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Independent Contractor

All Employers in North Carolina Must Now Post an Independent Contractor Notice

All Employers in North Carolina Must Now Post an Independent Contractor Notice

By Nancy E. Joerg of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Independent Contractor on Tuesday, January 9, 2018.

There is a wide variation, state by state, as far as the treatment of the independent contractor versus employee classification issue. Laws regarding independent contractor status and unemployment insurance benefits, workers’ compensation coverage, overtime, etc. vary widely from state to state. Yes, there are also Federal laws which impact independent contractor status; but, increasingly, states are enacting new and creative laws requiring employers to “jump through hoops” as far as permitting independent contractor usage.

The latest example of a state passing a new law combatting independent contractor misclassification is the North Carolina Employee Fair Classification Act.

BECAME EFFECTIVE DECEMBER 31, 2017: North Carolina Governor Roy Cooper signed this new law on August 11, 2017. It became effective December 31, 2017.

INDEPENDENT CONTRACTOR TEST IS STILL THE SAME: This new law does not change the legal test for independent contractor status in North Carolina. North Carolina still uses a classic independent contractor test which basically mirrors the IRS common law test (commonly known as the “control and direction test” or “the 20 factor test”).

RESPONSIBILITIES OF THE EMPLOYEE CLASSIFICATION SECTION: Under this new law, the Employee Classification Section of the North Carolina Industrial Commission serves as the primary point of contact for employees, businesses and citizens who wish to report suspected instances of worker misclassification. The Employee Classification Section will provide information about each instance of misclassification of independent contractors to the North Carolina Department of Labor, the North Carolina Division of Employment Security, the North Carolina Department of Revenue, and the North Carolina Industrial Commission.

The new Employee Classification Section will investigate reports of misclassification and also coordinate with other state agencies in the prosecution of employers and individuals who fail to pay civil assessments or penalties regarding misclassification.

The new Employee Classification Section is also responsible for educating employers about independent contractor classification issues.

ALL NORTH CAROLINA EMPLOYERS MUST POST A NOTICE: Of course, it is still perfectly legal for employers in North Carolina to use independent contractors, but North Carolina employers now have an additional legal responsibility under this new law. Every employer in North Carolina must now POST A NOTICE that includes the following specific language:

1. Any worker who is defined as an employee under the law shall be treated as an employee.

2. Any employee who believes that he/she has been misclassified as an independent contractor may report the suspected misclassification to the North Carolina Industrial Commission’s Employee Classification Section by phone, email or fax (the notice must provide the contact information for the Employee Classification Section).

3. When filing a complaint, please provide the physical location, mailing address, and if available, the telephone number and email address for the employer suspected of employee misclassification.

States are trying to grapple with the growing outcry about supposed instances of independent contractor misclassification. Various industries are being torn apart by differences of opinion over the use of independent contractors. We can expect to see more state action in the coming months and years as states try to set up laws, systems, procedures, and agencies to control the growing use of independent contractors, which is sure to continue.

For assistance with evaluating independent contractor usage to reduce risk or for help with independent contractor hearings or related issues, contact Attorney Nancy E. Joerg who can be reached at Wessels Sherman’s St. Charles, Illinois office: (630) 377-1554 or email her at najoerg@wesselssherman.com.

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Other

Three New Laws Affecting Employers Became Effective January 1, 2018

Three New Laws Affecting Employers Became Effective January 1, 2018

By Joseph H. Laverty of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Other on Wednesday, January 24, 2018.

I. Illinois Amends State Genetic Information Privacy Act

Illinois has amended the state Genetic Information Privacy Act (GIPA).

Amended Law

Under the amendment, an employer is prohibited from penalizing an employee who does not disclose his or her genetic information or does not choose to participate in a program requiring disclosure of the employee’s genetic information. Under existing law, employers are generally prohibited from using genetic information or genetic testing in furtherance of a workplace wellness program benefiting employees, unless certain conditions are met.

Background

Under GIPA, employers must treat genetic testing and genetic information in such a manner that is consistent with the requirements of federal law (e.g., GINA, the ADA, Title VII of the Civil Rights Act, the FMLA, and OSHA).

