• CGWG Joins Employment Law Alliance
• Starting the New Year: Resolutions to Make
• Get Compliant in 2010: Is Your Company Violating the NLRA or the FLSA Without Knowing It?
• ADA Discrimination: Pre-Offer, Post-Offer, and Employment
• Social Networking - Employer Alert
• News Around the Firm
• Calendar of Events

CGWG Joins Employment Law Alliance

Starting the New Year: Resolutions to Make




J. David Dixon
ddixon@cgwg.com

1. Resolve to review your independent contractor agreements.

As most business owners know, an independent contractor relationship can have its advantages over the traditional employer/employee relationship. That is, for example, the business does not incur hourly overtime expenses nor various employee taxes and, generally, is not subject to tort liability for the work committed by the independent contractor.

But, are your independent contractors really independent contractors? Well, unfortunately, this question is all too often answered in the negative when reviewed by Arkansas Courts and has resulted in hefty fines and tort and back wage liability for businesses.

The determination of whether an independent contractor relationship exists primarily hinges upon the employer's right to control the work of the independent contractor. The greater the right to control, the more likely an employer/employee relationship exist. Yet, the familiar adage of: "if it walks like a duck, talks like a duck, and looks like a duck, then it must be a duck" can be misleading in the independent contractor context.

In a recent Arkansas Court of Appeals case, Steinert v. Arkansas Workers Compensation Com'n,___ S.W.3d ___, 2009 Ark.App. 719 (2009), the Arkansas Court of Appeals affirmed Arkansas' tough stance on independent contractor misclassification. Hurricane Express operated a trucking company that leased trucks to drivers. Although the drivers operated under an independent contractor agreement with Hurricane Express, the Court held the drivers to be employees of Hurricane Express. The Court cited numerous facts to support its holding, including that: the drivers worked exclusively for Hurricane Express; the trucks had the Hurricane Express logo on them; the drivers were required to operate under Hurricane Express' DOT authority; the driver had the duty to regularly service the truck; and, the drivers were required to report to Hurricane Express and failure to do so would result in termination of the agreement.

The Arkansas Courts have defined an independent contractor as one who contracts to do a job according to his own method and without being subject to control of the other party, except as to the result of the work. Thus, to the extent your independent contractor agreement allows you to exert control, even if minimal, over the method of an independent contractor's work, it would be well worth the time to review the contract to assure that not only does the relationship walk, talk and look like an independent contractor relationship, but that it is legally in fact an independent contractor relationship.

2. Resolve to assess how well your business implemented the 2009 Family and Medical Leave Act (FMLA) regulatory changes into its policies and training.

Hopefully, by now, you are well aware of the relatively recent regulatory changes to the FMLA. Those rules and regulations took effect on January 16, 2009, and, in short, include changes to an employee's FMLA leave entitlements; the medical certification process; an employer's notice requirements and; increased penalties for violating the FMLA.

Naturally, many businesses only worry with the FMLA when an employee actually needs FMLA leave. The 2009 changes to the FMLA, however, require the employer to undertake some notably different steps in ensuring that it is FMLA compliant. Assuming your business implemented these FMLA changes in early 2009 now is the time to see how well those changes have taken hold in the workplace.

The FMLA is administratively burdensome, yet, with the FMLA an ounce of prevention is worth a pound of cure. The following are a few ideas to assure your business' 2009 FMLA policy changes are being properly observed:

a. Review all FMLA forms to assure they meet all notice and procedural requirements (the Department of Labor website is an excellent resource: http://www.dol.gov/);

b. Check FMLA postings to make sure all pre-2009 benefits posters were either revised or replaced;

c. Review and/or revise the handbook FMLA policy to address any confusion that may have arisen since the 2009 changes were implemented;

d. Hold employee shift meetings to review the FMLA leave benefits and procedures;

e. Hold supervisor and management meetings to assure all decision makers are familiar with the FMLA leave benefits and the FMLA leave grant and denial process.

Get Compliant in 2010: Is Your Company Violating the NLRA or the FLSA Without Knowing It?


