Tag Archives: labor and employment

Another Business Resolution: Conduct a Pay Audit in 2019

Pay Audits are different from wage and hour audits. A wage and hour audit looks at whether employees are being paid in compliance with state and federal wage and hour laws. A pay audit reviews whether there may be discrimination in pay practices within an organization. With the #metoo movement and a renewed focus on pay gaps, an internal review of pay practices could save a business from liability under the primary statutes used to combat discriminatory pay gaps – Title VII, the Florida Civil Rights Act, and the Equal Pay Act.

As with other types of claims brought under state and federal discrimination statutes, a claim of disparate pay based on any protected characteristic is subject to the same administrative filing requirement and provides the same remedies as a wrongful termination case. On the other hand, under the Equal Pay Act (which only covers disparities based on gender), there is not an administrative filing requirement, and the definitions and statute of limitations for an employee to bring a claim is the same as those in place for the Fair Labor Standards Act. Further, Equal Pay Act claims do not require proof of intent to discriminate on the part of the employer. And, not having intent as a requirement makes it easier for an employee/former employee to establish a prima facie case. Under the Equal Pay Act, an employee need only show that she works at the same location, performs substantially equal work (regardless of job title), works under substantially equal working conditions, and is paid less than a male counterpart.

In a perfectly competitive labor market, the value an employee contributes to a business should determine that employee’s wage. However, in the real world, there are disparities of income that may be due to differences in labor productivity, and there are wage disparities across genders and ethnicities. When it comes to gender, disparities may be due to:

  • Compensating wage differentials: men may be employed in more dangerous or “dirty” jobs that pay more
  • Choice of college major and choice of career
  • Time constraints: mothers may have only limited time to pursue career advancement
  • Different negotiating skills of men and women
  • The number of years of work experience
  • The number of years in continuous employment
  • The number of hours spent at work
  • Employer discrimination

As set forth above, employer discrimination is only one of several reasons why a gap may exist and employers may have pay gaps that are based on non-discriminatory reasons.  Both the civil rights statutes and the Equal Pay Act provide several defenses to claims of discriminatory pay. Employers can avoid liability by proving the pay differential is due to one of the following reasons:

  • Seniority System
  • Merit Pay System
  • System that measures quality or quantity of work
  • Factor based on any factor other than sex  (this is considered a “catch all” defense)

It is good for employers to be aware of any gaps that exist in its pay practices and understand why they exist. When an employer does not have an explanation, that is when litigation and potential liability can ensue. Below are a few ways that businesses can help prevent (and if necessary defend) discrimination in pay claims:

  • Evaluate all forms of compensation (starting salary, benefits, bonuses, shift differentials, overtime, training opportunities, separation pay, etc.) at least annually for potential pay disparities based on race/ethnicity and gender
    • Evaluate how pay raises and bonuses are determined to ensure that decisions are made in a non-discriminatory manner.
    • Evaluate how you assign your employees to specific jobs.
    • Focus on job recruitment, placement and how pay is assigned to job classes.
  • In addition to an annual assessment, throughout the year conduct periodic “spot” checks for potential compensation problems.
  • Correct problems as soon as they are discovered.
  • Evaluate how women and minorities are placed in your workforce. Do not make assumptions about what they can or cannot do.
    • Does your hiring process seek diversity in the qualified applicant pool?
    • Do you offer career training or opportunities for both genders?
    • If starting salaries and signing bonuses are negotiated, ensure that such a practice does not have an adverse impact on women or minority workers.
    • Evaluate whether all workers have equal opportunity for advancement. Placing one gender in areas that lead to greater advancement could be a violation of law.
  • Periodically review your performance evaluation process and the ratings given to each employee to determine whether the process or the ratings unfairly disadvantage women, or any other protected classes.

This post is part of a series of business resolutions to consider for the new year. In case you missed them, our previous posts in the series discussed Florida minimum wageemployee performance management, and employee handbook/wage audits.

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
(941) 552-2558

Business Resolutions: Ensuring Your Business Starts the New Year Off Right

When was the last time that your business had a wage audit to evaluate whether your employees are properly classified under the Fair Labor Standards Act, or had your employee handbook reviewed and revised to bring it up-to-date with the law and current company practices? If it has been a few years, then this may be the year that your business resolves to invest in a wage audit and/or handbook review.

Wage audits include an evaluation of your job positions, pay and overtime policies, as well as payroll records of each position within an organization or department. Sometimes, audits can also include interviews with employees to ascertain if there are any issues that management should be aware of. Audits can reveal if a business has any issues with, not only misclassification of employees as exempt when they should be non-exempt, but whether managers are following the organization’s policies regarding overtime. As a company grows and changes, often the duties of its employees also change. Sometimes these changes are significant enough that a change in classification is in order and a failure to adjust the classification could result in liability. Further, a wage audit can often help to determine if an organization’s accountant or payroll company is calculating overtime in accordance with the applicable regulations. Many a lawsuit are filed against employers who believe that since they have enlisted the assistance of a third party, employee overtime is being calculated appropriately. That is not always the case.