Among other things, employers are prohibited from soliciting, requesting, requiring, or purchasing genetic testing or genetic information of a person (or a family member), or administering a genetic test to a person (or a family member) as a condition of employment or pre-employment application.

The amended law went into effect on January 1, 2018. Click here to read the text of the law.

II. Illinois Amends Volunteer Emergency Worker Job Protection Act

Illinois has amended its Volunteer Emergency Worker Job Protection Act. Highlights of the changes are presented below.

Amended Law

An employer generally may not discipline an employee who is a volunteer emergency worker if the employee responds to an emergency phone call or text message during work hours that requests the person’s volunteer emergency services.

However, the law does not diminish or supersede an employer’s written workplace policy, a collective bargaining agreement, administrative guidelines, or its other applicable written rules. Existing written policies governing the use of cell phones prevail and control.

Background

Under the Illinois Volunteer Emergency Worker Job Protection Act, an employer generally may not terminate an employee who is a volunteer emergency worker because the employee is absent from or late to his or her employment in order to respond to an emergency prior to the time the employee is to report to work.

Click on the link above to read the text of the amended law. The law went into effect on January 1, 2018.

III. Schools Must Accommodate Nursing Mothers

State lawmakers voted to make Illinois the second state after California, to require public schools (including charter schools) to provide accommodations for lactating students. The law went into effect January 1, 2018. Currently, lactating mothers in Illinois are exempt from jury duty and the state has developed several state-funded breastfeeding education programs. Airports in Illinois are required to have accommodations for lactating mothers as well.

According the new law regarding nursing mothers, public schools, including charter schools, must provide space for nursing mothers in a private and secure room with an electrical outlet, other than a bathroom. Under the law, students will be permitted to bring any equipment needed to express their breast milk (i.e. breast pump). Additionally, students must have access to a refrigerator to store their milk. The student cannot be penalized for time they spend pumping or breast-feeding.

For more information and/or questions regarding the above information, please contact Attorney Joseph Laverty in our Davenport office at (563) 333-9102 or via email at jolaverty@wesselssherman.com.

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EEOC

Employers Need to Remain Diligent Regarding Discrimination/Retaliation Investigations in 2018

Employers Need to Remain Diligent Regarding Discrimination/Retaliation Investigations in 2018

By Joseph H. Laverty of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in EEOC on Friday, January 5, 2018.

On November 15, 2017, the Equal Employment Opportunity Commission (“EEOC”) issued its annual performance and accountability report. In the report the EEOC states that:

“offices deployed new strategies to more efficiently prioritize charges with merit and more quickly resolved investigations once the agency had sufficient information. Together with improvements in the agency’s digital systems, these strategies produced an increase in charge resolutions and a significant decrease in charge inventory. As a result, in fiscal year 2017 the EEOC resolved 99,109 charges and reduced the charge workload by 16.2 percent to 61,621, the lowest level of inventory in 10 years….In fiscal year 2017, the EEOC filed 184 merit lawsuits, including 124 suits on behalf of individuals, 30 non-systemic suits with multiple victims, and 30 systemic suits. This is more than double the number of suits filed in fiscal year 2016. Additionally, EEOC’s legal staff resolved 109 merit lawsuits for a total monetary recovery of $42.4 million.”

What does the EEOC yearly report mean to employers – it means that the EEOC is clearing more of its backlog cases and is filing more lawsuits on behalf of employees/ex-employees. The EEOC acting chair, Victoria Lipnic early last year said that the agency was going to address the large backlog in cases to “deal with the pending inventory” of cases and eluded to more litigation regarding cases that were found to have merit. The agency appears to be following Ms. Lipnic’s vision in clearing cases and litigating cases on behalf of individuals.

What this all means for employers is that the EEOC is becoming more efficient in its resolution of cases and in its determination of whether it will litigate cases. Employers need to be diligent in their efforts to try to resolve issues before charges are filed.

Employers should follow the below guidelines:

1) Make sure your company has an updated discrimination/harassment/retaliation policy in place and follow it.

2) Train your company supervisors on what to do when a complaint is made or when they hear of a complaint. Supervisors need to be able to recognize when a potential issue is present and know what to do when a complaint is made – waiting is not an option – supervisors must know how to respond and who they can go and talk to if they have questions.

