Employees

I’m Independent Until I’m Not

Josh runs a local Driver1 courier service. He decides which jobs to accept and negotiates delivery fees with customers. When a customer calls, Josh looks at the roster of drivers and goes down the list until he finds a driver to handle the job.

His couriers are part-timers and include college students, stay at home moms, and a few Uber drivers. He treats everyone as an independent contractor because they use their own vehicles and set their own hours. All Josh requires is a clean driving record and proof of insurance.

Driver3 Yesterday, Ron, a college student driver, was involved in a fender bender while making a delivery. Ron is desperate to avoid telling his parents about the car. His parents bought the car for him as a reward for dropping his beer and pizza plan for college studies and getting serious about graduating.

Ron asks Josh to help pay for the repairs but Josh declines. He points out that Ron is an independent contractor, not an employee. Josh adds that it’s not his fault Ron was talking on his cell phone while driving and not paying attention to the traffic signals.

So Ron calls his mom to give her a hint that the car insurance premium may, possibly, kind of, increase due to unforeseen circumstances. Like any experienced mother, Ron’s mom gets the real story within minutes. After she finishes explaining that idiots who can’t multitask shouldn’t try to drive and talk at the same time, she asks for more details about Josh’s courier business.

Driver2 Ron’s mom works in HR for a major corporation and she’s just read about the U.S. Department of Labor’s new “economic realities” test. She thinks that Ron is actually an employee and not an independent contractor.

What should Ron’s mom do next?

She can use her HR experience to compare Ron’s description of how the courier business is run to the DOL test and assess whether he’s an employee.
She can ask one of the corporate attorneys at her company to give her an off-the-record assessment of the DOL test.
She can contact Josh directly to argue that he should pay for the auto repairs because she believes her son is actually an employee of Josh’s business.

DOL released guidance on their new “economic realities” test about a year ago. This new test looks at whether a worker is economically dependent on the “employer”. If yes, then the worker is an employee under the Fair Labor Standards Act (FLSA). Expect to hear much more about this test.

If your company is struggling with HR issues, Corporate Compliance Risk Advisor can help you create HR policies that are appropriate for your company’s size and then serve as a resource to your staff as the policies are implemented.

Join the HR Compliance Jungle today. Click here!

Ebook Link: https://hrcompliancejungle.com/wp-content/uploads/2015/03/skh-employee-theft.pdf

Visit us: http://www.complianceriskadvisor.com/

Masters of the Universe

Another update from the Jungle…

Masters1 Jim and Tony run a venture capital fund that specializes in distressed assets. They buy companies, replace the management team, cut most of the employees to generate savings and make the company look profitable (on paper). Then they sell the company.

A business magazine features them in an article and uses the term masters of the universe. After the feature article, Jim and Tony decide to branch out from distressed assets and buy a company that has been successful without being spectacular.

Jim and Tony begin their ownership by holding a company-wide meeting with employees at which they talk about the company’s wonderful financial future. This sales pitch is interrupted by Linda who asks them to reconcile these comments with their established practice of boosting profits by firing most workers. Jim evades her question. So Larry asks pointblank how many jobs will be cut. Jim looks at Tony. Tony shrugs. The meeting ends abruptly.

Masters3 After studying the company’s bottom line, Jim and Tony decide that the first employees to go are Linda and Larry. They tell Sandra, the HR rep, to prepare the paperwork. She cautions against firing two of the most respected workers. Jim looks at the org chart again and concludes they are peons.

On Friday, Linda and Larry are ushered out the door. Their first port of call is an employment law attorney where they discuss wrongful termination, retaliation, and age discrimination. The attorney has a vision of becoming famous by taking down the masters of the universe. He agrees to represent Linda and Larry.

Master2 Within weeks, a third of the workforce resigns following Linda and Larry out the door. Jim and Tony are initially relieved; they only had to fire two workers. But the remaining workforce is demoralized. Within six months, the company has lost several key clients and the bottom line is tanking. Jim and Tony call a meeting with Sandra to discuss staffing levels and the status of Linda’s and Larry’s lawsuit.

What should Sandra tell them?

She can say that she warned them that firing Linda and Larry would have dire consequences.
She can tell them that as masters of the universe, she expects them to solve their own problems.
She can hand in her resignation, having already received several job offers.

The above scenario is exaggerated but may seem familiar to anyone who has experienced a change in ownership at an employer. Creating a plan with HR for handling inevitable layoffs can smooth the transition. It is also helpful to see employees as more than just a cost to the bottom line.

