Government audits: What do they want?
Article courtesy of HotelNewsNow
By Andria Ryan – March 5, 2012
Editor’s note: This is the first in a three-party series on government audits. Read part II, “Get your house in order,” and part III, “How to respond.”
During the past two years, the federal government and many state governments have changed their focus from compliance assistance to enforcement. Gone are the days of federal government outreach, education and compliance assistance to employers.
As a result, the risk of government investigations and inspections, large penalties and the possibility of criminal sanctions have increased substantially for employers. Even more disturbing for hospitality employers is the focus by these federal and state agencies on the hotel industry. This three-part series will highlight the agencies targeting the industry and their enforcement tactics, provide employers with useful tips to avoid high-exposure claims and set forth a proactive approach to handling government investigations for employers faced with an investigation or inspection by a government agency.
Who are they?
Several federal agencies have specifically targeted the hospitality industry, and other agencies have implemented aggressive enforcement efforts against employers across the board. Both the United States Department of Labor and the Immigration and Customs Enforcement have stepped up enforcement efforts in the hospitality industry specifically. Secretary of Labor Hilda Solis clearly stated the agency’s position in her 2009 Workers’ Memorial Day speech when she said “Let me be clear, the Labor Department is back in the enforcement business.” She has made good on her word.
DOL Wage and Hour Division officials unofficially launched the Department’s “Hotel and Motel Resort Pilot initiative” in fiscal year 2011. Under this initiative, the Division has targeted and continues to audit hospitality employers in two areas: compliance with the H-2B program requirements (for temporary seasonal workers) and the Fair Labor Standards Act generally.
DOL considers hospitality to be a “high-risk” industry for wage and hour violations for two reasons. According to the agency, the hospitality industry employs large numbers of “vulnerable” employees (younger workers, temporary workers and H-2B workers) who are not likely to complain. Secondly, the industry is what the DOL calls a “fissured industry” by which it means the industry is dominated by arrangements (such as franchises and management agreements) which results, in the DOL’s opinion, in the dilution of both the relationship between employer and employee and the responsibility for compliance with state and federal employment laws.
The agency will have more manpower and money to carry out this initiative against the hospitality industry. In fiscal year 2011, the Wage and Hour Division added more than 350 new investigators and more than $50 million to its budget.
To read the complete article Click Here
Budget Outlines Obama’s Worker-Protection Priorities
Article courtesy of Human Resources Executive Online
The Obama administration’s proposed 2013 budget continues to stress stepped-up enforcement of worker-protection laws at various federal agencies. It provides for more hiring at the DOL, continues to focus on possible employee misclassification issues and seeks to encourage state paid-leave initiatives.
By Tom Starner
When President Barack Obama’s 2013 budget hit the streets just over a week ago, there were some areas of consideration and concern for employers and HR professionals tucked into the 256-page document.
Among the initiatives are proposed funding increases for the administration’s accelerated focus on enforcement of worker-protection laws and regulations by entities such as National Labor Relations Board, Equal Employment Opportunity Commission, Mine Safety and Health Administration and Department of Labor.
As has happened for the past three years, of course, the president’s “wish list” realistically has little or no chance of passage in today’s political atmosphere — especially with the 2012 election looming. It will be up to Congress to work with the White House to hammer out an actual budget.
To the president and most in his party, it’s a “blueprint for economic success;” to Republicans in Congress, it’s dead on arrival.
The tone of the DOL funding section, experts say, certainly sends the clear and continuing message that the Obama administration will focus on stepping up enforcement of labor laws and regulations.
The 2013 budget for the DOL, which provides $12 billion in discretionary funding (a slight reduction from the comparable 2012 DOL level), includes among other work-related provisions:
Worker Protection: The budget includes nearly $1.8 billion for the DOL’s worker-protection agencies. In addition, it provides an increase of $6 million for the Wage and Hour Division for increased enforcement of the Fair Labor Standards Act and the Family and Medical Leave Act.
Independent Contractors: If employees are misclassified as independent contractors, they do not receive benefits and protections to which they are legally entitled (such as overtime and unemployment benefits). The budget includes $14 million to combat misclassification, including $10 million for state grants to identify misclassification and recover unpaid taxes, and $4 million for personnel at the Wage and Hour Division to investigate misclassification.
