HR Specialist: Texas Employment Law

HR
SPECIALIST
Texas
Employment Law
Trusted compliance advice for Texas employers
In the News …
Austin rates as one of
best cities for LGBT rights
Austin scored a perfect 100 in the
Human Rights Campaign’s (HRC)
annual rankings of American cities with local laws and policies that
protect lesbian, gay, bisexual and
transgender (LGBT) people from discrimination.
The gay-rights advocacy organization’s Municipal Equality Index ranked
353 cities nationwide on several categories including nondiscrimination
laws, relationship recognition, em­­ploy­­
ment practices, municipal services
and programs and law enforcement
practices.
Dallas came in second among Texas
cities, earning 91 points. Other highly
rated Texas cities included Fort Worth
(83 points), San Antonio (72) and
Houston (54).
The national average was 59.
Learn about the practices HRC considered at www.hrc.org/campaigns/
municipal-equality-index.
Starbucks customers to
see a latte more ink
In response to employee feedback,
Starbucks has changed its employee
appearance policy to allow employees
to show more of their tattoos.
The move comes after Starbucks
received an online petition signed
Continued on page 5
Texas Employment Law is published by
HR Specialist and is edited by Michael
W. Fox, a shareholder in the Austin ­office
of Ogletree Deakins. He has more than 35
years’ experience representing employers
in court and designing employment law
policies. Contact him at (512) 344-4711 or
[email protected]
(800) 543-2055
•
www.theHRSpecialist.com
January 2015
Vol. 10, No. 1
Editor: Michael W. Fox, Esq., Ogletree Deakins, Austin
Never skip ADA accommodations process
W
hen an employee returns to
work with restrictions after an
illness, he or she may be disabled
and entitled to reasonable ADA
accommodations.
Don’t make a mistake and skip the
interactive accommodations process,
even if you believe no accommodation is possible.
You are still required to consider
the possibility before taking action
like terminating the employee.
Recent case: Kristy worked as a
registered nurse, delivering home
health care services for ill clients.
She then began training to become
a nurse supervisor—a job that
required far less travel between clients than her prior position.
Then she had a grand mal seizure
at work and was transported to a
hospital via ambulance.
She was discharged two days later
and returned to work, albeit with a
driving restriction and orders not to
climb ladders. She also began taking
anti-seizure medications.
She arranged for rides to and from
work and to client homes as needed
and asked for help with the computer as she was adjusting to her
meds.
Kristy was fired shortly after she
Continued on page 2
No such thing as too many reasons to fire
S
ometimes, employers make mistakes and fire employees for a
reason later deemed illegal.
But if that same employer finds
evidence after the fact that would
have supported the termination decision on its own, that may serve as a
get-out-of-jail card.
Just make sure you can have someone testify that you definitely would
have terminated the employee had
you known what you know now.
Recent case: Thomas worked as a
pilot scheduler and reported alleged
scheduling and other violations to
authorities.
The company decided to terminate him. A few months after the
termination, someone found an
email Thomas had written. In it, he
urged subordinates to quit over their
schedules and referred to his supervisor in derogatory terms.
The company introduced this
email as proof it would have fired
Thomas no matter what.
The company was liable for firing
wrongly terminating Thomas and
hoped to use the email to cut off
back pay as of the day it discovered
the email.
Continued on page 2
IN THIS ISSUE
Transgender bias still not illegal . . . . . . . . . . . . . . 2 High Court: No pay for security screening . . . . 6
Don’t hold breath to recover attorneys’ fees . . 3 Paying employees for bad weather days . . . . . 7
4 progressive discipline principles . . . . . . . . . . . . 4 The Mailbag: Your questions answered . . . . . . . 8
Business Management Daily
Discrimination based on transgender
status still not illegal in Texas
ADA accommodations
(Cont. from page 1)
missed a day of work. A supervisor told her the reason was she
had become a “liability” for the
company.
The EEOC sued on Kristy’s
behalf, pointing out that no one
from the company had offered
any help or held discussions
on how her driving restriction
and her medication adjustment
could be accommodated.
Her former employer argued
that driving was an essential
function of the job and that
there were no accommodations
possible.