Join the HR Compliance Jungle today. Click here!

Ebook Link: https://hrcompliancejungle.com/wp-content/uploads/2015/03/skh-employee-theft.pdf

Visit us: http://www.complianceriskadvisor.com/

I’m Not Offensive… You’re Overreacting.

Another update from the Jungle…

Ted-1 Ted runs a company that provides website and social media support for small businesses. Ted grew up in the advertising business when it looked a bit like “Mad Men” and some of his habits are outdated. His most annoying habit is using nicknames.

Employees recognize Ted’s professional skills and ability to get customers to sign on the dotted line. Nicknames are part of the package when working for Ted. After all, every workplace has annoyances.

One employee is Italian-American and was nicknamed Guido because he looks like an extra in the Godfather movies. Another employee is Mario, short for Mario Andretti, because he’s gotten some speeding tickets. Blondie is an attractive woman who was hired long ago and keeps everyone on task.

Then there’s Tom, the first person Ted hired when he started the business. Tom is the only employee called by his real name and he’s so valuable to the team that Ted made him a partner in the business. Ted calls him Uncle Tom.

Ted-2 Recently, Ted agreed with his team that they needed to give back to the community by offering an internship to local college students. Judy is the first intern they hire. She’s a marketing major with an endless curiosity about all aspects of the business and a willingness to learn. Ted calls her the Elephant’s Child, after another inquisitive youngster. Judy isn’t familiar with Rudyard Kipling’s “Just So” stories and thinks Ted’s nickname is demeaning.

Two weeks into her internship, Judy hears Ted shout “Uncle Tom” and sees the only black employee heading for Ted’s office. She’s appalled. She tells Blondie that she can’t work for a racist like Ted and wants out of the internship immediately.

What should Blondie do next?

She can tell Judy that real world workplaces don’t come with college “safe zones” to avoid offending people. Succeeding in business requires a thick skin.
She can tell Judy that offensiveness is in the eye of the beholder and if Tom’s not protesting, then Judy shouldn’t either.
She can tell Ted that he needs to join the 21^st century and recognize that some of the things he learned “back in the day” are no longer acceptable.

The legal standard for deciding offensiveness is based on reasonableness. Would a reasonable person hearing a nickname, their own or a co-worker’s, be offended? The answer depends on the specific situation. However, a nickname can be in poor taste even if it doesn’t rise to the level of violating any equal protection laws.

Join the HR Compliance Jungle today. Click here!

Visit us: http://www.complianceriskadvisor.com/

Ebook Link: https://hrcompliancejungle.com/wp-content/uploads/2015/03/skh-employee-theft.pdf

If It’s Not In Writing…

Another update from the Jungle…

Auto-1 Alan owns an auto repair shop and he seems to have a revolving door for employees. He knows that not everyone wants to be a grease monkey and finding employees is not easy. In fact, he’s hired people who otherwise would never have experienced the joys of employment. With so much turn over Alan never created written policies for his employees.

When Alan started his business, he was on the edge of town surrounded by fields. Sam and Zeke, a couple of good old boys wandered in from the fields where they were looking for their hunting dog and signed on to work for Alan. Sam and Zeke are good auto mechanics when they pay attention to the job.

Auto-4 Alan lets them use some of his tools and equipment to build cars that they race on dirt tracks during the summer. If they don’t wreck their dirt track car, they celebrate by getting drunk on Jack Daniels (black label only; green label is for sissies). When work is slow, Sam and Zeke also like to do a little target practice at the makeshift shooting range they created on the back part of Alan’s property.

Now the surrounding fields are mostly gone, replaced by a shopping center and McMansions for the urban sorts who want to experience suburban life. Alan’s property still backs up to fields but he’s worried about stray bullets. So he tells Sam and Zeke to dismantle the shooting range and keep their guns at home. Several weeks pass and Sam and Zeke are still using the shooting range despite repeated verbal warnings of dire consequences.

Now Alan has a policeman in his office politely explaining that the neighborhood was recently annexed and is now within town limits. Town ordinances prohibit firing guns within town limits and violators can be arrested. As the property owner, Alan could be arrested.

What should Alan do next?

He can blame Sam and Zeke and tell the police officer to arrest them.
He can fire Sam and Zeke for ignoring his verbal warnings. Of course, Sam and Zeke have conveniently forgotten the verbal warnings (and they have guns).
He can acknowledge that he needs to take a more organized approach to employee matters by creating written policies and documenting disciplinary actions.

