Sick Leave Still Bad For Business

Two years ago when Maine was considering mandating paid sick leave, I wrote that I thought it was bad for business. I continue to believe this. As I stated then, no one can argue that it makes sense for employees to stay home when not feeling well.  The last thing anyone wants is to have someone preparing or serving your meal who is not well—and that’s what happens when the choice is between staying home and not receiving pay or working sick because you can’t live without your paycheck.  It is a terrible choice to have to make.

Unfortunately, as noble as the various bills being proposed throughout the country may be, as right as it feels, it is bad policy because it undermines the businesses it purports to support and ultimately hurt all employees.  Small businesses cannot afford another mandate.  Mandatory sick leave will be cost prohibitive and an administrative nightmare to manage, particularly on top of the other leave policies mandated under state and federal law.  Managing time-off policies are not easy.  Employers still struggle making sense out of the federal Family and Medical Leave Act (FMLA) and that’s been around 20 years!

One can empathize with any worker who has to work ill.  Ideally, businesses will see that sick leave benefits, voluntarily offered, provide them a competitive advantage. But mandating it is not the right thing to do. Smaller organizations often cannot afford these kinds of benefits and another mandate could potentially put them under.

What do you think? Share your comments and opinions below.

Workforce Predictions and Trends for 2013 (Audio Podcast)

In a lively, give and take radio interview on WLOB’s Mind Your Own Business, I give my workforce predictions for 2013. In addition, I discuss what the future workforce will look like, predict where unemployment will be at the end of the year, discuss how employers should address  social media, why turnover in many companies will begin to increase and much more. Listen in and give me your thoughts in the comment section below.

CLICK HERE TO LISTEN

Employee Medical Information: Be Careful What You Ask For

(This guest post was written by attorney Glenn Israel from Bernstein Shur)

Earlier this week, the national department store chain Dillard’s agreed to pay $2M to settle a discrimination claim based upon its policy of requiring absent employees to provide a doctor’s note stating the medical reason for the absence. The U.S. Equal Employment Opportunity Commission took the position that once a doctor confirms the employee was absent for medical reasons, the employer is not entitled to ask for any additional information. This is consistent with the approach taken by the U.S. Department of Labor with regard to Family and Medical Leave Act requests. The DOL medical certification form asks the doctor to state whether the employee has a medical condition that prevents the employee from performing one or more essential functions of his or her job and also asks the doctor to “describe other relevant medical facts” which “may include symptoms, diagnosis, or any regimen of continuing treatment.” The DOL form does not, however, require the doctor to provide any of that additional information.

In a recent case that I handled in Maine, an employer and a mid-level supervisor found themselves in front of the Maine Human Rights Commission for asking one too many questions. The supervisor noticed that one of his subordinates was acting strangely and asked the employee if she was “on drugs.” The employee said “No, but I do take medication.” The supervisor innocently asked “For what?” The employee then revealed her mental health diagnosis to the supervisor and filed a claim with the MHRC.

The take away point is don’t ask too many questions. Here are some things you can ask an employee:

Zales: Guilty of Discrimination

Would you buy from a firm found guilty of discrimination? Probably not and that’s the fear of Zales jewelry store today.

Claims of discrimination can severely damage an organization’s reputation and brand. Consumers who have options would rather buy from those who have sterling reputations—not from companies’ accused of illegal discrimination toward their own customers.

In this case, a woman accused Piercing Pagoda, a division of Zales Delaware, of discrimination and the Maine Human Rights Commission and the Cumberland County Superior Court agreed, ordering the company to pay $100,000 in damages.

Zales has denied the claim, but the damage is done. People have been hurt, reputations harmed, and the company must now deal with the ugly headlines and long term impact on its business, workforce and customer base.

Advice for Employers: Adopt a zero tolerance policy on discrimination. Be clear to your workers that any act of discrimination—whether in your employment practices or how you deal with others, will never be tolerated. Foster a respectful environment and only hire quality staff. Train your employees and be vigilant in ensuring that you maintain a respectful workplace. And if claims are made, rapidly address it.

For more information on preventing discrimination, click here.

Earned Benefit Time & Payout at Termination

Understanding an employer’s obligation regarding payout of vacation pay when an employee quits or is terminated can be very confusing, particularly when Paid Time Off (PTO) and Earned Benefit Time (EBT) is thrown in the mix. Each state has different laws, but we will focus in this post on Maine.