The court disagreed and said
the employer should at least
have discussed possible accommodations before discharging
her. A jury will now get the
case. (EEOC v. LHC Group, No.
13-60703, 5th Cir., 2014)
Back-up reasons to fire
(Cont. from page 1)
The 5th Circuit Court of
Appeals said that doing so
works in theory, but in this case
it did not.
That’s because the former
employer never called anyone to
testify about why it would have
fired him over this email alone.
Instead, it relied solely on the
email itself. That wasn’t good
enough. (Amistar Airways v.
Administrative Review Board,
No. 14-60061, 5th Cir., 2014)
The lesson here: If you
uncover new information that
would have led you to fire an
employee you have already terminated, hang on to it.
If sued, you can use it as
additional evidence that your
decision was right, even if you
were wrong in initially terminating the employee. Always bring
such evidence to your attorney’s
attention right away.
2
W
hile there is growing acceptance of same-sex marriage
and homosexuality in the United
States, being transgender is still not
a protected status under federal law.
That may be changing in the coming
years as more states adopt protection
for transgender individuals and as
the EEOC pushes cases based on its
interpretation of Title VII (see below).
However, there is as yet nothing
preventing a Texas employer from
discriminating against a transgender
applicant or employee, as the following case shows.
Recent case: Loretta was born
female, but now presents as male.
She was hired to work as a truck
driving instructor and did an excellent job. She was hired in part for
her skills, including the ability to
speak two languages. Her supervisor
praised her work.
Then a national director came to
campus and saw Loretta dressed as
a man. The director expressed surprise that Loretta’s supervisor had
approved hiring a “cross gender”
and, referring to Loretta, exclaimed,
“What is that?” and added, “Who
hired that?”
The director then told the supervisor that there would be consequences
for hiring Loretta even though the
supervisor explained that she was a
skilled and valuable instructor.
When Loretta found her schedule reduced, she complained about
discrimination. She was called to
a meeting during which she asked
whether her transgender status was
a problem.
She never returned to work, but in­­
stead sued, alleging she had been dis­­
criminated against because of her sex.
The employer argued that discriminating against the transgendered
isn’t illegal.
The court reluctantly agreed. It
explained that while it is illegal to
discriminate against someone for not
fitting into traditional gender roles,
that wasn’t what happened in this
case. Instead, the alleged discrimination was based on Loretta’s status as
transgender. The case was dismissed.
(Eure v. Sage Corporation, No. 5:121119, WD TX, 2014)
EEOC’s push for transgender protection
The EEOC has issued a Strategic Enforcement Plan for transgender discrimination, signaling that it intends to pursue litigation on transgender and other
related statuses. “Coverage of lesbian, gay, bisexual and transgender individuals under Title VII’s sex discrimination provisions” is a top enforcement priority.
As a practical matter, this means that the commission is looking for blatant and
egregious cases to pursue.
In addition, the U.S. Department of Justice in December announced that it
considers transgender status to be protected by the sex discrimination provisions of Title VII.
While the EEOC hasn’t filed a Texas case yet, it does appear eager to create
binding court precedent recognizing transgender discrimination as a form of sex
discrimination under Title VII.
The EEOC has filed two lawsuits against employers, alleging transgender
discrimination. In EEOC v. Lakeland Eye Clinic (filed in Florida) and EEOC v. R.G.
& G.R. Harris Funeral Homes, Inc. (filed in Michigan), the EEOC claims that
employees were terminated after informing their employer that they were transgender. These cases are both in the early stages, but employers should know
they are being litigated and consider the risk that any overt and obvious discrimination against the transgender may get the EEOC’s undivided attention.
Finally, there has been legislation introduced in Congress just about every
year that would add transgender status to Title VII.
Texas Employment Law • January 2015 www.theHRSpecialist.com
Courts reluctant to make losing employees
pay for employers’ legal fees
I
t can be frustrating to have to
defend your organization against
what you consider frivolous claims.
Unfortunately, that’s just another
cost of doing business.
As the following case shows, even
when you win the case and thought
it should never have been filed, you
probably won’t persuade a court
to penalize the employee by having
him pay your legal fees.