To continue reading the complete article Click Here
Feds sue Seafood Peddler, alleging it underpaid workers by $164,000
Article courtesy of Marin Independant Journal
by Richard Halstead
The U.S. Department of Labor has sued Seafood Peddler restaurant in San Rafael, alleging its owner and two managers underpaid a group of employees by some $164,000 and retaliated against eight workers when they filed a complaint with the federal government.
Only last week, Grateful Dead bassist Phil Lesh announced he had bought the Seafood Peddler at 100 Yacht Club Drive and plans to transform it into a concert hall. The restaurant owner said at the time he would be closing the restaurant by the end of this month.
The federal lawsuit, filed Jan. 6 in U.S. District Court in San Francisco, came after an investigation by the department’s wage and hour division. The inquiry found that the defendants repeatedly failed to pay proper overtime wages or maintain required records, and occasionally paid employees less than the federal minimum wage of $7.25 per hour. The investigation covered a three-year period ending in August 2011.
The owner of the Seafood Peddler, Alphonse Silvestri, was named as a defendant in the suit along with the restaurant’s manager, Richard Mayfield, and a supervisor, Fidel Chacon.
According to the Department of Labor, Silvestri was also the owner of a restaurant in Yonkers, N.Y., that was investigated by the department in 1999. That investigation found $7,858 was owed to workers in back pay for minimum and overtime wage violations.
“This owner has underpaid workers for years, despite being well aware of the law’s requirements,” said Susana Rincon, director of the wage and hour division’s San Francisco office. “This lawsuit sends a clear message to all employers that we will take action to protect the rights and pay of low-wage, vulnerable workers.”
Silvestri said, “It’s a bunch of fabricated garbage. It came from nowhere. They just fabricated a bunch of garbage — two stupid charges that I never heard before. That’s all I can tell you.”
Silvestri also denied the department’s allegation that he underpaid restaurant workers in New York.
“A big lie,” Silvestri said. “Fifty-three years in this business, I never got a letter from the labor department. They fabricated the lies one on top of the other. These people are worse than the Mafia.”
Silvestri referred all other questions to Mattaniah Eytan, a Corte Madera lawyer. Eytan, however, said he wasn’t sure he would be representing Silvestri in the matter and declined comment.
Neither Mayfield nor Chacon could be reached for comment.
The Department of Labor says Silvestri owes at least $137,938 in overtime back wages to 11 employees as well as $26,434 to the eight employees who were fired for cooperating with the investigation.
Additionally, the department has assessed $15,400 in civil penalties against the defendants for willfully violating provisions of the Fair Labor Standards Act that cover overtime and retaliation. According to the suit, the Seafood Peddler has an annual gross volume of sales of not less than $500,000.
A Seafood Peddler employee, who agreed to speak on the condition that he not be identified, said Silvestri threatened to take violent action against whoever complained to the labor department. The employee said Silvestri told employees that the labor department action is the only reason he agreed to sell the restaurant to Lesh.
The employee said he had worked 13 to 14 hours a day at the restaurant for more than three years and received no overtime pay, despite requesting it. The employee said he was told he wasn’t being paid extra for overtime because he was being paid partly in cash, which made up for the lack of overtime pay. The employee said Silvestri warned workers he would have them deported if they complained.
Deanne Amaden, a Department of Labor spokeswoman, said the government gets its leads from employees, the family of employees and sometimes business competitors.
“It’s hard for the employer who is paying their workers properly and in accordance with the law to compete with somebody who is not,” Amaden said.
The Out of the Box Time and Attendance system helps you to avoid situations like this by providing accurate tracking of an employee’s time spent on the job. Overtime thresholds are set in the rule of pay (shift) the employee is scheduled to, so that overtime hours are automatically granted and paid at time and a half. The program’s reports and Cards screen allow you to view a running total of an employee’s hours to make sure all hours are calculated properly.
Daylight Saving Time Update: 2012-03-11
Important Notice – Please Read
The federal government enacted the Energy Act of 2005 in an effort to reduce the amount of energy used in the United States. This has changed the dates for Daylight Saving Time since 2007.
Smart Clock versions below 3.93 contain a 100-year time clock chip that was programmed before the above legislation. Your Smart Clock version number can be found by disconnecting its power supply, plugging it back in, then reading its display during its self-tests.
