Employment Law Compliance and Counseling

Wage and Hour Issues

Federal and state wage and hour laws can create confusion and headaches for employers. Violating wage and hour laws – even unintentionally – can result in liability for backpay, penalties, and attorney fees.

Misclassification of workers is a recurring issue and there are two ways in which workers are frequently misclassified. One is to wrongly classify an employee as exempt from overtime pay requirements. The other is mistakenly classifying an employee as an independent contractor. Either of these classification problems can create substantial liability for an employer.

Are your “exempt” employees really exempt from the overtime requirements of the law? Some employers erroneously believe that a salaried employee is an exempt employee. That is not correct. It is true that exempt employees must be paid a salary, not an hourly wage. However, there are other criteria that must be met for an employee to be classified as exempt. The salary must meet a minimum required level (which was recently increased). Furthermore, the employee must perform job duties that qualify as exempt under the applicable regulations.

Do your independent contractors really qualify as independent contractors, or would a court disagree? Sometimes the answer is easy. Often, however, it is a close call to make. The legal analysis has evolved over time. So, too, have many jobs.

Other common wage and hour issues I can help with include:

How to calculate overtime pay
Issuing final paychecks
Whether an employee is owed vacation pay
Understanding meal and break period requirements
Understanding what paycheck deductions can (and cannot) be made
Whether it is permissible to give “comp time” in lieu of overtime pay

Employment Discrimination

Every employer knows there are several federal statutes prohibiting discrimination in employment. The most familiar are Title VII of the Civil Rights Act of 1964 (usually referred to simply as Title VII), the Age Discrimination in Employment Act (ADEA), and the Americans with Disabilities Act (ADA). Some laws, like the Genetic Information Nondiscrimination Act of 2008, might be less familiar.

It is worth noting that, in at least one important way, the ADA differs from other anti-discrimination laws. Like other anti-discrimination laws, the ADA prohibits discriminatory treatment of employees and applicants. However, unlike other laws, the ADA also imposes an affirmative duty on employers to make reasonable accommodations for qualified individuals with disabilities. Of course, that raises questions that often are not easily answered: What is reasonable? Is the individual qualified? Does the individual have a disability as defined in the ADA?

These federal laws do not apply to small employers. Employers with 20 or more employees are covered by the ADEA. The threshold is 15 employees for the other federal laws mentioned above. However, in Colorado (like most states) we have state laws modeled on the federal laws, but which cover all employers regardless of size. Therefore, it is important to know what the applicable laws prohibit and what they don’t, and how discrimination claims typically arise.

Leave Laws

Federal and state laws give employees the right to take leaves of absence for a variety of reasons. Employers are generally familiar with the Family and Medical Leave Act, but questions often arise concerning how that law applies in specific situations, and how it interacts with other laws. This is also true of absences under the Americans with Disabilities Act. Leave of absence for military duty is protected by both federal and Colorado law. Colorado law also provides leave rights for adoption, domestic abuse, jury duty, voting, and school activities.

Employee Handbooks and Employer Policy Manuals

There is no requirement that employers have an employee handbook, but they can be very useful. If you wonder whether your company should have one, we can discuss the “pros and cons” so you can make an informed decision. If you have an employee handbook, was it reviewed by an employment lawyer? Is it current? An employee handbook can cause serious legal problems if not properly drafted or out of date. For one thing, a poorly written handbook can alter the at-will employment relationship and create unintended contractual obligations for the employer.

An employer policy manual is different from an employee handbook. The policy manual is for managers and supervisors. It is an important guide for helping management address workplace situations in a consistent manner, which reduces the risk of claims of discrimination, favoritism and wrongful termination. Employee misconduct, leaves of absence, wage advances, use of company computers and phones, social media, vacations, employment references, and addressing employee complaints are just a sampling of the things you routinely deal with. It is important to handle employee matters in a consistent manner, not just from a legal perspective, but also in terms of employee relations. Dealing with employees in an arbitrary or ad hoc fashion can easily create the perception that management’s decisions are unfair or unlawful. With so many laws affecting the employment relationship, a policy manual can be a very good resource for management personnel.

Employee Handbooks and Policies

Performance Evaluations

Do you conduct regular performance evaluations? Did you say you would, but never seem to get around to it? Doing them is better than not doing them, but not doing them is better than doing them badly. How can that be so? To an employment lawyer, it is a familiar scenario: An employee is fired for good cause, but the problem that led to the termination is never mentioned in the employee’s performance evaluations. Some supervisors would rather make the evaluation a positive experience and avoid any unpleasantness. But by doing so they unwittingly create potential liability for the company. Unfortunately, most managers and supervisors are not adept at doing performance evaluations. I can train your supervisory personnel to conduct effective performance evaluations.

Apart from regular evaluations, it is very important to document problems with an employee’s job performance or workplace conduct whenever a problem arises. Although most employers seem to know this, it often goes undone. Employers are busy running the business. Besides, confronting a problem employee is a disagreeable task. Nevertheless, failure to address the problem, and properly document it, will only make it worse when things finally come to a head. Costly litigation and potential liability can often be avoided by documenting the problem, addressing it with the employee, and giving the employee a reasonable opportunity to correct the situation. This is not to say that employees cannot be fired for a first offense. Sometimes that is the appropriate course of action. But employers should always ensure that the action taken is consistent with the company’s discipline and discharge procedures or practices.