Recent case: Carry worked as a
municipal trash collector and was
among a group of employees who
belonged to a labor union. The collective bargaining agreement specified that qualified applicants could
bid on promotion opportunities and
the most senior employee would be
awarded the job.
Carry had a terrible attendance
record and had come close to being
fired because of it. Still, he was the
most senior worker who applied
for a new job opening. However,
another worker was selected.
Carry sued, alleging breach of
contract.
The city argued that while Carry
was technically qualified, it wasn’t
limited to considering just experience; it could also consider other
factors like reliability. Eventually,
the court tossed out the case after
agreeing with the employer’s definition of “qualified.”
The employer then asked for its
attorneys’ fees, arguing that it had
expended time and money defending against a frivolous claim.
The court refused to make Carry
pay. It reasoned that while his claim
wasn’t a winning one, it wasn’t
entirely frivolous. (Amos v. City of
Monroe, No. 14-30780, 5th Cir.,
2014)
Court refuses to punish employer
for scrubbing employee’s cellphone
A
federal court has dismissed a
former employee’s claim under
the Electronics Communication
Privacy Act (ECPA) alleging that his
employer illegally destroyed valuable
information when it remotely wiped
clean his iPhone after he resigned.
That’s good news for IT departments that must protect company
information that might be stored
on former employees’ smartphones.
Recent case: Saman worked in
residential construction for many
years, collecting information about
the industry. When he was hired to
work for a construction company in
sales and marketing, he had to use
his own iPhone to stay in touch. The
device could access company computers and the email system.
When Saman gave two weeks’
notice, he was terminated. A few days
later, the company remotely wiped
www.theHRSpecialist.com
clean the phone to its factory settings.
Saman sued, alleging violations of
the ECPA, arguing it was his personal phone and that he had lost
photos, contacts and other valuable
information when the employer
wiped the phone clean.
The court dismissed his lawsuit,
reasoning that information stored on
a smartphone isn’t covered by the
ECPA. Instead, that law is designed
to punish hackers who break into
computer servers that store electronic information. It doesn’t prohibit deleting cellphone information,
even if that phone wasn’t company
property. (Rajaee v. Design Tech
Homes, No. H-13-2517, SD TX,
2014)
Final note: This is a rapidly developing area of the law. A safer bet is
to provide phones to employees and
take them back at termination.
Legal Briefs
Investigate all bias claims,
even reverse discrimination
It may not be common, but reverse
discrimination does occur. Ignore it
at your peril.
Recent case: Young is AsianAmerican of South Korean national
origin. She taught chemistry to consistently full classes and got excellent reviews early on.
Then she began getting less desirable assignments and noticed that
her supervisor seemed to favor black
instructors. Her supervisor also once
referred to her by a common slur di­­
rected at Asians. She was terminated,
allegedly for substandard work.
Young sued, alleging that she had
been discriminated against in favor
of black faculty. The court said that
claim could go forward. (Buisson v.
Board of Supervisors, No. 13-31269,
5th Cir., 2014)
Final note: Investigate all bias complaints, no matter who files them.
With handbook warning,
it’s OK to deviate from policy
It’s OK to occasionally deviate from
the disciplinary process outlined in
your employee handbook—if you
leave yourself some wiggle room by
explaining that some infractions are
so serious they warrant immediate
discharge.
Recent case: Melinda, who is black,
was an apartment leasing manager.
Her job was to get apartments ready
and only lease those that had been
prepared properly. The handbook
said that employees would receive a
warning before being terminated for
violating rules.
Melinda was fired after a supervisor discovered she had rented apartments that weren’t ready. Melinda
sued, alleging race discrimination and
violation of the warning provision.
The court tossed out her lawsuit.
It explained that the handbook said
deviation from the rules could happen and that Melinda hadn’t shown
that nonblack employees always got
a warning, either. (Hamilton v. AVPM,
No. 14-10373, 5th Cir., 2014)
January 2015 • Texas Employment Law
3
Compliance Corner
Insight from TheHRSpecialist.com
4 principles for creating a progressive discipline system that works
Progressive discipline must happen in this order
T
he most reliable way to protect your organization
from wrongful termination charges is to establish
and enforce a system of progressive discipline.
