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Workplace rules are back, baby!

Peter Robb, General Counsel for the National Labor Relations Board (and my new hero), issued a memorandum on Wednesday that employers should love. Mr. Robb has declared that nine standard employer policies will now be presumed lawful under the National Labor Relations Act.

The memorandum was based on the Board’s decision in The Boeing Company, issued in December 2017. Before Boeingthe NLRB under the Obama Administration had taken the position that these policies were unlawful because they could have a “chilling effect” on employees’ exercise of their rights to engage in “protected concerted activity” under Section 7 of the NLRA.

So, without further ado, here are nine standard employment policies that the Board says are legal again, absent evidence that they’re being applied to protected concerted activity. (Welcome back!) I’ll also go over workplace rules that continue to violate the NLRA, and workplace rules that will be evaluated on a case-by-case basis.

Workplace rules that are presumed lawful

No. 1: Civility rules. The Equal Employment Opportunity Commission must be happy about this one because their proposed guidance on workplace harassment recommended civility training for employees as a harassment-prevention measure. The EEOC had to include a footnote that its recommendation could be problematic from an NLRA standpoint. (I’d been recommending to clients that they restrict civility training to management until this conflict between the EEOC and the NLRB was resolved.)

Conflict hereby resolved! According to the General Counsel, an expectation of civility does not interfere with employees’ right to engage in protected concerted activity because they can almost always criticize the employer, or individual supervisors, in a civil manner.

No. 2: No photography, no recording. Although there are occasions when employees may want to photograph or record working conditions or labor protests, the General Counsel says, for the most part rules prohibiting unauthorized recordings have no impact on Section 7 rights and therefore are lawful. However, “a ban on mere possession of cell phones at work may be unlawful where the employees’ main method of communication during the work day is by cell phone.” In other words, the ban should be on unauthorized recording, not on possession of a device that can record.

No. 3: Bans on insubordination, non-cooperation, adversely affecting operations. “An employer has a legitimate and substantial interest in preventing insubordination or non-cooperation at work. Furthermore, during working time an employer has every right to expect employees to perform their work and follow directives.”

Duh. It’s sad that this even had to be said, but thank you, General Counsel Robb, for saying it.

(Of course, if the “insubordination” is engaging in protected concerted activity, then the application of the rule would violate the NLRA.)

No. 4: Bans on disruptive behavior. Employers again have the right to prohibit “fighting, roughhousing, horseplay, tomfoolery, and other shenanigans.” Also, “yelling, profanity, hostile or angry tones, throwing things, slamming doors, waving arms or fists, verbal abuse, destruction of property, threats, or outright violence.”

There may, however, be instances when some of this activity is associated with a strike or walkout and may be protected. And you can’t ban strikes or walkouts.

No. 5: Protecting confidential and proprietary information, and customer information. Yes, employers, it is again legal for you to prohibit employees from disclosing your confidential and proprietary information. “In addition, employees do not have a right under the Act to disclose employee information obtained from unauthorized access/use of confidential records, or to remove records from the employer’s premises.” (Emphasis added.) To be lawful under the new standard, the employer should ban the unauthorized access or disclosure of confidential employee information rather than flatly banning disclosure of any employee information.

No. 6: Bans on defamation or misrepresentation. According to the General Counsel, because “defamatory” statements or “misrepresentations” imply some level of deliberate falsehood or misleading, “Employees will generally understand that these types of rules do not apply to subjectively honest protected concerted speech.”

No. 7: Bans on unauthorized use of company logo or intellectual property. “Most activity covered by this [type of] rule is unprotected, including use of employer intellectual property for unprotected personal gain or using it to give the impression one’s activities are condoned by the employer,” the memorandum says. And I love this:

“Employers have a significant interest in protecting their intellectual property, including logos, trademarks, and service marks. Such property can be worth millions of dollars and be central to a company’s business model. Failure to police the use of such property can result in its loss, which can be a crippling blow to a company. Employers also have an interest in ensuring that employee social media posts and other publications do not appear to be official via the presence of the employer’s logo.”

