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5 Questions Every Employer Should Ask Itself

Posted by Christin D. Hoyt | Mar 15, 2018 | 0 Comments

Every workplace is different, in terms of size, type of operations, culture, and location. But there are some things that every employer should be vigilant about regardless of whether they are small shops or international monstrosities.

Is my employee handbook current, comprehensive, and comprehensible?

Too often employee handbooks are a “checklist” item for employers. But “Yep, we've got one of those,” is far from sufficient. Your employee handbook needs to be reviewed on a regular basis (at least every 2-3 years) to ensure that it complies with current laws and regulations. It needs to be comprehensive, in that it covers issues not only that are required by law but that also reflect the reality of your workplace. And they need to be comprehensible to your employees. If the handbook does not communicate well to your employees, you have little advantage over an employer who has no handbook at all.

Are my exempt/non-exempt employees classified correctly?

A regular mini-audit of your wage and hour practices is a smart idea, but a critical area of focus should be on how your employees are classified. Oftentimes employees are classified as “exempt” when they are hired, but the nature of their job duties evolves over time, and they may not fit an exemption under the law any longer. Overtime awards can be expensive, and employees are becoming more aggressive about pursuing their rights under the Fair Labor Standards Act.

Am I sure my independent contractors aren't employees?

A number of factors, not the least of which is the expense of employee benefits, have pushed employers to use more “contingent” workers, including temporary employees, workers assigned through staffing companies, or independent contractors. The trouble is, what an employer considers as a “contractor” only sometimes (perhaps rarely) matches up with the law. There are a number of tests that can be applied when determining whether a worker is a contractor or an employee, and if you use any independent contractors in your workplace, you need to be vigilant to ensure you have classified them correctly. Otherwise, you can be looking at claims for lost wages, overtime, or lost benefits. You also can land in hot water with the IRS for not making required withholdings, or with immigration auditors for not having I-9s in place. In other words, if you are going to make a mistake in your employment law compliance, this isn't the one to make.

Do I have the right agreements in place to protect my confidential information?

Employees are mobile. Information is portable. That can be a frightening combination for employers, especially when you have a specialized product or service or a customer list that you have carefully prepared over time. In the wrong hands, that information can enrich an existing competitor or remove the barriers to entry into an industry for new competitors. In many states, non-competition agreements are difficult to enforce, but there are usually several other options that you can use to protect yourself. Simply cribbing from an employment agreement you found that was drafted during the Carter administration is not likely to give you the protections you need in a competitive world where all a competitor sometimes needs is a laptop and a head start.

Are my I-9s in order?

Whether you have one employee or ten thousand employees, you are required to correctly complete and retain an I-9 for each of them. It seems like a simple enough task, but employers commonly make critical and potentially costly errors in more than 50% of their I-9s. Retention and destruction of I-9s also can present headaches for employers. And when Immigrations and Customs Enforcement makes a visit, this isn't the kinder, gentler type of audit that we saw during the previous administration. ICE is looking to crack down on employers who do not meet their legal obligations to properly confirm the identity and employment authorization of their employees. Conducting an internal audit of your I-9s can give you safe harbor in the event of an ICE audit if you have found and corrected your errors before they do. With possible fines of over $1000 for each I-9 violation, it is worth the effort to make sure that your files are current and correct.

As with any compliance issue, the best practice is to make sure that you have your house in order before you have a government agency or an opposing attorney looking over your shoulder. These five areas are a good start to ensuring that your employment practices aren't a liability waiting to be discovered.

About the Author

Christin D. Hoyt

Our Attorneys

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