Fourth Quarter 2016

 

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In This Issue:

Quick Hits

Not Too Late: FLSA Compliance

Election Season

Regulatory Update

Retaliation

Employment Classifications and NLRB

Raising the Stakes: Federal Labor Law Penalties

Litigation Update

Enforcing Non-Solicitation Clauses

In the News

Security Breach: Confidential and Proprietary Information

Workplace Trends

Work/Life Balance: The 30-Hour Workweek

Wisconsin’s "Living Wage"

Legal Update

Substantial Fault & Unemployment Insurance

Links of Note

What’s on Your Mind?

Trying to Stay Positive

Striving for Perfection

Teamwork vs. Individual Productivity

Workplace Culture

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

Quick Hits

Not Too Late: FLSA Compliance

Revisions to the Fair Labor Standards Act's (FLSA) white collar exemptions take effect on December 1, 2016 — just over one month away. Be prepared! For information on how the changes may affect your business, see our FAQs here, here, and here; or contact Adam to schedule a free consultation at 414-446-8800 or adam@goldsteinsc.com.

Another FLSA-related reminder: If you have not yet done so, update your FLSA poster. The Department of Labor (DOL) offers one solution.

Election Season

It's no secret that elections can cause heated workplace debates as employees passionately support their respective candidates (or oppose the other candidate(s), or just "stir the pot"). And what of t-shirts and pins, or employees who are provocative on Facebook or Twitter? With fewer than 20 days until election day, it's important to maintain professional decorum while respecting employees' rights: Maintain a "neutral" business stance; make no assumptions about the political positions of your employees, co-workers, vendors, and clients; and instruct your employees on how to engage (or disengage) with clients if the conversation turns to politics. Employee comments, even if made off-hours and on a personal account, may have serious implications for your business.

Also, do not forget that employees must be granted up to three hours leave to vote (provided the leave was requested prior to election day). Businesses can designate the time of leave and deduct pay for missed work.

Regulatory Update

Retaliation

According to the Equal Employment Opportunity Commission (EEOC), "retaliation is the most frequently alleged basis of discrimination" and "the most common discrimination finding." Both the frequency of complaints and the size of damage awards have businesses concerned, and rightly so. The EEOC recently released an updated guide on retaliation to address the increase in retaliation cases. Additional EEOC guidance is contained in these FAQs.

Employment Classifications and NLRB

The National Labor Relations Board (NLRB) recently released a memo advising that misclassifying employees as independent contractors violates Section 8(a)(1) of the National Labor Relations Act (NLRA). As a refresher, Section 7 of the NLRA provides employees with the right to self-organize, form a union, collectively bargain, and engage in "concerted" activities (e.g., communications regarding wages, benefits, or terms and conditions of employment). Section 8(a)(1) makes it unlawful for a business to interfere with, restrain, or coerce employees in the exercise of these Section 7 rights. In the case under review, the business advised its truck drivers that they were independent contractors (not employees), and therefore had no right to form a union. The truck drivers were, in fact, employees, leading the NLRB to conclude that misclassifying the employees as independent contractors infringed upon their Section 7 rights (in this case, their right to form a union), and therefore violated Section 8(a)(1).

Employer Takeaway: Consider this yet another reason for businesses to get it right when it comes to the independent contractor/employee determination. Contact Julia at 414-446-8800 or julia@goldsteinsc.com with questions on employee classification.

Raising the Stakes: Federal Labor Law Penalties

The DOL recently released documentation of the 2016 monetary penalty adjustments issued pursuant to the 2015 Inflation Adjustment Act. These changes raise the maximum penalties for a variety of violations, including those involving the Fair Labor Standards Act (FLSA), Family and Medical Leave Act (FMLA), and Occupational Safety and Health Act (OSHA). For example, violations of the OSHA posting requirement now carry a $12,471 maximum penalty, up from $7,000.

Employer Takeaway: An increase in monetary penalties for federal labor law violations provides yet additional incentive to ensure that you are in compliance with legal requirements. Certain violations, such as posting requirements, have quick and easy solutions as OSHA, FLSA, and FMLA posters are available online. More complex matters—such as overtime—may require substantially more work and attention. If you have questions about potential violations or penalties, contact Adam at 414-446-8800 or adam@goldsteinsc.com.

Litigation Update

Enforcing Non-Solicitation Clauses

In Manitowoc Company, Inc. v. Lanning, Manitowoc Company sued former employee John Lanning to enforce an agreement Lanning had signed shortly before leaving the company. Lanning, an engineer, had been a key employee for 25 years before leaving to work for a competitor. The agreement prohibited Lanning from prompting any other Manitowoc Company employee to accept employment with a competitor, supplier, or customer. The court of appeals held that the agreement was unenforceable because it was overly broad (i.e., applied no matter the level of the employee). As a result, the lower court's decision in favor of Manitowoc Company, awarding $100,000 in damages and over $1 million in attorneys' fees and costs, was reversed.

Business Takeaway: The unenforceable agreement in Lanning contains language commonly used in such provisions. The court of appeals seems to suggest that an agreement must be tailored in virtually all respects, from the definition of "employee" and "competitor" to "geography" and "duration." The agreement must also account for scenarios in which it cannot legally apply—such as an employee's retirement, relocation, or reduction in hours for personal reasons. For help updating or implementing non-solicitation language, contact Michael at 414-446-8800 or michael@goldsteinsc.com.