No. 8: Requiring authorization to speak for the employer. Yet another “duh” moment: “Employers have a significant interest in ensuring that only authorized employees speak for the company.”

No. 9: Bans on disloyalty, nepotism, or self-enrichment. Even the Obama Board didn’t have much of a problem with employer rules that banned (or required disclosure of) conflicts of interest, or employees who had financial interests in competitors of the employer. The Trump Board agrees.

Workplace rules that are presumed unlawful

The memorandum lists two types of employer rules that will continue to be found unlawful, and I believe most employers are already aware of these:

  • Prohibiting employees from discussing or disclosing information about wages, benefits, or other conditions of employment.
  • Prohibiting employees from joining outside organizations or “voting on matters concerning” the employer. 

These rules are directly related to activity protected by Section 7 of the NLRA. Therefore, they are presumed unlawful, and NLRB Regional Offices are instructed to issue complaints “absent settlement.” (The Regional Offices do have the option of asking for advice from the Office of the General Counsel if they think special circumstances apply.)

Workplace rules that require case-by-case assessment

The memorandum also discusses some “gray area” rules, which may or may not violate the NLRA depending on the circumstances. The following types of rules will be submitted to the Office of the General Counsel and evaluated on a case-by-case basis:

  • “Broad conflict-of-interest rules that do not specifically target fraud and self-enrichment . . . and do not restrict membership in, or voting for, a union.”
  • Broad or vague “employer confidentiality” rules that don’t focus on confidential and proprietary, or customer, information and that don’t specifically restrict Section 7 activity (discussion of wages, benefits, or other terms and conditions of employment).
  • Rules prohibiting disparagement of the employer, as opposed to disparagement of employees.
  • Rules restricting use of the employer’s name, rather than just its logo or trademarks.
  • Rules that prohibit employees from speaking to the media or third parties at all (as opposed to communications to third parties where the employee purports to represent the employer).
  • “Rules banning off-duty conduct that might harm the employer.” A little vague.
  • “Rules against making false or inaccurate statements (as opposed to rules against making defamatory statements) . . ..”

For the past several years, employers have been struggling to comply with the Board’s interpretations while retaining the right to maintain some semblance of order in their workplaces. The General Counsel’s memorandum is a giant step in the right direction.

Article written by: Robin Shea, partner with leading national labor and employment law firm (and ThinkHR strategic employment law partner) Constangy, Brooks, Smith & Prophete, LLP

Originally posted on thinkhr.com

Managing pay can be tricky. Handled incorrectly, pay can create problems for an employer — everything from the inability to attract the right candidates and losing great employees to the competition to presenteeism (employees who are physically in the workplace but not engaged in their work), employee relations issues, compliance audits, and lawsuits. These outcomes impact productivity. They infect the company culture. And they tarnish the employer brand.

In your role as a trusted advisor to clients who may be struggling with their total compensation programs, you need to be ready to help them determine how to make the right decisions. This requires you to be aware of new trends while also helping clients manage risk by complying with wage and hour rules.

Pay Versus Employee Motivation and Retention

Many employee engagement reports note that pay doesn’t impact motivation as much as other work factors, such as:

  • The quality of the company and its management.
  • Belief in the organization’s products.
  • Alignment with the company’s mission, values, and goals.
  • Ability to make a meaningful contribution.
  • Ability to develop new professional skills.

IBM’s Smarter Workforce Institute’s 2017 study looked at employees’ decisions to leave their jobs and found that the three generations comprising most of today’s workforce would be open to considering new job opportunities for better compensation and benefits: Millennials at 77 percent, Generation X at 78 percent, and Baby Boomers at 70 percent. Those are big numbers, and they shouldn’t be ignored when designing pay plans.

