only if such tests are required of all
applicants offered jobs in that job classification). Similarly, after an employee has been
employed, random testing for alcohol would not be allowed (unless an applicable law,
such as DOT regulations, requires random testing for alcohol). Current employees may
be tested for alcohol, as with other medical tests, when the test is job-related and
consistent with business necessity (for example, when the employer has evidence of
alcohol use during work or of an alcohol abuse problem affecting the employee’s work).
Because the status of drugs differs from the status of alcohol under the ADA, employers
may implement a zero-tolerance standard for drugs (prohibiting any illegally used drugs
“in the employee’s system”), but employers should generally follow an “under the
influence” standard for alcohol. To avoid ambiguity, it is helpful to define “under the
influence” (such as a .04 blood alcohol level from DOT rules, or another level such as the
state’s DUI standard – .08 blood alcohol level in Florida). Employers should also reserve
the right to take disciplinary action for lesser amounts of alcohol in appropriate
circumstances.
Any medical information that an employer gleans from a drug test regarding the medical
history or condition of an employee is subject to the ADA’s confidentiality provisions.
For example:
•
386
medical information may not be used for any purpose inconsistent with the goals
of the ADA
•
such medical information may not be used to screen out any individual with a
disability unless the employer can show that the decision was job-related and
consistent with business necessity
•
such medical information must be kept confidential and in a separate medical file.
Family and Medical Leave Act (FMLA)
The FMLA has an impact on drug-free workplace programs because the FMLA permits eligible
employees to take job-protected leave in order to receive treatment for substance abuse or to care
for an immediate family member receiving treatment for substance abuse. Employees covered
by the FMLA are those who:
•
work at a site where the employer has 50 or more employees within a 75-mile radius
•
have worked for the employer for at least 12 months
•
have worked at least 1,250 hours for the employer in the past 12 months.
An employee with a substance-abuse problem may be eligible for FMLA leave if the employee’s
condition constitutes a “serious health condition” within the meaning of the statute and the
regulations. A serious health condition is an illness, injury, impairment, or physical or mental
condition which involves:
•
inpatient care (an overnight stay) in a hospital, hospice, or residential medical-care
facility
or
•
continuing treatment by a health care provider.
Under the regulations, a condition involving such “continuing treatment” can exist in several
different ways summarized briefly as follows:
•
an incapacity of more than three consecutive calendar days requiring healthcare treatment
on two or more occasions or healthcare treatment on one occasion which results in a
regimen of continuing treatment
•
an incapacity due to a chronic serious health condition which requires periodic visits for
treatment, which continues over an extended period of time, and which may cause
episodic periods of incapacity
•
a permanent or long-term incapacity for which treatment may not be effective
•
absence for multiple treatments either for restorative surgeries or for certain conditions
requiring multiple medical interventions such as chemotherapy, radiation, physical
therapy, dialysis, etc.
387
Clearly, an employee seeking rehabilitative services for drug addiction or alcoholism may have a
“serious health condition” under the FMLA. Nevertheless, the regulations recognize two
important limitations on such an employee’s ability to take job-protected FMLA leave:
1. FMLA leave is time off for treatment, not time off due to the substance abuse itself.
Thus, the regulations provide:
Substance abuse may be a serious health condition if the conditions
[set forth above] are met. However, FMLA leave may only be taken
for treatment for substance abuse by a health care provider or by a
provider of health care services on referral by a health care provider.
On the other hand, absence because of the employee’s use of the
substance, rather than for treatment, does not qualify for FMLA
leave.” 29 CFR Section 825.114(d).
2. A second rule limiting the employee’s right to FMLA leave provides that an employer
who consistently enforces a nondiscriminatory policy against substance abuse may
discharge an employee for a violation of that policy even if the employee has requested
FMLA leave. Thus, the regulations provide:
FMLA leave is available for treatment for substance abuse provided
the conditions [set forth above] are met. However, treatment for
substance abuse does not prevent an employer from taking
employment action against an employee. The employer may not take
action against the employee because the employee has exercised his or
her right to take FMLA leave for treatment. However, if the employer
has an established policy, applied in a nondiscriminatory manner that
has been communicated to all employees, that provides under certain
circumstances an employee may be terminated for substance abuse,
pursuant to that policy an employee may be terminated whether or not
the employee is presently taking FMLA leave.” 29 CFR Section
825.112(g).
The principles described in Section 825.112(g) quoted above are applied in an interesting
opinion letter (Opinion FMLA-59, 1995) published by the Director of the Division of Policy and
Analysis in the U.S. Department of Labor’s offices responsible for administering the FMLA.
The opinion letter answers four scenarios described by a county employer in questions to the
DOL:
388
•
Scenario 1
An employee comes up for random testing and tests positive for illegal narcotics and the
employee has never requested FMLA. Under the county’s policy this employee is
subject to immediate termination. FMLA does not require the County to allow the
employee the opportunity to seek treatment and be reinstated.
•
Scenario 2
Either the [County] Sheriff or the State’s Attorney receives information that an employee
is using illegal narcotics. As a result, the employee is requested to submit to a drug test
under the “for cause” provisions of the testing policy. The employee tests positive for
illegal narcotics and the employee has never requested FMLA. Under the provisions of
the testing policy, the employee is subject to immediate termination. FMLA does not
require the County to allow the employee the opportunity to seek treatment and be
reinstated.
•
Scenario 3
An employee comes forward and admits to the employer that he or she is addicted to
drugs and indicates that a doctor is placing the employee in rehabilitative treatment. You
state that there is an ongoing debate within your office as to whether such an employee
should be subject to immediate termination under the County’s policy. In any event, you
ask if the County’s policy so provides for immediate termination in this instance, would
FMLA require the County to allow the employee the opportunity to seek treatment and be
reinstated? The answer is “no.”
•
Scenario 4
An employee who tests positive for the presence of an illegal narcotic is granted FMLA
leave and the terms and conditions of reinstatement include a requirement that the
employee submit to weekly testing. If the employee tests positive a second time and has
either not used all of his or her allotted FMLA leave time or has used all the allotted
FMLA leave time, you ask if FMLA requires that the County allow the employee the
opportunity to seek treatment and be reinstated for a second time? The County’s policy
could provide for termination of employment in either case, whether or not the employee
has exhausted his or her FMLA leave allotment in the 12-month period.
Although the regulations and opinions cited above are helpful, employers must exercise caution
in dealing with leave requests of employees with substance-abuse problems. For example, if the
employee in Scenario 3 above had reported an alcoholism problem (not illegal drug use), and had
requested treatment before engaging in any violation of the employer’s substance-abuse policy,
the employer would appear to have no basis to deny FMLA leave (assuming the employee was
otherwise qualified for FMLA leave), and the employer could be required to grant temporary
leave as a reasonable accommodation under the ADA even if FMLA leave was not available to
the employee.
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390
Chapter 33
Smoking in the workplace
Florida legislation
The Florida Clean Air Act prohibits smoking in an enclosed indoor workplace, as defined by the
statute, with certain limited exceptions for private residences, retail tobacco shops, designating
smoking guest rooms in public lodging establishments, stand alone bars, smoking cessation
programs, medical or scientific research, or customs smoking rooms. Employers must also
develop, implement, and post policies regarding the smoking prohibitions established by the
Florida Clean Indoor Act.
Refusing to hire smokers
The Florida Supreme Court has ruled that a public employer can legitimately refuse to hire
smokers. The City of North Miami implemented a policy in 1990 that required job applicants to
sign a sworn statement that they had not smoked for at least a year prior to their application for
employment with the city. One job applicant challenged the policy in court after she was not
hired by the city as a clerk-typist because she had refused to sign the statement. The applicant
claimed that the policy violated her Florida constitutional rights by prohibiting her from smoking
in the privacy of her own home. The Supreme Court held that the policy could be enforced
because the applicant did not have a legitimate expectation of privacy concerning smoking given
the variety of ways in which smoking is prohibited in public. The Court reasoned that the
multitude of existing smoking regulations had essentially reduced an individual’s expectation of
privacy on the issue of smoking when applying for a government job. The Court was not willing
to expand the decision to private employment. However, to date, smokers in Florida have no
statutory protection. Employers can refuse to hire applicants who smoke. Likewise, most
employers, subject to a few exceptions, can ban smoking on their premises if they choose,
including outdoor areas.
Penalties
The department or the Division of Hotels and Restaurants or the Division of Alcoholic
Beverages and Tobacco of the Department of Business and Professional Regulation enforces this
law based upon each department’s specific areas of regulatory authority.
Upon notification of a violation, the appropriate entity will issue a notice to comply. If the
person fails to comply within 30 days after receipt of the notice, the appropriate entity shall
assess a civil penalty, ranging from $250 to $2,000. The appropriate entity is authorized to file a
civil action against an indoor workplace if such workplace refuses to comply with the law.
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Smoking in the workplace
SAMPLE SMOKING POLICY
In compliance with the Florida Clean Indoor Air Act, this Employer prohibits smoking
in all indoor areas.
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Chapter 34
Safety in the workplace
Occupational Safety
and Health Act (OSHA)
The Occupational Safety and Health Act of 1970 (OSHA) became effective April 28, 1971. The
stated purpose of the Act is to provide “every working man and woman in the Nation safe and
healthful working conditions.” The Act places the primary burden of achieving this goal on
employers by requiring each employer to:
•
provide a workplace free from safety and health hazards
•
comply with standards set by the Occupational Safety and Health Administration.
The Act extends to employment in any of the fifty states, the District of Columbia, Puerto Rico,
the Virgin Islands, and several other United States possessions. However, federal and state public
employment is excluded from coverage.
The Act allows states to assume responsibility for occupational safety and health by adopting
their own plans. Florida does not have a state plan and, therefore, is currently governed by
OSHA. This may change in the future, however, as Gov. Charlie Crist signed into law on June
10, 2008, a bill creating a task force to examine worker safety issues in the state. A report from
the task force is due on January 1, 2009.
Administration
The primary responsibility for carrying out the Act rests with the Secretary of Labor and
the Assistant Secretary of Labor for Occupational Safety and Health. The Assistant
Secretary directs the day-to-day activities of the Occupational Safety and Health
Administration (OSHA). OSHA’s national headquarters are located in Washington, D.C.,
at the following address:
Headquarters Office
Occupational Safety and Health Administration
200 Constitution Avenue, N.W.
Washington, D.C. 20210
Telephone: 800-321-OSHA (6742)
In addition to the national office, the country is divided into ten geographic regions, each
headed by a Regional Administrator. Each region has a regional office and several area and
district offices. Florida is located in Region IV, which also includes Mississippi, Alabama,
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Georgia, Tennessee, Kentucky, South Carolina and North Carolina. The regional office is
located in Atlanta, Georgia, at the following address:
Region IV
61 Forsyth Street, SW
Room 6T50
Atlanta, GA 30303
404-562-2300
404-562-2295 Fax
The addresses of the three area offices in Florida are:
8040 Peters Road, Building H-100
Ft. Lauderdale, FL 33324
954-424-0242
954-424-3073 Fax
Ribault Building, Suite 227
1851 Executive Center Drive
904-232-2895
904 232-1294 Fax
5807 Breckenridge Parkway, Suite A
Tampa, FL 33610-4249
813-626-1177
813-626-7015 Fax
The regional and area offices are responsible for conducting safety and health
inspections. The employees who conduct these inspections are called Compliance
Officers. Each Regional Director supervises and coordinates a staff of Compliance
Officers.
