Posts tagged Compliance
OSHA Recordability and Recordkeeping

Many organizations, including small businesses, are subject to OSHA recordkeeping requirements for injuries and illnesses that meet certain parameters. Although workplace incidents resulting in illness or injury can be rare for smaller organizations, especially those that are careful in their management of risks, these incidents must be properly identified, recorded and in some cases, reported, so that safe workplaces can be ensured and maintained.

As part of the Department of Labor, OSHA’s stated mission is “to assure safe and healthful working conditions for working men and women by setting and enforcing standards and by providing training, outreach, education and assistance.” As part of its enforcement mission, OSHA levies penalties and delivers consequences including assessing a maximum of $12,675 per violation for serious, less than serious and posting violations. Failure to abate an identified safety problem can result in a $12,675 per day penalty per instance of failure to abate, and willful or repeated violations can earn a penalty of up to $126,749 per violation.

Of course, the first priority for proper recordkeeping is to make the organization's leadership aware of potential hazards and need for training to keep employees safe at work. This is the goal of every great HR, Safety Department and executive leadership team. But in addition, the financial impact can be significant. OSHA-levied penalties can have a substantial impact on the operations of any business, but particularly on smaller organizations. In addition, the negative press such OSHA penalties receive, and the long life the cases have online in OSHA's own public database, can destroy trust among the public and be devastating to a company's brand.

How do employers know which incidents may be OSHA recordable, and therefore required to be included in records kept for review? An easy-to-use tool is provided by OSHA through elaws, and consists of a series of questions that take the user through the decision-making process. A decision tree visually illustrates the general steps in determining OSHA recordability:

Original version of decision tree available for review from  OSHA .

Original version of decision tree available for review from OSHA.

Recordability seems simple, but there is often more to the story depending on the facts of the situation, and things can change over time as well. Often when a worker is injured or becomes ill, initial first aid treatment may stabilize his or her condition, but later treatment or restrictions can turn a first aid only case into a recordable incident. Updating the status in the OSHA records is critical for compliance.

Finally, many organizations make the mistake of including workers' compensation documents, medical records and safety “root cause” reports in the same file with OSHA records. As with many auditors, OSHA will expect to review a set of information upon request when visiting your organization on site. That information includes, for each business location, for the past five years:

  • OSHA forms 301 or equivalent internal First Report of Incident forms that contain all of the same information
  • OSHA form 300 with information included on every recordable case (with identity masked for workers with sensitive cases like reproductive injury or biohazard exposure)
  • OSHA form 300A summary form completed and posted during the period of February 1-May 1 of each year

Medical records showing the factual basis for a decision of recordability or non-recordability should be retained and stored separately from these documents. If your HR team isn’t familiar with OSHA recordkeeping requirements for injuries and illnesses, consider seeking a safety or HR consultant to assist you in setting up your processes, so you can keep your workforce safe and remain in compliance with OSHA requirements. Don't overlook this critical, but easy to maintain, safety and workplace regulatory requirement.

Photo credit: AutrementDit Toronto. via Foter.com / CC BY

 

Change is the New Normal
Russell Senate Office Building, Washington, D.C.

Russell Senate Office Building, Washington, D.C.

In HR, we're used to rolling with the punches, adapting to changes every day in the needs of our organizations, the crises that arise among our workforce, and continuously learning how to navigate the workplace waters with new technology.

Recently, with a contentious election cycle completed, and an unexpected result (at least, unexpected by many), some of the HR compliance and policy issues that we all have been watching and working on for the past few years have been upended. What will the next four years bring? No one can predict that. But here are some of the areas I'll be watching with a new administration in place and (presumably) shifting alliances in Congress and new leaders/administrators at the Department of Labor.

  • Overtime Rule Changes: Even before the surprising injunction was issued out of federal court in Texas, the winds were shifting on the overtime rule salary threshold changes. In the first week after the election handed the presidency and majorities of both houses of Congress to the Republicans, even some Democratic lawmakers were willing to take a look at advocating for a more gradual increase in the threshold instead of doubling it in the first year and adding automatic increases. Perhaps they were thinking that a reasonable solution might save the rule from being reversed outright. Now that the rule has been blocked, it's anyone's guess whether it will be implemented as written anytime soon. With many employers having already made changes in advance of the 12/1/2016 implementation date, it may not matter to anyone but the most hardened procrastinators.
  • Inclusion of Pay Data in the EEO-1: This requirement isn't set to be rolled out until  March of 2018, but many have argued that the burden of this reporting and the privacy concerns that arise from this reporting requirement and the publication of aggregate data by the EEOC merit giving it another look. Employers with 100 or more employees and federal contractors with 50 or more employees make this a small business concern. President-Elect Trump has stated that he wants to make it easier for businesses to create jobs by cutting corporate taxes. Will he consider reducing regulatory burdens to be part of that picture?
  • Paid Maternity Leave: Mr. Trump has indicated that he is in favor of requiring six weeks of paid maternity leave. This is certainly a benefit that would allow many women to recover from birth and bond with their infants who would not otherwise have that opportunity if they are not currently eligible for short-term disability benefits through an employer. This policy (also championed by his daughter, Ivanka Trump) indicates that the new president may be willing to impose costly burdens on employers if he believes the outcome is worthwhile. This separates him from some other politicians in his party, who don't support such an expansion of paid leave.