It allows you to ensure that any employee fired because
of inferior performance was treated fairly and in accordance with your policies.
No state or federal law requires a company to establish
a progressive discipline policy. But if you do promise
one, make sure you follow it. Progressively harsher penalties are an important part of progressive discipline, but
they are only one element of the overall system.
An employee must understand the reason for the penalty and be given an opportunity to correct the behavior.
Keep these four principles in mind when launching a new
progressive discipline system or evaluating an existing one:
Principle No. 1: Generosity
The object of progressive discipline should be to rehabilitate employees, not punish them. Always ask an employee
for the reason behind the problem. Never take it for
granted or assume anything. If the problem is correctable by additional training, specify what steps you and
the employee will take to resolve it.
Docu­­ment everything that is said and done in case the
problem persists and you have to go to the next step in
the progressive discipline system.
Principle No. 2: Clarity
Employees must understand that their behavior violates
company rules. Employment law differs from civil law
in that employees can use “ignorance of the law” as a
defense. In other words, if they didn’t understand the consequences of their actions, they may be off the hook—and
you could be on it!
To make sure your communications are getting through
loud and clear, take these steps:
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4
Principle No. 3: Transparency
If employees are not warned about the consequences of
poor performance, a judge or arbitrator may see it as an in­­
dication that there hasn’t been any effort at rehabilitation.
Principle No. 4: Fairness
Progressive discipline must treat all employees equally. A
boss can’t slap one worker on the wrist, then fire another
for the same offense.
Editor: Michael W. Fox, Esq.,
Ogletree Deakins, Austin, (512) 344-4711
The 11th Annual Labor & Employment
Law Advanced Practices Symposium
Where: Bellagio,
Las Vegas, NV
•Be thorough when you are disciplining employees. State
exactly how the policy has been violated. Give clear-cut
examples of what is unacceptable about the behavior.
•Set the standards to be met so the employees can’t
claim they didn’t know they were doing something
wrong. Spell out the consequences if problems continue.
•No matter what the communication situation, try to
see it from both sides. Put yourself on the receiving
end of your message and see if it makes sense, is complete and provides a solution to the problem.
STAFF
LEAP 2015
When: April 8-10, 2015
Progressive discipline uses five steps, all designed to inform
the employee what he or she is doing wrong and providing
every opportunity to improve:
1. Oral reprimand for a performance deficiency or behavioral infraction, explaining what went wrong and what
needs to happen instead.
2. Written warning if the problem persists, detailing the
objectionable behavior, along with the consequences.
3. Final written warning, perhaps accompanied by probationary status.
4. Termination review by both HR and the employee’s
supervisor.
5. Termination, the final step.
To register:
LEAP2015.com
or (800) 543-2055
Contributing Editor: Anniken Davenport, Esq.,
[email protected]
Editorial Director: Patrick DiDomenico
Senior Editor: John Wilcox, (703) 905-4506,
[email protected]
Copy Editor: Cal Butera
Production Editor: Nancy Asman
Publisher: Phillip Ash
Associate Publisher: Adam Goldstein
Customer Service: [email protected]
BusinessManagementDaily.com,
(800) 543-2055
Vol. 10, No. 1
HR Specialist: Texas Employment Law (ISSN 1938-0178) is published monthly by Business
Management Daily, 7600A Leesburg Pike, West Building, Suite 300, Falls Church, VA 22043-2004,
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© 2015, Business Management Daily, a division of Capitol Information Group, Inc. All rights
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Texas Employment Law • January 2015 www.theHRSpecialist.com
In the News ...
Disabled SSA employees
settle for $6.6 million
Current and former employees of the
Social Security Administration (SSA)
will receive $6.6 million to settle
charges the agency failed to accommodate disabled workers and denied
them promotions. A federal judge
has given preliminary approval to the
deal.
SSA employees first filed complaints with the EEOC in 2005.
They alleged a pattern of discrimination throughout the SSA. EEOC
investigators found that some disabled employees were denied promotions as many as 15 times.