The Occupational Safety and Health Act also created the National Institute for
Occupational Safety and Health (NIOSH). It is part of the Department of Health and
Human Resources. NIOSH conducts research, develops occupational safety and health
standards, and provides technical services to government, labor, and industry. NIOSH
also tests and approves most personal protective devices such as breathing devices, gas
masks, and respirators. The primary function of NIOSH is research and testing. However,
some employers have been asked by NIOSH to allow health inspections on their
premises. The Act allows NIOSH to conduct inspections and gives it authority to seek
search warrants where necessary. Such NIOSH inspections will not result in a citation or
penalty.
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Enforcement
The Occupational Safety and Health Review Commission (OSHRC), composed of three
Commissioners, hears appeals from decisions of the Department’s Administrative Law Judges.
The Commission is designed to be independent from the Department of Labor. Administrative
Law Judges hear all cases where the employer has questioned a citation or a proposed penalty.
The Administrative Law Judges’ decisions are then reviewable by the full Commission. Even if
no appeal is taken, the Commission may direct review of a decision. If no review is directed, the
Judge’s order becomes final 30 days after it is filed.
Consulting services
Consulting services are provided by OSHA to educate employers and help them comply with the
Act. In Florida, such services are provided by the state. Consultations allow an employer to
“discover” any potential health or safety problems and no citations will be issued as a result of
an on-site consultation. However, if a safety and health consultant discovers a dangerous
situation that is not immediately corrected, the consultant is required to notify OSHA
immediately. While consultative services can be beneficial, employers should be cautioned that
compliance with the consultant’s recommendations will not provide a defense or prevent a
citation from being issued at a later date.
OSHA’s on-site consultation service in Florida is provided by:
University of South Florida
Safety Florida Consultation Program
Department of Environmental and Occupational Health
College of Public Health
13201 Bruce B. Downs Boulevard, MDC 56
Toll-free: (866) 273-1105
Phone: (813) 927-5347
Fax: (813) 974-9972
E-mail: [email protected]
Website: www.safetyflorida.usf.edu
Employers should be prepared to correct the problems immediately or as soon as possible to
avoid fines for violations which may be imposed on potentially dangerous situations.
Regulations and standards
The Act has two basic components. First, each employer is required to furnish each employee
with a place to work “free from recognized hazards which are causing or are likely to cause
death or serious physical harm.” This provision is commonly referred to as the General Duty
Clause. The section has been used as a “catchall” for unsafe conditions even if there is no
applicable OSHA standard. OSHA may rely on ANSI, NFPA or other industry or consensus
standards.
Second, the employer must “comply with occupational safety and health standards.” The
Secretary of Labor has the authority to adopt safety and health standards or rules of conduct and
minimum safeguards for the workplace.
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OSHA standards primarily fall into three basic categories.
1. General industry standards
General industry standards apply to all employers not engaged in construction or
agriculture industries.
2. Construction standards
Standards applicable to the construction industry.
3. Agricultural standards
Standards particular to agricultural industries regulate safety of farm equipment and
general environmental conditions affecting agricultural workers, such as clean-up of
pesticides.
Inspections
The Secretary is authorized “to inspect and investigate” any place of employment. Some
restrictions are placed on the time and manner of conducting an inspection, which may be
viewed as creating certain rights for employers.
•
The OSHA representative may only conduct an inspection “upon presenting appropriate
credentials to the owner, operator, or agent in charge.”
•
Before allowing a Compliance Officer to enter the workplace and begin inspection, the
employer may, and in fact should, insist on a presentation of credentials. In some
situations, the employer may choose to contact the Area OSHA Director to confirm the
identity of the Compliance Officer.
•
A limitation placed upon Compliance Officers is that they may enter the workplace only
at reasonable times during regular working hours and at other reasonable times.
Employers may use this reasonable time requirement to ask for a postponement of an
inspection only if there is truly a good reason for doing so.
•
OSHA requires that inspections be made “within reasonable limits” and “in a reasonable
manner.” There is limited case law to explain these limitations; however, employers
should “manage” any inspection and grant access only for the specific purpose requested
by OSHA.
Search warrants
The United States Supreme Court has ruled that employers may require OSHA to obtain
search warrants before allowing entry to the workplace to conduct inspections. The
majority of employers do not request a warrant, especially where a workplace fatality
occurs, but may choose to do so when no appropriate management representative is
available or unique production circumstances or labor unrest exist.
If an employer refuses entry to an OSHA Compliance Officer, OSHA maintains an
“expedited” procedure, will apply to a federal District Court for a warrant, and will
present specific facts showing a belief that a violation exists or that the employer was
selected on the basis of a neutral administrative plan. It normally takes at least two to
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three days to obtain a warrant. Employers who elect to demand a warrant may use this
time to ensure compliance with all OSHA standards. However, OSHA will issue
citations for provable violations occurring within the last six months.
There are three main parts to an OSHA inspection:
1. the opening conference
2. the inspection
3. the closing conference.
Employers have a right to participate in all three parts of the inspection. An employer
should participate to effectively protect its interests, especially on “multi-employer”
worksites where the interests of the different employers may be in conflict. OSHA will
include union representatives of a bargaining unit
1. Opening conference
The opening conference is the employer’s opportunity to ascertain the reason for
the inspection and to appear cooperative with OSHA. During the opening
conference, the OSHA inspector will explain why the employer’s facility was
chosen for inspection, identify records needed to conduct the investigation, and
describe the scope of the inspection. Pay particular attention to whether the
inspector is there as a result of an employee complaint, to investigate an accident,
or under a general administrative plan. This information is necessary in order for
the employer to seek to properly limit the scope of the inspection. The employer
should take the opportunity during the opening conference to explain the
company’s safety program but should not at this stage volunteer outside or selfaudits of safety.
2. Walkaround
The next portion of the inspection is the “walkaround.” The company
representative has a right to and should stay with the inspector throughout the
entire inspection. The company representative should keep detailed notes
concerning the entire safety inspection. As soon as possible after the inspection,
the company representative should use these notes to write a detailed report of
what took place. The company might also consider having a maintenance
employee on hand to correct any minor violations the inspector points out during
the inspection.
OSHA issued a directive to its field offices encouraging the use of videotape and
audiotape as a means of documenting violations and otherwise gathering
information during the walkaround. The OSHA representative must advise the
employer that a video or audio record will be made of the inspection. Refusal to
allow the recording will be treated as a refusal of entry. However, taping in
security clearance areas must be specifically authorized by the employer, and the
employer should request that trade secret and confidential areas be noted.
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The OSHA Compliance Officer is not permitted to “stage” hazards or employee
exposures or suggest that “re-enactments” be videotaped. The employer should
consider making a video or photographing at the same time for documentation.
The Compliance Officer may request interviews of employees. The company
attorney or management representative has a right to be present in supervisor
interviews.
3. Closing conference
Following the “walkaround,” the company official and OSHA inspector will hold
a closing conference. At the closing conference, the company official may question
the Compliance Officer to learn more facts of any alleged violations but should be
careful to make no admissions of a violation or to argue at this stage. In addition to
questioning the Compliance Officer about violations, the company representative
should also ask about correcting the problems. Remember, OSHA must show the
existence of a violation and the possibility of correction.
Citations and penalties
If the Compliance Officer observes a violation of the safety and health standards, regulations
(such as those on recordkeeping), or the general duty clause, OSHA will issue a citation. The
citation will advise the employer of the OSHA standard or regulation which has allegedly been
violated and when correction must be completed. The Compliance Officer will not typically
know the amount of any penalty the employer is expected to pay. Violations will be classified as
serious, non-serious, willful, or repeated. No financial penalty is usually assessed for non-serious
violations. OSHA penalties for “willful” and “repeated” violations range from $10,000 to
$70,000 per violation. Maximum penalties for “serious” violations, failure to correct a violation,
and failure to post warnings range from $1,000 to $7,000 per violation. Statistics for 2008
suggest that 80% of violations are categorized as serious, willful, repeat, or failure-to-abate,
resulting in an estimated 120 cases this year involving fines over $100,000.
Other civil issues
Florida employers should recognize that Florida is one of the most common jurisdictions for
survivors of deceased or seriously injured employees to file civil suits seeking to avoid the
exclusive remedy of workers’ compensation and should approach such OSHA inspections
accordingly.
Appeals or “contests”
The employer has the right to “contest” a citation and argue that it is improper before an
Administrative Law Judge. The employer may contest any or all of the violations, the proposed
penalties, or the proposed correction dates. To contest a citation, the employer must file a “notice
of contest” within 15 working days of receipt of the citation. Failure to file a timely notice of
contest results in loss of the right. Notices of contest are filed with the area director who issued
the citation.
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After the contest is filed, OSHA and the employer will present their positions to an
Administrative Law Judge. The Administrative Law Judge will issue a decision, and either party
may request a review by the Review Commission.
Employers typically should meet informally with OSHA prior to filing a notice of contest.
However, if they are unsuccessful in resolving the matter, the employer should not be reluctant
to file a notice of contest and negotiate further or try the case.
There are two types of OSHA recordkeeping and reporting requirements.
1. any employers are required to record and report certain employee injuries and illnesses
2. many OSHA standards require specific recordkeeping pertaining to workplace injuries
and illnesses. (See www.osha.gov/recordkeeping/handbook/index.html for the web-based
OSHA Recordkeeping Handbook for specific requirements).
OSHA has extensively revised annual recordkeeping requirements. The form used for recording
work injuries and illnesses is OSHA Form 300 (Log of Work-Related Injuries and Illnesses).
The 300A (Summary of Work-Related Injuries and Illnesses) must be posted. Employers must
prepare and maintain a separate form for each facility. Injuries and illnesses which must be
recorded are those resulting in:
•
fatalities
•
lost work days
•
restricted work or transfer to another job, discharge
•
medical treatment other than first aid
•
loss of consciousness
•
a significant injury or illness diagnosed by a physician or other licensed health care
professional.
Recordable injuries and accidents must be entered on the log as soon as practicable but no later
than six working days after knowledge that a recordable injury has occurred.
In addition to the log, employers must also prepare an individual report for each recordable
occupational injury or illness. OSHA Form 301 (Injury and Incident Report) is designed for this
purpose. At the end of the year, employers must summarize all recordable occupational injuries
and illnesses for the calendar year and post it for three months.
Note
A company executive must now sign the summary.
Employers should view the changes from the old OSHA-200 logs at OSHA’s website,
www.osha.gov/recordkeeping/RKmajorchanges.html.
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In addition to the forms and reports described above, employers must report any accident which
results in the death of an employee or the hospitalization of three or more employees. A verbal
report must be submitted to OSHA’s Area Director (or to (800) 321-OSHA after hours) within
eight hours of the incident. These reports can be made by telephone and will normally result in
an on-site investigation.
Employers with no more than ten employees at any time during the year are exempt from the
requirements of maintaining OSHA Form 200 and OSHA Form 101. Small employers are not
exempt from the requirement of reporting accidents which result in fatalities or multiple
hospitalizations. However, some small employers can anticipate being selected by the Bureau of
Labor Statistics to participate in an annual survey. If so chosen, the small employer will not be
exempt from recordkeeping requirements.
Refusals to work
Under OSHA regulations, employees may refuse to perform unsafe work under certain
conditions. If those conditions are present and an employee refuses to work, employers are
prohibited from taking any action against the employee. Violation of this regulation can result in
reinstatement to employment of discharged or suspended employees with an award of backpay.