What labor policy will we see from an incoming Republican president whose base of support includes party-crossing union voters as well as business owners? The answer is likely the be fascinating and unpredictable. These are just three of the policy issues I'll be following over the next year. Share your thoughts on issues important to HR in the comments below!

Photo Credit: Kelly Marinelli

10 Issues to Address Today to Comply With DOL's Overtime Rule Change

timeclock Unless you've been living under an HR rock for the past couple of months, you probably have heard about the more than doubling of the salary minimum for the white collar exemption from overtime, which will soon be increased to $47,476. I have a client who is fully engaged in the stages of grief over these new overtime rule changes just finalized by the Department of Labor (DOL). At first she was in shock (why haven’t I heard of this before?) denial (Congress will block it) and now she’s angry (where are we supposed to get the money to pay for this?!?).

She knows her organization is going to have to come up with a game plan, so I shared with her these 10 most critical issues HR managers need to consider in order to successfully implement the new rules. Some companies will easily get over this hump, and some will struggle, but we are all going to have to come to terms with these changes, because it looks like on December 1, 2016, they are going into effect. That doesn’t leave any of us much time to plan, so I recommend we all get started on addressing these 10 issues:

  1. Identifying who is actually over the new salary limit for the so-called “white-collar exemption” from overtime is not as clear-cut as it seems. Up to 10% of the salary amount can consist of non-discretionary bonuses. If a bonus is delivered based on predetermined factors like the company’s performance, then this amount can count for up to 10% of the annual salary amount for determining which employees fit the white-collar exemption. In contrast, if a bonus is not based on pre-announced parameters, but is paid by the employer spontaneously after the fact, then it wouldn’t meet this category.
  2. Dealing with the situation where a commissioned sales employee falls somewhat short of the limit due to natural fluctuations in earnings. The DOL gives employers the opportunity to make a “catch-up” payment of up to 10% of the base salary amount to the employee at the end of a calendar quarter in order to bring the employee within exempt status for that quarter. The employer has one pay period in which to make the catch-up payment, and if it is not made, then the employee is entitled to overtime pay for the quarter in which she didn’t meet the exemption.
  3. Deciding whether to raise pay of employees to enable them to qualify for the exemption or reclassify them as non-exempt. It’s relatively simple to do this when you’re looking at single employees, and you can consider their productivity, the type of work they do, and the value they bring to the organization. However, you won’t want to raise salary levels to make one person exempt, while designating another employee non-exempt in the same or a similar role. You also need to consider whether new hires into that role should be paid a higher rate and included in the exempt category. Making the right decision requires a review of not only how your organization looks today, but how it’s likely to grow, and the succession planning and talent acquisition strategies you have for the future. This, all before you even look at the budget you have in place (or not).
  4. Delivering the news to employees who are being reclassified. If you are raising the rate of pay for your employees, this one seems simple. But when communicating a pay increase, use it as an opportunity to set expectations, express appreciation and confidence, and capture the goodwill that it generates. If, on the other hand, you must tell your team members they are losing exempt status, some of them may be offended, especially if they view the change as a demotion. Carefully and completely explain the situation, including any benefits, such as recaptured time. Finally, if you must tell employees that not only are they being reclassified as non-exempt, but their hourly rate of pay will be reduced to reflect the actual hours they were working while exempt, get ready for some backlash. Be transparent; don’t sugar-coat the message, but do explain the “why” behind it. The company may not have any ability to pay additional compensation in the form of wages, but maybe there are other benefits or opportunities you can highlight to employees. Encourage them through the transition, and remain open to hearing their thoughts on how it’s going, if you’d like to retain your staff.
  5. Monitoring hours for newly classified non-exempt employees. Ask your soon-to-be reclassified employees to do a “dry run” of tracking their hours each week prior to the implementation date. Low-tech solutions like timecards or spreadsheets can be used for the testing period, but if your organization is of a certain size, you may find it’s more cost-effective to use technology to handle the increase in timekeeping duties. Either way, plan for the HR operations staff time needed to process payroll in an environment where additional hours must be tracked. Documentation is everything, so ensure that all non-exempt employees are accurately tracking, recording, and submitting their time.
  6. Troubleshooting use of smart phones and other devices by non-exempt employees. According to a 2013 Harvard Business Review article, “60% of those who carry smartphones for work are connected to their jobs 13.5 or more hours a day on weekdays and about five hours on weekends, for a total of about 72 hours.” Remember that whether non-exempt team members have permission to work or not, if they do work, they must be compensated for it under the Fair Labor Standards Act (FLSA). Newly non-exempt employees who have been used to receiving praise for going above and beyond as salaried exempt employees now must be coached not to work smart within the 40 hour workweeks they are allotted, unless overtime is approved. You will need to consider whether it makes sense to continue to allow smartphone use for work among your non-exempt team members.
  7. Communicating changes to workers that may remove flexibility. Although the DOL is correct that flexibility within a work day or a workweek for non-exempt workers is preserved, in that employees may take off two hours early for an appointment but later work from home for two hours, there will be impacts to some flexibly-scheduled employees, especially those who are working schedules that allow them to flex hours as long as they add up to 80 hours per pay period. The FLSA requires time and a half be paid for each hour in excess of 40 hours in a workweek.  So these arrangements suddenly become much more expensive for employers to allow. And don’t forget state law when considering flexibility, because California, for example, has its own rules.
  8. Swallowing the increased costs that come with paying for work the organization was previously getting within the lower salary level.  As mentioned above, it is possible to make this transition at no cost, by determining how many hours your currently exempt employees between today’s salary limit of $23,660 and the new limit of $47,476 are actually working, and divide their current salary by that number of hours to get their new hourly wage when they are converted to non-exempt status. As an example, if I am currently exempt, with a salary of $40,000 per year, and I divide that amount by 52 to get the weekly wage, and then divide again by the 40 hours in a workweek, I get an hourly wage of $19.23. But if I have actually been consistently working 54 hours per week, and my employer instead uses that as my workweek in the calculation, then that hourly wage goes down to $14.25. Caution: in today’s current tight labor market, this is a tough sell, and turnover is expensive (see this EREmedia.com piece for more specifics), so this “cost-free” option may end up costing you tens of thousands of dollars per employee.
  9. Supporting salaried workers making over the new limit, as extra work gets pushed on them in the effort to avoid additional labor costs. If you’re unable to convert newly non-exempt employees to an adjusted hourly wage, as descried above, you may instead decide to directly convert the salary to an hourly wage when you reclassify your employees, and simply shift the work to those who are currently being paid above the new salary limit for the white collar exemption. This shift in work will certainly affect the outlook of those employees, which could also hurt engagement and retention. The ideal solution will depend on your budget (if any), a thorough analysis of the work activities in the roles, and a candid discussion of the value of the work being performed and its impact on the organization’s bottom line.
  10. Finding systems and technology to help the organization track time in an efficient and compliant manner. Kronos, ADP and Insperity all have offerings, and if you outsource payroll, you should check with your vendor right away to initiate a review of your data feed and processes, so there are no surprises when suddenly a large group of employees are reclassified. If your organization does not currently have a timekeeping and attendance system in place, toptenreviews.com has a lot of information about several different options, features and cost of systems.