The deal will compensate 570 current and former employees affected
by the SSA’s actions. Additionally,
SSA will create a supervisory board
responsible for ensuring the settlement
is carried out fully. The SSA will also
overhaul its reasonable accommodation process and create a centralized
office to handle disability issues.
Starbucks tattoo policy
(Cont. from page 1)
by 25,000 employees requesting the
change.
Under the new policy, employees
may show tattoos as long as they are
tasteful and not located on the face
or throat.
Specifically, the policy advises em­­
ployees to treat tattoos like speech:
Their ink shouldn’t expose co-workers
and customers to anything profane,
hateful or lewd.
Employees are allowed piercings
within limits.
Ear piercings are to be kept small
and no more than two per ear. Ear
gauges are permitted, but limited to
10 millimeters in diameter. A small
nose stud is permitted, but no septum
piercings or rings.
Note: Starbucks charted a middle
course with its tattoo policy by listening to its employees, but limiting the
changes to those it felt its customers
would be comfortable with.
www.theHRSpecialist.com
Unions on the rise: Prepare for ‘ambush’ elections
The National Labor Relations Board (NLRB) says a new controversial rule
issued Dec. 12 will “streamline” union elections. Critics say the result will be
“ambush elections” in which voting happens so quickly that employers stand
little chance of persuading employees to reject union representation.
The new final rule, which takes effect April 14, covers elections that certify a
union to represent workers.
Under current rules, an automatic one-month delay follows after the NLRB
receives a petition for a union election. The new rule eliminates the one-month
pause, clearing the way for so-called “ambush” or “quickie” elections, which
usually come within days. (Read the NLRB fact sheet at http://tinyurl.com/
ambush14.)
Currently, the standard time period for elections is 42 days. After these rules
take effect, most elections will likely be held within 10 to 21 days, experts say.
Also, employers will have to provide more contact info to unions, including
employee personal phone numbers and email addresses.
Practical impact: Employers interested in keeping their workplaces union-free
must prepare in advance to react fast to the threat of union organizing.
Online resource For tips on what employers still can (and can’t) do to defend
against a union campaign, go to www.theHRSpecialist.com/unions.
Austin bus company to pay
$655K to settle labor dispute
It’s an almost surefire way to provoke
an unfair labor practices complaint.
Travis Transit Management of Austin
has agreed to pay 600 current and
former employees $655,000 to
settle charges it unilaterally changed
employee health, retirement and
other benefits when it began providing bus service for Austin’s Capital
Metro in 2012.
The changes affected employees’
health care premiums, out-of-pocket
medical expenses and retirement-plan
contributions.
Amalgamated Transit Union
Local 1091 filed a grievance with
the National Labor Relations Board
(NLRB) alleging Travis Transit’s
actions violated the existing collective bargaining agreement because
the company failed to consult
with the union before making the
changes.
The NLRB agreed with the
union and the parties negotiated a
settlement that was approved by an
administrative law judge.
Note: Employers that operate
under collective bargaining agreements generally cannot make unilateral changes to employee benefits.
EEOC sues oilfield contractor
over alleged sexual harassment
An oilfield services company in Iraan,
Texas, faces an EEOC lawsuit after its
only female roust­­about was fired.
The woman claimed a supervisor
and co-worker at Gar­­ri­­son Con­­trac­­
tors subjected her to unwanted sexual advances. She alleges that when
she complained to the company CEO,
he fired her.
She filed a complaint with the
EEOC and the parties failed to resolve
the dispute during the commission’s
conciliation process. The EEOC has
now filed suit on her behalf.
Note: Arguments in these kinds
of EEOC cases proceed in a specific
order. First, the employee must show
that she made the complaint. Then
the employer must demonstrate that
it investigated it. If the employer
cannot show evidence of an investigation, it will lose in court.
Advice: Always offer multiple
avenues employees can use to report
­­har­­ass­ment and discrimination.
Establish procedures to investigate
every harassment complaint.
January 2015 • Texas Employment Law
5
In the Spotlight
by Hera S. Arsen, Ph.D., Ogletree Deakins
Supreme Court: No pay for security screening time
T
he U.S. Supreme Court on Dec. 9
unanimously ruled that the time
workers spend waiting to undergo
and undergoing security screenings is
not compensable under the Fair Labor
Standards Act (FLSA).