Further, while pay may not be a motivator, it can be a powerful dissatisfier when employees believe that they aren’t being paid correctly for the value they are bringing to the organization, or at the market value of their jobs. Worse yet is the perceived — or real — belief that their pay is lower than what their co-workers are earning. In some markets, this problem is genuine, as companies in hot labor markets struggle with paying new people more than current employees, causing pay compression. Employees do talk and pay information is readily available.

Considering every variable that goes into compensation planning can be complicated. Your clients can start by: setting a compensation strategy to fit their company’s needs and budget; developing compensation programs to fit that strategy, the talent marketplace, and employee demographics; and then administering the compensation program fairly and in compliance with federal, state, and local laws.

Equal Pay Mandates

The Equal Employment Opportunity Commission’s (EEOC) Strategic Enforcement Plan prioritizes enforcing the Equal Pay Act (EPA) to close the pay gap between men and women, and the Trump administration has been silent about changing this direction. This topic is trending, as legislators in more than 40 jurisdictions introduced bills related to equal pay in 2017. California, New York, Massachusetts, and Maryland are setting the pace with laws addressing this issue. These states have set rules that more broadly define the equal pay standard requiring different factors, such as skill, effort, working conditions, and responsibility, in justifying gender pay disparities. These states are also broadening the geographic restrictions for employee pay differentials.

We expect that more states will enact equal pay rules in 2018. Companies should review gender pay differences in their workforce, document the bona fide business reasons for the differences, and correct wage disparities as needed. Permitted differences could include seniority, documented merit performance differences, pay based on quantity or quality of production or sales quotas, or geographic differentials.

Salary History Ban

The issue of pay has traditionally been an inevitable topic of discussion in any job interview. However, in a growing number of places throughout the country, an employer can no longer ask an applicant about his or her salary history. At least 21 states and Washington, D.C., along with several municipalities, have proposed legislation that would prohibit salary history questions. California (effective January 2018), Delaware (effective December 2017), Massachusetts (effective July 2018), and Oregon (effective January 2019) have enacted laws impacting private employers. More bans are expected at both the state and local level.

While the provisions of each law vary, they make it illegal for employers to ask applicants about their current compensation or how they were paid at past jobs. The rationale for these laws stems from the equal pay issue and the premise that pay for the job should be based on the value of the job to the organization, not the pay an applicant might be willing to accept. These laws are designed to reverse the pattern of wage inequality that resulted from past gender bias or discrimination.

For employers, this means:

  • Establishing compensation ranges for open positions and asking applicants if the salary range for the position would meet their compensation expectations.
  • Updating employment applications to remove the salary history information.
  • Training hiring managers and interviewers to avoid asking questions about salary history.

Pay Transparency

Outside of certain industries, the public sector, and unionized environments where pay grades and step increases are common knowledge, historically many employers have had a practice of discouraging employees from openly discussing their compensation. That practice is fast becoming history, due to another notable trend in state legislatures: enacting laws that allow employees to discuss their wages and other forms of compensation with others. Although the provisions of the laws vary, California, Colorado, Connecticut, Delaware, Washington, D.C., Illinois, Louisiana, Maine, Maryland, Michigan, Minnesota, New Hampshire, New Jersey, New York, Oregon, and Vermont now have laws in place allowing pay transparency.

In addition to these state laws, Section 7 of the National Labor Relations Act (NLRA) allows employees to engage in pay discussions as “concerted and protected activities for the purpose of collective bargaining or other mutual aid or protection.” During the Obama administration, the National Labor Relations Board (NLRB) broadly interpreted the NLRA’s Section 7 to side with employees’ rights to discuss wages and other terms and conditions of employment. Unless the Trump administration’s NLRB changes direction on this issue, which is not expected, the clear message for employers is to remove any prohibitions of employees discussing pay or working conditions with others.

Be Vigilant

Employee compensation has always been a hot topic, and this year the temperature will continue to rise. Keep abreast of legislative and regulatory changes that impact pay practices to help your clients stay in compliance with the pay laws that are spreading throughout the country.