Jess Sweere
jsweere@cgwg.com

Ensuring compliance with all of the rules and regulations governing labor and employment practices can be a daunting task. The best advice to follow is to stay in the know, and to become proactive rather than reactive. This article will provide you with some easy tips to help your company get compliant in 2010.

National Labor Relations Act

The National Labor Relations Act ("NLRA") was first enacted in 1935 to prohibit employers from interfering with employees' rights to engage in certain activities relating to union membership. Some obvious examples of employer conduct which violate the NLRA are making threats to terminate employment or benefits, or to close the plant if employees select a union to represent them; questioning employees about their involvement with union activities; promising benefits to employees to discourage their union support; and punishing employees because they engaged in protected activity.

There are, however, a number of not-so-obvious violations that employers should be wary of. First, while it is true that "supervisors" are not protected by the NLRA, a supervisor who has been discriminated against for refusing to violate the NLRA may be covered. Further, it is important for employers to know that their definition of the term "supervisor" and the NLRA's definition of the term may not coincide. The NLRA defines a "supervisor" as " any individual having authority, in the interest of the employer, to hire, fire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly direct them, or to adjust their grievances." The NLRA goes on to add that the exercise of any of the above duties must require the use of "independent judgment" and not be "merely routine or clerical" in nature. Recently, the National Labor Relations Board ("NLRB") determined that shift leaders at a manufacturer were not "supervisors" as defined by the NLRA. Although the shift leaders had the authority to exercise independent judgment in assigning work to their crew members, the assignments were regularly dictated by "informal routine."

If your company became the target for union organizing, would you know who your supervisors are? Supervisor identification is critical in order to properly respond to an organizing effort without committing unfair labor practices. Though you may have given an employee the title of "supervisor," he or she may not actually be a supervisor in the eyes of the NLRB and thus may be protected under the NLRA.

The third potential violation of the NLRA about which employers need to be aware can be found in many if not all company handbooks, specifically the confidentiality policy. If such a policy attempts to prohibit employees from discussing their wages, it can result in an unfair labor practice charge before the NLRB even if the policy is not enforced. Recently, the NLRB provided employers with a cautionary tale about the risk of maintaining a broad confidentiality clause. In that case the company's employment contract included the following clause:

"Employee understands that the terms of this employment, including compensation, are confidential to Employee and [the Employer]. Disclosure of these terms to other parties may constitute grounds for dismissal."

When an employee, who was unhappy about travel expenses, complained to another party about his problem, disclosing "confidential" compensation information in the process, he was fired for violating the company's confidentiality policy. The Board found that the employee was terminated in violation of the NLRA and ordered that the employee be reinstated. The bottom line is that if a rule affects an employee's rights under the NLRA, then the maintenance of that rule is an unfair labor practice, even if the rule is not enforced. So, take a look through your handbooks and employment contracts. If your company has confidentiality polices that may restrict an employee's rights under the NLRA, then talk to your lawyer about the best way to revise your policies.

Fair Labor Standards Act

What about the Fair Labor Standards Act ("FLSA")? Is your company maintaining proper records to avoid a wage and hour lawsuit? Among other things, the FLSA establishes guidelines for overtime pay. Recently the Department of Labor ("DOL") secured $1 million for workers of a Texas-based company in a lawsuit based on failure to compensate the workers for overtime. The FLSA requires that covered employees be paid at least the minimum wage of $7.25 per hour, plus time-and-a-half their regular rate for hours worked in excess of 40 in a workweek. Companies are free to choose what day and at what time the workweek begins and it may begin at different times for different groups of employees, but it must be a fixed, recurring period of 168 hours, or seven consecutive 24-hour periods. Included in the compensable work hours must be time spent waiting for work, certain on-call time, rest periods of up to 20 minutes, time spent in training, lectures, and in meetings, and travel time.

To avoid liability under the FLSA employers should avoid the following practices. Do not misclassify employees to avoid overtime pay. It is an employee's job duties, not his/her title that determines overtime eligibility, so classifying an employee as a manager will not necessarily exclude him or her from coverage under the FLSA. Further, do not average the time an employee works in consecutive work weeks to determine overtime pay. Some employers are giving their employees "comp time" rather than overtime.  Doing so opens the door for liability. Comp time is only available in the public sector or within the same work week. For example, if an employee works 45 hours during one work week, an employer should not "comp" the five hours by only making the employee work 35 hours the next week. Rather, the employer should pay the employee the overtime rate for the five hours he or she worked in excess of 40.