Employee handbooks should be reviewed every couple of years, not only to ensure that the handbook reflects the current state of the law, but also that it reflects the actual practices of a company. Businesses grow and change, and actual practices can start to diverge from what is reflected in the handbook. It is always better to have a handbook that provides policies and procedures that the company is currently using and enforcing. It is never recommended for a company to have policies that it does not follow.

This post is part of a series of business resolutions to consider for the new year. In case you missed them, our previous posts in the series discussed Florida minimum wage and employee performance management.

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
(941) 552-2558

Another Business Resolution: Ensure Your Business Implements Florida’s New Minimum Wage

The next suggested resolution in our series of business resolutions is one that all businesses in Florida should implement, as it is legally required. On January 1, 2019, Florida’s minimum wage will increase from $8.25 to $8.46 an hour. Employers should be prepared to make appropriate pay adjustments for their minimum wage earners. Failing to pay non-exempt employees Florida’s statutory minimum wage can result in claims against employers pursuant to Section 24, Article X of the State Constitution and Section 448.110, Florida Statutes. The maximum tip credit ($3.02) that can be taken by Florida employers with tipped employees will remain the same, but the direct wage paid to tipped employees will increase from $5.23 to $5.44 an hour.

In addition to raising the minimum wage, Florida employers are required to post a minimum wage notice in a conspicuous and accessible location. You can download the 2019 Florida Minimum Wage Notice from the Florida Department of Economic Opportunity’s website. This notice requirement is in addition to the requirement that employers post regarding the federal minimum wage (which has not been increased). There will also be commercially available Florida-specific “all-in-one posters” that satisfy both the federal and state notice requirements.

In case you missed it, our first business resolution of this series covered employee performance management.

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
(941) 552-2558

What Are Your Company’s Business Resolutions for the New Year?

As 2019 approaches, many companies reflect on the year that has gone by, remembering both the triumphs and missteps. As this year comes to a close, many businesses will be making business resolutions for the new year. You may already have some goals set, but if you do not, this post will be the first in a series designed to provide insight into areas where companies may want to focus in the year ahead.

We will start this series off with our colleague John Hament’s recent article from our Requisite X publication, “Adapting to Change: Reinventing Employee Performance Management.” As explained in this article, for some employers there can be downsides to the traditional annual performance evaluation system. Recognizing these downsides, and ascertaining if a different approach is good for your organization, may be a worthwhile business resolution.

Stay tuned for more resolutions to consider in 2019.

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
941-552-2558

A Clue to the NLRB’s Future Focus?

In regulatory action last week, the current board of the National Labor Relations Board not-so-subtly identified several areas where the Board wants to reverse course. Specifically, on October 16, 2018, the Board’s General Counsel released four advice memorandums issued during the Obama administration addressing several topics, including dress codes, replacement of striking employees, and video recordings of workplace strikes.

It is uncommon for advice memos to be released, especially those from prior administrations.  Most times, such releases happen after a matter has been resolved or the General Counsel has directed a region to dismiss a case. When memos are released, it is because the Board wants to draw attention to a trending topic or point of emphasis. In this instance, the Board released advice memos that were quite favorable to labor unions and workers:

  • In two advice memos involving Walmart dating to 2013, the Board’s General Counsel at that time recommended that the regional director bring unfair labor practices when the retailer (1) told a plainclothes security guard that he could not wear union clothing while undercover; and (2) prohibited workers from wearing union insignia shirts and then disciplined them for engaging in a work stoppage (which the General Counsel opined was not an unprotected sit-in strike);
  • In a different 2013 memo, the General Counsel found that Boeing acted unlawfully when it recorded union solidarity marches that happened on its property while it also had a rule in its employee handbook that blocked employees from using cameras on its property; and
  • In another advice memo issued in early 2017, the then-General Counsel concluded a California fishery committed an unfair labor practice when it unlawfully replaced striking employees by giving temporary employees permanent positions.

These memos are noteworthy since the current General Counsel, Peter Robb, and the Board at large are unlikely to support the positions espoused in the Obama era memos. For instance, in December 2017, the Board has changed course in the Boeing matter, concluding that the Board’s previous edicts on handbooks gave too much credence to employees’ rights and too little to employers’ interests.

Considering the reversal in Boeing matter, the fact that the General Counsel released the other advice memos on the same day potentially signals those advice memos do not reflect the Trump-era General Counsel or Board’s position. For that reason, employers may wish to challenge similar unfair labor practice findings in other settings.

Still, although these advice memos may be a relic of the Obama-era Board, another administration’s Board could renew the legal theories and positions contained in the advice memos. Thus, at the very least, employers should remain mindful of the views taken in the advice memos and consider potential protective steps.

