Categories
Union Matters

Pro-Business Majority Now in Control at NLRB

Pro-Business Majority Now in Control at NLRB

By Richard H. Wessels of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Union Matters on Friday, April 27, 2018.

Good news for business! On April 11, 2018, the US Senate confirmed Morgan Lewis & Bockius attorney John Ring to fill the National Labor Relations Board’s only remaining vacancy. With this confirmation, the NLRB will be at full strength with a 3-2 pro-business majority. This clears the way for the Trump administration appointees to resume their pro-business agenda.

The new pro-business NLRB majority has a long list of Obama-era pro-labor policies to overturn, including the pro-labor ruling letting workers use company e-mail systems for union business and a series of pro-labor decisions limiting the rules employers can impose on their employees. The latter amounted to an attack on employer policies and procedures as contained in employee handbooks.

Equally as important has been the arrival on the scene of the new General Counsel, Peter Robb. Robb who became General Counsel in November, 2017 has been under fire from NLRB employee unions and the NLRB’s national staff over Robb’s proposal to cut costs by demoting the NLRB’s regional directors and subjecting them to new layers of oversight.

Employers can happily look for a string of pro-business decisions by the full strength NLRB. And, the new General Counsel can be expected to help tilt the playing field back at least to level.

A more subtle change will also be seen. As union organizing has dropped dramatically, the NLRB has been playing a game of survival. The NLRB didn’t have enough to do. So, they started taking cases where no union was in the picture at all!

We began seeing a wave of protected concerted activity complaints where logic was strained to find violations and where there was no union activity involved. We were hit with fly-specking of handbooks, policies, and computer policies to find NLRA violations using questionable theories.

Employers began facing costly litigation over terminations where the protected concerted activity was pretty difficult to spot and a real stretch. There was no union activity (which has been the usual requirement). All this is about to change with an expected series of pro-business decisions. Look for NLRB pro-business action in these areas:

· Joint employer

· Ambush elections

· Ability to terminate employees for outrageous and obscene Facebook posts

· Rescind difficult “status quo” rules in first contract negotiations

· Reverse check-off decision holding that such clauses survive contract expiration.

Other pro-union decisions had been reversed before the December, 2017 retirement of the Board Chairman, which then created a 2-2 split. This is all changed now and it is good news for employers. For those of you who are really interested in this stuff, click here for the biographical sketches of the five Board members and the General Counsel.

Read them, and it is easy to spot who is pro-business and who is pro-labor.

Questions? Contact Attorney Richard H. Wessels at riwessels@wesselssherman.com or at (630) 377-1554

Related Posts: Merry Christmas, and Happy New Year Employers, Life Raft For Multiemployer Pension Plans, Operating Engineers Local 150 Remains One of Northern Illinois Most Active Unions, No Recording Rules-NLRB Protected?

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Categories
Independent Contractor

A 2018 Update For Illinois Trucking Companies Who Use Independent Contractors: Another Look At Owner-Operators!

A 2018 Update For Illinois Trucking Companies Who Use Independent Contractors: Another Look At Owner-Operators!

By Nancy E. Joerg of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Independent Contractor on Thursday, April 19, 2018.

The purpose of this article is to update readers on what has been happening recently with Illinois Department of Employment Security (“IDES”) Hearings (and IDES audits) regarding the classification of owner-operator truck drivers (i.e., are they independent contractors or misclassified employees for purposes of Section 212.1?).

SECTION 212.1: Many readers will know that the IDES evaluates (at time of IDES audit or at time of an IDES benefits claim by a driver) whether a truck driver is a true owner-operator or a misclassified employee by applying Section 212.1 of the Illinois Unemployment Insurance Act.

Many IDES audits in 2018 occur on a purely random basis, and the trucking company is usually surprised to receive the Notice of Audit in the mail. Unless the Illinois trucking company being audited passes all six parts of Section 212.1 for a particular independent contractor owner-operator, the IDES auditor will reclassify that particular owner-operator to employee status.