According to Justice Clarence
Thomas, who wrote the opinion in
Inte­­grity Staffing Solutions v. Busk
(No. 13-433, U.S. Supreme Court,
2014), the security screenings at
issue were not the principal activities
the employees were employed to perform, were not “integral and indispensable” to those activities and, thus,
were noncompensable.
Preliminary, postliminary
Two Integrity Staffing warehouse
em­­­­ployees sued the company on
behalf of a class of workers claiming federal and state law wage-andhour violations. They claimed their
employer, which provided workers at
an Amazon.com facility, violated the
FLSA and state labor laws by failing
to pay them for the time they spent
in security screenings designed to
prevent theft.
The district court granted Integrity
Staffing’s motion to dismiss, holding that the time they spent passing
through the security clearance was
not compensable.
The case was appealed to the 9th
Circuit Court of Appeals, which noted
that the FLSA, as amended by the
Portal-to-Portal Act of 1947, does
not require employers to compensate
employees for activities that are “preliminary” or “postliminary” to
employees’ “principal activity or
activities.”
But, those activities are compensable if they are “integral and indispensable” to an employee’s principal
activities. According to prior case
law, to be “integral and indispensable,”
an activity must be “necessary to the
principal work performed” and “done
for the benefit of the employer.”
The 9th Circuit found that the
security clearances were necessary
6
to the employees’ primary work
and were done for the benefit of
the em­­ployer, as the screenings were
intended to prevent theft by employees. Thus, the court ruled that the
workers had a valid FLSA claim.
Circuits courts disagreed
In arriving at its pro-worker conclusion, the 9th Circuit distinguished
cases from the 2nd and 11th Circuits
holding that time spent clearing
security is not compensable under
the Portal-to-Portal Act.
In those decisions, the security
screenings were unrelated to employees’ primary work and had not been
implemented for the employer’s
benefit. Noting that there was no
blanket rule that time spent going
through a security screening is noncompensable, the 9th Circuit said
the “integral and indispensable” test
should have been applied to analyze
the warehouse workers’ claims.
The Supreme Court’s decision
The Supreme Court reversed the 9th
Circuit’s decision, finding that time
spent passing through the security
clearance is not compensable.
The Court started its analysis with
the Portal-to-Portal Act’s exemption
for “activities which are preliminary
to or postliminary to said principal activity or activities.” It noted
that the Court has interpreted the
exemption to include “all activities
which are an ‘integral and indispensable part of the principal activities.’”
The Court decided that an activity
is “integral and indispensable to the
principal activities that an employee
is employed to perform if it is an
intrinsic element of those activities
and one with which the employee
cannot dispense if he is to perform
his principal activities.”
Finding that Integrity Staffing did
not employ its workers to undergo
security screenings but to retrieve
and package warehouse products, the
Court ruled that the security screen-
ings were noncompensable postliminary activities.
In addition, the Court found that
the screenings also were not “integral
and indispensable” to the employees’
duties as warehouse workers in that
they were not “an intrinsic element
of retrieving products from warehouse shelves or packaging them for
shipment.” The Court also noted
that the employer “could have eliminated the screenings altogether without impairing the employees’ ability
to complete their work.”
Providing further clarification on
the “integral and indispensable”
test, the Court found that the “test
is tied to the productive work that
the employee is employed to perform” and not whether the employer
required the particular activity.
The Court also rejected the workers’ claim that they should have been
compensated for the time they spent
waiting to undergo the screenings
because the employer could have
reduced that time to a de minimis
amount. The fact that the employer
could have reduced the time, the
Court found, “does not change the
nature of the activity or its relationship to the principal activities that an
employee is employed to perform.”
What it means for employers
Employers should be encouraged by
this unanimous Supreme Court decision. Finding security screening time
noncompensable validated practices
many companies use to safeguard
their inventory and minimize theft.
The Court’s clarification of which
activities are integral and indispensable
to an employee’s principal activities is
helpful guidance employers can use to
evaluate which activities are an intrinsic part of the work activities that em­­
ployees cannot avoid or neglect when
performing their principal activities and
for which employees must be paid.