John Getty*
jgetty@williamsparker.com
(941) 329-6622
*Admitted in Louisiana and Georgia

The NLRB Shifts its Strategy in its Attempts to Change the Joint-Employer Standard

After a failed attempt to change the joint-employer standard through legal decision arising out of a pending case before the NLRB, on September 14, 2018, the National Labor Relations Board (the “Board”) published a Notice of Proposed Rulemaking in the Federal Register regarding its joint-employer standard. The proposed rule would overturn the standard set by the Board in Browning-Ferris, 362 NLRB No. 186 (2015) to determine if an employer is a joint employer. Under the Browning-Ferris standard, the inquiry turns on whether the alleged joint employer had the potential to control aspects of the workplace, either directly or indirectly, regardless of whether the employer actually exercised that authority.

The proposed rule would revert to the pre-Browning-Ferris standard for determining whether an employer will be considered a joint employer of a separate employer’s employees. Under this proposed rule, an employer may be considered a joint-employer of another employer’s employees only if it possesses AND exercises substantial, direct, and immediate control over the essential terms and conditions of employment and has done so in a manner that is not limited and routine. This would effectively reverse the Browning-Ferris standard and render indirect influence and contractual reservations of authority insufficient to establish a joint-employer relationship.

The 60-day period for public comments on this proposed rule began on September 14, 2018, and continues through November 13. After the Board receives and reviews the public comments and replies, it will issue a final rule regarding the joint employer standard. If issued without substantial changes, this rule would be great news for employers as this stricter standard is clearer, provides more consistency, and reduces the likelihood of an employer inadvertently becoming a joint employer.

Ryan P. Portugal
rportugal@williamsparker.com
941-329-6626

Planning for the Next Hurricane: Employee Pay During and After a Storm

With the onset of the 2018 hurricane season and the effects of Hurricane Irma still being felt by many, employers have a number of concerns. These concerns range from preparing facilities to determining whether a business will stay open. At some point, after decisions have been made about whether a business will stay open and if goods or people need to be moved out of harm’s way, the questions relating to employee pay may arise.

One question that is frequently asked is “Should I pay exempt employees who miss work due to bad weather conditions?” When it comes to deductions from exempt employees’ salaries, it is easy to get into trouble. The general rule is that an exempt employee is entitled to receive his or her entire salary for any workweek he or she performed work. This means, if the work site closes for a partial week due to bad weather conditions (such as a hurricane) and the exempt employee has worked during that workweek, the employee is entitled to his or her full salary. However, if the employer has a leave benefit, such as PTO, and the employee has leave remaining, the employer can require the employee to use paid time off for this time away from work. If the employee does not have any remaining leave benefit, he or she must be paid.

If the work site remains open during inclement weather and an employee is absent (even if due to transportation issues), the employee can be required to use paid time off. If the employee does not have any paid time off remaining, the employer may deduct a full-day’s absence from the employee’s salary. For a more detailed explanation visit dol.gov.

Other issues that arise relate to what constitutes compensable time for non-exempt employees. The FLSA only requires that non-exempt employees be paid for the hours they actually work. However, those non-exempt employees on fixed salaries for fluctuating workweek(s) must be paid their full weekly salary in any week for which work was performed. Further, those businesses, such as hospitals and nursing homes that remain open during a storm and require employees to remain onsite during the storm may have to pay employees required to be onsite during a storm for all time they are at the employer’s place of business, as they may be considered to be “on call.”

It is important for businesses to start planning in advance for the next hurricane. Such plans should include evaluating which employees may be required to continue working during a storm and what portion of their time during a storm is considered compensable.

Heathcare employers also have new ACHA rules to comply with relating to storm preparation (not specifically related to employee compensation). For further information on these regulations see my colleague Steven Brownlee’s recent article, “Senior Living Providers: Are you ready for the Beryl, Chris, and Debby?

Jennifer Fowler-Hermes
jfowler-hermes@williamsparker.com
941-552-2558

Seminar: What’s a Business to Do in the Age of #MeToo?

In light of all of the attention that is being focused on issues relating to harassment and the #MeToo movement, it is now more important than ever for businesses to develop a better understanding of what constitutes harassment in the workplace.

Join us Wednesday, April 11, at the Lakewood Ranch Business Alliance’s upcoming seminar featuring Williams Parker board certified labor and employment attorney Jennifer Fowler-Hermes. Jennifer will discuss types of harassment and provide guidance on how employers can prevent, recognize, and respond to harassment.

WHEN:
Wednesday, April 11, 2018
7:30-8:00 a.m. Networking & Breakfast
8:00-9:00 a.m. Presentation

WHERE:
Keiser University
6151 Lake Osprey Drive
Sarasota, FL 34240

COST:
$10 Members, $20 Non-members

Register Online

MORE ON #METOO:
Catch Williams Parker labor and employment attorney Gail Farb discussing the #MeToo movement on a recent ABC7 news TV segment and roundtable discussion.

Intro Segment (Gail first appears at 2:31):

Roundtable Discussion (Gail first appears at 2:55).