New Hires

May 7th, 2013

Starting May 7, 2013, every employer will need to have all new employees sign  the new Form I-9 when verifying their employment eligibility.  Unlike with previous revisions, the Department of Homeland Security has stated that all prior editions of the I-9 are no longer acceptable.  The new I-9, which generally must be completed and signed by the new hire on the first day of the job, contains additional data fields, including foreign passport number and country of issuance, as well as optional data fields, including the new hire’s e-mail address and telephone number.

Employers failing to use the new I-9 face a civil penalty in an amount not less than $110 and not more than $1,100 for each violation.  While a single violation may not hurt your bottom line, the penalties can quickly rack up if you have multiple new hires.

When completing the form, employers need to remember that they must physically inspect the original identity and employment authorization documents presented by the new hire.  This duty to inspect, however, doesn’t mean that you suddenly need to be an expert on spotting a real driver’s license from a phony.  It just means that you need to look at the actual documents presented in good faith.  In fact, the law requires that you accept the verification documents if they reasonably appear on their face to be genuine and to relate to the person presenting them.  If you fail to do so, the new hire could claim that you’ve engaged in unlawful discrimination.

The new I-9 expires on March 31, 2016.  Consequently, the form should last for a while.  But it never hurts to review your employment forms annually to make sure that you’re using the most up-to-date forms.

Employing illegal workers

January 9th, 2012

At a minimum, all employers have to follow one simple law:  each employee must be legally authorized to work.  With an estimated 11.2 million unauthorized immigrants  in the U.S., chances are pretty good that you (a) know of an employer or (b) are, in fact, an employer that presently employs an illegal worker.  If you fall into the “b” category, you’d better be aware of the risks. In 2010, there were an estimated 190,000 unauthorized workers in Washington and 110,000 in Oregon. 

Despite the law, some employers choose to ignore it by thinking that it’s not a big deal or that there’s little chance of being caught.  And that, unfortunately, may have been exactly what an owner and manager of a popular restaurant in San Diego were thinking.  Last month, The French Gourmet, along with its owner and manager, were sentenced in federal court on charges that the business hired illegal workers.  The government alleged that the three defendants–business, owner, and manager–hired illegal workers between 2005 and 2008 and continued to employ them knowing they were unauthorized to work.  When the government raided the business in 2008, the business was employing eighteen illegal alien workers.

After the defendants pled guilty, the federal judge fined the business and owner jointly and severally for $396,575 and the manager for $2,500 for knowingly employing illegal workers.  Luckily, the judge spared the owner and manager up to six months of prison time by sentencing them to five and three years of supervised probation, respectively. 

This recent example should serve as a clear reminder to businesses, owners, and upper management that they need to follow the law by employing only legal workers.  By completing the required I-9 Employment Eligibility Verification form for each employee, employers will not only be following the law, but will have the needed proof when the U.S. Department of Homeland Security conducts an inspection.   

Mandatory union poster put on hold

January 4th, 2012

Employers know, or at least should know, of the many mandatory notices they must post in the workplace.  These notices inform employees of their rights and responsibilities under the law, such as the state and federal minimum wages, Occupational Safety and Health Act (OSHA), workers’ compensation, etc.  But one poster that private employers likely don’t know they may have to post is the National Labor Relations Board (NLRB) poster.  This poster informs employees, including non-union employees, of their “right to organize and bargain collectively with their employers, and to engage in other protected concerted activity or to refrain from engaging in any of the above activity.”   

Originally, employers were required to post the NLRB poster on November 14, 2011, but the NLRB postponed the date to January 31, 2012.  However, because of on-going court challenges to the requirement, the NLRB just recently agreed to postpone the date to April 30, 2012.  Consequently, time will only tell if non-union employers, regardless of size, will need to prominently display the NLRB poster in the workplace along with the other legally required posters.

A Big Mac, large fries, and my vote?!

November 4th, 2010

Generally, employers maintain a cohesive work environment with their employees by following the simple rule of social etiquette at a party:  don’t talk about money, religion, and politics.  However, the endless political commercials, nonstop political chatter, and midterm stump speeches may have been just too much for one McDonald’s owner to keep his political views to himself.  