The old adage “if it’s not in writing, it didn’t happen” still holds true. Employers like Alan who fail to document employee actions, including verbal warnings, face a greater chance of being sued for wrongful termination if they fire an employee for disciplinary reasons.

Ebook Link: https://hrcompliancejungle.com/wp-content/uploads/2015/03/skh-employee-theft.pdf

Join the HR Compliance Jungle today. Click here!

Visit us: http://www.complianceriskadvisor.com/

Too Many Hats

Hats(1) Another update from the Jungle…

Tina was the first employee at her company, hired a month after Drew, the owner, created the company. Tina got the job because she was a friend of Drew’s and she was willing to work for an erratic paycheck. Also, Tina had a liberal arts degree from a state university which turned out to be not much good when job hunting.

So Tina worked for Drew and was excited each time the company grew. In the early days, they shared ramen noodles for lunch and pooled their money to pay for coffee meetings with prospective clients. Tina liked the sense of adventure and the fact that each day was different.

Over the next three years, Tina worked on everything from the sales brochures to updating the logo to handling disgruntled customers. She handled administrative tasks such as ordering office supplies and equipment so that Drew could focus on the company’s strategy. She also helped Drew interview and hire new employees.

Each new employee was hired for a particular job, even though they lacked written job descriptions. Any job that didn’t fit into another employee’s skill set slid onto Tina’s desk. She knew the history of the company, the way things has always been done, and she was willing to help solve problems faced by other employees.

Hats(2) Drew was happy to delegate employee issues to Tina. But Tina didn’t know anything about employment laws or human resources best practices. She Googled key terms periodically and filled out paperwork to the best of her ability. The company’s CPA was able to answer her questions related to payroll processing, but basically Tina was on her own.

Now Tina’s burnt out. Although it’s a fine spring day, she’s slumped at her desk, exhausted and dispirited. It’s time to plan the monthly employee birthday party and she just can’t face it. Working for Drew isn’t fun anymore.

What options are available to Tina?

She can continue doing all the tasks that none of her co-workers want to do until she becomes a bitter old woman.
She can explain to Drew that it’s time to professionalize the back office so that the company can grow smoothly.
She can quit and go sit on a beach in the Caribbean drinking rum and eating rum-soaked fruit.

In the actual situation, the company decided to hire a subject matter expert to help them create a formal structure for the administrative side of the business and to implement best practices. Then the subject matter expert helped train a new employee to handle administrative tasks.

Ebook Link: https://hrcompliancejungle.com/wp-content/uploads/2015/03/skh-employee-theft.pdf

Join the HR Compliance Jungle today. Click here!

Visit us: http://www.complianceriskadvisor.com/

The Micromanager

Another update from the jungle…

MicroMan 1 Sarah joined the company as an experienced lateral hire. She was attracted to the company after they offered her a chance to use her diverse experience. Sarah likes variety because she’s easily bored by routine. She bailed out of several previous jobs when they became boring. Now she does all the special projects for her new employer and each day offers a new challenge. She likes everything about her job except her boss, Dean.

Dean is the second most dreaded type of boss: the micromanager. The most dreadful managerial sort, of course, is the psycho boss. Dean can’t just assign a project to Sarah. He spends half an hour explaining in detail how he would complete the project. Then he tells Sarah to use her own judgment.

Sarah has high personal standards which require her to thoroughly research an issue before making recommendations. She is also a perfectionist and agonizes over each memo and report to ensure that the information is accurate and the words are clear and concise. Then Dean ruins it. MicroMan 2

As her boss, Dean wants to see Sarah’s written memos and reports before they are sent on to the senior management team. Sarah understands the need for quality control but he’s a micromanager and he can’t resist meddling. His review of her first report for the higher ups resulted in a sea of red ink. Dean had revised the entire report.

Sarah stared at her destroyed sentences and asked Dean why he had changed it. He said he thought it read better with the changes. Sarah pointed out that all the changes were stylistic. Essentially, he had re-written her report to reflect his more verbose style of writing. Dean smiled and assured Sarah that things would change as he became familiar with the quality of her work.

Of course, nothing changes. As the months pass, Sarah’s frustration grows. She daydreams of beating Dean senseless with his own laptop computer or forcing him to listen to rap music. She discreetly asks the HR director to transfer her to a different manager but is told such a move is impossible.

What options are available to Sarah?

She can continue hoping that Dean’s management style will change.
She can continue objecting to Dean’s management style, which is contributing to a perception that she’s bitchy and not a team player.
She can do the minimum necessary to earn her paycheck while she looks for another employer.

