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‘Labor Laws’ Category

Apr07

Jury Duty Pay

My company has more than ten employees. One of my employees served jury duty for eight days. How much am I obligated to pay him?

The federal Fair Labor Standards Act (FLSA) does not require employers to pay non-exempt employees for any time off taken to fulfill jury duties. However, exempt employees must be paid their full salary for any week during which the employee performs any work, including checking and responding to work related voicemails and emails. The only circumstance during which an exempt employee is not guaranteed his full salary while on jury duty is if he performs no work in the given work week. An exempt employee’s salary may be offset by any compensation that the employee receives from the courts for his or her jury service.

Some states mandate employers to pay all or a portion of an employee’s regular wages during jury duty. You’re welcome to re-post your question with the specific state listed and we can better answer your question.

Keep in mind, federal law prohibits an employer from discharging, threatening to discharge, intimidating or coercing any employee based upon the employee’s jury duty. Also, federal law requires that any employee who takes jury duty leave be treated in the same way as all other employees who are on a leave of absence with respect to employment benefits and job restoration.

April 7th, 2014, 1:14 PM |  Posted in: Compensation, Labor Laws |
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Apr03

Compensating a Salaried Employee for Contract Work

We are piloting our internal database system with other similar organizations. The initial set-up and additional customization of the software will take our IT Director several hours outside of his normal responsibilities. He is a full time salaried employee. The company has agreed to hire our IT Director as a contract laborer to complete the additional programming requests on his own time (and we have agreed). Our Finance Director wants the company to bill us for the service and then we will compensate the IT Director. Can we do this? Is that considered “bonus” income? The IT Director charges a higher rate per hour for his contract labor compared to what he is paid at our organization (we are a nonprofit). Is it better to let our IT Director contract this work out on his own or to let our Finance Dept run it through our books and pass along the income?

It’s possible for an employee to also work as an independent contractor for the same company. The classification of employee or independent contractor is based on each position individually. So, one position could clearly be an employee relationship while the other has more independent contractor characteristics. If an employer chooses to have the worker in employee and independent contractor positions it’s very important that the employer is absolutely certain the latter position is clearly classified correctly. Otherwise, the company is risking potential violations under the Fair Labor Standards Act (FLSA).

It’s often believed the safer approach is to have the employee work two jobs within the company and pay him directly through Finance as any normal employee. A common misunderstanding with this approach is that the employee will automatically retain his FLSA classification, meaning if his current position is exempt than is second job will also be exempt. This is not always true. Under the FLSA, a worker can only have one classification, exempt or non-exempt. The classification is based on the worker’s primary job duties but when a worker has two jobs within the same company the primary duties are actually a combination of both jobs. Thus, it must be determined if the combined responsibilities would still permit the exempt classification. If not, the employee must be re-classified as non-exempt for both positions and subject to overtime regulations per the FLSA.

Based solely on the information provided it’s difficult to determine if the IT Director would maintain his exempt classification. However, assuming he would continue to have autonomous decision making on matters of significance in the second position and the second position wouldn’t assume a substantial amount of his time, it seems the exempt classification would still be viable.

Keeping the employee on the payroll for the second job, eliminates the risk of “red flags” since having the same worker listed as an employee and independent contractor may illicit attention from regulatory agencies. As mentioned above, it’s still important to ensure proper classification in order to avoid costly FLSA violations.

Assuming the IT Director would remain exempt, it’s permissible to pay him either hourly or salary for the second position. Remember non-exempt and exempt are classifications under the FLSA determining the need to adhere to overtime regulations. Hourly and salary are payment methods. So, the exempt IT Director can be paid a salary for his primary job and either a salary or hourly wage for his secondary job while keeping his exempt classification. The additional payments to the employee would be considered supplemental wages.

April 3rd, 2014, 8:21 PM |  Posted in: Compensation, Labor Laws |
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Apr03

FMLA medication and tardiness

If an employee is covered by FMLA and her physician has prescribed a medication that may cause her to oversleep and be late to work, can that employee be disciplined, or at worse, terminated?

The federal Family and Medical Leave Act (FMLA) entitles covered, eligible employees to take twelve workweeks in a twelve month period of unpaid, job-protected leave for specified family and medical reasons. Eligible employees are allowed to take FMLA leave for both unforeseen emergencies and planned absences involving the care and bonding with a newborn, adopted, or foster child; and to care for oneself or immediate family member with a serious health condition.

FMLA leave may be taken intermittently or on a reduced leave schedule under certain circumstances. Under FMLA regulations, there must be a medical need for such a leave and it must be that the medical need is best accommodated by an intermittent or reduced schedule leave. The medical certification submitted to the employer must address the medical necessity for intermittent leave and state the estimated frequency of the leave. If the initial medical certification doesn’t state the need for intermittent leave or if it’s determined that the employee’s absences substantially differ from what the certification states, the employer may request recertification to substantiate the need for more frequent absences as intermittent leave.