Even if your company is not engaging in the above activities, it may nonetheless be violating other provisions of the FLSA. What should your company do to make sure it is in full compliance and to avoid liability? One of the most important things your company can do is to keep accurate records. Not only is record keeping required by the FLSA, but it also may help your company discover improper practices before the DOL does. Be sure that you have a file for every employee with the following information included: the employee's full name, address and social security number, the number of hours worked by the employee each day and each workweek, the time and day each workweek begins, the total wages, including overtime pay, paid to the employee each pay period, and the date of the payment and the period covered by each pay period. Create a checklist for each file to be sure that you have all of the proper information. It is also a good idea to include each employee's job duties and title. Interview your employees to be sure that their job duties accurately reflect the work they perform. Doing so might reveal that a certain employee has been misclassified and should have received overtime pay when he or she did not. If errors are found correct them immediately. Doing so could prevent unwanted litigation before it ever arises.

Should you have any questions regarding compliance with these statutes, contact any attorney at the Firm.

ADA Discrimination: Pre-Offer, Post-Offer, and Employment




Bo Loftis
bloftis@cgwg.com

The Americans with Disabilities Act of 1990 ("ADA") outlines when an employer can request that an employee undergo a medical examination and be subject to medical inquiries. Under the ADA, an employer's ability to make such disability-related inquiries or require medical examinations is analyzed in three stages: pre-offer, post-offer, and employment.

At the first stage (prior to an offer of employment) an employer is prohibited from asking any disability-related questions or requiring the applicant to submit to any medical examination, even if the questions or examination are related to the job. The employer may simply ask the applicant about his or her ability to perform the essential functions of the job, with or without a reasonable accommodation.

At the second stage (after an applicant is given a conditional job offer, but before the applicant has started work), an employer may make "disability-related inquiries" and conduct medical examinations, regardless of whether they are related to the job, as long as it does so for all entering employees in the same job category. A "disability-related inquiry" is a question that is likely to elicit information about a disability. Such inquires may include: (1) asking an employee whether he or she has, or has ever had, a disability, or how he or she became disabled, or inquiring about the nature or severity of an employee's disability; (2) asking an employee to provide medical documentation regarding his or her disability; (3) asking an employee's co-worker, family member, doctor, or another person about an employee's disability; (4) asking an employee whether he or she is currently taking any prescription drugs or medications, or whether he or she has taken any in the past.

A "medical examination" is a procedure or test that seeks information about an individual's physical or mental impairments or health. Such procedures include: (1) vision tests conducted and analyzed by an ophthalmologist or optometrist; (2) blood, urine, and breath analyses to check for alcohol use; (3) blood pressure screening and cholesterol testing; and (4) psychological tests that are designed to identify a mental disorder or impairment.

At the third stage (after employment begins), an employer may make disability-related inquiries and require medical examinations only if they are job-related and consistent with business necessity. A disability-related inquiry or medical examination of an employee may be "job related and consistent with business necessity" when an employer has a reasonable belief, based upon objective evidence, that an employee's ability to perform essential job functions will be impaired by a medical condition, or an employee will pose a direct threat due to a medical condition. For example, employers may make disability-related inquiries and require medical examinations that are required or necessitated by another federal law or regulation (e.g. interstate bus drivers must undergo medical examinations at least once every two years). Employers may also make disability-related inquiries or conduct medical examinations that are part of its voluntary wellness program. However, employers may not ask all employees what prescription medications they are taking because it is generally not job-related and consistent with business necessity (some exceptions apply).

Social Networking - Employer Alert




Elizabeth Rowe Cummings
ecummings@cgwg.com

Many employers have existing policies regarding employee use of e-mail or the Internet, but they may wish to amend those policies, or create new ones, to address online social networking. More and more companies are maintaining company blogs and social networking profiles, but many employees are involved in personal social networking, and this too may impact your workplace.

What is Social Networking?