  

Recently, newspapers reported that earlier this month, the owner of a McDonald’s in Canton, Ohio, attached a pamphlet to the employees’ paychecks urging them to vote Republican candidates for governor, Senate, and Congress.  According to the reports, the pamphlet said: “If the right people are elected, we will be able to continue with raises and benefits at or above the current levels. If others are elected, we will not.”   It then named three Republican candidates after stating, “The following candidates are the ones we believe will help our business move forward.” The only problem is that it’s illegal for an employer in Ohio to attempt to influence the political votes of employees.  However, the political frenzy of the midterm elections isn’t limited to Ohio. 

  

Here in the Pacific Northwest, some grocery employees of Fred Meyer and Safeway recently complained about having to distribute flyers in favor of Washington’s ballot initiative 1100, which would have allowed grocery stores to sell hard liquor.  While there’s no specific prohibition in Washington, Oregon recently enacted ORS 659.785, which prohibits an employer from taking, or threatening to take, any adverse employment action against an employee for declining to attend or participate in an employer-related political or religious meeting or communication.  The statute also requires employers to post a notice at the worksite advising employees of their rights under the new law.  Of course, the statute doesn’t prohibit an employer from engaging in political or religious activities where attendance or participation is strictly voluntary. 

 

Therefore, if you’re an employer that’s a dyed-in-the-wool Democrat, Republican, Libertarian, Tea Partier, Green Partier, or an Independent, be smart:   don’t force employees to participate in any religious or political activity.  You’ll be happier and so will your employees.  Yes, the midterm elections are over, but before you know it, the 2012 political organizations will be in full-swing creating a compelling campaign of slogans, speeches, and sound bites.

 

 

Unpaid intern or upset employee?

April 21st, 2010

In the current recession, private employers are quickly discovering there’s no shortage of talented and skilled workers in the labor market.  The problem is not finding workers, but paying them.  So, when employers receive stacks of resumes from recent college graduates, many of whom are willing to work as a “volunteer,” some employers have started to bring the eager beavers on board as unpaid interns or trainees.  To these employers, the situation appears to be a clear win-win:  the volunteer intern gains valuable work experience while the employer receives free labor.  The only problem is that it may be illegal.

Under the Fair Labor Standards Act (“FLSA”), a worker cannot “volunteer” for a for-profit employer.  While the FLSA allows for unpaid interns or trainees,  the U.S. Department of Labor’s Wage and Hour Division (“WHD”) has developed the following six factors to evaluate whether a worker is truly an “trainee,” who is not subject to FLSA, or an “employee,” who may be subject to the FLSA:

1.    The training, even though it includes actual operation of the facilities of the employer, is similar to what would be given in a vocational school or academic educational institution;

2.    The training is for the benefit of the trainees;

3.    The trainees do not displace regular employees, but work under their close observation;

4.    The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded;

5.    The trainees are not necessarily entitled to a job at the conclusion of the training period; and

6.    The employer and the trainees understand that the trainees are not entitled to wages for the time spent in training.

Often, the difficulty for employers is to show that it “derives no immediate advantage from the activities of the trainee.” Consequently, the unpaid intern—you know, the one who’s been photocopying reams of paper for weeks in the back office—might actually be an upset employee who is eligible for back pay, including overtime payment.  Therefore, despite their good intentions, private employers need to think twice before bringing unpaid interns on board.

Helping Hand

January 17th, 2010

The people of Haiti need you. They don’t know your name, where you live, or if you’ve ever visited Haiti. But if you’ve seen the gut-wrenching videos and photos coming out of Haiti, you know that right now—at this very moment—all they want to know is if you can help them.

With a death toll reaching six figures, a reported 300,000 people suddenly left homeless, and 2 million without food, the earthquake survivors are just looking for help—any help—as they wander past collapsed buildings, through chaotic mobs, and over dead bodies littered in the streets in search of food, medicine, and the whereabouts of their family. The loss of human life and human dignity continues to rise each day. Tragically, the poorest nation in the world became exponentially poorer.