As long as the absences are verified by the medical certification and covered under the FMLA, the employee cannot be disciplined for them. However, if the employee is unable to provide a medical certification substantiating the need for intermittent leave under the FMLA, the absences are considered unexcused and normal disciplinary procedures should be followed. If this ends up being the case, it’s important to have clear documentation given to the employee stating that the absences are not covered under the FMLA. It would also be a good idea to have a documented conversation with the employee ensuring she is aware the absences are not covered and she will be subject to disciplinary actions if further lateness occurs.

April 3rd, 2014, 10:30 AM |  Posted in: Labor Laws |
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Mar29

New Business in Hawaii

Aloha,
We are a small employment agency in Hawaii. We are very new to the business. We are wondering if we are required to provide an employee handbook? If yes, where can we get one or how should we create one? If we need help, who can we ask? Also, who should we ask to help with job descriptions, job offers, or contracts to see if we break any laws or if it was created properly?
Mahalo for your time.

Hawaii’s Department of Labor and Industrial Relations (DLIR) provides a guide for new employers. The guide can be found at http://labor.hawaii.gov/wp-content/uploads/2013/03/New-Employer-Packet-3-14-13.pdf. It will help you with basic information.

There is no specific law in Hawaii requiring employers to provide employee handbooks. However, an employee handbook is a comprehensive resource to employees necessary to ensure they are aware of company policies and procedures as well as federal and state employment laws. Examples of company policies include codes of conduct, timekeeping/pay/overtime, benefits, attendance, performance management, discipline, discrimination, harassment, retaliation, workplace violence, drug and alcohol abuse, smoking, complaints/concerns procedure, safety, and electronic communication. It’s important employees are informed of the employer’s expectations and standards in the workplace.

Some Hawaii and federal laws require published statements or workplace postings of certain legislation. The DLIR provides posters at http://labor.hawaii.gov/labor-law-poster/. The federal Department of Labor provides information on mandated postings at http://www.dol.gov/oasam/boc/osdbu/sbrefa/poster/matrix.htm.

Educating yourself on the vast set of laws and which ones apply to you as a small business is important. Consider taking employment/labor law trainings focused on both federal and Hawaii legislation. There are many companies that provide thorough state and federal labor law trainings for a fee. Also, consider joining your local Chamber of Commerce. For minimal fees, you will gain access to a variety of resources like trainings, ever changing laws, and, most importantly, the knowledge and support of other business professionals.

Sample job descriptions, policies, and contracts can be found online, both for free and at a cost, and altered to suit your company’s needs. You can consider utilizing the services of an employment lawyer or HR consultant; however, depending upon the number of workers employed, the cost of such services may be burdensome.

March 29th, 2014, 10:25 AM |  Posted in: Labor Laws |
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Mar26

Salary plus commissions

Do commissions count towards the total salary that is required of $455 minimum. Example: associate is paid base salary of $250 per week plus commission makes a total of $1000 per week.

The federal Fair Labor Standards Act (FLSA) requires that most employees be paid at least the federal minimum wage for all hours worked and overtime pay at time and one-half the regular rate of pay for all hours worked over 40 hours in a workweek. However, the act provides an exemption from both minimum wage and overtime pay for employees employed as bona fide executive, administrative, professional and outside sales employees as well as certain computer employees.

To qualify for exemption, employees must pass all three “tests”, salary level, salary basis, and duties, as outlined by the FLSA. Job titles alone don’t qualify employees for exempt status. Specific job duties and salary must meet the requirements of the FLSA.

Employees generally must be paid not less than $455 per week on a salary basis in order to be exempt. These salary requirements do not apply to outside sales employees, teachers, and employees practicing law or medicine.

If a retail or service employer uses the overtime exemption for commissioned employees, three conditions must be met:
1. The employee must be employed by a retail or service establishment;
2. The employee’s regular rate of pay must exceed one and one-half times the applicable minimum wage for every hour worked in a workweek; and
3. More than half the employee’s total earnings in a representative period must consist of commissions on goods or services.

The representative period for determining if sufficient commissions have been paid may be as short as one month but no more than one year. The employer is responsible to select a representative period in order to determine if the condition has been met.

Unless all three conditions are met, exempt status is not applicable. Thus, overtime pay must be paid for all hours worked over 40 in a workweek at one and one-half the regular rate of pay, which includes commissions.

March 26th, 2014, 7:55 PM |  Posted in: Compensation, Labor Laws |
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