If the IDES auditor finds that the drivers are misclassified and should really be employees of the trucking company (usually an Authority holder), then the audited trucking company will be hit with a bill from the IDES for back taxes (i.e., the taxes the company should have paid on the drivers as employees). The IDES calls these back taxes “unemployment insurance contributions.” The back taxes can be hefty. It depends on the audited company’s unemployment insurance rate and also how many independent contractors are reclassified. Additionally, there is 24% interest per year slapped on the tax bill to sometimes total a rather significant and unexpected tax bill. Many companies choose to protest (the protest must be timely-you cannot be even one day late), and then eventually there is an IDES Hearing.

WHETHER DRIVER CAN UNILATERALLY CHANGE HIS SCHEDULE: Evaluating a recent IDES Hearing decision, an interesting factual issue shows up in evidence where the trucking company admits that it requires the independent contractor owner-operator to be available to perform services at a specific time. But, the driver is free to accept or reject any delivery orders and free to create his own schedule. The driver can also give written notice to the trucking company of any changes he wishes to make to the schedule.

In that particular case, the Hearing Officer ended up agreeing with the audited trucking company that Section 212.1 is still satisfied because the driver could unilaterally change his schedule and has the right to reject the trucking company’s delivery orders. So the IDES Hearing Officer ultimately decided that the owner-operator was in fact an independent contractor. This particular case shows how fact sensitive these IDES Hearing independent contractor Section 212.1 cases are.

TIP: In the independent contractor agreement, be sure to state that the driver is free to accept or reject any particular job and is free to create his own schedule.

WHETHER DRIVER OFFERS HIS SERVICES TO THE PUBLIC: In another recent IDES Hearing, a factual issue was whether the drivers offered their services to the public [required under Section 212.1(a)(6)]. Even where the drivers were incorporated, the Hearing Officer felt that it did not prove that the drivers actually offered their services to the public.

TIP: If your independent contractor drivers advertise in their business name, keep copies of their ads in independent contractor files.

WHETHER DRIVER MAINTAINS OWN SEPARATE BUSINESS IDENTITY: In another Hearing, the Hearing Officer again focused on whether the owner-operators named in the audit maintained their own separate business identities offering or advertising their services to the public [again required under Section 212.1(a)(6)]. So, it is clearly very important to have proof (to present as evidence at an IDES Hearing) that the independent contractor owner-operators do indeed maintain their own separate business identity offering or advertising their services to the public under their own business name.

CONCLUDING THOUGHTS: Illinois trucking companies should be aware of what steps they should take in order to have a legitimate independent contractor relationship with their owner-operators under Section 212.1 and be prepared to prove this before being audited by the IDES.

One way to “audit yourself” is to fill out the special Worker Relationship Questionnaire on Section 212.1 that the IDES has designed for auditors to question Illinois trucking companies as to their relationship with their independent contractor truck drivers.

Have an experienced attorney review your responses to the 212.1 Questionnaire. It is better to know what your legal problems under Section 212.1 might be up front-before being selected by the IDES for audit.

For assistance with IDES audits and hearings (or for consultations on limiting your liability in the use of Independent Contractors), contact Attorney Nancy E. Joerg, who enjoys a nationwide reputation in assisting companies who use Independent Contractors of all types. Nancy Joerg can be reached at Wessels Sherman’s St. Charles, Illinois office: 630-377-1554 or email her at najoerg@wesselssherman.com.

If readers would like a free copy of Section 212.1 and the special 212.1 Questionnaire, please contact Legal Assistant Tammy Nelson at 630-377-1554 or via email at tanelson@wesselssherman.com.

Related Posts: Yes, You Can Win Before an IDES Hearing Officer on the Issue of Independent Contractor Status!!, IRS Form SS-8 Continues To Upset And Confuse Employers Across The U.S.!, Psychological Counselors In Pennsylvania Found To Be Independent Contractors, Yes, There are Certain Categories of Workers Who Are Independent Contractors By Law Under the Illinois Unemployment Insurance Act

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Categories
Harassment

“Me Too” Movement and “Hush Money”

It reached a similar conclusion with respect to her FMLA claim:

“Me Too” Movement and “Hush Money”

By Walter J. Liszka of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Harassment on Tuesday, April 3, 2018.