Maine does not require employers to provide paid vacation. However, if an employer offers it, any accrued and unused vacation pay must be paid out at the time of termination. But what happens if an employer combines vacation time, sick time, and other time off into either Earned Benefit Time or Paid Time Off? Again, the law is only concerned about the vacation time.

If you can separate the various time-off pieces, then the only obligation you would have is the vacation time. If, however, you cannot, you should look at the following:

1. What does your policy say?
2. What is your past practice? How have you handled it in the past?

If your policy and practice does not differentiate between the various time-off pieces and simply treats them all as “earned time,” then you have no obligation to payout at termination. Your accrual should also focus on the earned time without differentiating. And finally, you may also want to state that your “earned time has no value at separation.”

A well-written policy that includes these components and has been reviewed by counsel will minimize any confusion on how to handle this benefit at termination.

For addition assistance, contact the Dacri HR HelpLine by clicking here.

Protection Against Fraud: Advice On Guarding the Public Purse

(This article appeared in Maine Townsman, October 2012 and was written
by Douglas Rooks)

The headlines can be unsettling. A town treasurer, clerk or tax collector is suspected of stealing money from municipal accounts. The offense may have happened over many years. It may have been in a small town with few employees, or one where several different people handle money daily.

Whenever it happens, it sends shock waves through the municipal community. As Kennebunk Town Manager Barry Tibbetts puts it: “If one person fails, the whole organization takes a hit. And if one town fails, it reflects on the entire municipality community.”

Prosecutions for fraud and misappropriation of funds are uncommon in Maine, but they do happen. Businesses can be victimized but in recent years there have been cases involving Little Leagues, Boy Scouts, snowmobile clubs and other non-profits. No organization seems immune.

Still, there’s an added sting when a municipal official or employee is involved. “We don’t own this money,” said Tibbetts. “We’ve been entrusted with it by the people, and it’s our job to keep it 100 percent safe.”

Ron Smith is an auditor whose firm, RHR Smith & Co. of Buxton, does the books for many Maine towns and counties. He’s also an expert on forensic audits and has worked with law enforcement agencies on investigations involving Maine municipalities.

Affordable Care Act: What Employers Need To Know

(Post was written by James McCarthy, Mainebiz)

Rick Dacri, owner of a Kennebunkport-based consulting firm that advises businesses on work force issues, says his client list ranges from Fortune 500 companies to nonprofits employing fewer than 10 people. Whatever their size, he says, health care benefits and their costs have long been a front-burner issue for Maine employers.

Yet, when asked about the 5–4 Supreme Court decision upholding the Affordable Care Act, Dacri carefully sidesteps the political controversy that preceded the June 28 ruling and continues in its aftermath. He prefers to focus more on the practical steps employers need to take now that the law has been ruled constitutional.

“I don’t think it’s as big a deal as is being portrayed,” Dacri says, noting that most of his Maine clients, even the smaller companies, already provide health insurance to their employees. For them, he says, it’s an essential way to attract and keep quality employees.

Affordable Care Act: What HR Managers Need To Know

(Post written by James McCarthy, Mainebiz)

Kristine Avery, senior vice president of human resources at FISC Solutions in Lewiston, has four words of advice for HR managers now that the ACA has withstood its legal challenge: “Get informed, get educated.”

Avery, certified as a senior professional in human resources, quickly adds that there are plenty of resources available, including the Maine affiliate of the Society for Human Resource Management, which she leads as state director.

While acknowledging the complicated mix of legal and political questions to be evaluated, Avery says there are some ACA highlights that HR managers should know now.

Maine Law: Governor Signs Three Workers’ Compensation-Related Bills

(Guest post was written by attorney Glenn Israel, Bernstein Shur)

 In the closing days of the legislative session, Governor LePage signed into law three bills that will impact all Maine employers. The first bill (LD 1913) makes a number of procedural changes to the workers’ compensation statute; it will reduce benefit amounts under some circumstances and place a 10-year cap on benefits. The second bill (LD 1725) tightens eligibility requirements for unemployment compensation and imposes criminal penalties for unemployment fraud. These laws will become effective ninety days after the adjournment of the 125^th Legislature which is currently scheduled to occur no earlier than May 15, 2012.

The third bill (LD 1314) adopts a new, standardized definition of “independent contractor” that applies to the workers’ compensation and unemployment statutes, and also imposes a fine of $2,000 to $10,000 on employers that intentionally or knowingly misclassify employees as independent contractors. It will take effect on December 31, 2012.

