Fourth Quarter 2015

 

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In This Issue:

Firm News

Legal Update

Verdicts and Settlements

Religious Rhetoric

FLSA White Collar Exemptions Revised

2016 – Revenge of the PPACA

In the News

Portable Electronics Strike Back

Employment Turnover

HR News

Leap Year Brings Payroll Challenges

Published or Quoted Elsewhere:

Timing Works Out Well for Goldstein

Wisconsin Law Journal

Concealed Carry Concerns

Ozaukee Press

Packing Heat: Local Businesses Torn on Concealed Carry Law

Fox Point Patch

Social Media and the Workplace

(SBDC Front Page)

Are Unpaid Internships Legal?

(Dime Crunch)

Loose Lips Sink Ships – Things That Can Get Educators in Legal Hot Water!

(Teachers.Net Gazette)

The Focus on Misclassification

(SBDC Front Page)

Hiring in the New Economy

(SBDC Front Page)

Understanding and Bridging
the Generational Gap

(WORK Spring, 2009)

What is the Role of an
Attorney on the Board?

(Compasspoint Board Café - February 28, 2008)

Also published in Blueavocado.org - June 17, 2008

How Do I Handle an
Underperforming Staff Person?

(Wisconsin Lawyer - Vol. 81,
No. 2, February 2008)

Previous Issues

Merry Christmas, Happy New Year, and Happy Holidays from Goldstein Law Group, S.C. As we approach our eighth anniversary, and our team continues to grow, we take this time to stop and count our blessings. Wishing you good health and prosperity in 2016.

Firm News

We would like to introduce the newest member of our team: paralegal Adam Becker. Adam is a graduate of the University of Wisconsin and the paralegal program at MATC. Adam supports both transactional work and litigation, helping us round out the services we offer our clients. Welcome Adam!

Legal Update

Verdicts & Settlements – "These are not the results you are looking for."

  • A settlement awarded $220,000.00 to exotic dancers in Buffalo County who claimed they were not paid minimum wage or overtime.
  • A settlement in the amount of $18 million was awarded to 1,016 Haliburton employees claiming unpaid overtime. Although the case was settled, and stemmed from Haliburton’s self-report of misclassified employees, the settlement permitted the Department of Labor to impose the maximum penalty allowable.

Religious Rhetoric – "It’s a trap!"

Rhetoric about Syrian immigrants, and Muslims in general, in the media and on the campaign trail is both ubiquitous and brash. In the workplace, such language creates significant legal exposure. In Huri v. Office of the Chief Judge of the Cir. Ct. of Cook County (7th Cir. 2015), the employer allegedly stated a preference for "good churchgoing Christians" and engaged in other actions against Muslims (e.g., shunning, trumped-up discipline, and other abusive language and behavior).

Employer take-away: In this case, the 7th Circuit reinstated the employee’s suit, reversing a lower court, and reminding us of the danger of such language in a work setting.

FLSA White Collar Exemptions Revised – "May the Force be with you."

The comment period on the United States Department of Labor’s proposed rule changes regarding white collar exemptions ended September 4, 2015. The Department of Labor received over 290,000 comments which are now being reviewed. While it is anticipated that the final rule may not be out (and effective) until late 2016, the period of time between the announced rule and its effective date may be shorter than usual (perhaps only 30-60 days).

Most significantly, the proposed rule changes:

  • Increase the salary threshold for "exempt" status. Currently, certain professionals and managers are exempt from overtime pay if they earn more than $23,660 per year and perform primarily "exempt" duties. The proposed rule would raise this salary threshold to $50,440 per year, instantly making a large number of “exempt” employees "non-exempt" (i.e., OT-qualifying).
  • Require annual increases to the salary threshold to keep pace with inflation and the cost of living.

There is some talk that the DOL may back away from the $50,440 figure, may allow certain bonuses to count toward that total, and may introduce modifications to the "duties test."

Employer take-away: These rules apply to any employee whom you consider exempt from overtime. Generally speaking, in order to be exempt, the employee must be salaried (versus hourly), paid above a certain level (currently $455/week, projected to increase to $970/week), and meet one of the statute’s various duties tests. It may be the end of 2016 before proposed changes become rules, but there are steps to take now to prepare for the changes and avoid misunderstandings:

  • Audit your exempt v. non-exempt classifications. Are your classifications accurate, and how much will they change under the new law?
  • Educate managers about how to discuss the issue with employees as they will become increasingly aware that they may qualify for overtime (1½ times their pay for all hours over 40 per workweek).
  • Ask managers to report concerns they are hearing from employees.
  • Plan for which, and how many, employees will shift from exempt to non-exempt under the new rules, and how to manage this transition.
  • Contact Adam at 414-446-8800 or adam@goldsteinsc.com should you wish to schedule a consultation regarding the new white collar exemptions.

