September 2015
Get autumn off to a productive start by tackling those end-of-the-year tasks early. Whether you need to examine your pay schedules and rates, implement a performance evaluation program, or complete paperwork for the Affordable Care Act, your HR Support Center has the guidance you need to make everything fall into place.
HR Alerts
Employee or Independent Contractor? A New DOL Interpretation
To help employers properly classify their workers, the Department of Labor (DOL) has issued a new Administrator’s Interpretation to explain how the Fair Labor Standards Act’s definition of employee should be understood. As opposed to focusing primarily on the amount of control exerted by the employer, as was standard before, this guidance focuses more on the economic realities. According to the interpretation, an employee is a worker who is economically dependent on the employer and not in business for themselves. Most workers are employees, not independent contractors, and many workers presently classified as independent contractors should be reclassified as employees. If you currently assign work to independent contractors or will do so in the future, it would be a good idea to examine the reasons you have for classifying these workers as independent contractors instead of as employees.
The Department of Labor has announced that it will be aggressively pursuing businesses for misclassification of workers. The result of misclassification is that an employer will owe up to three years of back taxes on the misclassified employee’s wages, up to 41.5% of their total income. In addition to owing back taxes, employers could face fines, interest charges, and criminal penalties. The correct classification of workers has not only critical implications for the legal protections that workers receive, but also a significant impact on a company’s bottom line.
Administering Unusual Hourly Schedules
When recruiting for unusual hourly schedules, such as graveyard or on-call shifts, it’s important to sell the position in the right way. Some people prefer unusual schedules because of their sleep habits, their family’s needs, or their recreational habits; but not everyone can be successful working odd or irregular hours. Here are a few keys to successful recruiting and hiring for these positions:
Look for past experience in a similar schedule. Many people think they can work odd hours, but most are not suited to it.
Conduct reference checks with former employers, specific to the candidate’s ability to work independently, as is often necessary during these shifts.
Ask interview questions that probe into the candidate’s desire for this schedule and ability to work under the specific conditions that will be present.
Situational questions can also be helpful. Ask candidates to describe a situation when they had to solve a problem independently. How did they handle it? Present a real life example from your business, e.g., how they would respond to a middle-of-the-night elevator failure or an after-hours breakdown in equipment. Look for candidates who show independent problem-solving initiative—those who would attempt to solve the problem instead of waking their supervisor with an immediate phone call for help.
The downtime often associated with these unusual shifts is another matter to address in the interviews. State your expectations and ask candidates how they would use this idle time. Depending on your business, the ideal answer may include some variation of “I would clean the front area, prepare for the next shift, and then read a book.”
Unusual shifts are usually compensated with higher pay, and we recommend assessing your local labor markets for comparison. Typically, graveyard shifts earn an extra $1 – $2 per hour as compensation for the odd hours and for the independent work. The increased pay may not be necessary for the swing shift, but if you are having difficulties filling swing positions, or keeping employees in the positions, higher pay may be something to explore.
Finally, it’s important to review your state’s meal period regulations. Often times, there’s an exception to providing an unpaid meal period if doing so would impose an undue hardship on the business. It might not be feasible to relieve a graveyard shift (and possibly a swing shift) employee of all duties in order to provide a meal period. In such cases, the meal period must be compensated as part of the employee’s shift.
Another type of unusual shift is “on-call” or “fill-in.” In our experience, these shifts can be difficult to fill for a couple of reasons. First, employees seeking on-call shifts often have positions elsewhere, which means they may or may not be available when you call (it’s rare to find an employee that can subsist on only on-call employment with one business). Second, they are called so infrequently that they often perform below expectations and less efficiently than your regular staff. If you choose to hire on-call employees, it’s important to hire for a position that has clear guidelines, perhaps even a shift checklist, because they won’t typically have the same task repetition as others.
If you elect to hire on-call employees, it’s important to review your state and local laws regarding any show-up pay or reporting time pay regulations. For example, California law states that an employer must pay half of an employee’s scheduled shift (though not fewer than two hours and not more than four) if the employee is sent home early for lack of work.
There are alternatives to hiring on-call you might consider. You may find that your current employees are happy to take on an additional shift now and then for the extra cash, and it may even be more cost effective to use them rather than hire additional help. If this isn’t an option, then consider hiring part-time employees who are regularly scheduled for a few shifts a week, but are willing and able to pick up additional shifts when needed.
Question & Answer
Q: An employee has informed me that he was offended by a suggestive photo a coworker showed him on the computer. What do I need to do now?
A: You have a duty as an employer to make sure that any behavior that could constitute unlawful harassment, bullying, or workplace violence is investigated and stopped immediately. Failure to do so could expose you to liability, since you knew about the inappropriate behavior. Visual conduct such as displaying sexually suggestive objects, pictures, cartoons, or posters may constitute unlawful sexual harassment. Thus, we recommend you take immediate steps to correct this behavior. We recommend that you thoroughly investigate this allegation by interviewing the complainant, any witnesses, and lastly, the accused. Based on the results of the investigation, you may need to discipline the offending employee in a manner consistent with your workplace discipline practices. Be sure to document your conversations as well as the discipline chosen and your specific reasons for taking that course of action.
Why You Should Think of Your Office as a Community
Whether or not you’re attempting to build a sense of community among your employees, your office is a social place and it will, despite any designs to the contrary, function like one.
How so? When you staffed your organization, you had a division of labor in mind, but you didn’t hire roles and responsibilities. You hired individuals with unique personalities, attitudes, quirks, likes, and dislikes. And these individuals have formed (or avoided) relationships beyond the ways their various positions were intended to interact. In every office, the personal is fused with the professional.
Office relationships are going to form—some inclusive and some exclusive. And some employees will isolate themselves as best they can. These dynamics can serve the interests of your organization or work against them. They can build a healthy culture or an unhealthy one. So you have a choice. You can stand back and allow these personal dynamics to crystalize and go where they will, whatever the cost, or you can step up and encourage your employees to come together behind a common purpose and shared set of values.
How do you bring everyone together and foster a community? Start by clearly defining your mission. Every healthy community has something uniting it, binding it together—a culture. As a communal place, your office should also have a culture, a shared sense of purpose. At a company meeting or a staff retreat, discuss the values of your organization and the purpose they serve. Talk about what you’re doing and why you’re doing it. Discuss your culture as a whole group and within your individual teams. If employees understand the culture and see how they can contribute to the overall mission, they’ll be more personally invested in it.
With a shared sense of purpose, you can implement company policies and practices that make cultural sense. If one of your values is openness to criticism and new ideas, then institute an open-door policy with management, where employees can bring concerns and ideas to management’s attention. If your company values trust and personal responsibility, consider offering unlimited PTO. Go through all of your policies, asking yourself how each represents one or more of your values. If some policies don’t fit, maybe it’s time to jettison them or find a way to bring them in line with your culture.
When the operations of your company fit with its mission and culture, they become a strong and flexible framework in which relationships can form, develop, and flourish. And when these relationships work towards a common purpose, then you have a strong community—diverse employees committed to the company’s mission and eager to accomplish great things together.
Tool of the Month:
FSAs, HSAs, and HRAs
Health Savings Accounts (HSAs), Health Reimbursement Arrangements (HRAs), and Flexible Spending Accounts (FSAs) are all benefit options employers can offer to employees, but they can be easy to confuse. This guide addresses the most frequently asked questions about each option. “FSAs, HSAs, and HRAs” can be found in the Guides section of our Documents tab.