By contributing financially to the many disaster relief agencies, like UNICEF, Mercy Corps, or American Red Cross, we can help the Haitians take the difficult first steps on the long road to recovery. Hopefully, we’ll all be able to give a helping hand to strangers in need when the need is so great.

New Year’s Resolutions

January 6th, 2010

According to the Chinese zodiac, 2010 is the Year of the Tiger.  No, not that Tiger.  However, that’s one person who definitely isn’t sad to say goodbye to 2009.  In fact, some economic professors have calculated that Tiger’s transgressions infidelity scandal may have cost the shareholders of the companies that he endorsed about $12 billion.  Yes, that’s with a “B.”  When you add that to the cost to his family and personal life, the amount, sadly, is even more.

While the beginning of the New Year is often a celebratory time, we often rattle off our resolutions like they’re part of our weekend chore list:  buy milk, lose weight, pick up dry cleaning, quit smoking, etc.  Perhaps we could get more excited about our resolutions if we spent just a little more time in developing them than, say, Tiger did before partying in Las Vegas. 

Besides the standard healthy lifestyle resolutions, there are other resolutions that you may want to consider from a legal perspective.  For example, in 2010, consider organizing your personal affair by updating your estate plans.  When was the last time you took a look at your will, trust, and advance directives?  Maybe you want to change the beneficiaries you’ve named in your will or insurance policies. And if you’ve never planned your estate before, now is good time because your mind is still sharp as a razor. Okay, maybe your razor is a bit rusty these days, but it still cuts, right?

Also, organizing one’s internal affairs is not limited to individuals.  Employers can get their business affairs in order by proactively conducting an employment audit to identify risky or illegal employment practices.  For example, an employment audit may reveal that your business has neglected to update job descriptions, train managers and supervisors on employment laws, or provide employees with written policies and procedures in an employee handbook. 

Even if a handbook exists, it should be updated annually to reflect changes in the law or policies.  For instance, with the iPhone, Droid, and other gadgets, employees are able to post messages, photos, and videos 24/7 on Twitter, Facebook, LinkedIn, MySpace, YouTube, or on their blog.  Are employees disparaging the company on their blog or posting unflattering videos of a tipsy supervisor from the holiday party?  Employers should consider developing an internet posting policy before sticky situations develop. 

The bottom line is that in our highly litigious society, a little preventative maintenance, in the form of  carefully crafted New Year’s resolutions, can go a long way to improving your bottom line—physically and financially.  That is, if you stick with them.

New Business

October 1st, 2009

Starting your own business during this prolonged recession may seem counterintuitive, but for others, the turbulent economy is just the right spark to ignite the entrepreneurial spirit.  Whether you’re business idea involves a new computer software, selling ice cream, or creating a production company, starting your own business requires careful planning and a lot of hard work.

After working on your business plan, analyzing the risks and rewards, strengths and weaknesses, and figuring out how you’ll finance your business, one important decision you’ll need to make is to decide which business structure best suits your plans:  S-corporation, C-corporation, Limited Liability Company, partnership, sole proprietor? 

Each type of entity has its particular requirements and restrictions, as well as advantages and disadvantages.  For example, if one of the owners of the new business will be another corporation, then an S-corporation will not be appropriate.   If the business will own real property, then an LLC may be attractive because of possible tax benefits.  And if there are multiple owners, you will need to think about agreements that deal with how to handle any future transfer of ownership.

Besides issues of entity formation, business owners needs to think about other important legal issues from the outset, including, but not limited to, commercial leases, vendor agreements, obtaining required licenses and permits, copyright and trademark issues, and, of course, hiring and firing employees.     

Without receiving sound legal advice upfront, business owners may soon find themselves besieged with unanticipated problems.  Instead of spending time growing their business, they may find themselves struggling with penalties and fines from government agencies, competition from copycat businesses, and lawsuits from disgruntled former employees.   

However, with a great business plan, solid legal advice, elbow grease, and a bit of luck, entrepreneurs can focuse on executing their business plan, rather than getting bogged down with costly distractions.  As Benjamin Franklin noted, “Remember that time is money.”  And, even in this economy, there’s no better time than the present. 