Several circumstances must exist before an employee is protected under this regulation. Each of
the following factors must be present:
•
good faith by the employee
•
reasonable basis for believing conditions are unsafe
•
risk of death or serious bodily injury
•
opportunity given to employer to correct the unsafe conditions
•
insufficient time for OSHA to act.
Employers should contact a labor attorney before taking any action against an employee who
refuses to work due to unsafe conditions.
Employee access to medical records
An OSHA standard gives employees and their representatives the right to see and copy medical
records under certain circumstances. This standard includes both current and former employees.
An employer has up to 15 days to comply with an employee request for access. The standard
does not create any new recordkeeping requirements; it simply requires that any records kept
must be made available to employees who request access.
The OSHA Hazard
Communication Standard
The Hazard Communication Standard establishes requirements for the evaluation of physical and
health hazards of all chemicals produced, imported or used within the United States.
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Who is covered
The Standard covers all employers within OSHA’s jurisdiction if employees are exposed
to hazardous chemicals.
Written hazard communication program
Covered employers must establish a comprehensive written hazard communication
program which includes provisions for container labeling, maintenance, and Material
Safety Data Sheets (MSDSs), an employee training program, and information sharing
with other employers and contractors onsite. It must contain a list of the hazardous
chemicals in each work area and a method for informing employees of the hazards of
each “type” of hazardous chemical (flammable, irritant, release of pressure, toxic). The
written program need not be lengthy or complicated, but the written program must be
available to employees during all working hours, their designated representatives, the
Assistant Secretary of OSHA, and the Director of the National Institute for Occupational
Safety & Health (NIOSH).
Hazard evaluation
Chemical manufacturers and importers are required to review the available scientific
evidence concerning the hazards of chemicals they produce or import and to report the
information they find to employees and employers purchasing their products. Those
employers generally may rely on the evaluation performed by the manufacturers or
importers when establishing compliance programs for the hazardous chemicals
purchased. Employers must conduct their own evaluations for hazardous chemicals
created in their workplaces. Distributors may have additional obligations.
Each chemical is to be evaluated for its potential for adverse health effects and physical
hazards. Certain chemicals are listed in the standard as hazardous in all cases. When
evaluating chemicals, an employer must describe, in writing, the procedures used to
determine the possible hazards.
These written procedures must be made available upon request to employees, their
designated representatives, OSHA, and NIOSH.
Labels and other forms of warning
With a few exceptions, each container in the workplace must be marked with the identity
of the hazardous chemicals and appropriate warnings. The term “container” includes
stationary processing equipment in the workplace.
Exceptions
•
Employers can post signs with information for a number of containers
within a work area which have similar hazards.
•
Various types of written materials can be substituted for container labels
on stationary equipment if they contain the same information as a label
and are readily available to employees in the work area.
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•
Employers are not required to label portable containers.
•
Employers are not required to label pipes or piping systems.
Material safety data sheets
Chemical manufacturers and importers must develop MSDSs for each hazardous
chemical they produce or import. An MSDS is a technical bulletin intended to be the
primary vehicle for transmitting information about a hazardous chemical to affected
employers and employees. Each MSDS must be in English and include the following:
•
the specific chemical identity and common names of the chemical
•
the physical and chemical characteristics of the material
•
the known health effects of the chemicals
•
limits of exposure permitted under OSHA
•
whether the chemical is considered to be a carcinogen
•
safe handling procedures
•
emergency and first aid procedures
•
the identification of the organization responsible for preparing the MSDS.
Employers are responsible for obtaining or developing an MSDS for each hazardous
chemical used in their workplaces. Copies must be readily available to employees during
all work hours and must be made available to an employee’s designated representative
and to OSHA inspectors. A new MSDS should be obtained with each new chemical
formulation.
In March 2004, OSHA began a special enforcement effort regarding Material Safety Data
Sheets and revisited the role of producers and distributors of chemicals. Special issues
are presented by imports and also by Internet sales of hazardous chemicals or the
provision of MSDS.
OSHA debuted in summer 2007 a new “Database of Chemical Information,” which
continues OSHA’s efforts to develop a Globally Harmonized System of Classification
and Labeling of Chemicals (GHA). OSHA issued its second largest number of citations
under the Hazard Communication Standard.
Employee information and training
Employers must establish a training and information program for employees exposed to
hazardous chemicals in their work areas at the time of initial assignment and whenever a
new hazard is introduced into their work area. The program must include the following:
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•
the requirements of the Standard
•
the employer’s hazard communication program
•
the location of hazardous chemicals in an employee’s work area
•
where evaluation procedures, list of hazardous chemicals, and the required
MSDSs are kept
•
how to read and interpret information on labels and MSDSs
•
the physical and health hazards of the chemicals in the employee’s work area
•
measures employees can take to protect themselves from hazards, including the
use of protective equipment
•
methods to be used to detect the presence of a hazardous chemical
•
procedures to share information with other employers working onsite.
Trade secrets
A trade secret is a specific formula (for example, chemical formulas), process, or makeup which gives an advantage over competitors. Disclosure of trade secrets may therefore
be limited to health professionals, employees, and their designated representatives under
specified conditions of need and confidentiality. The extent to which employers must
disclose trade secret information depends upon whether a medical emergency exists or
not.
OSHA regulations on bloodborne pathogens
This regulation sets a standard for limiting the risk of exposure to viruses carried in
human blood, or other potentially infectious matters, including HIV and the hepatitis B
virus. The standard covers any worker in any industry with “occupational exposure”
where it may reasonably be anticipated that the employee may contact human blood or
other potentially infectious matter as the result of the performance of the employee’s
duties. Certain provisions do not cover employees who merely perform Good Samaritan
acts. Likewise, certain provisions apply to employees whose duties at times may include
providing first-aid or medical assistance, and all provisions apply to employees whose
primary duty is the provision of first aid. The standard initially identified 24 industry
areas where workers are in contact with or handle blood, but the list is not intended to be
exhaustive. Housekeeping and other personnel are effected.
The key provisions of the standard are summarized below.
•
Each employer must prepare:
a list of job classifications in which all employees are exposed
and
a list of job classifications in which only some employees are exposed and
list the tasks and procedures involved.
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•
Each employer having one or more employees with occupational exposure must
establish a written Exposure Control Plan. Such plans must:
establish a procedure for the evaluation of an incident involving the
unprotected exposure of an employee to blood where transmission of a
virus was possible
be accessible in copy form to employees or their representatives be
reviewed and updated at least annually.
•
“Universal precautions” must be observed to prevent contact with blood and other
potentially infectious materials. Compliance with the precautions is to be
monitored by the employer and included in employee discipline and performance
evaluations. Special precautions apply to research laboratories and production
facilities. Employers are also required to evaluate engineering controls and work
practices to protect employees.
•
Employers must require employees to use “personal protective equipment” when
there is possibility of exposure. The equipment must be provided by the employer
at no cost to the employee, must be readily accessible or issued to the employee,
clean, in good repair, and appropriate to the exposure.
•
This standard has been revised in part as a result of the Needle stick Safety and
Prevention Act, which was passed in November, 2000. Under the 2000
regulation, employers must consider the use of safer needle devices as part of the
re-evaluation of appropriate engineering controls during it annual review of its
exposure control plan. It also makes the solicitation of employee input
mandatory, and requires employers to establish a log to track needle sticks rather
than only those cuts or sticks that lead to illness. The requirements became
effective April 18, 2001.
•
Work sites must be maintained in a clean and sanitary condition. There must be
an appropriate written schedule for cleaning and decontamination.
•
Medical evaluations and procedures, including the hepatitis B vaccination series,
must be provided at no cost to employees with potential exposure. Post exposure
evaluation and follow-up must also be provide at no cost to all employees who
have had an exposure incident.
•
Warning labels or red bags must be used as containers of regulated waste and
infectious materials.
•
Employers must provide a training program to employees who have “occupational
exposure” at no cost to the employee and during working hours. The training must
be appropriate to the education level of the employees and conducted by someone
knowledgeable. Training must be provided at the time of initial assignment and at
least annually thereafter. Additional training must be provided whenever new
tasks or procedures affect occupational exposure. The training must include:
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a copy of the standard with explanation
information on viruses carried in blood and how they are transmitted
a description of the employer’s exposure-control plan
a description of universal precautions, engineering controls, and work
practices that reduce the risk of such transmission, including the use of
personal protective equipment
information on the hepatitis B vaccine
information on exposure incidents
information on labeling, where appropriate
a question-and-answer session with the person conducting the training
session.
•
An accurate and confidential record of exposure incidents shall be maintained for
the duration of employment plus 30 years.
•
A complete record of training sessions shall be maintained for three years from
the date of training.
OSHA Personal Protective
Equipment (PPE) Standard
OSHA issued revised standards on the use of personal protective equipment in April, 1994,
imposing strict requirements on all employers, even those that do not currently require the use of
personal protective equipment. The revised standards require employers to conduct job hazard
assessments and to prepare and maintain written certifications that document the name of the
person who has conducted assessments of the workplace. Employers that must require personal
protective equipment must also provide specified training to affected employees and maintain
certification that the training took place.
Employers are required to furnish appropriate eye and face protection during exposure to hazards
from flying particles, fumes or gases, or light radiation. The revised standard requires the
additional use of side protection and filter protection.
If there is a potential for head injury, the standard requires the employer to provide protective
helmets, which must also include protection against electrical shock for employees near exposed
electrical conductors. Protective footwear must be furnished if there is a danger of foot injuries
from fallen or rolling objects which might pierce the soles of the feet, or if the feet are exposed to
electrical hazards.
Employers must furnish hand protection if hands are exposed to harmful substances, cuts,
chemical burns, or harmful temperatures. Appropriate hand protection must be selected based on
evaluation of the conditions of the workplace, duration of use and characteristics of the task to be
performed.
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The employer’s workplace hazard assessment may not necessitate the purchase of new
equipment. However, if done as required by the standard, and on a regular basis, the employer
should inspect existing personal protective equipment for defects or improper fit, establishing
compliance and further reasonable steps to insure safety.
In November 2007, OSHA issued a PPE Standard stating that employers do not have to provide
employees with protective equipment where none was required before. The standard also
articulates certain exceptions related to logging boots, everyday clothing, skin creams, items
used for protection from weather, and lost or intentionally damaged PPE.
See www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=STANDARDS&p _id=9777
for the complete language of the standard.
OSHA suggestions to avoid heat-stress
OSHA continues to issue reminders to employers and employees on the hazards of working in
extreme heat in the form of “suggestions.” Workers who don’t take precautions during
extremely hot weather could suffer rashes, cramps, fainting, heat exhaustion, or heat stroke. In
severe cases, excessive heat can be life-threatening. It is also important to realize that an
employee need not be working directly in the sun for heat stress conditions to occur. OSHA
suggested the following tips for employers and workers which may prevent heat-related
disorders:
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•
Encourage workers to drink plenty of water even when they are not thirsty. A good rule of
thumb is to drink about one cup of cool water every 15-20 minutes. Avoid coffee, tea, or
caffeinated soft drinks which can actually contribute to dehydration.
•
Assist employees in adjusting to the heat by assigning light workloads and longer rest
periods for the first five to seven days of work in intense heat. Repeat the adjustment
process after an employee returns from vacation or absence of more than one day.
•
Allow employees to wear lightweight, loose-fitting, and light-colored clothing.