2016 – Revenge of the PPACA

Certain Affordable Care Act reporting requirements take effect in 2016. Beginning in January 2016, employers of at least 50 full-time equivalent employees must complete and file IRS Forms 1094-C and 1095-C. All full-time employees must also be provided a copy of Form 1095-C. These reports document whether you offer employer-sponsored health insurance and, if so, the particulars of the plan(s) offered. 2016 also means higher penalties for employees without coverage – from $395 or 2% of income to $695 or 2.5% of income.

Employers are also looking to 2018, just two years away, when the Cadillac Tax is scheduled to take effect. The Cadillac Tax imposes a 40% levy on health plans which exceed $10,200 per individual or $27,500 per family. 2016 also means higher penalties for employees without coverage – from $395 or 2% of income to $695 or 2.5% of income.

Employer take-away:It is not too late to discuss "pay or play," the precise type of coverage to offer, how to complete the 1094-C or 1095-C, or how to plan for the Cadillac Tax in 2018. Contact Adam at 414-446-8800 or adam@goldsteinsc.com should you wish to schedule a consultation.

In the News

Portable Electronics Strike Back

As technology advances and provides greater opportunities for remote communication and work, new issues arise. Off-the-clock employees can now text, email, handle voicemails, etc. from portable electronic devices when away from the office. How frequently does this occur, and does this work time need to be recorded? The Department of Labor is contemplating a rule regarding portable electronic devices, communications and payment for off-the-clock activities (including, potentially, overtime).

Employer take-away: If / when changes to the FLSA white collar exemptions come into effect, one possibility is strong handbook language – including an email curfew or banning work away from the office in its entirety.

Employment Turnover – "When I left you, I was but the learner; now I am the master."

An issue that comes our way with increasing frequency is that of employee turnover. Many employers express anxiety about finding skilled workers. Holding on to good employees has become an equally difficult challenge, and requires a whole new level of engagement – beyond annual performance reviews and the occasional "cake in the breakroom."

According to author Daniel Pink, the three elements of employee engagement are: (1) autonomy; (2) mastery (the sense of having expertise); and (3) purpose (the sense that what they are doing is meaningful). Professor Tal Ben Shahar articulates it as follows: People experience work as a job (paying the bills), a career (opportunity for advancement), or a calling (as an end in and of itself).

Professor Barry Schwartz describes the issue as follows:

You enter an occupation with a variety of aspirations aside from receiving your pay. But then you discover that your work is structured so that most of those aspirations will be unmet. Maybe you’re a call center employee who wants to help customers solve their problems — but you find out that all that matters is how quickly you terminate each call. Or you’re a teacher who wants to educate kids — but you discover that only their test scores matter. Or you’re a corporate lawyer who wants to serve his client with care and professionalism — but you learn that racking up billable hours is all that really counts.
Pretty soon, you lose your lofty aspirations. And over time, later generations don’t even develop the lofty aspirations in the first place. Compensation becomes the measure of all that is possible from work. When employees negotiate, they negotiate for improved compensation, since nothing else is on the table.

Employer take-away: The cost of hiring and training a new employee can meet or exceed the cost of retaining an existing employee. For additional ideas on the subject, contact Adam at 414-446-8800 or adam@goldsteinsc.com

HR News

Leap Year Brings Payroll Challenges - "No, there is another."

In 2016, February will have 29 days. While an additional day on the calendar may not have much effect on most of us, it can be a headache for payroll professionals - especially because January 1st falls on a Friday. So if the first paycheck of 2015 was issued on Jan. 1 (a Thursday), an additional payday will occur on Dec. 31, 2015 (also a Thursday). This will also be true if the first paycheck of 2015 was issued on Jan. 2 (a Friday), and payroll policy provides for salaries to be paid the day before a holiday. This "Leap Year problem" has a surpising number of repercussions including income tax witholding, health savings account deferrals, 401K witholdings, and even child support payments. If you have questions about Leap Year payroll issues, contact Adam at 414-446-8800 or adam@goldsteinsc.com to schedule a consultation.

Upcoming Events

1/12/16

Legal & Legislative Update

Racine Workforce Development Center


1/13/16

Legal & Legislative Update

SPAHRA (SHRM Stevens Point Area HR Assn.)


3/3/16

Legal & Legislative Update

Workforce Development Center


3/16/16

Legal & Legislative Update

Workforce Development Center

3/17/16

Legal & Legislative Update

SRKA (SHRM Racine/Kenosha Chapter)


For more information on upcoming events, click here.