Click Here if your Smart Clock is version 3.93 or older to learn how to update it.
Users of Smart Clock versions 3.93 or above have the ability to use the “Daylight Saving” button in the Perform Clock I/O window to download the start and end dates/times for Daylight Saving Time each year.
Once downloaded to the Smart Clock, the clock will automatically adjust the time at those pre-determined times without the need to change the time by hand or the Daylight Saving Time Program. Please refer to your manual or program’s built-in help system for more details.
Mattress retailer to pay sales associates $40,000 in back wages
Article courtesy of Furniture Today.
Larry Thomas — January 11, 2012
BATON ROUGE, La. — Bedding retailer Mattress Direct has agreed to pay more than $40,000 in back wages to 96 current and former sales associates following an investigation by the U.S. Department of Labor’s Wage and Hour Division.
The Labor Department said the investigation found that the retailer violated portions of the Fair Labor Standards Act by failing to pay overtime and/or the federal minimum wage of $7.25 per hour to some of its salespeople.
Investigators found that commissions earned by sales consultants did not always yield the minimum wage. In addition, many employees received “straight time” wages for all hours worked, rather than 1½ times their pay rate for hours worked above 40 hours per week.
“Inside sales work is not exempted from the minimum and overtime wage requirements of the Fair Labor Standards Act,” said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southeast. “Employees were working up to 50 hours per week – some exceeding 120 hours in a pay period – but were not always paid at least the federal minimum wage or overtime when required.”
The department said a total of $40,253 is being paid to the current and former employees. The retailer also agreed to comply with wage and hour laws in the future and install a new timekeeping system to accurately record work hours.
Lee Burns, president of the 26-store chain, said the pay discrepancies resulted from a misunderstanding of wage and hour rules, as well as the week-to-week fluctuations of sales commissions.
“I have some employees who make $70,000 a year in commissions, but if they have one pay period with very few sales, then there could be a problem (complying with wage and hour regulations),” Burns said.
Prior to the Labor Department audit, he said sales associates were paid full commission or $7.25 per hour, whichever was greater. Now, they’re paid full commission or $10.89 per hour, which is 1½ times the minimum wage.
“Our employees are paid very well, and we want to continue to do that,” said Burns.
He noted that the Labor Department did not assess any fine or civil penalty against the company.
The Out of the Box Time and Attendance system helps you to avoid situations like this by providing accurate tracking of an employee’s time spent on the job. Overtime thresholds are set in the rule of pay (shift) the employee is scheduled to, so that overtime hours are automatically granted and paid at time and a half. The program’s reports and Cards screen allow you to view a running total of an employee’s hours to make sure all hours are calculated properly.
Top 10 Employee Handbook Updates For 2012
Article courtesy of Manufacturing.net
Written by Daniel Kaufman, Partner at Michael Best & Friedrich LLP
The New Year is a great time for employers to review and update their employee handbooks. It is especially important this year because of several changes to existing laws, as well as new challenges that employers may not have previously addressed in their handbooks, such as workplace bullying.
Below is a list of the top ten areas that employers should consider updating in their employee handbooks for 2012:
1. EEO Policies
It is important that employers have clear Equal Employment Opportunity (EEO) policies and consistently enforce such policies. In June 2011, the U.S. Supreme Court reversed certification of a class of approximately 1.5 million Wal-Mart female employees claiming that Wal-Mart engaged in sex discrimination by denying female employees promotions and raises. In Dukes v. Wal-Mart, the Supreme Court specifically noted that Wal-Mart had an EEO policy that it enforced, including imposing penalties on those who violated the policy. In light of the Dukes decision, employers should be sure to update and enforce their EEO policies, which may prove critical in avoiding and defending litigation.
2. Employee Discipline
A disciplinary policy with clear procedures places employees on notice of the possible consequences of violating the employer’s policies. Disciplinary policies should require supervisors to look into and document every disciplinary action consistently. This evidence will help employers defeat challenges from employees who have experienced adverse employment decisions. A clear policy that provides for uniformity and consistency in disciplinary actions will reduce the risk of exposure to discrimination claims.