Employees should also be permitted and encouraged to change their clothing if it
becomes saturated.
•
Provide good ventilation and spot cooling where heat is generated by production. Good
air flow eliminates the stagnant atmospheric conditions and poor air quality which can
contribute to induce heat-related illnesses.
•
Train all employees and supervisors to recognize the symptoms of heat- stroke, which
can be fatal. Severe headache, mental confusion, loss of consciousness, flushed face, and
hot, dry skin may signal the onset of heat- stroke. If a person has stopped perspiring, seek
medical attention immediately.
•
Identify and train first aid workers to recognize and treat the many other forms of heat
stress, including heat exhaustion, heat cramps, skin rashes, and swelling. Supervisors
should also be able to detect early signs of heat-related illnesses and permit employees to
interrupt work if symptoms arise.
•
Consider an employee’s physical condition when determining fitness to work in intensely
hot environments. Remember, however, that employers may not discriminate against
individuals for pregnancy or for conditions which rise to the level of disability.
•
Alternate work and rest periods, providing longer rest periods in cool areas during days
of intense heat. Shorter work-rest cycles are best, as is scheduling heavy work for cooler
periods of the day.
•
Certain medical conditions or treatments, such as heart conditions, low- sodium diets, and
certain medications may increase the risks of heat exposure. Ask employees to selfidentify and seek medical advice in those situations.
•
Monitor temperature, humidity levels, and employees on an hourly basis.
OSHA provides two free publications on heat hazards, including OSHA 95-16 entitled
“Protecting Workers in Hot Environments” and “Heat Stress Card,” OSHA 3154 (English) and
3155 (Spanish). Both publications are available from OSHA’s website at www.osha.gov or by
contacting a local OSHA office.
Most of the suggestions involve application of common sense to the work environment.
Nevertheless, it is likely that these suggestions will provide a starting point in any OSHA
investigation involving heat-related illness.
Workplace violence
For a more complete discussion of workplace violence, see Chapter 35, Workplace violence.
The violence rate in businesses throughout the country continues to escalate. Employers have
been held accountable in courts, and now face possible OSHA citations for failure to protect
employees from workplace violence:
•
over two-thirds of violent attacks are by strangers or customers
•
almost 20% of workers feel threatened by co-workers during a year
•
75% of workplace homicides involve a handgun
•
15% of employees say they have been attacked in the workplace at least once
•
violence is the leading cause of workplace death for female employees.
OSHA will issue citations to companies in situations where it can be shown that criminal activity
is a threat to employees, and the employer knew of the risk of such activity. Certain safety
precautions against criminal violence both inside and outside the workplace should be taken by
all employers as preventative measures.
Florida also recently enacted the Preservation and Protection of the Right to Keep and Bear
Arms in Motor Vehicles Act of 2008, which allows employees, customers, and third parties who
have a valid conceal and carry permit to bring guns in their vehicles on the employer’s property.
See Chapter 35, Workplace violence, for a more detailed description of this Act.
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For additional information, contact:
OSHA Publications
P. O. Box 37535
Washington, D.C. 20013-7535
AIDS and related
illnesses in the workplace
Florida became one of the first states to enact comprehensive legislation regarding AIDS and its
related illnesses. This legislation affects all segments of society including the insurance industry,
health care, education, law enforcement, and the prison system as well as the workplace. Its
purpose is to serve the interests of public health by facilitating informed, voluntary, and
confidential use of testing.
Under this legislation, an employer cannot order a human immunodeficiency virus-related test
without the informed consent of the person to be tested unless one of the exceptions listed under
Fla. Stat. § 381.004(3)(h) is met, such as the employee being medical personnel who was
exposed to the virus through the course of employment. An employer can require the test as a
condition of hiring, promotion, or continued employment if it can prove that there is a significant
risk of transmitting infection in the course of normal work activities and there is no means of
reasonable accommodation to prevent the risk.
Emergency action and
emergency response plans
Employers are required to maintain Emergency Action Plans (EAPs) that address all workplace
emergencies that the employer can reasonably expect including fire, the release of toxic
chemicals, and natural disasters. An EAP must include at a minimum:
•
an employee alarm system
•
emergency escape procedures and escape route assignments
•
procedures for employees who remain to operate critical plant operations before
evacuating
•
procedures to account for all employees after evacuations
•
rescue and medical duties for any employees who are to perform them
•
preferred means of reporting fires and other emergencies
•
names and job titles of persons or departments to contact for further explanation of plan
duties.
Work sites where there is the potential for a release of “hazardous substance” must have a sitespecific Emergency Response Plan (ERP), and the number of substances that qualify as
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hazardous under the OSHA standard is quite large. However, OSHA allows an employer to
comply with the less burdensome requirements of an EAP if it elects to have all of its employees
evacuate the danger area and does not permit any employees to handle the emergency. If an
employer does not choose this option, it must establish and maintain and ERP, which must
include:
•
pre-emergency planning and coordination with outside parties
•
personnel roles, lines of authority, training, and communication
•
emergency recognition and prevention
•
safe distances and places of refuge
•
site security and control
•
evacuation routes and procedures
•
decontamination procedures
•
emergency medical treatment and first aid
•
emergency alerting and response procedures
•
a critique of response and follow-up
•
PPE and emergency equipment.
Challenges of multi-employer work sites
Although the majority of OSHA cases involving multiple employers on one worksite arise in
construction, OSHA citations and civil liability are applicable in all industries due to the
presence on-site in all industries of contractors, temporary employees, vendors, repair
technicians, and delivery personnel.
OSHA analyzes multi-employer work sites under its 1999 Citation Policy CPL 2-0.124. OSHA
may not only cite an employer whose employees are exposed to a hazard, but an employer who
is classified as a creating, correcting, or controlling employer. Once OSHA has classified an
employer’s role, OSHA seeks to determine the extent of measures the employer should take in
order to satisfy its duty to exercise reasonable care to prevent and detect violations, especially
where its own employees are not exposed.
If anything, this contested area of the law became more muddled in 2007 with the OSHRC’s
decision in a recent lawsuit, rejecting OSHA’s ability to cite a general contractor as a controlling
employer where the general contractors did not create the hazard or expose Trust own
Employees.
First, the decision turns on provisions in OSHA’s Construction Standards and does not limit
application of the policy to General Industry employers. Second, MSHA maintains different
language and its policy has been upheld. Third, OSHA has taken the position that all or most
409
Circuit Courts have upheld the controlling employer approach, and OSHA may follow it absent
Court of Appeals action. OSHA initially appealed the decision in the U.S. Court of Appeals for
the 8th Circuit and has discussed possible rule making.
On a practical level, employers should continue to follow applicable OSHA guidelines and
determine “how much” responsibility to take to ensure that other parties on its site are complying
with OSHA Standards. Employers should review contracts, as well as determine their extent of
control in safety and operational areas, ability to detect violations, and civil exposure.
Employers may have a duty under Construction Standards or the General Duty Clause to train
their employees to recognize hazards and to inspect workplaces to which they are sending
employees.
Visit the Occupational Safety and Health Administration at www.osha.gov or contact:
Region IV
61 Forsyth Street, SW
Room 6T50
Atlanta, GA 30303
404-562-2300
404-562-2295 Fax
8040 Peters Road, Building H-100
Ft. Lauderdale, FL 33324
954-424-0242
954-424-3073 Fax
Ribault Building, Suite 227
1851 Executive Center Drive
904-232-2895
904 232-1294 Fax
5807 Breckenridge Parkway, Suite A
Tampa, FL 33610-4249
813-626-1177
813-626-7015 Fax
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Chapter 35
Workplace violence
Workplace violence is a significant problem in today’s businesses. Workplace violence is a
significant problem in today’s businesses. While homicides in the workplace decreased by 18% in
2008, according to the Bureau of Labor Statistics, it is estimated that more than 500 homicides
will occur in the workplace this year. Many more will fall victim to non-fatal physical attacks at
work. Along with the disruption to business activities, victims and their families experience a
huge emotional toll. Additionally, the potential for employer liability is increasing under a
number of novel legal theories.
Employer responsibility
Employer responsibility is assessed under the following theories:
•
Negligent hiring
The employer will be liable if the victim can prove that the employer knew or should
have known at the time of hiring that the employee was potentially dangerous or
incapable of performing the job. Employers are more likely to be held responsible for the
hiring of employees who have contact with the public. (See page 41, Negligent hiring.)
•
Negligent supervision and retention
This theory of liability is similar to negligent hiring but is applicable when the victim can
prove the employer knew or should have known that a current employee was potentially
violent and failed to take appropriate disciplinary action. (See page 42, Negligent
retention.)
•
Under the workers’ compensation system in Florida, a victim/employee or family
member generally cannot sue the employer for on-the-job injuries because workers’
compensation benefits are the exclusive remedy for employee injuries. However,
employees or their families can sue if the victim can prove that the employer knew or
should have known that a workplace situation was likely to result in serious bodily injury
and did nothing to try to prevent it.
•
Prohibited harassment
An employee’s harassing conduct may result in liability to an employer, especially if that
employer does not have an effective policy prohibiting harassment on the basis of
protected characteristics. (See page 94, Sexual harassment.)
•
Negligent references
Employers could face liability for providing a positive employment reference on an
employee who poses a known danger. An organization relying on such a reference might
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Workplace violence
allege negligent referral or negligent failure to warn if your former employee harmed
someone at their organization. Florida law encourages employers to be candid about a
former employee’s violent conduct when contacted by a prospective employer. Florida
employers are immune from civil liability for providing information to a prospective
employer about a former employee as long as the information is not knowingly false and
does not violate the former employee’s civil rights. (Available at
www.myfloridahouse.gov.)
•
ADA
Employers must be aware of potential liability which may arise due to the actions of a
violent employee. A violent employee could be considered disabled or handicapped
under Florida or Federal law. In such a scenario, employers must consider many issues,
including:
whether the employee is qualified for his or her position
whether the employee is a direct threat under the ADA
whether accommodations are necessary or possible.
In any event, you should maintain the confidentiality of all medical records.
Law regarding guns at work
On July 1, 2008, the Preservation and Protection of the Right to Keep and Bear Arms in Motor
Vehicles Act of 2008 took effect in Florida, allowing employees, customers, and third-parties
who have a valid conceal and carry permit to bring guns in their vehicles on the employer’s
property. Here are some important aspects of the law:
•
defines “employee” broadly to include independent contractors, volunteers, and interns
•
excludes company-owned vehicles
•
excludes schools, correctional facilities, and businesses dealing with national defense,
aerospace, domestic security, and explosive materials
•
prohibits conditioning employment on whether an applicant has a conceal and carry
permit
•
prohibits asking employees whether they have a firearm in their vehicle or whether they
have a conceal and carry permit
•
prohibits searching employees’ vehicles for firearms
•
prohibits terminating or taking other action against employees who acknowledge that they
have a firearm in their vehicle or that they have a conceal and carry permit.
For more information, see Chapter 36, Guns in the workplace.
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Workplace violence
OSHA guidelines on workplace violence
The Occupational Safety and Health Administration (OSHA) has issued informational, voluntary
guidelines on preventing violence in the workplace (available at
www.osha.gov/Publications/OSHA3148/osha3148.html). These guidelines are targeted at the
health care and social service industries. In issuing the guidelines for these industries, OSHA
observed that the workplace violence incident rate for private industry is 3 cases per 10,000
workers, whereas for health care and social service workers the incident rate is 47 cases per
10,000 workers. Although these guidelines are intended for health care and social service
workers, OSHA did announce that all employers have a general duty to provide their employees
with a workplace free from recognized hazards. It is the position of OSHA that employers can be
cited for violating the law under the “general duty” clause if there is a recognized hazard of
workplace violence in their establishments and they do nothing to prevent or fix it.