With the ever increasing coverage and commentary regarding sexual harassment issues (even Speaker Mike Madigan’s office recently) there have been two (2) very interesting developments in the arena of sexual harassment/sexual abuse that Employers should be aware of.

Our brilliant legislators in the Federal Government, while dealing with the various machinations of the budgetary process, immigration, and other very challenging issues, did have the ability to pass a bit of legislation dealing with sexual harassment. This legislation makes it now the personal responsibility of any member of the House of Representatives to pay any sexual harassment settlement or related legal fees out of “his/her own pocket” rather than using their public budget. It is certainly gratifying to the author that the House of Representatives has become cognizant that individuals who are culpable for sexual harassment/sexual abuse are required to pay out of “their own pocket” rather than use tax payer funds! Certainly other “stunning legislation” is forthcoming.

Of course, Congress has also decided, in the new tax bill, to deal with the sexual harassment/sexual abuse issue and its impact on businesses. In a specific section, Section 13307, which is titled “Denial of Deduction for Settlements Subject to Nondisclosure Agreements Paid in Connection with Sexual Harassment or Sexual Abuse”, the new tax bill, which became effective December 22, 2017, provided for an Amendment to the Internal Revenue Code:

Section 162(q): No deduction shall be allowed under this chapter for (1) any settlement or payment related to sexual harassment or sexual abuse if such settlement or payment is subject to a Nondisclosure Agreement, or (2) attorney’s fees related to such a settlement or payment.

Obviously, these new rules become effective with regard to any Agreement and/or amounts paid or incurred after December 22, 2017.

It is unclear as to how Section 162(q) will treat settlements of employment related claims when there is an assertion of multiple claims, some of which are not related to sexual harassment or sexual abuse. Will Section 162(q) require that any payment made for a totality of claims, one of which is sexual harassment and sexual abuse, covers the entire settlement payment and none of it is deductible as a “business expense”? Could the settlement payment be apportioned with regard to “actual payments made” related to certain other claims other than sexual harassment and then be deducted? Will the same apply to an apportionment of attorney’s fees?

It is also very uncertain as to how this Section 162(q) will effect settlements of a nonsexual harassment issue where the Employee agrees to a general release of any and all unasserted claims, some of which may include unasserted sexual harassment/sexual abuse claims. If the general release of all unasserted claims has application and includes a confidentiality provision, will that trigger Section 162(q) and therefore, no deduction may be made?

Obviously, there will be many developments regarding Section 162(q) and its specific application occurring in the future. The wise Employer who is dealing with execution of a Settlement Agreement will certainly consult with Labor Counsel prior to having that document executed.

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

Related Posts: Internal Harassment Complaints, Seventh Circuit Decision-Use Of The “N-Word”, Illinois Workplace Transparency Act, Alert: Pending Legislation in Illinois Would Impose Huge Impact on Sexual Harassment Claims on all Employers

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Categories
Harassment

Love Contracts And Policies On Office Romance: What Can An Employer Do?!

Love Contracts And Policies On Office Romance: What Can An Employer Do?!

By Nancy E. Joerg of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Harassment on Thursday, April 5, 2018.

There has been so much written lately both in gossip columns and legal (and standard) news about sex harassment in the workplace. Employers are understandably quite nervous about dating among co-workers. Can it lead to lawsuits? When does it deteriorate to sex harassment? What should an employer do?

LAYER OF LEGAL PROTECTION: Workplace dating is a fact of life. However, if two co-workers are dating, the employer must be sure that it’s consensual. If it turns into a situation where it’s not consensual, then the employer needs to be aware of the potential for illegal sexual harassment.

Employers sometimes prohibit romantic relationships between employees in supervisory/subordinate positions, given the inherent issues that arise when one romantic partner supervises the other. Another option is to require employees (via strict policies) to inform management of any workplace romances.