3. Workplace Violence and Conflict Resolution
In September 2011, the Occupational Safety and Health Administration (OSHA) issued a directive on how to respond to workplace violence, which remains a top concern for employers. Workplace violence currently affects nearly two million people every year and is not expected to abate as layoffs and unemployment continue. Workplace violence-related litigation includes actions for negligent hiring, worker’s compensation and violations of OSHA. Though handbook policies cannot always prevent workplace violence, they serve an important purpose when they provide employees with avenues for reporting incidents and obtaining counseling and give guidelines for responding when violence is suspected or threatened.
4. Workplace Bullying
Workplace bullying involves repeated unreasonable acts toward an employee, either by a peer or supervisor, intended to humiliate or undermine the employee, and creating a risk to his or her health. Workplace bullying is not yet illegal, but employers have significant incentives to prevent it. The costs of bullying to an employer include training new employees to replace employees who leave as a result of bullying; decreased productivity as employees cope with bullying incidents; and harm to an employer’s reputation. Employers should seriously consider revising their employee handbooks to reflect a zero tolerance, anti-bullying policy as part of their commitment to a safe and healthy work environment. Such policies should include a process for reporting bullying, as well as responding to and investigating complaints of bullying.
5. New NLRB Rules
While Congress did not pass the Employee Free Choice Act (EFCA), employers should be prepared for changes in union organizing tactics and procedural requirements, and should make sure handbooks are up to date on union issues. Agencies, including the National Labor Relations Board (NLRB), have been attempting to adopt, through rulemaking, many of the reforms sought in the failed EFCA legislation. The NLRB proposed various rules in 2011 that support unionization, including rules that would lead to significantly speedier union elections. Another requires all employers to post a notification by Jan.31, 2012, informing employees of their rights under the National Labor Relations Act (NLRA). While the Final Rule associated with the Notice Posting requirement is being legally challenged, employers must stay informed of this issue to ensure compliance.
6. Social Networking and Blogging
As Facebook, Linkedin and Twitter accounts become more prevalent, employers should consider handbook policies that address employment issues that may arise from these social media. Such policies should address what communications are prohibited and the consequences of “misuse” of social networking related to the workplace. Employers should place limits on posting confidential or proprietary company information, as well as photos taken at the workplace. In addition, handbook policies should address the use of social media to disparage or harass other employees or the company. However, employers must be aware of the NLRB’s recently ruling, which established that the NLRA gives employees the right to communicate about wages, hours and other conditions with one another via social media. Specifically, in May 2011, the NLRB ruled that an employer violated the NLRA when it fired an employee for publicly discussing “protected concerted activity” via Facebook.
7. More FMLA Changes
The U.S. Department of Labor (DOL) Wage and Hour Division recently issued Administrator’s Interpretation No. 2010-3, clarifying a provision of the Family and Medical Leave Act (FMLA), declaring that either day-to-day care or financial support may establish an in loco parentis relationship. According to the DOL, an employee who does not have a biological or legal relationship with the child, but assumes the responsibilities of a parent with regard to the child, may qualify for FMLA leave under the same circumstances as a biological parent. The interpretation also recognizes nontraditional family arrangements, including adopted children of same-sex partners, and states that an employee who will share equally in the raising of a child with the child’s biological parent also is entitled to leave for the child’s birth.
8. Sexual Orientation Discrimination
Nearly half the states and the District of Columbia have laws that prohibit discrimination in employment on the basis of sexual orientation. Some of these states also specifically prohibit discrimination based on gender identity. As a result, employers should be mindful of this issue in revising their EEO policies.
9. Benefits Provisions
Many employers have made changes to their benefits plans in 2011 and should be sure their handbooks accurately reflect those changes. Furthermore, the handbooks should state that the language in the benefit plan controls if the handbook summary and the plan language differ.
10. Adverse Weather/Other Closings
More companies are incorporating adverse weather policies into their handbooks to provide guidance on when the business will close and how weather-related absences or shutdowns will affect employee compensation. Employers need look no further than Hurricane Irene in 2011 for an example of a natural disaster that forced businesses to close, some for many days if not weeks. Policies should address such considerations as shutting down the workplace, working remotely, cross training and returning to work as well as compensation issues for both exempt and non-exempt employees. Employers must ensure such policies are in compliance with the federal Worker Adjustment and Retraining Notification (WARN) Act, if applicable, and other similar state laws, which require notice to employees in the event of a plant closing.