Hera Arsen is managing editor of publications at Ogletree Deakins.
Texas Employment Law • January 2015 www.theHRSpecialist.com
Nuts & Bolts
Let it snow! But make sure you know how to pay employees
P
arts of New York were inundated
with feet of snow well before
Thanksgiving. Buffalo businesses
have dug out from under the lake
effect by now, but they may still be
dealing with lingering pay issues.
executive, administrative and professional workers are exempt. Cer­­tain
highly skilled computer workers are
also exempt. Confer with your attorney to ensure your classifications
comply with the FLSA.
THE LAW The Fair Labor Stand­­
ards Act requires employers to pay
exempt personnel their regular salaries if they worked any part of the
workweek. Nonexempt employees
are generally paid for only the hours
they work.
Several states have enacted laws
that entitle employees to receive pay
if they show up for work and the
business is closed due to weather. In
most cases, employers can avoid the
situation by informing employees
of the closing.
For example, New York law
requires employers to pay workers
who show up for work for at least
four hours. California has a similar
statute that requires two to four
hours of pay depending on a number of variables.
Formulate a policy
WHAT’S NEW Much of North
America, including areas not accustomed to harsh weather, have
experienced extended cold spells
and higher than normal winter precipitation. Should the pattern hold,
employers throughout much of the
country will have to make decisions
about when to open, when to close,
liberal leave and telecommuting
policies.
Additionally, the IRS and Depart­­
ment of Labor have been scrutinizing employers’ classification of
employees as exempt or nonexempt.
Those agencies are also looking
closely at employers that classify em­­
ployees as independent contractors in
order to avoid payroll taxes, benefit
costs and workers’ compensation costs.
HOW TO COMPLY Employers
should review which employees are
exempt and which are not. Gen­erally,
www.theHRSpecialist.com
Employers should determine which
operations must continue during
inclement weather. From there,
decide which workers have to report
to work under those circumstances.
Some functions can be performed
remotely. Employees asked to work
from home must be paid as if they
came into work. For nonexempt
workers, you must have a way to
track employees’ time—it’s up to the
employer to maintain time records.
If an exempt employee performs any
work during the week, he or she
is entitled to a full week’s salary.
Most telecommuting policies
include a list of jobs that can be
done remotely. It’s important to
coordinate your hazardous weather
policy with your telecommuting
policy.
You may wish to designate only
some positions to operate remotely
during emergency conditions. If so,
note that in your policy.
Establish notification protocols
Especially if you operate in a state
where employees are entitled to
some pay if they show up for a regularly scheduled shift, you need a
notification protocol. This can be
via phone or email. The laws in your
state may have specific requirements.
Check with your attorney to ensure
your practices comply with the law.
Travel liability
Requiring employees to come to
work during hazardous weather
could potentially subject you to
liability. Employers are potentially
responsible for auto accidents in­­
volving employees who are on the
clock.
Include in your policy a limitation
on travel during hazardous conditions. Again, include in your plan
a protocol for notifying traveling
employees when to stay in place.
You may have to send employees home early if weather becomes
inclement during the day. In certain
cases, providing lodging for employees may be a better option. For
example, last year a severe winter
storm hit the Atlanta area. Because
this was such a rare event, the state
and city had no means to clear the
roads and the entire area skidded
to a halt. Many employers wisely
opted to house employees at nearby
hotels so they could easily get to
work without incurring potential
employer liability.
Liberal leave policies
Depending on how long an em­­
ployee’s commute may be and what
conditions the employee will face
while commuting, employers should
remain flexible.
Many employers have liberal leave
policies that allow employees to stay
home from work if they determine
commuting would be unsafe. (As a
practical matter, parents often appreciate a liberal leave policy to care for
their kids when inclement weather
causes schools to close.)
The absence is typically charged
against employees’ available leave.
Some make other arrangements, such
as allowing workers to come in a
specific number of hours late without docking their leave total.
Generally, liberal leave is triggered
when the employer determines that
travel is hazardous enough to warrant it. Employees may not claim
it unless the employer authorizes
liberal leave for specific locations on
specific days.