Address these 10 challenges head-on, and you will be more than ready when the rule change goes into effect.

Visit Solve HR, Inc.

Photo credit: mikecogh via Foter.com / CC BY-SA

My Employee is Trashing Us on Social Media

social media Dear Kelly,

My employee in customer service is a decent performer but she definitely brings the drama. She got really mad about a schedule change the other day and let loose on her Facebook page. She’s friends with a lot of people at our office, including me, and now people are “liking” her post and there’s a ton of gossip around it. It’s totally distracting from our work.

The schedule change is unpopular (I don’t like it either) but the company had to do it so they could put together a way to cover expanded hours because our business is growing. My manager and other people are asking what I’m going to do about the Facebook post and I’m not sure what to tell them.

What do you think?

Jesse

Hi Jesse,

Change is the only constant in life. Your employees are reacting in an expected way to a change they don’t like, and it’s your job to help them through that process. You said yourself that you don’t like the change, but you recognize it’s needed for business reasons.

Have you gotten your team together to make sure they are all aware of why the change is necessary? Do they believe that you understand the many difficulties the change might present, like childcare challenges, personal adjustments, and other things that can affect them in significant ways? Do they know that you appreciate their willingness to work through this?

That’s the place to start, with real, transparent communication. You may find that if you are willing to listen, support and understand them, your team will adjust more quickly to these tough changes. None of you has a choice about the schedule changes-that’s true. But ignoring the fact that it’s a tough change isn’t going to solve this problem. It will only lead your employees to think they are not valued, and will hurt the level of trust, engagement and commitment of your team.

As far as the social media postings, tread carefully. Consult with your HR department and your company’s legal counsel. The National Labor Relations Board (NLRB) warns that social media policies “should not be so sweeping that they prohibit the kinds of activity protected by federal labor law, such as the discussion of wages or working conditions among employees.” Scheduling can be characterized as working conditions. So be sure to get advice before deciding whether to address the post, and how to communicate that.

You can coach your employees on finding proactive solutions to problems, and encouraging them to come up with ideas instead of complaining. By rewarding this positive behavior, and ignoring the drama, you may find that it dissipates more quickly. If you focus on the trust, transparency and communication, you may find that the social media issues and gossip won’t be a problem anymore.

Best wishes,

Kelly

Visit Solve HR, Inc.

Photo credit: Jason A. Howie via Foter.com / CC BY