3) Make sure specific individuals, usually HR Managers or Directors are fully trained on how to conduct an investigation and that they are fully trained on documentation techniques/strategies.

4) Make sure that there is follow up with the person who first made the complaint so he/she knows that the company took the matter seriously and investigated the matter, no matter what the outcome.

With these policies and/or procedures in place, companies can considerably cut down on charges/complaints. It is much better for a company to resolve issues internally before charges are filed with the EEOC or state agencies.

For more information and/or questions regarding the above information, please contact Attorney Joseph H. Laverty at (563) 333-9102 or via email at jolaverty@wesselssherman.com.

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Categories
Discipline Employment Policies and Procedures Hiring/Firing

Lessons Learned: Effective Documentation

Lessons Learned: Effective Documentation

By Alan E. Seneczko of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Employment Policies and Procedures on Monday, January 15, 2018.

“The importance of documentation” is an axiomatic, and almost trite, battle cry that human resource professionals constantly beat into the psyches of their supervisors – quite often to no avail. But what, really, is “documentation?” When do you do it? How do you do it? And, what, exactly, are you supposed to document? More importantly, have you ever conveyed this information to your supervisors?

Documentation serves many purposes. It can help prove an essential element of a claim – such as “misconduct” in an unemployment claim, or a “legitimate business reason” in a discrimination claim. It can help defend a claim, confirming that certain action was taken, demonstrating that others were treated in the same manner, or preserving a record or history of prior events. Most importantly, it is the best evidence of events as they occurred – at a time when they are fresh in the individual’s mind. This information generally constitutes the best evidence of what actually happened, and allows the individual to recall it in much greater detail several months, or even years later.

When to document? Prepare your documentation as close in time to the event you are seeking to document as possible. This is not only important because the relevant facts will be freshest in your mind, but also, because it is necessary for the documentation to be later admissible as a “business record.” “Documenting” a conversation three months later, after a charge of discrimination is not documentation that constitutes admissible evidence, and is therefore only helpful for background purposes.

What to document? The simple answer is “whatever might become an issue later.” Examples include: attendance – reasons given for absences and tardiness; performance – significant incidents of inadequate job performance, violations of work rules, repeated unacceptable behavior, etc.; attitude – manifestations of inappropriate comments, gestures or actions not otherwise apparent; discipline – a contemporaneous record of verbal or written warnings for violations of work rules, including the employee’s response and agreed-upon corrective action; complaints from co-workers – the name of the individual complaining, the date of the complaint and the nature of the complaint; receipt of information – confirm receipt of policies, work rules, etc.; training – confirm participation, subject matter and materials distributed or relied upon; investigations – record response to complaint, including action taken, information received, etc. To name a few.

How to document? Be specific – include date (with year), names, and all relevant information. Do not assume anything is so obvious/easy that it will not be forgotten. Be detailed – use exact words, no matter how offensive or vulgar, and quotes whenever possible. Be accurate – do not omit relevant details, make assumptions or misrepresent what actually happened. Be smart – remember, what you write may someday constitute evidence in a legal proceeding. Your notes will thus help – or hurt your case. Make it easy – prepare/use established forms, email, notes to self, or whatever it takes to be sure that the record is made. The more difficult or burdensome the requirement, the less likely it will be happen. Don’t sugarcoat reality – when conducting a review or performance evaluation, be brutally honest! Do not water down your criticism, or shy away from an unpleasant discussion. Your “just being nice” will come back to haunt you when it is time to make a hard decision.

What about emails? In today’s electronic work environment, no discussion of documentation can be complete without specifically addressing emails, electronic documentation that can potentially win your case – or lose it! In this regard it is critical to recognize that emails can be used to demonstrate the existence of unlawful or improper motives, ill will or malice by an employer, supervisor or manager; evidence of pretext (i.e., the absence of purported reasons for acting); or “knowledge” of unlawfulness of conduct for purposes of punitive or liquidated damages. At the same time, emails often contain the best evidence of the underlying conduct at issue, providing colorful evidence of an employee’s attitude, and/or demonstrating the legitimate, non-discriminatory business reasons for an employer’s actions. They can be very helpful in proving “misconduct” for UC; establishing evidentiary facts and/or evidence of “knowledge” (or the absence thereof) in harassment cases; records of prior discipline or warnings, and/or “notice” in discharge cases. Remember, once you hit “send,” you have just created a permanent record of whatever it is you just said.