Some employers use “love contracts” (also called “consensual relationship agreements”) in order to try to create a layer of legal protection from sex harassment lawsuits that might arise. Documenting the nature of the romantic relationship can offer some protection against possible claims of harassment. A love contract can ideally set ground rules for office behavior and reinforce the Company’s sexual harassment policies.

Regardless of the exact details of the love contract, such a contract should always reference the company’s anti-harassment policy (and remind employees exactly how to complain and how to report unwanted sexual or romantic conduct). In addition, employers should be diligent in making sure their sex harassment policies are enforced fairly and promptly across the workforce.

WHAT IS IN A LOVE CONTRACT: Love contracts usually include:

  • A summary of the Company’s sex harassment policy.
  • An acknowledgement of the employees’ intentions to comply with the Company’s sex harassment policy.
  • Affirmations that the romantic relationship is voluntary, consensual, and welcome.
  • An agreement to not engage in public displays of affection in the workplace.
  • An agreement that there will be no negative impact on work due to the romantic relationship.
  • An agreement to maintain professionalism even after the romantic relationship ends, if it should go sour, and
  • A commitment to immediately complain to the employer of “unwelcome” advances, should there be any.
  • The love contract should advise the “workplace lovers” that any favoritism towards each other could be a violation of your policies and would be considered a conflict of interest.

Many love contracts include the following two provisions:

  1. The agreement is confidential and intended not to invade employees’ privacy but to affirm that both employees have received and agree to comply with the agreement.
  2. The employees may consult with an attorney before signing the agreement.

LOVE CONTRACT MIGHT HELP REFUTE CLAIMS THAT EMPLOYEE WAS PRESSURED: When and if a workplace romance ends, one employee may claim to have been pressured into the romantic relationship in the first place. A love contract, if signed after the relationship began, might help refute such unfortunate claims, as it provides written evidence that the employee making the claim entered the relationship voluntarily. In other words, a love contract could potentially mitigate risk of unlawful harassment liability for the employer.

EMPLOYEE COULD CLAIM HE/SHE WAS PRESSURED TO SIGN: Receiving a signed love contract from employees engaged in a romantic relationship in the workplace, however, does not guarantee protection for the employer from liability for sexual harassment under Title VII. For one thing, an employee could claim that he or she was pressured by the employer into signing the love contract in the first instance, especially where the employee is subject to at-will employment.

MUST HAVE STRONG SEXUAL HARASSMENT POLICY AND APPROPRIATE TRAINING: While documenting the consensual nature of a relationship through an agreement like a love contract can prove useful, it’s no substitute for having a strong sexual harassment policy, appropriate sexual harassment training, and a sound and prompt enforcement program. Love contracts are an additional tool that employers can use to prevent claims of sexual harassment.

NOT EVERYONE IS A FAN OF LOVE CONTRACTS: Some employment lawyers argue that employers should not get involved in the private lives of employees. Clearly, a love contract is not a substitute for good management judgment. Such agreements don’t eliminate all risks associated with office romances. Companies still have an obligation to make sure employees are not subject to a hostile work environment. The company still has an obligation to investigate complaints of sexual harassment.

SLIPPERY SLOPE: Using love contracts can be a “slippery slope” for employers. When you put in writing highly personal things in which reasonable people can differ, you may actually be creating management problems. Many personal relationships are hard to define. In the final analysis, it is for the employer to decide if this tool of “love contracts” will be helpful or will prove to be the stimulus for even more management problems. This is a controversial subject and each company must decide for itself if love contracts will be helpful as a management tool.

For assistance with sexual harassment issues, love contracts, investigations and training, 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.

Tags: Co-workers dating, Office Romance, love contract

Related Posts: Internal Harassment Complaints, Seventh Circuit Decision-Use Of The “N-Word”, Illinois Workplace Transparency Act, Alert: Pending Legislation in Illinois Would Impose Huge Impact on Sexual Harassment Claims on all Employers

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Categories
Family and Medical Leave Act (FMLA)

Is Your Company Covered Under the Family and Medical Leave Act?