In the actual situation, the subordinate eventually found a new employer where her new boss wasn’t a micromanager.

Ebook Link: https://hrcompliancejungle.com/wp-content/uploads/2015/03/skh-employee-theft.pdf

Join the HR Compliance Jungle today. Click here!

Visit us: http://www.complianceriskadvisor.com/

Dis-Integration

Mentor

Another Update from the Jungle…

Several years ago Cindy suggested that her company should create a mentoring program to reduce employee churn. As the HR manager, she was spending most of her time interviewing applicants or completing termination paperwork. At first, selling the idea to the owners of the company wasn’t easy.

The owners thought a mentoring program was a waste of time. The company founder told her that employees should be happy to have a job and didn’t need “touchy-feely crap”. Cindy countered with diagrams showing years of trashed productivity and reduced profits caused by the revolving door of new hires. So the founder grudgingly consented to a mentoring program.

Cindy’s next hurdle was finding mentors. No one volunteered when she posted a notice on the bulletin board in the break room. Her blast email calling for volunteers was ignored, except for the idiot who hit “reply all” when he commented to a co-worker about snowballs and hell. The idiot doesn’t know it yet, but Cindy has decided he needs to volunteer for quality control visits to suppliers in McAllen, Texas in August and Buffalo, New York in January.

Mentor 2 Cindy eventually found enough mentors to run a pilot program. Now six months later she is meeting with the mentees to ask for their feedback on how the program can be made better. What she learns is illuminating but a bit unexpected.

Brian says his mentor took him to dinner at an establishment with pole dancers and cheap booze. Brian admits he doesn’t know much about the company but he now carries lots of dollar bills just in case. Susan’s mentor complained incessantly about the company leading Susan to discreetly search for a new job.

Daniel, on the other hand, is enthusiastic about his mentor. She introduced him to key employees in each department, meets with him regularly to answer his questions, and urges him to volunteer for new duties in order to broaden his experience.

What should Cindy do next?

She can recognize that the corporate culture’s defeatist attitude needs to be fixed first.
She can ask Daniel’s mentor to create a list of her successful mentoring techniques so that others can copy it and hope a successful mentoring program will fix other problems.
She can give up trying to make the workplace better and streamline the firing and termination processes.

In the actual situation, the senior management team never saw the value in a mentoring program and failed to support the initiative. The company continued to experience over 40% turnover in personnel and low productivity and employee morale.

Ebook Link

https://hrcompliancejungle.com/wp-content/uploads/2015/03/skh-employee-theft.pdf

Join the HR Compliance Jungle today. Click here!

Visit us: http://www.complianceriskadvisor.com/

Improving Morale with Beatings

Morale Another update from the Jungle….

Don started his tech company in the depths of the financial meltdown a few years ago. After years of struggling, he expanded his client base to the point that he now has employees instead of subbing out the work to independent contractors.

Don ought to feel happy, but he’s not. His employees make him unhappy. He hired millennials expecting them to be energetic and creative and to keep his company on the cutting edge of technology. Instead, they infuriate him with their attitude.

Greg and Sam blew a deadline because they went bar-hopping with college friends. They had not wanted to work on the project but they were next up on the rotation for assignments. So Don ignored their lack of enthusiasm and told them to get busy. Their final work product was so crappy that Don agreed not to charge the client.

Don was so angry he decided to take away a few perks. He folded up the ping pong table and shoved it in Startup, Business, People, Students the storeroom. Then he ordered Greg and Sam to report to the office every day so that he could keep a closer eye on them. Now they sulk at their desks, doing as little as possible, while surfing the web for other job opportunities.

Don is also annoyed with Beth. Beth wants to work on a fundraising campaign for her favorite non-profit (humane housing for pot-bellied pigs that have outgrown their cuteness) rather than working on client projects. Don likes bacon and ham and doesn’t see any point in coddling a former pet piggy. Besides, he hired Beth to work for his clients; not her favorite charity. He said no.

Morale is so low that even the free-beer-on-Friday promise hasn’t improved the general malaise afflicting the office. It’s Friday evening. Don’s sitting at home drinking the single malt scotch he reserves for special occasions and wondering what he should do on Monday morning.

What options are available to Don?

He can take away all the perks, including free beer, and enforce more discipline until employees crank out quality work and morale improves.
He can fire his current employees and start over with a new batch of employees who accept his way of doing things.
He can allow his employees more freedom to choose their assignments and set their own schedules as long as they meet project deadlines and submit quality work.

