What's on Your 2019 HR To-Do List?
Miller & Martin PLLC Alerts | January 11, 2019
If you’re like me, you have an ongoing, and what may seem like a never-ending, to-do list. But, from an HR compliance perspective, some things simply have to be on there and need to be prioritized.
As you are planning for the New Year, have you made out your HR to-do list? If not, now is as good a time as any to do so. Here is a list of some possible HR priorities to consider as you customize your list.
15. Question – “How old is your employee handbook?"
If you cannot answer this question, you just answered it as far as whether or not you need to update your employee handbook in 2019! If it has been more than 3 years since you did so, I would also recommend this being on your HR to-do list for 2019.
Some other items on your HR documentation checklist should be your employment application, interview and background check process, job descriptions, offer letters and (if you use) employment agreements (including non-competition or non-solicitation agreements) if it has been more than 2 years since you reviewed them.
14. Develop a plan to complete timely and accurate performance reviews.
I get it. Most people don’t like conflict, and most supervisors would rather let marginal or even not-so-great employees slide by year after year than bring their issues to the forefront. But, not every employee is “excellent” or even “satisfactory” in every area, and it will be difficult to defend a decision to discipline or terminate an employee who has been rated consistently as above average – or even average -- year after year and who has received consistent pay increases merely because a supervisor doesn’t like confrontation.
Performance reviews must be honest and accurate. They should be a written confirmation of issues that have been addressed throughout the year. There should also be clear goals and expectations established for the future in them, including coupling negative reviews with a formal performance improvement plan, even if the negative rating is only in one or a few areas of the overall evaluation.
This is also an area to add to your “manager training to-do list” (as part of -- spoiler alert – item 2 we will discuss on Monday). Providing supervisory employees with a performance evaluation form with no guidance as to how you expect them to use it is a surefire way to guarantee your performance review process will be as close to useless as possible based on the human “confrontation aversion” factor described above. Reviewing draft evaluations with your managers whenever possible before they present them to employees is also a helpful exercise to further illustrate inaccuracies or patterns they otherwise may not notice, particularly as most supervisors are just trying to “get all these forms filled out before X deadline.”
I am also aware of the line of thought in some performance management circles that employers should abandon the concept of performing annual employee performance reviews altogether. This is something else for your organization perhaps to consider in 2019. There are other alternatives out there, particularly if you have found your current annual review system not to be effective in providing timely, accurate performance feedback. The upside of many of these alternative review methods is they do force your managers to provide more regular formal feedback throughout the year (usually on a quarterly basis) rather than waiting to discuss employees’ overall performance at what is usually the worst possible time from the employees’ standpoint, in connection with their annual pay increase.
Do be wary of alternative review systems which utilize subjective, narrative assessments rather than using any type of rating system which allows an employee to know where he/she stands in relation to the expectations of his/her job (or in relation to others, in case you have to use these assessments in a layoff or promotion decision at some point or to justify why one employee is paid more than another for the same job).
Regardless of what performance review method you decide to use, two considerations remain key. Your chosen method will only be as effective as the training and accountability you implement among your managers for using it.
13. Consider using a mandatory arbitration provision, at least for certain types of claims.
While employee advocates have continued to question the fairness of prohibiting employees from bringing claims in front of a jury or seeking class-wide litigation relief, courts (for the most part) have continued to find that mandatory arbitration agreements and waivers of class actions are generally enforceable. And, the benefits to employers in the form of cost-effectiveness, confidentiality, reputational damage control, etc., can be very appealing. So, it may be worth your while to assess whether having an alternative dispute resolution program makes sense for your organization.
12. Think about your temps.
While we are hopeful to get more business-friendly definitions of “joint employment” from the DOL, the NLRB and perhaps even the EEOC this year, in the meantime, because your organization most likely exercises at least some control over the work your temporary workers perform for it, they remain subject to be deemed your “employees” for purposes of discrimination, harassment, tax and failure to pay claims, among others. One way to insulate your company from such claims is to make sure you have indemnification clauses in your written agreements with your temporary agencies.
11. Watch those 1099’s.
Many businesses believe an easy way to avoid being liable under discrimination, harassment, tax, workers’ comp, unemployment and wage and hour laws is simply to agree to call some or all of the individuals who work for them “independent contractors” rather than “employees” and to issue 1099’s rather than W-2’s to them at the end of the year. It’s not that easy, as the DOL, the IRS and even state unemployment offices have been cracking down on misclassification issues for years.
You may also be surprised to know the legal criteria in this area has changed. Factors that now may be used to show your “independent contractor” is really an “employee” include: the work he performs for you is integral to your business; he works for your organization on a permanent or indefinite basis; he does not have a large investment in equipment or facilities in order to perform his work, particularly compared to yours; he does not have a great potential for loss or profit on the work based on how the work is managed (i.e., he is going to “take home” the same amount on the work no matter how long it takes, how much material is used, etc.); he does not exercise a great deal of independent judgment as to how or how much he is paid or what work he will agree to take on for you, as a business owner typically would; he is paid on an hourly, salary or other regular basis; you provide him with paid vacation and/or sick leave and/or insurance; you reimburse his business expenses; you require him to sign a non-compete agreement; and/or you control his work hours or where the work is performed (when the latter is not required based on the nature of the work). You should also continue to be aware of other “tell-tell” signs of “employment” such as the fact your “independent contractors” carry business cards with your business name on them or have a company email address through your business.
10. Oversee overtime.
There are two components to this one: making sure your employees are properly classified as exempt (not eligible for overtime) or non-exempt (eligible for overtime) and making sure overtime is properly paid.
While misclassification issues often get a lot of press, not getting paid for overtime remains the leading reason employees file wage and hour lawsuits and collective actions. In today’s electronic world, it is very easy for employees to work remotely, either by connecting through their laptops or simply checking emails or sending work texts on their phones at all hours of the day or night. If these employees are non-exempt, they need to be recording this time. It also remains a very competitive world where companies still reward managers for things like maintaining low overtime costs. What does this do? It sends a message that paying overtime is a “bad thing,” which encourages off-the-clock work, or worse, changing employee time records by unscrupulous (or desperate!) managers.
What policies and procedures do you currently have in place to avoid these common overtime issues?
There is more to come. . .tune in Monday for the rest of our list!
In the meantime, as always, should you have any questions or we can be of any assistance regarding any of these HR to-do list items, please feel free to contact any member of our Labor & Employment Law Practice Group.
To read more, please click here.