Employers should seek counsel before revising their handbooks. There is no one-size-fits-all employee handbook or policy. The laws with which employers must comply vary greatly depending on individualized factors, such as an employer’s size and location. In addition, when employers adopt new policies, they should make sure their employees are aware of the changes, obtain signed acknowledgement forms from their employees and implement the new policies consistently.
If you need to update your employee handbook or have any questions about adopting or implementing new policies, please contact the author of this article, Daniel A. Kaufman, an attorney with Michael Best & Friedrich LLP in Chicago, Ill. He can be reached at dakaufman@michaelbest.com or (312) 222-0800.
Janitorial Company Must Pay Back Wages
Article courtesy of BuffaloNews.com
A janitorial company has paid $22,000 in back wages and damages to 26 employees who worked at Ralph Wilson Stadium after a U.S. Department of Labor investigation found it didn’t pay them proper minimum wages or overtime compensation.
Knights Facilities Management, a Michigan-based company that provides grounds maintenance and janitorial services at the stadium, was cited for violating the Fair Labor Standards Act’s minimum wage, overtime and record- keeping provisions.
The Labor Department’s Wage and Hour Division’s Buffalo Area Office reviewed the company’s records and timesheets and found employees were required to work long hours and often weekend shifts during the Buffalo Bills’ home games and other special events. But the company avoided paying overtime by switching workers to different payrolls when their hours went beyond 40 for the week. It also did not calculate all the hours employees worked and didn’t combine hours from different duties.
“To see janitors fall below the mini-mum wage while providing services to an industry that makes billions of dollars every year is extremely disappointing and legally unacceptable,” said Michael Fitzgerald, the Wage and Hour Division’s area director in Buffalo, in a release.
The Out of the Box Time and Attendance system helps you to avoid situations like this by providing accurate tracking of an employee’s time spent on the job. Overtime thresholds are set in the rule of pay (shift) the employee is scheduled to, so that overtime hours are automatically granted and paid at time and a half. With the labor distribution option, you can even track how much time an employee worked on various duties and assign different rates for each duty, if required. If the employee is only paid a minimum rate regardless of the duty, that can be specified in their employee record.
The program’s reports and Cards screen allow you to view a running total of an employee’s hours to make sure all hours are calculated properly.
To view Smart Clock’s Out of the Box software Click Here.
How Long Do We Need to Keep All This Stuff?
Article courtesy of Our Colorado News.
by Jack Goldberg
Every year at this time, our phones ring with questions such as “How long do I have to keep these personnel files?” or “Do we really need to hang on to these time cards?”
How about some guidelines?
Below is a short list to guide you in your year-end cleaning. Remember that many federal and state laws include provisions related to record retention. While the following does not anticipate every piece of paper, these general, and usually generous, guidelines anticipate the most common record retention questions.
Employee Compensation: Your payroll department should keep payroll records (including records of wages, hours, collective bargaining agreements, employment contracts, date of payment, amount of payment, record of straight and overtime earnings etc.) for three years. The actual time cards can be discarded after two years.
Leave of Absence Records: FMLA wants you to retain records related to leaves of absence for three years. This includes basic payroll data, FMLA leave dates, and copies of leave notices.
I-9 Documentation: Employers must retain completed I-9s for three years after the date of hire or one year after the date employment ends, whichever is later.
Pre-Employment Records (i.e. job postings, ads, applications, resumes): The Age Discrimination in Employment Act requires you to keep advertisements, job applications and resumes for one year from the date of the event.
OSHA Logs: This law mandates that logs be kept for five years following the end of the year to which the records relate.
Employment Records (including promotions, demotions, transfers, terminations): Companies must keep these records for one year from the date the record was made or the termination action was taken, whichever is later.
EEO-1 and Affirmative Action Plans: These retention requirements are not specified by law. However, EEO-1′s and AAP’s must be updated annually, and the most recent version must be available for review.
Documents Related to Enforcement Actions: If your company is being investigated for some reason, you should retain everything until the action is completely finalized. For example, if you are audited for alleged wage and hour violations, you must not discard wage information related to the time period being audited. If you are responding to an EEOC complaint, you must retain all the documentation related to that complaint and employee.
