July 2012
Welcome
With half of 2012 in the books, we hope that your business has exceeded its first and second quarter goals. Midyear is a great time to review your company’s HR compliance strategy. Hopefully this edition of the HR Advisor will assist your management team in remaining abreast of important HR topics relevant to your business.
HR Alerts
U.S. Supreme Court Decides on Health Care Reform Act. On Thursday, June 28, 2012, the U.S. Supreme Court issued a ruling that upheld (except for sanctions related to Medicaid expansion) the constitutionality of the Patient Protection and Affordable Care Act (PPACA), also known as the Health Care Reform Act. The Act’s multiple provisions impacting employers remain intact, and many of the mandates become effective in 2013 and 2014. Thus, employers must proceed with implementation of the Act or prepare to pay penalties. Immediate employer actions for the remainder of 2012 include but are not limited to: assessment of the Act’s effect on the business; determination of redistribution or usage of Medical Loss Ratio (MLR) rebates; distribution of Summaries of Benefits and Coverage (SBC) in time for the next open enrollment; reporting of group health plan coverage costs on 2012 Forms W-2; and revisions to company cafeteria plans to reflect employee contribution limits on health care Flexible Spending Accounts (FSA). Stay tuned for more updates from the HR Support Center.
Federal Circuit Courts’ Stance on Hostile Work Environment. On June 4, 2012, the 11th U.S. Circuit Court of Appeals recognized a retaliatory hostile environment claim brought by two physicians who had filed Equal Employment Opportunity Commission (EEOC) claims against their employer, a VA hospital and a medical center (Gowski, et al v. Peake, et al). The 11th Circuit for the first time recognized a cause of action for retaliatory hostile work environment under the language contained in Title VII, and the EEOC’s own interpretation of the statute. Further, it found that prohibition of a retaliatory hostile environment is consistent with Title VII’s remedial goal of preventing supervisors from deterring protected conduct.
H-1B Cap Reached. As of June 11, 2012, the U.S. Citizenship and Immigration Services (USCIS) has announced it received enough H-1B cap-subject petitions to reach the annual 65,000 “regular cap” limit. USCIS will reject H-1B cap-subject petitions filed and received after June 11, 2012.
Employment Nondiscrimination Act. On June 12, 2012 the Senate Committee on Health, Education, Labor and Pensions (HELP) held a hearing to discuss the merits of the bipartisan Employment Non-Discrimination Act (ENDA). ENDA would create comprehensive employment based anti-discrimination protections for individuals based on their sexual orientation or gender identity.
New Deportation Rule. On June 15, 2012, President Obama announced an Executive Order that allows some undocumented youths to avoid deportation and receive work permits to remain in the United States (U.S.). Students in the U.S. who are in deportation proceedings or those who would have qualified for the Development, Relief, and Education for Alien Minors Act (DREAM Act) and have yet to come forward to Department of Homeland Security officials will not be deported and will be allowed to work in the United States. In addition, Secretary of Homeland Security Janet Napolitano announced young people who were brought to the United States as children through no fault of their own will be considered for relief from deportation, known as “deferred action.”
Employee Retirement Income Security Act (ERISA) Service Provider Fee Disclosures. Effective July 1, 2012, the final service provider fee disclosure regulations under ERISA Section 408(b)(2) must be met. These ERISA regulations are for both existing and new service arrangements. Under these regulations, Registered Investment Advisers (RIAs) and Broker Dealers (BDs) must disclose certain information to the responsible plan fiduciary, including services provided to the covered plan, fiduciary status, and direct and indirect compensation.
Form 5500 Record Keeping Requirements. As a reminder, under the Department of Labor’s (DOL) electronic filing regulations, plan administrators are required to keep a paper copy of the filed Form 5500 report, including schedules and attachments, in the plan’s records. The DOL stated a paper copy of the electronic filing receipt is not adequate in satisfying this requirement. The paper copy in the records must be a complete copy that is manually signed and dated.