There is little doubt that the first two measures will reduce the economic burden of workers’ compensation and unemployment on employers by making it more difficult for some employees to qualify for benefits and by reducing the amount of those benefits in some cases. The effect of the third measure is not as easy to predict. Having a consistent definition of “independent contractor” for both the workers’ compensation and unemployment statutes will reduce confusion and make compliance easier. The new definition, however, combines parts of the two existing definitions and requires employers to prove that five specific criteria are met and that at least three out of seven additional criteria have been satisfied. The new definition also contains terms such as “essential” and “responsible” that are not further defined.

The five criteria that must be met address:  1) the employer’s right to control the details of the work; 2) whether the worker is engaged in an independent trade or business; 3) whether the worker has an opportunity for profit or loss; 4) whether the worker hires, pays and/or supervises any assistants;  and 5) whether the worker holds him or herself out to the public as an independent contractor. The seven “secondary” criteria – three or more of which must be met – address:  1) the worker’s investment in tools and facilities; 2) the exclusivity of the relationship; 3) the consequences for the worker if the work is not completed; 4) the rights of the worker in the event the employer wishes to terminate the relationship before the work is completed; 5) the method of payment; 6) whether the work is outside the scope of the employer’s regular business; and 7) whether the Internal Revenue Service has determined the worker to be an independent contractor.

Practical Considerations:

Given the complexity and the potential ambiguity of the new definition, it may not be any easier to apply to real-life situations than the old definitions. It also is not clear whether the new definition will result in a larger or smaller number of workers being classified as independent contractors under the workers’ compensation and unemployment statutes.

What is clear, however, is that the change in the law makes this the perfect time for employers to: 1) review their current worker classifications for compliance with the new definition; 2) be prepared to reclassify any employees who may be misclassified when the new definition takes effect; and 3) take steps to modify or better document existing independent contractor arrangements that may not pass muster under the new definition. Taking these steps now can reduce or eliminate potential liability when the new definition takes effect.

Maine Drug Testing Law Changes

(article written by David Ciullo, Career Management Associates)

Loosening the Reins on Maine’s Drug Testing Law

Most of you are familiar with Maine’s drug-testing statutes, and some of you might have gone through the rigmarole of getting a drug testing policy approved by the Maine Department of Labor (MDOL).  Under Maine law, you cannot drug test employees without first having an MDOL-approved policy.  Even with an approved policy, however, employers are subject to a host of limitations on when and how they can test employees, as well as what they can do with employees who test positive for a controlled substance.  A change in the law could have a major effect on Maine employers that have employees who are covered under federal drug-testing requirements. 

Existing law for federally covered employees

Until recently, individuals “subject to substance abuse testing under any federal law” were some of the few employees who could be drug tested in Maine without an MDOL-approved policy. Even those employees, however, were still protected by the rehabilitation requirements of Maine law if they tested positive for controlled substances and could not be terminated on the basis of a single positive test.

New legislation and what it means

New legislation could change the face of Maine’s drug-testing landscape. Legislative Document 1241, as originally proposed, would have lessened certain restrictions on when nonfederally covered employees could be drug tested, including after an accident or for probable cause. An amendment, however, changed the legislation to provide that “any employer subject to a federally mandated drug and alcohol testing program . . . and its employees” are exempt from Maine’s drug testing laws in their entirety. The bill, as amended, was signed into law by the governor on June 2,  2011, and took effect September 28, 2011.

Any Maine employer with federally covered employees is no longer required to follow Maine’s drug-testing statutes for any of its employees (federally covered or otherwise). Instead, it can test all of its employees under the federal standards. The amendment’s bill summary supports that interpretation and explains that the language was designed to allow an employer covered by federal requirements “to extend its [federal drug-testing] program to its entire workforce . . . [and] have the same substance abuse policy for all employees.”

The good news

Employers that have some employees subject to federal drug-testing requirements (e.g., commercial drivers) no longer have to have an MDOL-approved policy for the rest of their workforce (e.g., secretaries, janitors, office workers, and the like). Now you can test all employees and applicants under your federal policy. If you elect to take that route, you should review your federal drug testing policy, amend it to include all employees, and be sure to communicate to all workers the changes and the end of your old drug-testing policy. It’s important to remember that to avoid the MDOL drug-testing requirements you must have at least some employees on your payroll who require federal drug testing.