Is Your Company Covered Under the Family and Medical Leave Act?

By Anthony J. Caruso Jr. of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Family and Medical Leave Act (FMLA) on Tuesday, April 24, 2018.

Did you Count Temp and Part-Time Employees?

If you are a Company covered under the Family and Medical Leave Act (FMLA), eligible employees are entitled to leave (either consecutive or intermittent) of up to 12 work weeks of leave in a 12 month period under certain circumstances. PLUS the Company must continue to pay the employer’s share of the employee’s individual group health insurance premiums during the leave. These entitlements can be very disruptive and costly to an employer. So, is your Company covered?? Does your Company have to have and follow an FMLA policy?

Under federal law, the Family and Medical Leave Act, a private employer is covered if it maintained 50 or more employees (full or part time) on the payroll during 20 or more calendar work weeks (not necessarily consecutive work weeks) in either the current or the preceding calendar year. If you have fewer employees than this, your Company does not have to have an FMLA policy.

As to temp employees, the Company must count such employees in determining the Company’s coverage under the Family and Medical Leave Act. Click here to see Fact Sheet #28N: Joint Employment and Primary and Secondary Employer Responsibilities under the Family and Medical Leave Act (FMLA) as issued by the US Department of Labor Wage and Hour Division.

Thus, the headcount for a Company to determine if it is covered under the Family and Medical Leave Act includes all part-time employees and temp employees.

If you have any questions on this topic and FMLA, please contact attorney Anthony J. Caruso in our St. Charles office at (630) 377-1554 or by email at ancaruso@wesselssherman.com

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Categories
Wage and Hour

Recent Court Ruling On Equal Pay Suggests That Salary History Questions May Be Off Limits In Job Interviews

Recent Court Ruling On Equal Pay Suggests That Salary History Questions May Be Off Limits In Job Interviews

By James B. Sherman of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Wage and Hour on Friday, April 13, 2018.

Asking job applicants how much they make with their current employer, or what they’ve been paid in prior positions, are common questions in job interviews for many hiring employers. While questions on salary history generally are not per se unlawful – yet – they can land an employer in hot water. The legal theory against salary questions in onboarding is based on the Equal Pay Act of 1963 and its state law counterparts. These laws make it unlawful for an employer to pay women less than men for doing the same work. However, despite more than 50 years since the Equal Pay Act became law, there are growing concerns that women continue to be paid less than men. If true, basing job offers on a woman’s salary history could serve to perpetuate gender-based disparities in pay. This was the rationale in a recent decision issued by the U.S. Court of Appeals for the Ninth Circuit, in California, which held that setting initial pay of new hires based on their salary history cannot serve as a defense to an Equal Pay claim. This decision conflicts with a 1995 opinion of the U.S. Court of Appeals of the Seventh Circuit, in Chicago, which held that salary history is a “factor other than sex” that may provide a defense to claims challenging pay differences based on gender. A showdown before the U.S. Supreme Court now seems likely. Additionally, emerging laws and administrative requirements aimed at “closing the pay gap” and/or “breaking the glass ceiling” are ushering in significant change. Employers who fail to stay ahead of this trend risk trouble down the road.

Already companies such as Google are embroiled in class-action lawsuits alleging equal pay violations based on their use of applicant salary history in setting pay in their initial offers of employment. This trend can also be seen in the fact that several states have enacted new legislation akin to “Ban-the-Box” laws that prohibit employers from even inquiring about an applicant’s pay history. Other states have transparency laws designed to enable employees to see for themselves what others are paid; e.g. Minnesota’s Women’s Economic Security Act (WESA), which requires employers to advise employees (in writing, in their handbooks) of their right to discuss their wages with co-workers. And although currently on hold, the EEOC’s proposed new EEO-1 Form would have employers disclose to the federal government their pay practices with respect to gender.