What about electronic documents?
The Federal Rules of Civil Procedure (FRCP) were recently revised to address issues of discovery as they relate to electronically stored information. (Basically, the FRCP are the court rules and procedures attorneys follow when conducting civil suits.) The FRCP always included rules related to the retention and discovery of documents relevant to litigation. However, because so many documents are now stored electronically, the rules needed to be updated.
- Talk with your IT department to determine what your company policy or practice is related to data storage and retention.
- If not done already, draft a Document Storage and Retention policy. This policy will set out procedures for scheduled destruction of documents and electronically stored information. Have your attorney review your policy.
- Draft a policy to address document preservation should litigation be threatened. The rules change if you think you will be sued.
- Communicate your policies to all employees who may create or have access to electronic data.
If you are like most businesses, you create and save an enormous amount of data — both electronically and hardcopy. This is a good opportunity to review and update your policies related to retention; it is a good preventative measure to save time and expense should your company ever, unfortunately, be named in a lawsuit.
How do we get rid of it?
Please be careful when disposing of documents. Imagine the outcry if you simply put in the Dumpster documents listing employees’ Social Security numbers, addresses or private medical information. Many states have laws requiring organizations to carefully maintain security and confidentiality when disposing of files — generally requiring that you render the information unreadable or undecipherable.
Office shredders are appropriate for daily use but not very efficient for large volumes or documents. A better solution is to utilize a document management company.
Whether you are still working on your end of the year file purges or are anticipating office spring cleaning, we hope you will refer to these guidelines. If you need further assistance on this or any other Human Resource issue, call on Forté Human Resources.
Smart Clock’s Out of the Box software allows you to set the number of days you wish to keep punch card records on file in your hard disk. Follow our instructions below.
Days On File: The valid value for this field is from 1 to 9,999 days. Set this to the number of days you wish to keep punch card records on file in your hard disk. Please Note: By setting this field to 9,999, the program will keep a punch history of over 27.3 years.
Keeping Time – Volume 4
Biometric – Proper Finger Placement
The basics for successful usage of the Smart Clock fingerprint sensor are simple, but important. Performance improves with consistent finger placement. It is important to make sure that the position of your finger allows the fingerprint sensor to record the unique features of your fingerprint. Here are some simple suggestions to follow for trouble-free fingerprint recognition.
The Ridge-Lock is the raised plastic piece underneath the sensor. It is used to help guide your finger onto the sensor and to discharge static electricity prior to touching the sensor. The Ridge-Lock was designed to help maintain “consistent” finger positioning. With your fingertip raised, slide your finger across the Ridge-Lock, until it “locks” into place within the first indentation of your finger. Next, lower your finger onto the sensor and apply moderate pressure. Here are some common mistakes to avoid:
- Sliding your fingertip into place while making contact with the sensor instead of lowering your fingertip onto the sensor can cause distortion of the fingerprint and degrade the image quality. Keep your fingertip raised while sliding across the Ridge-Lock and then lower your fingertip onto the sensor when in position.
- Rotating or twisting your finger into position will also cause distortion of the fingerprint and make verification less reliable.
- Positioning your finger more to one side than the other and leaving a portion of the sensor exposed will degrade image quality. Try to center your fingertip into position.
- Placing your finger at an angle to the Ridge-Lock is another common mistake. Rotation of your fingertip will not provide a reliable image of the fingerprint for verification.
If you follow these suggestions, you will see some improvement in the Smart Clock’s ability to recognize your fingerprint.
Monthly Tip
Use the Exception List report to quickly isolate missing punches (MP) and absences (NP) for any date range.
The report will only show those employees that have the specified notations applied to them. To tag the MP and NP notes, just left click and then right click on each one. This will highlight them.
Monthly Trick
Use the Criteria option to create a custom filter for the CARDS window that will focus on just tracking down missing punches (MP) and absences (NP).
The example above focuses on the current period. Some companies create one custom criteria for the current period and another for the previous period, so they can switch back and forth between them. The notes must be entered in capital letters in the “from” or “to” fields for the criteria to work.
Copyright © 2012 Desco Industries Inc. All rights reserved
Phone: (909) 664-9980 Fax: (909) 627-7449 Website: SmartClock.com EMail: Service@SmartClock.com