Employers in the health care and social service industries should obtain a copy of these
guidelines and review them to see if changes need to be made in the workplace. Unfortunately,
workplace violence is becoming a weekly incident in the U.S. When such incidents increase, the
public brings pressure on the government for some type of response. If workplace violence
occurs, OSHA may take the position that the employer violated the law if it can show that
appropriate steps were not taken to prevent or minimize the harm to employees.
Steps recommended by the guidelines
1. Management commitment and employee involvement in preventing violence. “To
ensure an effective program, management and frontline employees must work
together, perhaps through a team or committee approach.” If employers opt for
this strategy, they must be careful to comply with the applicable provisions of the
National Labor Relations Act, which prohibits employee safety committees that
“bargain” with management.
2. A written program for job safety and security, incorporated into the employer’s
overall safety and health program. Consult the OSHA website for a wealth of
information on how to develop and maintain a written safety and health program
at www.osha.gov/SLTC/safetyhealth/.
3. Management should conduct a worksite analysis which involves a step-by-step,
common-sense look at the workplace to find existing or potential hazards for
workplace violence. Employee involvement in the analysis is recommended to
“minimize oversights, ensure a quality analysis, and get workers to ‘buy in’ to the
solutions.” See OSHA’s online Job Hazard Analysis booklet at
www.osha.gov/Publications/osha3071.html for comprehensive guidance on how
to conduct such an analysis.
4. Review of medical, safety, workers’ compensation, and insurance records,
including the OSHA 300 log, to pinpoint instances of workplace violence.
5. Monitoring trends and analyzing incidents in the workplace by reviewing accident
reports in the OSHA 3000 log to identify any reoccurring hazards or injuries.
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Workplace violence
6. Screening surveys. OSHA recommends that employers give employees a
questionnaire or survey to get their ideas on the potential for violent incidents and
to identify or confirm the need for improved security measures.
7. Workplace security analysis.
8. Implementation of engineering controls, such as use of closed-circuit videos,
placement of curved mirrors in desolate hallways, enclosing offices with safety
doors and glass, etc.
9. Use of administrative and workplace practice controls such as requiring all
employees to report assaults or threats to a manager, organizing an emergency
response team, and establishing liaisons with enforcement.
10. Development of a post-incident response and evaluation team.
11. Training and education to ensure that all staff are aware of potential security
hazards and how to protect themselves and their co-workers through established
policies and procedures.
12. Recordkeeping – good records help employers determine the severity of the
problem, evaluate methods of hazard control, and identify training needs.
13. Regularly scheduled evaluations of safety and security measures by management
Domestic violence costs
employer and employee
In two unemployment cases before the Florida First District Court of Appeals, the issue arose as
to whether unemployment benefits should be awarded to women whose absences from
employment were related to issues of domestic violence. In the first case, the employee was fired
for excessive absenteeism. During a one-year period, the employee had 23 unscheduled
absences, attributed to domestic violence. During one two-week period, the employee was absent
because of a back injury she had suffered at the hands of her abusive husband. The court found
that her absences were not misconduct, in light of the reason for her inability to come to work:
“her husband’s repeated, violent attacks on her person.” Since the employee’s absences were not
the result of her own carelessness or negligence with regard to her employment, she was entitled
to unemployment compensation benefits.
In the second case, the employee voluntarily left her employment when she moved out of town
to avoid conflict with an abusive husband. The court found that while her reason for leaving was
“good cause,” it was not attributable to the employer. Unemployment benefits were not payable
in this case, because there was no dispute that the employee gave up her job for a reason
unrelated to the employer.
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Workplace violence
Employer strategies for
preventing workplace violence
•
Require the employment application to be completed entirely, particularly with regard to
criminal record, prior job history, and providing an explanation for periods of
unemployment.
•
Perform background and reference checks (see Background checks on page 30) for all
new hires. Request and check personal references.
•
Secure the workplace. Identify high-risk hours of operation or locations such as retail
businesses, employees working alone, late night, and early morning shifts, urban crime
areas, and valuable equipment on site. Consider use of the following:
lighting
metal detection devices
surveillance cameras
barriers
emergency or panic buttons
drop safes
cash handling procedures
sign-in procedures limiting access.
•
Enforce no solicitation/no distribution rules, and prohibit off-duty employee presence in
the workplace.
•
Implement and enforce written workplace rules that provide “zero tolerance” for
potentially violent conduct such as fighting, threats, physical contact, etc.
•
Implement and enforce written policies prohibiting harassment of any kind.
•
Train supervisors to identify potentially dangerous employees, and to take appropriate
steps to contain inappropriate or suspicious behavior.
•
Consider implementing a policy banning all weapons from company premises except to
the extent allowed by law. Consider a policy which allows the employer to conduct
searches of employee lockers and/or containers, but remember that searching employees’
vehicles for firearms is prohibited. You must comply with the Preservation and
Protection of the Right to Keep and Bear Arms in Motor Vehicles Act of 2008 as
previously discussed.
•
Implement and enforce a drug testing policy.
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Workplace violence
•
Implement and publicize grievance procedures for employees. Consider providing direct
communication channels to upper management, allowing the employee to bypass his or
her direct supervisor.
•
Require supervisors to provide accurate job evaluations to all employees. Undeserved
good performance reviews can contribute to violent outbreaks when adverse employment
action finally occurs.
•
Provide job counseling as soon as possible for employees who are terminated or laid off.
Train supervisors to communicate any necessary layoffs or discharges without anger.
•
Develop emergency plans to prepare supervisors to deal with violent situations if they
should arise. Consider the best way to handle bomb threats, robberies, assaults, and other
workplace violence before such incidents occur.
It is vital that employers consistently enforce any policies implemented to avoid or otherwise
minimize the risk of violence in the workplace.
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Chapter 36
Guns in the workplace
The law
Workplace use of guns is governed by the Preservation and Protection of the Right to Keep and
Bear Arms in Motor Vehicles Act of 2008, more commonly known as Florida’s Guns-at-Work
Law. Perhaps the most important aspect of the law is the broad definition of “employee.”
Unlike other employment laws, the definition of employee includes any independent contractor,
volunteer, or intern who holds a valid concealed weapons permit. By its terms, the law only
applies to employers who have at least one employee who has a weapons permit. However, the
law prevents employers from asking employees whether they have concealed weapons permits,
or conditioning employment on whether an applicant has a permit.
What the Act allows
The Act simply requires employers to allow employees who have a permit to keep a firearm
secured in a locked vehicle parked on company property. The law does not permit the exhibition
of a firearm for any purpose other than lawful self-defense. The law also does not require that
employers permit firearms to be brought into any building, structure or facility, as the law
provides employees with the limited right to store firearms locked in vehicles while parked on
company property. The law applies only to an employee’s personal vehicle and employers may
still ban guns in any company-owned vehicles. As a result of the newly enacted law, generalized
policies which simply ban guns “on all company property” will probably need to be revisited.
Searches
The guns at work law prohibits employers from conducting vehicle searches solely for the
purpose of determining whether an employee is storing a gun in their car. However, the law does
not limit an employer’s right to conduct searches of employee vehicles for drugs, stolen property
or for any other reason other than to ascertain whether the employee is storing a gun in their car.
As such, blanket policies which simply provide employers the right to search employee vehicles,
for any reason, will probably need to be rewritten. In any event employers should establish and
maintain a contact person with a local law enforcement agency and call on that contact in the
event a search of an employee’s vehicle becomes necessary.
Non-discrimination policy
The law also makes it unlawful for an employer to condition an offer of employment, or
otherwise discriminate against, an employee based on whether they carry a concealed weapons
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Guns in the workplace
permit. The law also prohibits employers from simply asking whether an employee has a gun in
their vehicle or whether or not they carry a concealed weapons permit.
Complying with the law
As it was originally written, the law required businesses to allow employees and customers and
other invitees to keep guns locked in their cars while parked on company property. The
provision applying to customers was held to be unconstitutional and therefore employers may
prevent customers and other non-employee invitees from bringing guns onto company premises.
However, enforcement of such a policy could become problematic, especially if employees and
customers share the same parking lot. In order to ensure compliance with the law, employers
should do the following:
418
•
Revisit all existing weapons policies and revise all policies that ban all weapons on
company property. This can be as simple as adding language to existing policies such as
“except as authorized by law.”
•
Review policies relating to vehicle searches. Searches of employee vehicles solely for
firearms must only be conducted by on-duty law enforcement personnel. Employers
may still search for drugs and stolen property, however make sure all such policies are
clear and consistently enforced so as to avoid the implication that such policies are
pretext for searches for firearms.
•
Establish a point of contact with local law enforcement who will conduct vehicle searches
if necessary and who will assist in the case of an episode of violence.
•
Establish and enforce “zero tolerance” policies relating to employee violence and the
improper display of a firearm (remember the only proper display of a firearm is for
lawful self defense purposes).
•
Train supervisory employees in proper dispute resolution procedures in the event of
conflicts among employees.
Chapter 37
Privacy in
the workplace
Employees, even those who are suspected of fraud or theft, do not relinquish all privacy rights in
the workplace. Employers seeking to avoid company losses and expose fraudulent employee
conduct may not necessarily justify an expansive search into the employee’s personal affairs and
effects. The Fourth Amendment of the U.S. Constitution provides that “[t]he right of the people
to be secure in their persons, houses, papers, and effects, against unreasonable searches and
seizures, shall not be violated,” but this applies only to public employers, not private.
The Florida Constitution contains a similar provision establishing a “right to be let alone and free
from governmental intrusion into his private life.” Again, it requires a “state actor,” that is, a
public employer, for this provision to be relevant. But from these general provisions, and
expanding expectations of privacy brought about by civil litigation, most individuals believe that
they have some level of individual privacy rights in the workplace.
Florida law recognizes rights of privacy in various categories. As such, intrusion rights must be
considered whenever you search what could be considered a “private” employee area. In such
situations, an employee may claim that the employer violated a reasonable expectation of
privacy. In many cases, whether or not an expectation of privacy is reasonable will depend on
what the employer said or did not say to create the expectation of privacy.
It is important for employers to be able to conduct investigations when circumstances give rise to
a suspicion of theft or fraud. During such an investigation, an employer should attempt to ensure
that employee privacy rights are protected to the extent possible. When appropriate, the
employer should consider obtaining the written permission of the employee. However, no
workplace investigation, however carefully conducted, will be entirely immune to claims that
employee privacy rights were violated.
Recording or monitoring employees
Except under certain circumstances, Florida law prohibits the interception and disclosure of wire,
oral or electronic communications without the consent of all parties to the communication.
“Interception” is defined as acquiring the contents of any wire, electronic, or oral communication
through the use of any electronic, mechanical, or other device. An employer who illegally
intercepts the communications of its employees could face criminal and civil liability under
Florida law.
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Privacy in the workplace
The Federal Wiretap Act generally prohibits the interception, disclosure or intentional use of
wire, oral or electronic communications, including those that occur in the workplace.
•
A “wire communication” is one that carries a person’s oral communication over a wire,
such as a phone call and includes the “electronic storage of such communication.”