Now is a good time to suggest that your clients consider conducting pay audits, updating compensation plans, making compensation adjustments where needed, training managers regarding pay strategy and practice, and communicating the company’s compensation strategy and incentive plans to employees.

 

By Laura Kerekes, SPHR, SHRM-SCPz

Originally posted on thinkHR.com

IRS Releases Publication 15 and W-4 Withholding Guidance for 2018

On January 31, 2018, the federal Internal Revenue Service (IRS) released Publication 15 — Introductory Material, which includes the following:

  • 2018 federal income tax withholding tables.
  • Exempt Form W-4.
  • New information on:
    • Withholding allowance.
    • Withholding on supplemental wages.
    • Backup withholding.
    • Moving expense reimbursement.
    • Social Security and Medicare tax for 2018.
    • Disaster tax relief.

Read Publication 15 and further details here.

EEOC Penalty Increases for Failure to Post Required Notices

On January 18, 2018, the U.S. Equal Employment Opportunity Commission (EEOC) released a final rule increasing the penalty amount from $534 to $545 for violations of Title VII of the Civil Rights Act (Title VII), the Americans with Disabilities Act (ADA), and the Genetic Information Nondiscrimination Act (GINA) notice posting requirements.

The final rule is effective February 20, 2018.

Originally Published By ThinkHR.com

On August 22, 2017, in AARP v EEOC, a federal court found that regulations allowing employers to offer large incentives under workplace wellness programs were arbitrary. The court did not vacate (nullify) the rules due to concerns about disrupting employers’ existing programs. Instead the court has ordered the responsible agency, the Equal Employment Opportunity Commission (EEOC), to review and reconsider its regulations.

Background

The EEOC regulates and enforces provisions of the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act (GINA) that affect workplace wellness programs. Employers with 15 or more workers generally are prohibited from requiring employees to undergo medical exams or answer disability-related questions (unless needed for certain job-related health/safety exams). An exception is allowed for wellness programs that are “voluntary,” but the meaning of voluntary has long been debated.

For many years, the EEOC failed to issue regulations defining voluntary while at the same time unofficially asserting that programs were not voluntary if the employee was required to provide private health information to earn a reward or avoid a penalty. In 2015, the EEOC finally proposed rules on the matter, which were finalized in 2016 and took effect January 1, 2017. In an about-face from its prior assertions, the EEOC rules allow employers to offer wellness program incentives of up to 30% of the health plan’s cost. The AARP, on behalf of its membership, sued in federal court alleging that the 30% threshold was too high to be considered a voluntary program.

(The Health Insurance Portability and Accountability Act (HIPAA), a separate federal law primarily regulated by the Department of Labor (DOL), not the EEOC, permits group health plans, including wellness programs, to offer incentives of up to 30% of plan cost. AARP did not challenge the HIPAA rules. HIPAA’s incentive cap applies only to health-contingent programs, however, while the EEOC’s ADA and GINA rules are broader and include both participatory-only and health-contingent wellness programs.)

In AARP v EEOC, the U.S. District Court for the District of Columbia found that the EEOC failed to justify how it had determined its new definition of a voluntary program. The court ordered the EEOC to reconsider its regulations and to file a status report by September 21, 2017 that includes a proposed schedule for the review.

Employer Considerations

Last week’s court ruling did not vacate the EEOC’s wellness program rules. They remain in force and employers may use them as guidance in designing and administering their workplace programs. At the same time, however, employers will want to be mindful that the current rules are under review and may be revised in the future. Also, employers whose wellness programs offer large incentives for providing individual health information need to consider whether their program may be challenged through private litigation. Employers are encouraged to work with their benefit advisors and legal counsel to ensure their wellness programs are consistent with rules under HIPAA, and, if applicable, under the ADA and GINA.

Originally Published By ThinkHR.com

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