Effective documentation can be a lawyer’s best friend – or worse enemy. If you follow the above guidelines, you will be well on your way to becoming a good friend.

If you would like more information, or have questions about documentation, contact Attorney Alan E. Seneczko at (262) 560-9696, or alseneczko@wesselssherman.com.

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Other

Employer Concern (Fear?) in 2018

Employer Concern (Fear?) in 2018

By Walter J. Liszka of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Other on Thursday, January 11, 2018.

As we open the book on Calendar 2018, there are various concerns for Employers. Obviously, the recent passage of a major overhaul of the United States Tax Code will present many opportunities to Employers, both from an accounting perspective (alleged tax savings) and also from a perspective of handling payroll systems. Obviously, this will be a continuing concern in 2018, but there are three (3) other areas that may “bode ill” for Employers.

1. Sexual Harassment is Back with a Vengeance.

How many of you remember the Clarence Thomas/Anita Hill saga that arose when Clarence Thomas was nominated for a United Supreme Court Justice position? Shortly after Anita Hill’s blockbuster allegations against Judge Thomas, sexual harassment charges rose by 71% with the Equal Employment Opportunity Commission. Does the current environment of sexual harassment claims initially involving the “Hollywood Elite”, and now claiming and affecting the careers of Politicians, Chief Executive Officers, and even Federal Jurists, open the doors for more claims? Time Magazine named the “Silence Breakers” as the Person of the Year for 2017. There is no doubt that Plaintiff’s Lawyers “smell blood in the water” and it is a fairly safe assumption that sexual harassment claims will drastically increase. Employers must review their sexual harassment policies, update those policies, and make sure their HR Professionals, both in-house and outside resources, are readily available to deal with any claim quickly and efficiently. From a Defense Lawyer’s perspective, it is an “extremely bad time” to try a sexual harassment case!

2. Exempt Salary Increases

Our short term memories of the Obama attempt to increase the salary threshold from exemption for overtime pay is fresh in our minds. If there is anyone who believes that there will not be some effort made by the Trump Department of Labor to deal with this issue in the near future, they will be sadly mistaken. The salary threshold exemption is being reconsidered and reworked and, in fact, in August, Employers were asked a number of questions dealing with their feelings on the United States Department of Labor, making a modification in the minimum salary from $23,660 to a yet unnamed figure. This is something that is on the very near horizon in 2018 and has the potential to impact Employee morale. It is a “very good time” to review pay scales/salary structures in order to position a company to favorably deal with this issue.

3. Marijuana

While still illegal in the Federal Venue, there have been a vast number of States (at least twenty-five (25)) who have legalized marijuana for medicinal purposes and a number of States – California as of 2018, that have legalized it for recreational purposes. While most of those regulations still allow Employers to maintain their workplace rules dealing with reporting to work under the influence of marijuana, there have been recent inroads into that area. Recently, the State of Massachusetts found that an individual who was medically prescribed marijuana for a serious medical condition was subject to the regulations under the Americans with Disabilities Act and, therefore, was protected from disciplinary treatment. Pressure is also being exerted to view marijuana as “any other pain medication”. As more and more States legalize marijuana, either for medicinal or recreational purposes, pressures will be exerted on Employers with regard to marijuana testing. Is it in the interest of an Employer to modify its marijuana testing procedures now to deal only with safety-related positions and not all positions? That is an issue that may (will?) have to be dealt with shortly.

While 2018 will be viewed as a potentially less stressful year for Employers, the sexual harassment bandwagon, the potential exempt salary modifications and marijuana use will potentially expose Employers to legal pitfalls. The wise Employer deals with these issues now, before being forced to deal with them!

Questions? Contact Attorney Walter Liszka in our Chicago office at (312) 629-9300 or by email at waliszka@wesselssherman.com

Related Posts: New Illinois Laws in the New Year, Illinois Changing Employment Landscape, Get Ready! All Owners of Hotels and Casinos in Illinois Must Soon Protect their Employees from Sexual Assault and Harassment with Panic Button Safety Devices!, So You Have A Whistleblower

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