•
An “oral communication” occurs when the individual uttering the communication
expected it would be a private conversation.
•
An “electronic communication” is the transfer of information (writing, images, signals,
sounds, data, etc.) transmitted by electronic means including radio waves but is not an
oral or wire communication. E-mail, pagers, and cell phone usage are examples of
“electronic communications.”
•
“Interception” is the aural or other acquisition of the contents of any oral, wire, or
electronic communication, through the use of any electronic or mechanical device.
For example, intercepting a call with a tape recorder connected to a switchboard without an
employee’s knowledge is a violation of the Act. However, merely listening to an allegedly
illegally-obtained audiotape of private telephone conversations is not a violation of the Act.
The Act provides three defenses for employers:
1. the Act has an exception for employers who act in the “ordinary course of business.”
This exception allows an employer to electronically monitor, using a telephone extension,
any business-related communication without the employee’s knowledge or consent. An
employer may not, however, monitor communications of a purely personal nature. An
employer does not violate the Act if it terminates electronic monitoring immediately upon
discovering that the monitored call is purely personal.
2. The Act does not apply if the employer has the consent of one party to the
communication, unless the communication is intercepted for the purpose of committing a
criminal or tortuous act. Consent may be either express or implied.
3. Under the “provider” exemption, telephone companies and other employers that provide
wire communication services may monitor calls for service checks.
The Act provides a civil cause of action to anyone whose communications are unlawfully
intercepted. Successful plaintiffs may recover actual or statutory damages, up to $10,000 in
some instances, punitive damages, and attorneys’ fees. The Act also makes the unlawful
interception, or the attempted interception, of an oral, wire, or electronic communication a felony
punishable by fine and/or imprisonment.
Searches
An employer should not search federal delivery mail addressed to the employee before it has
been delivered. Federal law prohibits any person from taking a letter, postcard or package from
420
the mail. Also, as a general rule, employers should not read correspondence addressed to
employees that are marked “personal” or “confidential.”
Employers may search work areas, lockers, vehicles and other personal items if they have a
reasonable basis for doing so. Employers are advised to have a policy authorizing and regulating
searches.
Electronic and voice mail
Employees generally have no reasonable expectation of privacy in their electronic mail or voice
mail messages, as long as this is communicated and clearly acknowledged via a clear policy
restricting employee use of such systems to business use and informing employees that such
communications are subject to monitoring. You should notify all employees on a regular basis
that their personal use of company equipment is subject to monitoring.
Obtaining employee consent to monitor your electronic systems is important, as employers can
be potentially liable for offensive materials which are easily transmitted among the company via
electronic or voice mail. Further, in connection with employee misconduct or other similar
matters, reviewing employer communications may provide useful information.
Additionally, you may have a legitimate business need to prevent trade secrets or other
confidential information from being transmitted outside the company. See Chapter 38,
Changing technology in the workplace.
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Chapter 38
Changing technology
in the workplace
If you had any questions before, there should be no question now: the Information Age is here to
stay. The relative ease of using computers, electronic mail, Internet and voice mail systems has
created entirely new sets of employer-related problems and policy issues. To give your company
a competitive edge, you need to learn to use technology appropriately, while protecting your
company from the dangers of information overload.
Determine the business goals for your company, and consider which of the many advantages of
the Internet and e-mail are appropriate for reaching these goals. For instance, technology can
effectively be used for:
•
communication
•
research
•
marketing
•
sales/e-commerce
•
customer service
•
organization development, such as recruiting and training.
Then develop a plan and policy for the effective and appropriate use of technology to achieve
your business goals, taking into consideration human resources issues. Keep in mind that with
all the advantages the Internet has to offer, it can also be a source of strife for employers when
their employees are focused more on their own personal Internet activities than their work. For
this reason, it is best to implement and consistently enforce policies governing the use of the
various forms of technology in the workplace.
Electronic mail
E-mail is arguably the most prevalent methods of communication in the world. Its use has
become nearly universal. While many businesses find e-mail to be an indispensable part of their
operations, misuse of e-mails is also nearly universal. Most businesses will find it necessary to
set out reasonable guidelines for use of their electronic and Internet communications.
In light of both the widespread use and the permanency of the medium, e-mail creates several
potential problems for employers. Among the most common and troubling are the use of e-mail
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Changing technology in the workplace
as evidence in employment litigation, the use of e-mail as a vehicle for harassment among
employees, and the use of e-mail as a mechanism to transmit confidential information.
E-mail as the smoking gun
One author summed up the danger of e-mail in the workplace by stating once an e-mail
message has been sent, it is beyond the reach of a delete key but not beyond the reach of
a subpoena. In fact, recently enacted Federal Rules of Civil Procedure now permit
extensive discovery of electronically-stored data, and both federal and state courts have
specifically held that e-mail is discoverable and admissible. As a result, an indiscreet email message may come back to haunt a company that has been sued by a former
employee, job applicant or even consumer.
Consider the following scenarios:
•
As a supervisor, you have decided to fire John, a 58-year-old male employee.
Upon receiving this news, John is very upset and accuses you of discriminating
against him because of his age. In documenting the incident, you send the
following message to your boss: “Finally terminated John yesterday, keeping him
on was just not worth the headaches. He was, of course, upset and even had the
nerve to accuse me of age discrimination – the ornery old goat. I sure hope we
don’t end up in a lawsuit over this one. Of course, I think we now have enough
evidence to avoid a wrongful termination claim.” While seemingly harmless, a
message similar to this one resulted in a loss of a $3.3 million dollar verdict to
Airborne Freight Corporation. The e-mail was offered as critical evidence of the
employer’s intent and arguably showed that the company believed that it had
something to worry about.
•
In line with your reputation as a hard-nosed, driven supervisor, you send the
following message to Sally, one of your subordinates who is habitually late
finishing her projects: “I don’t want to hear any more excuses about it not
working properly. Just get it done.” When viewed five years down the road by a
jury in a products liability case, is this simply a message from a no-nonsense boss,
or is it a direction to Sally to cut corners and sacrifice quality in order to meet
production deadlines?
•
Angie, an employee in your department, complains about everything. You receive
an e-mail from her immediate supervisor that she has complained about
inappropriate sexual comments being made by Bill. You send the following
response: “That is the most ridiculous thing I’ve ever heard. Bill is the third one
she’s complained about this month, and I know he would never say anything like
that. If Angie’s so ‘uncomfortable’ around him, just reassign her to second shift.”
In all of these illustrations, the e-mails were sent by managerial employees, who, because
of the positions held, are deemed to act on the Company’s behalf. The first scenario
above illustrates how an ironic statement, even if genuinely offered purely for is
humorous value, can provide damaging evidence to a plaintiff and significantly increase
the value of their claim. The second scenario demonstrates how easily a statement out of
context can be manipulated to support a plaintiff’s allegations. And the third scenario is
424
an example of a classic smoking gun, offering rather solid proof that the employer was
nonresponsive and even retaliatory toward a plaintiff’s protected activity of issuing a
complaint about alleged sexual harassment against her.
These problems can be avoided by recognizing that offhand remarks sent through the email system are not simply deleted at the touch of a button and, thus, are likely to come
back and bite you. As a general rule, if you wouldn’t put it in a memo, don’t put it in an
e-mail.
E-mail as a forum for harassment
Perhaps even more dangerous than e-mails sent by managers and other company
representatives are e-mails sent from one employee to another. The assumption that email messages are private and will be deleted automatically upon command has led to a
proliferation of inappropriate, defamatory and offensive messages being sent through
company e-mail systems. These messages can create a hostile working environment, and
the company can be held liable. Indeed, as a result of the recent developments in the area
of sexual harassment, it does not matter whether the employer was actually aware that the
harassment was taking place. Examples of the dangers associated with harassment via email include the following:
•
In 1995, Chevron Corporation paid $2.2 million to settle a sexual harassment
lawsuit filed by four female employees who alleged that e-mails circulated
throughout the company, including items such as “25 Reasons Why Beer Is Better
Than Woman,” created a sexually hostile working environment.
•
In 1997, lawsuits were filed against R.R. Donnelley & Sons, Citicorp, and
Morgan Stanley alleging that black employees had been subjected to a racially
hostile working environment as a result of e-mails circulated by their white
supervisors.
As discussed below, a good e-mail policy, which provides for some type of employer
monitoring, may have a chilling effect on e-mail indiscretion and unproductive banter
because it puts employees on notice that their e-mail might be read by others.
E-mail as a mechanism to transmit trade
secrets and other confidential information
Because of its simplicity and versatility, e-mail also presents a risk to companies that
want to protect trade secrets or other confidential information. Sensitive information can
be easily disseminated to anyone connected to the e-mail network, including outside
users and competitors. In addition, an employee who has resigned or has been terminated
can download confidential information onto his or her own computer. Though
unintentional, the transmission of confidential information to outside parties can occur if
an employee inadvertently selects the wrong recipient from his or her address book.
In one recent case, Borland International Inc. v. Eubanks, the company searched a former
employee’s e-mail messages and found evidence that trade secret information had been
sent to a top executive of one of its major competitors. This discovery led to 31 counts of
425
felony criminal trade secret theft being brought against both the former employee and the
executive.
Monitoring employee e-mail
The problems associated with e-mail in the workplace have led more and more employers
to consider utilizing some for of e-mail monitoring. A 1993 survey of 301 businesses
reported that 30% of employers with more than 1,000 employees and 22% of smaller
companies regularly monitored their employees’ e-mails. Because this is an area in which
the technological developments have largely outpaced the applicable law, employers
engaging in monitoring have very few guidelines to follow. Nevertheless, guidance can
be gleaned from the few recent developments and from examining concepts developed in
related areas such as the monitoring of telephone conversations.
Electronic Communications Privacy Act
The key federal law to date in this area is the Electronic Communications Privacy Act of
1986 (ECPA), which prohibits the interception of electronic communications. The ECPA
would seem to protect workers from many types of electronic monitoring including email interceptions, but it is not specific when it comes to the workplace, and it contains
some exceptions that courts may determine exclude employee protection.
The statute has three exceptions that limit its protection of employee e-mail: noninterstate systems, prior consent and business use.
1. Interstate systems
The ECPA may only protect messages sent over public networks, since the
definition of “electronic communications” under the ECPA only pertains to such
communication that “affects interstate or foreign commerce.” Although Congress
did intend for the ECPA to include intracompany networks, it confined this
broader coverage to “wire communication,” and Congress has specified that “wire
communication” includes some element of the human voice. Therefore, a
company voice mail may be covered, but not an intracompany e-mail system –
unless that system crosses state lines or perhaps connects to an interstate network.
The ECPA is not clear on this point, however, and thus court interpretation will be
needed.
2. Prior consent
The ECPA also allows the interception of electronic communications where “one
of the parties to the communication has given prior consent.” Oftentimes, though,
there is no specific consent from an employee and the issue becomes whether
implied consent was given. Courts do not generally apply a broad meaning of
implied consent. For instance, knowledge of an employer’s possible monitoring of
e-mail communications is not sufficient to establish implied consent of the
monitoring.
3. Business use exception
There are two key provisions of the ECPA that address the business use
exception. One provision has been relied on in telephone extension monitoring
426
cases but may not pertain to e-mail monitoring unless telephone equipment or
facilities are specifically involved. This provision permits interceptions where
telephone or telegraph equipment are used “in the ordinary course of business.”