Online social networking and blogging generally consists of web sites that enable users to interact with each other via messages and posts; publish photos, videos, status updates, and other content; and locate and establish contact with new and old "friends." Some of the more popular social networking and blogging sites include Facebook, MySpace, Friendster, Bebo, LinkedIn, Xanga, Twitter, and BlogSpot.

Why Should Employers Care About Their Employees' Personal Social Networking?

Within the workplace, employers should be concerned about personal online social networking impacting their employees' productivity while on the job. However, even outside of the workplace, online social networking can give rise to several situations that can impact the workplace. For example, if an employee identifies himself as a company employee on his Facebook page or blog, and proceeds to publish racy photos or inappropriate comments, this can tarnish the company's reputation. Even if employees do not identify themselves as company employees online, there is still a risk of them making confidential company information, such as trade secrets, available online. Further, social networking can create opportunities for harassment and disparagement of employees, customers, or clients.

What Should Employers Do as Far as Addressing Employee Social Networking?

Employers should develop a policy to address the foregoing concerns and others, and the company's culture will help determine the parameters of the policy. The policy should address whether use of social networking sites is permitted on company equipment and, if so, when such sites may be accessed (such as only on break time, or during working time only if relevant to the employee's duties). Some employers may choose to block access to these sites altogether. Even if access to these sites is blocked, however, employers still need a policy to address the "outside of work" concerns. Discourage employees from identifying themselves as company employees on their personal blogs and social networking sites, or suggest that they at least provide a disclaimer indicating that the views on their sites are theirs alone. Emphasize that the company's confidentiality, harassment, and non-disparagement policies extend to online social networking. Require that employees be respectful to the company, its employees, its clients and customers, its partners and affiliates, and others (including the company's competitors). Provide a mechanism by which employees can report inappropriate online conduct by other employees. Ask for employee cooperation in the event that social networking gives rise to a lawsuit against the company (such as the situation where one employee is harassing another employee via MySpace), but be mindful of the employee's privacy rights. Remind employees that they are personally responsible for content they publish on blogs and social networking sites. Based on the content they publish, employees can be held liable for defamation, harassment, libel, and the like.

This article addresses only a few of the many legal implications of social networking and the workplace. Because technology evolves so rapidly, any policy addressing social networking will have to be closely monitored and updated when necessary. If you would like to discuss drafting and implementing a Social Networking Policy at your workplace, please contact our firm for assistance. Attorney Allen Dobson is presenting a Breakfast Bulletin on May 5 in our Little Rock offices discussing social networking in the workplace. If you would like to attend, please contact Kelly Davenport at kdavenport@cgwg.com or 501-371-9999.

Russell Gunter spoke at the SHRM NOARK chapter on March 11 on Social Networking Issues in the Workplace. He will provide a legislative update at the ARSHRM State Conference on April 15 -16, in Fort Smith.

Rick Roderick spoke at a CGWG Basic Supervisor Training in Rogers on Discipline, Termination, and Documentaton, and Guidelines on Harassment on November 12. He also presented a session on Discipline, Termination and Documentation at a Little Rock Basic Supervisor Training on November 17 and March 30.  Mr. Roderick will speak in Paragould for the Black River Technical College on April 28 at their "Positive Employee Relations" workshop.  On May 6, he will speak in Batesville for a CGWG supervisor training discussing: Union Avoidance, How to Terminate an Employee and Performance Appraisals.     

R. Scott Zuerker spoke at the Human Resources Management Association of Arkansas's Annual Conference in Hot Springs on March 16 on the topic of independent contractors and subcontractors. He will also be lecturing on ethics at the Arkansas Self-Insured Association's Spring Fling in Hot Springs on April 8.

Carolyn Witherspoon spoke at the Human Resources Management Association of Arkansas's Annual Conference in Hot Springs on March 16. Her topic was "When Workers' Compensation Clashes with the ADA and FMLA."

David Dixon was designated as an "Industry Leader" by the Legal Aid of Arkansas/Equal access to Justice Commission. This designation highlights those attorneys/firms that have shown a commitment, through their time and willingness, to pro bono work. An article written by this organization about Cross, Gunter, Witherspoon Galchus and David will appear in The Arkansas Lawyer.

Calendar of Events

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