Golden Ticket: Diversity Visa Lottery

September 30th, 2009

From October 2 through November 30, 2009, you have a chance to win the lottery.  Instead of cash prizes or a trip to Willy Wonka’s Chocolate Factory, you have the chance to win legal permanent residence in the U.S. through the U.S. Department of State’s Diversity Visa Lottery program.  And, unlike other lotteries, there is no cost to participate.  While the chances of winning might be low, the old adage remains true:  You can’t win unless you play.”

Each year, the U.S. Department of State makes 55,000 permanent resident immigrant visas available through a random selection process.  The visas are apportioned among six geographic areas that cover most of the world.  However, natives from the following countries are ineligible to participate:  Brazil, Canada, China (mainland-born), Columbia, Dominican Republic, Ecuador, El Salvador, Guatemala, Haiti, India, Jamaica, Mexico, Pakistan, Peru, Philippines, Poland, South Korea, United Kingdom (except Northern Ireland) and its dependent territories, and Vietnam.  If you were born in one of these countries, you still may be eligible if your spouse is from an eligible country or if other specific conditions apply. 

The requirements for participating are simple:  you have to be a native from an eligible country and you must have a high school education or its equivalent.  Alternatively, in lieu of a high school diploma, you can qualify by satisfying certain work experience requirements. 

To submit an entry, an eligible person must complete an entry form online by visiting the Department of State’s website.  Be aware of fraudulent websites that require payment.  Remember, there is no cost to participate.  Participants may only submit one entry form or risk disqualification.  The form requires basic biographic information, such as date of birth and marital status.  The form also requires that you submit a digital photograph of everyone you list on the form, including yourself and any spouse and children. 

The U.S. Department of State notifies winners between May and July 2010 through a letter.  The letter will provide further instructions on how to immigrate to the U.S.  You should note, however, that receiving a letter does not automatically guaranty permanent residency.  The U.S. Department of State often selects more than 55,000 winners because not everyone selected will actually decide to pursue legal residency.   Of course, if you do receive a letter, you’re that much closer to securing permanent residency. 

Layoffs

April 2nd, 2009

In 2008, the word on everyone’s lips was “change.”  This year, unforunately, the word seems to be “layoffs.”   And if you’ve grown weary of the media buzzwords “bailouts” and “bonuses,” you’ve probably muttered the word “$#*@%#%$!“  

Hopefully, the worst is behind us and the economy is headed up.  However, if you’re an employer that’s looking at declining revenues or an employee that’s noticing the flow of work significantly slowing down, layoffs might be on your horizon.  For many, it’s unchartered and unpleasant waters.

Before employers start to cut their work force, they need to be aware of the laws that may apply.  All layoffs are not the same.  Some layoffs involve a large number of employees in multiple locations, while some only involve a few employees within one department.  Some layoffs provide severance benefits, some do not.  For example, if an employer provides severance benefits that involve an on-going administrative scheme, the benefits may trigger requirements under the Employee Retirement Income Security Act (ERISA).  Failing to be aware of this Act could be costly. 

And if the employer is instituting a “mass” layoff that involves at least 50 employees at a single site of employment or reduces the hours of work for 50 or more employees by 50 percent or more, the employer will likely need to comply with Worker Adjustment and Retraining Notification (WARN) Act.

Even if the layoffs only involve a small number of employees (e.g., two employees) employers need to be aware of mandatory notice and statistical disclosure requirements relating to release and settlement agreements.  The Older Workers Benefit Protection Act (OWBPA), which applies to workers 40 and over, requires that employers include certain language and follow certain steps to ensure that releases signed by subject workers are made “knowingly and voluntarily.”  If employers fail to follow the requirements, the releases can be, and often are, invalidated.  In such cases, laid-off employees are able to maintain lawsuits against their employers, even though they may have received severance benefits.

Consequently, employers need to plan carefully.  If you don’t, you might end up saying ”$#*@%#%$!” more than a few times.  And in these turbulent economic times, your business can’t afford you saying it even once.