The keys to handling winter
weather are to plan in advance and
have clear lines of communication
in place.
January 2015 • Texas Employment Law
7
The Mailbag
by Michael W. Fox, Esq., Ogletree Deakins, Austin
Can you recommend resources for classifying
employees and independent contractors?
Q
I am assistant HR director for a small company
that uses independent contractors as well as fulland part-time employees. In my role, I must ensure
that these workers are accurately classified as either
employees or contractors, and that my company fully
complies with federal and state tax and labor laws.
What is out there to assist me in accurately classifying the workers performing services for our firm?”
A
The IRS and Texas Workforce Commission utilize an
11-factor test to determine the employment relationship
of a particular person or entity. The 11 factors are grouped
into three main categories: behavioral control, financial
control and the type of relationship between the parties.
Behavioral control
Facts that show whether the business has a right to direct
and control how the worker does the task for which the
worker is hired include the type and degree of:
1. Instructions that the business gives to the
worker. An employee is generally subject to the business’s instructions about when, where and how to work.
All of the following are examples of types of instructions
about how to do work.
•When and where to do the work
•What tools or equipment to use
•What workers to hire or to assist with the work
•Where to purchase supplies and services
•What work must be performed by a specified individual
•What order or sequence to follow.
The instructions needed may vary among different
jobs. Even if no instructions are given, sufficient behavioral control may exist if the employer has the right to
control how the work results are achieved. A business
may lack the knowledge to instruct some highly specialized professionals; in other cases, the task may require little
or no instruction. The key consideration is whether the
business has retained the right to control the details of a
worker’s performance, or instead has given up that right.
2. Training that the business gives to the worker.
An employee may be trained to perform services in a
particular manner. Independent contractors ordinarily
use their own methods.
Financial control
Facts that show whether the business has a right to control the business aspects of the worker’s job include:
3. The extent to which the worker has unreimbursed business expenses. Independent contractors
are more likely to have unreimbursed expenses than are
employees. Fixed ongoing costs that are incurred regardless of whether work is currently being performed are
especially important. However, employees may also incur
8
unreimbursed expenses in connection with the services
they perform for their employer.
4. The extent of the worker’s investment. An independent contractor often has a significant investment in
the facilities or tools he or she uses in performing services for someone else. However, a significant investment
is not necessary for independent contractor status.
5. The extent to which the worker makes his or her
services available to other entities. An independent
contractor is generally free to seek out business opportunities. Independent contractors often advertise, maintain
a visible business location and are available to work for
many clients.
6. How the business pays the worker. An employee is
generally guaranteed a regular wage amount for an hourly,
weekly, or other period of time. This usually indicates that
a worker is an employee, even when the wage or salary
is supplemented by a commission. An independent contractor is often paid a flat fee or on a time and materials
basis for the job. However, it is common in some professions, such as law, to pay independent contractors hourly.
7. The extent to which the worker can realize a
profit or loss. An independent contractor can make a
profit or loss; employees cannot.
Type of relationship
Facts that show the parties’ type of relationship include:
8. Written contracts describing the relationship the
parties intended to create.
9. Whether the business provides the worker with
benefits, such as insurance, a pension plan, vacation pay
or sick pay.
10. The permanency of the relationship. If you
engage a worker with the expectation that the relationship will continue indefinitely, rather than for a specific
project or period, this is generally considered evidence
that the intent was to create an employer-employee relationship.
11. The extent to which services performed by the
worker are a key aspect of the regular business of the
company. If a worker provides services that are a key
aspect of your regular business activity, it is more likely
that you will have the right to direct and control his or
her activities. For example, if a law firm hires an attorney,
it is likely that it will present the attorney’s work as its
own and would have the right to control or direct that
work. This would indicate an employer-employee relationship.
Michael W. Fox practices employment law at the
Austin office of Ogletree Deakins. He has more
than 35 years’ experience representing employers
in court and designing employment law policies.
Contact him at (512) 344-4711 or at Michael.
[email protected]
To submit your question to The Mailbag, email it
to [email protected]
Texas Employment Law • January 2015 www.theHRSpecialist.com