However, courts may not consider a network manager’s modem, computer, or
software program to be telephone or telegraph equipment, and the leasing of
telephone lines may not necessarily qualify under this exception.
Still, employers may turn to another ECPA “business use” exception that does not
specify the type of equipment, but rather allows certain interceptions by electronic
communication service providers or their “agents.” This section provides:
It shall not be unlawful under this chapter for an officer,
employee, or agent of a provider of wire or electronic
communication service, whose facilities are used in the
transmission of a wire communication, to intercept, disclose, or
use that communication in the normal course of his employment
while engaged in any activity which is a necessary incident to the
rendition of his service or to the protection of the rights or
property of the provider of that service.
The term “provider” would likely include public e-mail networks, and the term
“agent” may or may not be defined to include employers who subscribe to or use
their e-mail service. Companies with their own e-mail systems on their own wide
area (interstate) networks could also fall under this exception as electronic
communication service providers.
The references to “in the ordinary course of business” and “in the normal course
of employment” in two ECPA provisions may be interpreted to give employers
fairly broad authority to intercept and monitor e-mail messages. To fall within
these provisions, employers and public e-mail providers are required to
demonstrate that a particular interception was done in the ordinary course of
business – such as the rendering of service maintenance. In fact, under the ECPA
section quoted above, employers or service providers would need to prove that the
monitoring was necessary to render service or to protect their rights or property.
The courts, though, may find that this includes such reasons as the need to prevent
abuses of the system such as computer crime, system failure, or unpermitted
personal use.
In conclusion, the easiest, most straightforward way to avoid violating ECPA is to
inform employees in writing of the fact that the employees may have no
legitimate expectation of privacy in their e-mail messages and that the e-mail
system is owned by the employer, provided for business purposes, and may be
monitored when the employer deems it necessary to do so.
Constitutional issues
For some classes of employers, additional protection may be provided to
employees through the Fourth Amendment prohibition on unreasonable searches
and seizures. However, this protection only applies to governmental intrusion and
thus does not prohibit monitoring by private employers. In addition, even for
427
government entities, a search cannot violate the Fourth Amendment unless the
employee has a “reasonable expectation of privacy,” which in the case of a
company e-mail system, may be difficult to demonstrate.
State law issues
Most states, including Florida, recognize a claim for invasion of privacy. It is
likely that an employer’s search of its employees’ e-mail messages to protect the
company’s property or other legitimate interest (such as preventing abusive
personal use of the company e-mail system) would not constitute an invasion of
privacy. Generally, employees’ claims for invasion of privacy – based upon an
employer’s monitoring of e-mail – have been unsuccessful because employees do
not have a reasonable expectation of privacy in their use of a company e-mail
system.
Other ramifications
Aside from the legal issues relating to employer monitoring of employee
communications, there are other practical issues to consider:
Effect on employee morale
In evaluating whether and to what extent they should engage in any type
of e-mail monitoring, companies should consider the potential effects this
practice will have on employee morale. If the issue is not handled
properly, employees are likely to feel distrusted and resentful that “Big
Brother” is watching. Consequently, it is extremely important that
employers inform their employees of the company’s monitoring policy as
well as the reasons for the policy.
Employee self-help
Many advocates of employee privacy are currently encouraging
employees and members of the general public to engage in self-help
methods of protecting the privacy of their e-mail messages. The primary
means of doing this is through the use of encryption software. Encryption
software allows users to transmit secure e-mail messages which only the
intended recipient can decode. The use of self-help methods such as this
can create problems for employers because they lose control over the email system and are unable to determine if the system is being abused.
The use of e-mail in union activities
The convenience and effectiveness of e-mail communication systems can also be a powerful tool
in union-organizing efforts. In a matter of moments, an employee who supports a union
organizing campaign can deliver a pro-union message to numerous potential voters.
The first decision concerning the application of traditional National Labor Relations Board
(NLRB) rules to e-mail communications was issued in December 2007. Traditionally, oral union
solicitation is permitted during non-working times in working and non-working areas. In
contrast, distribution of union literature can be banned at all times in working areas. The NLRB
has reasoned that solicitation is permitted during non-working time because solicitation impinges
428
upon an employer’s interest only to the extent that it occurs during working time. In its Register
Guard decision, the NLRB determined that an employer has the right to place restrictions on
employees’ use of company-provided e-mail, even if it, in some way, dampened union
solicitation.
The NLRB has analyzed the use of e-mail communications as similar to determining whether or
not a union can use a conventional company bulletin board. Employees have no statutory right to
use an employer’s bulletin board; however, unions have the right to post notices on bulletin
boards when boards are provided for the employees’ general use.
Thus, an employer who regularly permits employees to use a bulletin board – or arguably, the email system – may be hard-pressed to justify a ban on pro-union messages.
In at least one case the use of e-mail was ruled a protected activity by the NLRB when an
employee sent e-mail messages to the company CEO and co-workers.
Voice mail systems
Employers should establish policies and procedures for the use of voice mail systems,
particularly in light of the fact that public contact is most often made by use of telephone systems
in the workplace. As such, voice mail messages and greetings should reflect the image which the
company wishes to portray to the public or its customers.
All relevant employer policies should apply to the use of the Voice Message System, and voice
mail should not be used to avoid the purpose or consequences of other personnel policies. For
example, employees should be instructed that they may not leave a message that they will be late
on the Voice Message System, but must speak directly with a supervisor.
Another good general rule should be that confidential information is not to be left on voice mail.
Most voice mail systems require each employee to have a code to retrieve voice mail messages.
Employers should establish a policy that prohibits employees from sharing codes, passwords or
other means to gain access to the voice mailboxes of others. To insure security, passwords
should be changed frequently. For emergency purposes, a single individual, preferably in the
Human Resource department, should be provided with a list of every employee’s voice mail
code or password.
Ideally, the voice mail system should be designed to increase productivity. However, it may be
necessary to instruct employees not to leave curt, last minute messages for anyone. Employers
may require that employees treat each other, as well as customers of the business, with courtesy
when leaving messages. Foul, inappropriate or offensive messages should be strictly prohibited.
Employees should not use the voice mail system to “hide” from co-workers or others. If at his or
her desk, the employee should generally be expected to personally answer the telephone, absent
an emergency situation.
Employers should obtain employee consent prior to monitoring. If messages are subject to
random monitoring to determine whether any outsiders have gained unauthorized access to the
system, a recording advising the caller of the possibility of monitoring is advised.
429
Employees should be reminded to keep their greeting current and to change it periodically. For
example, if an employee is on vacation and leaves a greeting advising callers of their
nonavailability during the vacation period, the greeting should be immediately removed upon the
employee’s return to work.
Checking for messages
Employees should be required to check their voice mail messages at least once per day. If
needed, supervisors may instruct certain employees to access their voice mail more often
depending upon the job requirements.
If the voice mail system has an automatic delete feature, employees should be informed.
Systems often delete messages automatically after a certain number of business days,
because of the limits on the number and length of messages that can be maintained in the
voice mail system.
Monitoring Internet use
Employers with the capability usually provide Internet access to their employees. Employers
may have a business policy or practice limiting access to particular employees in particular job
positions. In general, employers should provide that Internet use is subject to the same
requirements and restrictions that apply to internal e-mail messages.
Online communities and social networking
With the emergence – and prevalence – of eBay, Craig’s List, blogging, instant
messaging, Myspace, YouTube, Twitter, Facebook and other online communities,
employers face a new challenge. As employees now increasingly use these tools during
the work day, they have the potential to become less productive. In the case of blogging,
when employees blog about their employer, it may put certain proprietary and/or negative
information about the employer on the worldwide web for all to see. Additionally,
because there are many applications available to users of social networks, an employee
would unknowingly open the company’s computer system up to viruses. Because of
these, and other reasons, employers may implement a policy blocking access to these
websites.
Employers have the right to monitor Internet usage and should do so. In fact, a 2005 survey
conducted by the American Management Association and the ePolicy Institute discovered that
76% of employers monitor their employees’ internet usage. Employees should be informed that
Internet usage is not to be considered private, and that employees should have no expectation of
privacy in their Internet usage.
Internet access should be limited for business purposes only. At a minimum, employees should
be instructed that they may not establish Internet or external connections that could allow
unauthorized persons to gain access to the employer’s computer system.
No files should be posted to the Internet without proper authority. Unless posting is restricted,
there is a danger that information will be posted which does not reflect the standards and policies
of the company. Confidential or proprietary information should never be posted to the Internet.
430
The posting of material that is subject to copyright protection should only be posted with
permission of the copyright holder.
As a condition of employment, each employee should be required to acknowledge the company
policy on Internet use. One method is to establish an “access” screen containing the
acknowledgment which employees see every time they log on to their computers. Sample
language is set out on page 432.
431
SAMPLE ACKNOWLEDGMENT/CONSENT FORM
I,__________, expressly consent to the Company monitoring my Internet access activity
including, but not limited to, browsing, posting, downloading, and otherwise transferring
information to and from Internet sites. I acknowledge that any files that I download from
the Internet are subject to review and monitoring by management. I further acknowledge
receipt of the Company’s Internet access policy, and I have read and understand the policy
as it relates to the Company’s other policies and understand that violation of this policy
may be grounds for disciplinary action, up to and including discharge.
432
Preventive measures
In order to capitalize on the benefits created by advanced technological developments such as email systems and, at the same time, minimize the inherent risks, it is imperative that employers
develop policies to define permitted uses of the medium and also protect the employer’s interest.
An employer should ensure that the policy is reasonable and that it is not overly burdensome so
that it can be enforced. A carefully drafted Information Technology (IT) Policy serves two
purposes:
1. it educates employees about the pitfalls and risks inherent in the use of the Internet and email
and
2. it establishes the company’s rights and official position on employee use of the Internet
and e-mail systems and provides grounds for disciplinary action should the policy be
violated.
An IT Policy can also reduce an organization’s liability by preventing instances of technology
misuse and by providing an important defense should employees act outside the scope of the
policy.
•
Develop a written policy informing employees that computers, e-mail, voice mail, etc.,
are company property subject to monitoring by the company. The policy should state in
writing that these electronic systems are not for private or personal use, that employees
have no privacy rights to the content of e-mail messages, and that the employer has the
right to review, audit, intercept and disclose all matters sent over its electronic systems.
Employees should acknowledge receipt of this policy in writing. A Sample
telecommunications policy appears on page 435.
•
Specify in the policy the rules for the use of the e-mail system and the “do nots.”
•
no offensive material
no racial or ethnic slurs
no off-taste comments
nothing illegal
nothing defamatory
nothing obscene
nothing otherwise inappropriate.
The policy should explain that discipline or discharge can result from violation of the
policy or from information obtained through employer monitoring or inspection of e-mail
files.
433
434
•
An effective IT Policy should also address the need to discard e-mail messages regularly
and should limit the disk space allotted to each employee for personal e- mail. Companies
should consider the need to systematically purge e-mail and backup files and should
provide for this in the IT Policy. The policy should also include a statement to the effect
that automatic deletion of electronic records will be suspended and steps will be taken to
preserve such records if litigation or investigation should commence.
•
The IT Policy needs to protect the integrity of the employer’s system by prohibiting the
importation of documents from outside the system and the downloading of files from the
Internet. The policy should also prohibit the distribution of internal e-mails to anyone
outside the company unless the e-mail specifically states that it is intended for
distribution.