Whether the Equal Pay Act has largely failed to accomplish its goal of ensuring that women receive the same pay as men doing the same jobs, or, like any other employment law it sometimes is violated by some employers, is the subject of ongoing debate. However, one thing is beyond debate: there is an intense spotlight on this issue that is coming from plaintiff lawyers, government authorities, women’s groups and, more recently, Hollywood celebrities alike. This is not going away anytime soon. Employers can and should expect to see more challenges to pay practices based on gender. In many cases these challenges will be in the form of class-action lawsuits. Those employers who are indeed paying women less for doing the same work as men, will pay a price. Those who do so unintentionally, as in the case of using pay history of applicants to set initial wages, may soon find themselves paying the same price as those who flout the law.

Questions? For assistance in conducting an internal audit of pay practices, establishing onboarding protocols to avoid unintended pay disparities, or for further information on this emerging issue in workplace law, contact Attorney James B. Sherman at 952-746-1700 or jasherman@wesselssherman.com

Related Posts: Get Ready! Some Chicago Employers Must Soon Predict Work Schedules Under City of Chicago Ordinance!, Chicago Fair Workweek Ordinance, Summer Interns Still an Option?, DOL Rolls Out Proposed Overtime Revisions

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Categories
Wage and Hour

DOL Rolls Out Voluntary Self-Audit Program (PAID)

DOL Rolls Out Voluntary Self-Audit Program (PAID)

By Alan E. Seneczko of Wessels Sherman Joerg Liszka Laverty Seneczko P.C. posted in Wage and Hour on Monday, April 9, 2018.

On April 3, 2018 the Department of Labor implemented a new pilot program, in effect for the next six months, under which employers may correct inadvertent minimum wage and overtime violations without the imposition of penalties or liquidated damages (employers must still pay 100% of any back wages owed). Under the new program – Payroll Audit Independent Determination (PAID), employers are encouraged to conduct self-audits, and if they discover any violations, to report them to the Wage and Hour Division, which will work with the employer and affected employees to correct them.

Here is how the program works. Employers are directed to the PAID website (www.dol.gov/whd/paid/), where they must first walk through a number of questions to confirm that they are covered by the FLSA and eligible to participate in the program. If so, the employer must then to review a number of online FLSA compliance materials (a total of 12 screens of information and videos) and obtain a certificate of completion. Once the review is complete, the employer must audit the company’s compensation practices and identify any potential violations that may have occurred in the past two years; which employees were affected by the violations; the timeframes in which each employee was affected; and, the amount of back wages believed to be owed to each employee.

After completing the self-audit, the employer must contact the WHD, which will request the names, addresses and phone numbers of the affected employees; the back pay calculations and supporting evidence; payroll records and related information; confirmation that the practice has been corrected; an explanation of the scope of potential violations to be included in a release of liability; and, certification that the employer has reviewed the PAID compliance assistance materials and meets the eligibility requirements for the program. The WHD will then evaluate the information, assess the back wages due, and issue a summary of unpaid wages, along with a release employees will be required to sign in order to receive the payment. The employer must then pay all back wages due by the end of the next full pay period.

What’s in it for the employer? Generally, penalties for wage and hour violations include liquidated damages equal to the amount of the liability (i.e., double the back wages), penalties, interest and attorney fees (if applicable) – as well as the employer’s attorney fees if litigation is involved (and these types of violations are often the subject of class action lawsuits). In addition, if violations are found to be willful, the employer’s liability can go back three years. As a result, it is a way to remedy inadvertent mistakes without risking exposure for double damages, penalties and attorney fees.

If you have any questions about the PAID program, conducting a self-audit or wage and hour compliance issues, feel free to contact Attorney Alan E. Seneczko at (262) 560-9696, or alseneczko@wesselssherman.com.

Related Posts: Get Ready! Some Chicago Employers Must Soon Predict Work Schedules Under City of Chicago Ordinance!, Chicago Fair Workweek Ordinance, Summer Interns Still an Option?, DOL Rolls Out Proposed Overtime Revisions

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