The NLRB’s Social Media Policy Memorandum
On May 30, 2012, the National Labor Relations Board (NLRB) Acting General Counsel Lafe Solomon issued a memorandum regarding social media policies in the workplace. The General Counsel’s memorandum is applicable to both unionized and non-unionized work environments.
Section 7 of the National Labor Relations Act (NLRA) allows employees the right to form, join, or assist labor organizations and the right to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. In addition, even in union-free businesses, employee complaints about hours, pay, treatment, working conditions, etc. may not result in disciplinary action or termination under the NLRA. This section of the Act has important implications for employer social media policies, as delineated in the NLRB’s recent memo.
The NLRB’s memo covered seven social media policies published by various employers to demonstrate specific provisions that may be unlawful. Some of those social media policies are discussed here.
Policies concerning an employer’s attempt to protect confidential information may be unlawful.
- For example, a policy prohibiting employees from online discussions regarding “confidential guests, team members or company information” is unlawful because the policy could be shown as the employer prohibiting employees from disclosing information regarding their own terms and conditions of employment (which is a protected activity).
Policies that aim to show peaceful relations amongst staff may be unlawful.
- For example, a policy intended to reduce conflicts amongst employees (that may include controversial issues) can be unlawful depending on the topic. If the topic is about working conditions, it can be interpreted as inhibiting Section 7 rights, if employees are prohibited from discussing such matters (either verbally or in an online format).
Policies about employer image protections may be unlawful.
- For example, if the employer enforces a policy suggesting that employees are prohibited from commenting on legal matters, including pending litigation or disputes, the company may be unlawfully restricting employee communications. In addition, if an employer restricts which employees are permitted to discuss company information with the media, it may be unlawful. The NLRB stated that: “[e]mployees have a protected right to seek help from third parties regarding their working conditions,” so employers may not restrict social media comments to non-public forums only.
The social media policy that was approved by the NLRB allows for employees to band together to discuss or improve working conditions. Businesses are encouraged to adopt and/or modify the NLRB’s social media guidelines. According to the NLRB, it is still lawful to have a policy that bans harassment, bullying, discrimination, and retaliation using social media platforms. Another lawful provision in the memo stated that, “information regarding the development of systems, processes, products, know-how, technology, internal reports, procedures, or other internal business-related communications” is permissible.
Although the NLRB’s new social media policy guidelines are somewhat restrictive, it is still important to publish a policy. It is critically important that businesses in certain regulated industries (medical, financial, etc.) adopt social media policies that comply with industry regulations, such as HIPAA. One final suggestion is to include a “saving clause” in the company’s social media policy. A “saving clause” is a statement such as, “nothing in this policy is intended to infringe upon Section 7 rights.” Such a clause may partially shield employers from liability.
Based on the number of violations outlined in the memorandum, many employers are not in compliance with the NLRB guidelines for social media policies. It is extremely important to comply in this area, as the NLRB’s interpretations seem to be supported by the US court system. It is important to have your social media policy reviewed by your HR Professional or your legal counsel to ensure it does not violate an employee’s Section 7 rights. It is also highly recommended for employers to contact a HR Professional or legal counsel before disciplining or terminating an employee due to his or her social media activities.
Question & Answer
Date of Birth Questions
Q. Is it legal to ask for the date of birth before making an offer of employment?
A. It is permissible to ask a job applicant for his or her date of birth prior to hire. However, an employer who asks this question would have to be able to defend themselves if charged with a discrimination claim and explain how the birth date is relevant to the job. If an employer has a job requirement to know if a job applicant is 18 or 21 for job related purposes (such as serving alcohol), the question on the application or during the interview would be, “Are you at least 18 or 21 years of age?” Age discrimination comes into play when an applicant/employee is over the age of 40. The birth date becomes irrelevant during the hiring process, but a minimum age can be a job requirement.
Summer Dress Codes: Too Hot for Compliance?