In the News

Security Breach: Confidential and Proprietary Information

In just three years, two employees of Booz Allen Hamilton, a consulting firm that works with intelligence agencies (including the National Security Agency), have been implicated for stealing classified information from the NSA—first Edward Snowden and, in August 2016, Harold Martin. While much is known about the Snowden breach, Martin's motives remain unclear (e.g., espionage or hoarding). 

An increased use of technology in the workplace, from company computer systems to tablets and smartphones, means more employees have easier access to confidential company data and proprietary information, both during and after employment. The Computer Fraud and Abuse Act (CFAA) allows businesses to seek damages from these current and/or former employees for the improper use of such information. Businesses can also go after third parties, including competitors, that are working with current or former employees without authorization. The CFAA has broad implications (particularly in the Seventh Circuit) and will likely be the subject of increased litigation in the future.

Business Takeaway: Expressly outlining each employee's permitted access to company data, systems, trade secrets, proprietary information, etc., will help establish your position if you believe an employee or former employee acted beyond his/her authority. Be explicit about the penalties for a violation as well. If you have any questions about employee authorization, device policies, or protecting confidential and proprietary information, contact Adam at 414-446-8800 or adam@goldsteinsc.com.

Workplace Trends

Work/Life Balance: The 30-Hour Workweek

Amazon is experimenting with a 30-hour workweek for designated teams within the company, offering 75% of full-time salary and no decrease in benefits. Initial favorable reaction comes from parents wishing to maintain the benefits of a full-time job, but at the same time, spend more time with family. Forbes suggests this is also a big draw for millennials -  who seemingly place greater importance on healthy work/life balance than previous generations.

Business Takeaway: The results of Amazon’s experiment remain to be seen, but the initiative has the potential to significantly impact the future of work. It is also unclear whether such a program could translate to other businesses and whether these employees will travel the same career path as their full-time counterparts.

Wisconsin’s "Living Wage"

A $15/hour minimum wage has been proposed for Milwaukee County employees and contractors, increasing incrementally from $11.68/hour (as of 2016) to $15/hour by 2021. Dane County recently approved a similar plan for county workers and contractors. Governor Scott Walker has opposed any increase to the state minimum wage ($7.25/hour, the same as the federal minimum wage) which would affect private sector jobs. Conflicting studies suggest that it is too early to conclude how a higher minimum wage has affected those cities and states that adopted one. For example, some studies show that the increased minimum wage adopted by Seattle in 2015 ($11/hour for large businesses) has had a neutral or positive impact (namely, that the forecasted reduction in jobs has not come to pass) while others suggest it is not working as intended.

Business Takeaway: A growing number of cities and states across the country have adopted, or are considering adopting, a higher minimum wage. How would a gradual increase in minimum wage affect your business if such legislation were enacted?

Legal Update

"Substantial Fault" & Unemployment Insurance

Under certain circumstances, employees terminated for "substantial fault" receive a smaller payout from unemployment insurance. However, it can be difficult to determine exactly what constitutes "substantial fault" as the 2013 revisions to the "substantial fault" law fail to define it adequately. Instead, they include three examples of what is not "substantial fault" (e.g., minor infractions, inadvertent errors, and mistakes made due to lack of skill). A recent court of appeals case involving an employee terminated for consistent cash handling errors seeks to clarify the issue. In Operton v. Labor and Industry Review Commission, the court concluded that a "frequency of 'inadvertent errors'" did not constitute "substantial fault," as Operton's cash handling errors, though numerous, were inadvertent (as opposed to intentional).

Business take-away: Keep your eye out for further developments on the scope of "substantial fault." When terminating an employee, consider whether the employee's actions were inadvertent or intentional, as the answer may inform your decision of whether to invoke the "substantial fault" defense. If you have any questions regarding "substantial fault," contact Adam at 414-446-8800 or adam@goldsteinsc.com.

Links of Note

What’s on Your Mind?

In recent weeks, there has been a lot of talk about the concept of "implicit bias." Harvard's Project Implicit provides a free Implicit Association Test that analyzes beliefs and attitudes you may not realize you have (and display). Have you and/or your team taken the test? If so, were you surprised by the results?

Trying to Stay Positive

What can a company legally do to promote a "positive" work environment? Maria Konnikova analyzes the impact of the National Labor Relations Board's ruling against T-Mobile's vaguely defined "positive" work environment.

Striving for Perfection

No business is perfect, but by studying successful businesses, we see what is possible. This was the idea behind Jim Collins' bestseller Good to Great. Quartz also has compiled a compelling series that highlights aspects of a variety of businesses to show what might comprise the perfect company.

Teamwork vs. Individual Productivity

A Washington Post article on helicopter parenting emphasizes the importance of self-reliance and individual work—a common theme these days. Candor, a free web tool, provides a platform to allow individuals to generate ideas independently. Only after group members formulate their own ideas is it time to come to the table and brainstorm as a team.

Workplace Culture

Adam Grant suggests job candidates analyze three major concerns with any potential employer: justice, security, and control. How might your business fare to outside eyes on these criteria?

Upcoming Events

10/20/16

Updating Your Employee Handbook

ABC Conference

11/17/16

Ethics and Social Media

MBA Law & Technology Conference


For more information on upcoming events, click here.