•
Some companies have installed an electronic reminder of various portions of the IT
Policy into their computer system. This might include a short message reminding the
employees that the e-mail system is to be used for business purposes and may be
monitored by the employer. The key is to ensure that employees are educated as to the
terms of the policy and the company’s position.
•
Monitor e-mail and voice mail messages only with a legitimate business purpose and
refrain from reviewing employees’ private messages if it can be avoided.
•
Review the backup and memory process in your computer and voice mail systems to
determine whether messages may be recovered after they have been “deleted” from the
system. Discuss your company’s backup system, discovery concerns, and the appropriate
content of e-mail and voice mail messages with management staff. Explain to employees
that, even after the messages have been “erased” or “deleted,” they may linger forever in
backup tapes and stored printouts.
•
Maintains electronically stored files and documents. It’s even more important should this
particular matter proceed to litigation. An employer’s failure to properly store and
maintain its electronic documents may even expose the employer to court imposed
sanctions. Therefore, it is imperative to implement and utilize a system for backing-up
data.
•
Remind employees that they should exercise the same care in drafting e-mail messages
that they would any written memorandum or document; it is often helpful to remind
employees to draft each written message as if it were to be read or heard in public,
including proofreading the emails before sending.
SAMPLE TELECOMMUNICATIONS POLICY
Telephones, voice mail systems, and computers, including electronic mail systems (email) are provided for Company business use, and excessive personal use of these
devices is prohibited. In addition, use of these items in violation of the Company
policy regarding Solicitation and Distribution of literature is strictly prohibited.
Communication through these devices is subject to monitoring by the Company, and
the use of discriminatory, hostile, suggestive, or otherwise inappropriate language is
strictly prohibited. Violation of these rules will be considered grounds for disciplinary
action, up to and including, discharge.
435
SAMPLE SOLICITATION AND DISTRIBUTION POLICY
Everyone has probably found himself/herself in a difficult situation when asked to
make a purchase or donation to support some sort of fund-raising drive or cause. Even
though most of these projects are worthwhile causes, they can disrupt normal
Company operations as well as put unnecessary pressure on employees to participate.
Also, if nonemployees are involved, this activity can also involve trespass. The
following rules must be followed to ensure that everyone’s rights and obligations are
upheld:
436
•
Solicitation and distribution of literature, including e-mail and voice mail
messages, by nonemployees on Company property is prohibited at all times.
•
Solicitation and distribution of literature, including e-mail and voice mail
messages, by employees on Company property during working time, which
in any way interferes with work, is prohibited.
•
Distribution of literature, including e-mail and voice mail messages, by
employees on Company property in nonworking areas during working time,
which in any way interferes with work, is also prohibited.
•
Distribution of literature, including e-mail and voice mail messages, by
employees on Company property in working areas is prohibited at all times.
Chapter 39
Employment in
the Internet age
“It requires ages to destroy a popular opinion.”
– Voltaire: Philosophical Dictionary, 1764.
Technology may have shortened the news cycle since 1764, but that does not appear to challenge
the notion that public opinion – once formed – tends to be entrenched. Today, technology
provides both employers and employees with immediate access to the means of attracting an
audience, and forming opinions. Additionally, outsiders bombard the email accounts of manager
and line employees alike, attempting to influence the formation of an opinion to purchase
everything from legitimate goods to the most sordid services.
Like the tools of eras past, present technology can be used for purposes that management either
desires or reviles. The first part of this chapter addresses the latter situation, and how employers
can address the inappropriate use of communications technology. The second part of this
chapter discusses ways in which employers can promote favorable uses of communications
technology, and establish guidelines for use of modalities such as blogs to present a positive
image of their organization.
Employees who use communications
technology inappropriately
Advances in computer technology and usage increasingly blur the line between work and home.
Employees are now using e-mail and internet postings to broadcast information and opinions
worldwide. Inevitably, some of those employees will post negative, harassing, hostile, false, or
confidential information and opinions about the institutions where they work and those who
work there. In determining how to deal with such matters, you will first need to consider when
you can legally monitor computer usage and/or communications; when you will actually
monitor; how you will notify your employees of your intent to monitor; and whether any
objectionable postings are legally protected or instead form a basis for discipline or discharge.
Navigating these treacherous waters is a daunting task, but if you fail to protect your institution’s
reputation in appropriate cases, you will likely open the door to even more harm.
Limitations to monitoring
employees in an electronic workplace
The first step toward dealing with employees who use technological systems
inappropriately is to gather information yourself. Whether an employer can legally
437
Employment in the Internet age
monitor computer usage and/or communications must be carefully examined under both
federal and state law.
Federal Wiretap Act
The Federal Wiretap Act (the Act) generally prohibits the interception, disclosure
or intentional use of wire, oral or electronic communications, including those that
occur in the workplace. A “wire communication” is one that carries a person’s
oral communication over a wire, such as a phone call and includes the “electronic
storage of such communication.” An “oral communication” occurs when the
individual uttering the communication expected it would be a private
conversation.
Electronic communications are defined broadly
An “electronic communication” is the transfer of information (writing,
images, signals, sounds, data, etc.) transmitted by electronic means
including radio waves but is not an oral or wire communication. e-mail,
pagers, and cell phone usage are examples of “electronic
communications.” “Interception” is the aural or other acquisition of the
contents of any oral, wire, or electronic communication, through the use of
any electronic or mechanical device. For example, intercepting a call with
a tape recorder connected to switchboard without an employee’s
knowledge is a violation of the Act. However, merely listening to an
allegedly illegally-obtained audiotape of private telephone conversations
is not a violation of the Act.
Three defenses to alleged violations of the Wiretap Act
First, the Act has an exception for employers who act in the “ordinary
course of business.” This exception allows an employer to electronically
monitor, using a telephone extension, any business-related communication
without the employee’s knowledge or consent. An employer may not,
however, monitor communications of a purely personal nature. An
employer does not violate the Act if it terminates electronic monitoring
immediately upon discovering that the monitored call is purely personal.
The Act also does not apply if the employer has the consent of one party
to the communication, unless the communication is intercepted for the
purpose of committing a criminal or tortuous act. Consent may be either
express or implied. Finally, under the “provider” exemption, telephone
companies and other employers that provide wire communication services
may monitor calls for service checks.
Penalties for violations
The Act provides a civil cause of action to anyone whose communications
are unlawfully intercepted. Successful plaintiffs may recover actual or
statutory damages ($10,000 or $100 a day for each day of violation,
whichever is greater), punitive damages, and attorney’s fees. The Act also
makes the unlawful interception, or the attempted interception, of an oral,
wire, or electronic communication a felony punishable by fine and/or
imprisonment.
438
Florida law
Florida has its own counterpart to the Federal Wiretap Act, known as the Security
of Communications Act. This act is generally very restrictive in terms of when an
employer can monitor an employee’s electronic communication, requiring consent
from all parties to the communication. Violations of the Security of
Communications Act can subject an employer to a civil suit for actual damages up
to $1,000, punitive damages, court costs, and attorneys’ fees. Additionally,
violators may be subject to criminal prosecution and fined up to $5,000. If the
violator derives a profit from the violation or causes a loss to the person being
monitored, then a court may impose a penalty equal to three times the profit or
loss.
Blogs, chatrooms, online postings
Many employees now use internet “blogs,” “chatrooms” and other online posting outlets
such as YouTube, Facebook and Twitter to criticize their employers or harass their fellow
employees. A blog is, in essence, an electronic internet diary. Some are open to the
public; others require a password. Chatrooms are similar to blogs and function as
interactive electronic bulletin boards. Many bloggers, chatroom participants, and social
network users speak impulsively, with little consideration of the consequences to
themselves or their employers. Others use blogs to pursue anti-social agendas or simply
to get attention, including in some cases by posting sexually suggestive pictures of
themselves. Examples of inappropriate blogs include the self-titled “Phantom Professor”
of Southern Methodist University, who allegedly used thinly veiled pseudonyms to
demean and belittle students and colleagues, and the adjunct professor at Boston
University who allegedly blogged inappropriately about his female students.
Note
When you hear of an inappropriate posting, the first step is to try to determine whether
the rumor is true. If you can get copies of the posted material, you will then need to
determine whether the content is legally protected or if it instead warrants remedial
counseling, discipline, or discharge.
Attempting to gain access to suspect postings
Federal and state laws limit access to electronic information in various ways but
also provide some guidance as to when access is permitted.
As noted above, Florida law is generally very restrictive in terms of when an
employer can monitor an employee’s electronic communication, requiring
consent from all parties to the communication. However, one appellate court
has suggested that if an employer retrieves the communication from its server
after it was sent, rather than using “spyware” that “intercept[s] the electronic
communication contemporaneously with transmission, copie[s] it, and route[s] the
copy to a file in the computer’s hard drive,” the employer would not run afoul of
Florida’s Security of Communications Act. O’Brien v. O’Brien, 899 So.2d 1133
(Fla. App. 5 Dist. 2005). Even so, employers should exercise special caution
because this area of the law has not evolved as quickly as the technology which
439
an employer may want to control, and therefore employers should consult
employment counsel prior to embarking upon any effort to gain access.
In any event you are certainly entitled to review a website that is open to the
public. If the site is instead password-protected, consider the following options:
•
Someone with access might give you a copy of the materials or a
password to the site. (The latter option is not without risk but has been
upheld by one federal court of appeals.)
•
If your institution owns the computer the blogger is using, you may be
able to review the communications in your institution’s server; but again,
note that this area of the law is still evolving.
•
Where an anonymous source posts libelous or otherwise harmful materials
attacking your organization, you may want to file a “John Doe” lawsuit to
smoke out the wrongdoer.
•
If you can’t get lawful access but suspect who the source is, you can
confront that employee and ask whether they made the improper posting.
(As discussed below, you should only do this where the employee has no
protected right to post the material.)
Are these postings legally protected
Whether you are a public or private employer will determine how you must
consider this key question.
NLRA rights of private sector employees
The National Labor Relations Act (NLRA) entitles employees (whether or
not they belong to unions) to engage in “concerted activity” relating to
their wages, hours and working conditions. Their right to speak about
such matters extends to forms of speech that would be offensive to most
employers. For example, an employer may not simply ban all negative
conversations about supervisors. In addition, the NLRA prohibits
retaliation against employees for exercising their NLRA rights. Where
employees use a blog or chatroom to discuss “concerted activity,” an
employer that monitors and comments on such communications may also
be engaging in unlawful surveillance.
Note
Not all work-related speech is protected by the NLRA. For example,
statements disloyal to the institution, reckless or malicious lies,
threatening or harassing statements, disclosure of confidential information,
would likely be unprotected.
Constitutional rights of public sector employees
The First Amendment to the U.S. Constitution entitles public employees to
voice their concerns about matters of public interest. Public employers
may, however, regulate employees’ communications about more personal
440
matters. Where a public sector employee raises both public and private
interests, the administration must show that any right to speak of public
concerns is offset by other considerations such as undermining a
legitimate goal of the institution, creating disharmony among colleagues,
or impairing discipline. Some courts find such communications
unprotected even where only a potential for disruptiveness has been
shown.
•
•
Examples of subjects likely protected:
Corruption.
Wastefulness or inefficiency.
Performance standards.
Personnel reductions.
Examples of subjects likely not protected:
Bickering with department heads.
Poor performance evaluations.
Reducing your risks of
harm from technology abuses
•
Put employees on notice that certain forms of o

Florida Employment Law Manual

Transcription

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