According to the May 2012 HR Support Center poll inquiring about spring and summer dress code policies, most businesses do not alter their dress code policies during these months. Out of all the respondents, 63% indicated no change during the spring and summer months from the company’s standard dress code, while 9% indicated that employees are not required to wear professional clothing during these months. There are several implications to be aware of in regards to workplace dress code policies in the summer.
- Health concerns (physical and mental stress). During the hot summer months, it is important to consider the health of employees who will be performing work outside or in a facility without air conditioning. The company may need to alter its dress code in order to reduce the physical stress of employees working outdoors, as physical stress can lead to reduced cognitive ability and heat-related injuries and illnesses. In addition, some employees may be protected under the American with Disabilities Act (ADA) which may require reasonable accommodations.
- Productivity levels (includes motivation). The productivity levels within the business may be reduced if employees are dressed in a manner that is distracting to themselves or others. Therefore, it is important to ensure that dress codes allow for maximum productivity. For example, if an employee is wearing a baseball cap during an office meeting, others may find that to be a distraction.
- Safety concerns (injury and accident prevention). There are several safety concerns to consider if dress codes are not properly enforced. Even in extreme temperatures, it is critical that employees wear all recommended and required safety equipment. For example, those in a construction field should not wear sandals; those in the medical field should avoid exposing unprotected skin and wearing loose accessories (such as jewelry) around hazardous chemicals, equipment/machinery (such as wheelchairs), and other things (i.e. syringes).
- Image/Professionalism. Even in the summer months, it is important that the company portray a professional business image. For example, allowing pilots to wear swim trunks could certainty result in decreases in customer confidence levels.
It is encouraged to write comprehensive policies that cover the business dress code. The management team must consider productivity, safety, and regulatory compliance when writing the dress code policy. It is vital to consider whether the dress code could create a charge of discrimination. A workplace dress code for summer months should not discriminate against members of a protected class under civil rights laws such as gender discrimination, religious discrimination and race discrimination. It is important to stay consistent for all exceptions to the policy and to apply consequences for all violators of the policy. Considering these factors will ensure the company’s dress code maximizes summer productivity and minimizes the potential for legal exposure.
Tool of the Month:
Employment Lifecycle Checklist
The employment lifecycle is a critical component for business success. Use the Employment Lifecycle Checklist to become organized and stay on top of your HR business needs related to employee relations. The employment lifecycle typically involves recruiting, hiring, orientation, training, advancement, coaching, disciplining, and terminating employees.
This checklist covers aspects such as:
- Employee communications
- Access protection
- Employment lifecycle stages
- And much more!
HRCast of the Month
Leveraging Mobile Technology to Your Company’s Advantage
How could you position mobile technology towards positive results for your company’s HR business needs? This month’s HRCast explores this question and provides listeners with insightful answers and helpful tips.
On July 15th, be sure to visit the HR Support Center, and listen to this month’s HRCast to learn more.
HR Tip of the Month
Tracking Hours Worked
It is the employer’s responsibility to track all non-exempt employees’ hours and pay accordingly. Employees may be required to use a time clock system or submit timesheets, but pay may not be withheld as penalty for missed punches or failure to submit a timesheet in a timely manner. However, the company may use its regular progressive disciplinary system when an employee fails to follow the company’s timekeeping procedures.
Did you know?
41%
According to the NACE 2012 Student Survey, approximately 41% of 2012 college graduates are using social media to help them land a job.
Quote of the Month
“Work joyfully and peacefully, knowing that right thoughts and right efforts will inevitably bring about right results.” ”
– James Allen
A Look Ahead
UV Safety Month
July 4:
Independence Day
July 22:
Parent’s Day
July 27:
Summer Olympics begin
First Day of Summer
Contact Us
Paragon Business Services, Inc.
7610 N Stemmons Frwy
Suite 600
Dallas, TX 75247
Additional Contacts
Phone: 866-444-4615
Fax: 214-951-1920
Legal Disclaimer: This message does not and is not intended to contain legal advice, and its contents do not constitute the practice of law or provision of legal counsel. The sender cannot be held legally accountable for actions related to its receipt.
Paragon Business Services, Inc 