This story is a composite of several actual situations in which the small business owners still believed in face time and didn’t recognize that the newer generation of employees desire autonomy. No one likes to be micro managed, however, a worker still needs to serve the person who has employed them. They still need to earn their paycheck. The difficulty is always in finding a good balance.

Download my FREE eBook today! Click here!

Click here to join the HR Compliance Jungle today.

Boxed in by Box 12 on the W-2

Another update from the Jungle…

unnamed Maryann handles payroll questions for her employer. She and her coworkers have been scrambling for a couple of years to ensure they comply with the Affordable Care Act (ACA). Last year was all about finding a software program that would allow the company to track the hours of its temporary employees.

This year, Maryann is looking at box 12 on the W-2. That’s the box where employers need to plug in the cost of the medical plan for the employee. Filling in this information is mandatory only for employers who filed at least 250 W-2’s in the previous tax year, meaning in 2013. Maryann’s company filed 170 W-2’s in 2013, so they aren’t required to complete box 12 for the 2014 tax year.

She knows that this January her company will issue 200 W-2’s covering the 2014 tax year. She thinks that number will rise to 250 during 2015. Maryann wants to get a head start on figuring out box 12 after some of the past fiascos in trying to comply with the ACA.

What should Maryann consider?

Maryann knows that the “cost” or “value” of health coverage refers to the premium paid for medical coverage in the health plan, known as “major medical”. She needs to verify what other costs, such as FSA contributions and dental and vision premiums, may need to be included.
Maryann can consult her company’s CPA firm for assistance on completing box 12.
Maryann can do some research in the ACA section of the IRS website during her spare time.

Update: According to the IRS website, no new guidance has been issued in the past year. As a result, reporting the cost of the employee medical plan in Box 12 is required only for employers who filed 250 W-2’s in the previous tax year. Employers who filed less than 250 W-2’s in the previous tax year may voluntarily report the medical plan cost in Box 12.

To download my free ebook, click here.

Join the HR Compliance Jungle today. Click here!

Visit us: http://www.complianceriskadvisor.com/

Good cover, lousy book

Another update from the Jungle….
NS12016-2 Gene is the managing partner of a professional services firm and he’s extremely proud of the team that works with him. He insists that they follow a reasonable work schedule leaving time for family. He rewards every employee with a bonus when the firm hits revenue targets.

The result is high productivity and soaring morale. People want to work at his firm and Gene has the luxury of picking job candidates that best fit his philosophy. It was all smooth sailing until six months ago when he hired Avery.

Avery looked great on paper. His three page resume looked impressive, full of academic achievements, extensive industry experience, and a history of community involvement. Avery showed up for the interview in an expensive suit, looking thoroughly professional. He was relaxed, articulate, and generated a good vibe when he met the whole team. He seemed like a great fit for the firm and Gene hired him.

Within a week, Avery was a problem. He told several senior partners that his old firm had a much better system for tracking client services. Then he told the secretaries they were being unfairly exploited and should go on strike for higher wages. After that he asked junior staff members why they worked so hard when there was no obvious path to promotions since all the senior partners were years from retirement.

Gene learned about the underbelly of discontent when a delegation of junior staff members cornered him to complain about Avery. The youngest secretary said she didn’t appreciate being told that she ought to feel exploited. That was one of the milder comments.

Gene’s always been told not to judge a book by its cover. But it’s obvious that underneath Avery’s polished façade lies a wealth of baggage picked up from the conditions he experienced with previous employers.

How should Gene handle this situation?

He can fire Avery immediately since the state has “at will” employment. But with Avery’s baggage, a wrongful termination lawsuit seems inevitable.
He could try to counsel Avery on his attitude but worries this will simply delay the inevitable outcome.
He can tell Avery that the firm isn’t the right fit and offer Avery a generous severance package in exchange for leaving immediately.

In the actual situation, the firm chose the third option because the management team decided that a toxic personality was too big a risk to keep on the payroll and the severance package limited any possible wrongful termination claims. Everyone lived happily ever after (except “Avery” who carried his baggage to the next employer’s office).

To download my free ebook, click here.

Join the HR Compliance Jungle today. Click here!

Visit us: http://www.complianceriskadvisor.com/

	Mae on Halloween Horror
	Mae on Freedom from Rules
	Genie Herron on Where Is He?
	Norma Shirk on Whose Side Are You On?
	Pat Brewer Hairston on Whose Side Are You On?

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this:

Share this: