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Protecting Your Employees and Your Business During COVID-19

As the coronavirus pandemic (as officially declared by the World Health Organization) occupies our daily news feed, many business owners, non-profits and corporations are scrambling to figure out exactly what to do. In the case of small businesses or non-profits they may not have the luxury of telling their employees to work remotely for the next three weeks. On the other hand, they know that the health and safety of their employees is a top priority.

This blog is a summary of steps you may need to take to stay in compliance with employment law, protect your employees, and protect your business. This is an evolving situation, so we suggest checking the official websites we list below to stay informed of any recent updates.

Stay informed and educate employees

Refer to the CDC (Center for Disease Control and Prevention), World Health Organization and OSHA for the latest information and guidance about the Coronavirus (COVID-19). Certain county and states have taken additional steps to secure public safety. Please check your local health department websites for specific regional information.
Educate employees on what is known about the virus and how to prevent the spread of illness.
Implement a communicable illness policy and response plan that may allow for flexible work and telecommuting, minimizing exposure between employees and with the public, and postponing or canceling large meetings or events.
Follow the CDC guidance on dealing with COVID-19 by actively encouraging sick employees to stay home. If an employee has acute respiratory illness symptoms, send them home immediately. It’s also important to provide information and training to employees on: cough and sneeze etiquette; proper hand hygiene (wash for at least 20 seconds); avoiding close contact with sick people; keeping hands away from their face; not sharing personal items with coworkers; using a tissue to open doors; and sanitizing workspaces. Also, provide hand sanitizer.

Review your sick leave policy especially if your business is either located in California or has employees working remotely in California

Allow employees to use paid sick leave for COVID-19 related illnesses. However, under California law and in other jurisdictions, you cannot require quarantined workers to exhaust their paid sick leave.
Do not punish employees for using paid sick leave or for taking time off to care for a sick family member.
Make other paid leave available if sick leave is exhausted.
Consult local paid-sick-leave laws that may be more generous than the statewide law.

Inform employees of additional leave/benefits that may be available

Employees with serious conditions stemming from COVID-19 might be covered by The Family and Medical Leave Act (FMLA) or The Americans with Disabilities Act (ADA). In California it’s important to keep in mind the California Family Rights Act (CFRA) and the California Fair Employment and Housing Act (FEHA). It’s important to consult your employment counsel as to whether any of these apply to an employee’s situation.

Employees who are unable to work due to COVID-19 exposure may be able to file a disability insurance claim with the EDD (Employment Development Department). In CA, the EDD website has timely and important information on how employees can apply for unemployment insurance or disability coverage. Here’s the link to the CA EDD website: https://www.edd.ca.gov/about_edd/coronavirus-2019.htm

Bear in mind that although the EDD requires a physician’s certification, in the current environment medical professionals may be overwhelmed and unable to provide that certification in a timely manner. Allow some flexibility in the turnaround time for those certifications. Workers may also be eligible for unemployment insurance benefits if their work hours have been reduced by their employer or the company has temporarily shut down.

Along with health, safety and compliance issues, if you decide to offer telecommuting or require employees to work at a location other than their typical work situation, please be sure to review your company policies before making the change. Also, be sure to keep in mind that you may have to consider wage and hour issues for non-exempt employees as it relates to reporting pay, travel pay and reporting time.

Most of all, remember that employers are responsible for maintaining a safe and healthy work environment for their employees.

This topic is top of mind for many individuals. I suggest being proactive and letting employees know that as a company you are aware of the issues and you have a plan. If you need assistance, please reach out to me.

Stay well!

New Employment Laws for 2020

California has enacted a number of new laws for 2020. Becoming familiar with them will help you stay in compliance and avoid costly penalties. Also, be sure to update your Employee Handbook to reflect the new legislation.

California has enacted a statute, AB5, effective as of last month, that makes it much more difficult to classify workers as independent contractors.

AB5 applies a strict “ABC test” to determine whether a worker is an employee or independent contractor, and puts the burden of proof on the employer. In order to be classified as an independent contract, the worker must meet each of the following:

(A) The worker is free from the control and direction of the hiring entity in the performance of the work, both under the contract for the performance of the work and in fact; AND
(B) The worker performs work that is outside the usual course of the hiring entity’s business; AND
(C) The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

There are some exemptions including doctors, dentists, insurance agents, lawyers, accountants, real estate agents, hairstylists, and a variety of creative professionals. AB5 also exempts business-to-business contractors subject to a 12-factor test.

Misclassification can be extremely costly for employers in legal fees, back wages and benefits, and penalties. Now is an ideal time to do an overall review of how you’ve classified your workers. Also, it’s important to consult with an employment attorney if you plan to audit your records and reclassify your contractors.

SB142 – Lactation Accommodation – requires that all employers provide a safe, private and clean lactation room that is not a bathroom. The room must have access to a power supply for breast pumps, and a sink and refrigerator that are close to the employee’s workspace. Additionally, employers must provide reasonable rest breaks to express milk. They must also develop and distribute a policy. Employers may not discharge, discriminate or retaliate against an employee for exercising rights under the law. If an employer denies reasonable breaks or adequate space to express milk, they will suffer the penalty of an additional one hour of pay for each day there is a violation. Employers with fewer than 50 employees may seek an exemption from the requirement.

SB188 – The Create a Respectful and Open Workplace for Natural Hair Act (CROWN Act) – protects employees from racial discrimination based on hairstyle. The law clarifies the definition of race for the workplace and educational institutions to include, but not limited to, hair texture and protective hairstyles, and defines protective hairstyles.

Other changes of note:

The federal minimum salary threshold for exempt employees was increased as of January 1. Note that California employers must comply with the state’s higher thresholds for their employees working in the state. For employers with at least 26 employees, the minimum annual salary for a managerial, administrative, or professional employee in California to be classified as exempt is $54,080 ($49,920 for employers with 25 or fewer employees).

California increased its minimum wage as of January 1 to $12/hour for employers with 25 employees or fewer and $13/hour for employers with 26 employees or more. Several cities within the state also increased their minimum wage. Be sure you are paying employees based on the minimum wage in the city where they work or in the state of California, whichever is higher.

Here’s a reference regarding California minimum wage increments to keep handy: https://www.dir.ca.gov/dlse/faq_minimumwage.htm

The deadline for harassment prevention training has been extended to January 1, 2021 for most California employees.

Connect to HR is Celebrating its 10th Anniversary!

It’s hard to believe, but it has been 10 years since I decided to leverage my human resources experience and start my very own business – Connect to HR.

It hasn’t always been easy, as you business owners will know, but it has always been gratifying, educational and inspiring! Having my own business has been like getting an MBA. It’s been the best teacher and has pushed me outside of my comfort zone.

This is the first in a series of blogs about my journey as a small business owner. Along the way I’ll be sharing some tips and lessons learned – how to get off to a good start, how to stay motivated, how to deal with setbacks, how to evolve to meet client needs, and more.

Before Connect to HR

After years of working in senior-level positions for large corporations across a variety of industries, I decided to leave the corporate world in search of work-life balance and a different work environment. Shortly after leaving, I had the opportunity to do some consulting work. One of my consulting engagements was with Apple, who had been around for a while, but still had that “start-up” feel. I was fortunate to do three consulting projects around the time Apple was reinventing itself and launching its first versions of the Apple iPod, iPad and iPhone. In between these projects, I had an opportunity with a nonprofit that was looking for someone to set up their human resources fundamentals. They wanted someone who could work in a small organization, but who had the experience of a larger, more established environment. I went from being part of an HR team to an HR Department of one. It was challenging and exciting and really honed my ability to be resourceful to get things done.

Other consulting opportunities followed, and I realized two things: 1) There was a big need for compliance experience. We were just coming off the downturn, and many companies had neglected that aspect of HR. And 2) I no longer wanted to work through someone else and lose part of the profit from my consulting gigs.

It was time to start my own business. In 2010, Connect to HR was born.

Getting Started

Running your own business requires you to wear many hats – management, marketing/sales, finance, administration, accounting, IT the list is long – in addition to actually doing your core work. SCORE is a great resource for small business owners. They have workshops on a variety of business topics and even offer experienced businesspeople as mentors. I learned a lot from their small business fundamentals workshop, and later had the opportunity to present a workshop on HR fundamentals for small businesses at SCORE for 4 years.

The human resources function is pretty broad, so one of the first steps was for me to decide on my focus area. I had worked in all aspects of HR, but was particularly interested in the legal area. In fact, at one point I had contemplated attending law school. Also, in the consulting work I’d done it was clear that there was a demonstrated need for compliance.

I decided that these three areas: employee relations, compliance and policies and procedures (Employee Handbook) would be my starting point, and I was off to the races!

Tips for getting started: Learn the fundamentals of starting a business. Be clear about your focus.

Tune in next time when I’ll share about acting on inspiration.

Time to Review Your HR Year-End Checklist

There are just a few weeks left until the holidays and year end. Before you get caught up in all the festivities, it’s a good idea to set aside some time to make sure you have addressed any outstanding HR issues for 2019, and have finalized your plans for 2020 and the new decade.

Be sure you have made the appropriate adjustments to comply with recent legislation, specifically:

The deadline for harassment prevention training has been extended to January 1, 2021 for most California employees.

California has enacted a statute that makes it much more difficult to classify workers as independent contractors, effective January 1, 2020.

The federal minimum salary threshold for exempt employees is being increased, effective January 1, 2020.

California is increasing its minimum wage again as of January 1, 2020. Several cities within the state also are increasing their minimum wage.

Here’s a checklist of other items to complete before year end. Be sure to add any items relative to your particular business that you don’t see here.

Order any updated Federal and State Labor Law Posters
Review your Employee Handbook to identify any changes needed based on new laws, policies and/or procedures
Review and update employee addresses in preparation for W-2 distribution
Review and update job descriptions
Finalize the HR Budget for 2020
Finalize focal process for 2020
Finalize company goals
Determine dates of company holidays for 2020
Finalize and announce any new benefits/employee perks for 2020
Renew any annual memberships and subscriptions
Schedule annual reviews with employees
Deal with any lingering employee relations issues

In addition, think back over the year and reflect on what went well and what didn’t go well from an HR standpoint. Are your employees engaged and productive? If not, do you see any trends that you could work on turning around in 2020? Are there any employees who stand out as particularly high potential? How will you develop and retain them in 2020?

This is also a good time to look back over the past decade. Reflect on how your organization has changed and celebrate your accomplishments over the past decade. Also, consider what you want to usher into the next 10 years. If you don’t know where to start, consider conducting a SWOT analysis in the New Year. This way, you can become aware of trends both inside the company as well as in your industry.

Giving some thought to these things now, and then putting a plan in place to address them after the first of the year will get 2020 off to a good start!

I would love the opportunity to help you plan for 2020 and the next decade please contact me at michelle@connecttohr.com.

New Federal Salary Threshold for Exempt Classification

As of January 1, 2020, the federal salary threshold for employees to qualify as exempt from overtime will increase from $455 per week ($23,660 per year) to $684 per week ($35,568 per year). For employees to qualify under the Fair Labor Standards Act’s (FLSA) “highly compensated employee” exemption, the minimum salary threshold will increase to $107,432 per year.

As a reminder, for an employee to be classified as exempt, they must meet both the minimum salary requirement and the “duties test.” This new law does not make any changes to the duties test.

It also does not affect employees in California, where the exempt salary threshold is higher.

California employers must comply with the higher thresholds for their employees working in the state. The minimum annual salary for a managerial, administrative, or professional employee in California to be classified as exempt is $49,920 ($45,760 for employers with 25 or fewer employees). Also, California does not recognize the “highly compensated employee” exemption.

Another difference is that the federal law allows for bonuses, commissions and incentives that are paid at least annually to be counted toward the minimum salary requirement. California makes no such provision. And California’s duties test is stricter than the duties test under federal law. Here, an employee must spend more than 50% of their time in each workweek performing exempt duties to qualify as exempt from overtime.

If you have employees outside of California now is the time to review your compensation plans for exempt employees and make any changes needed to comply with the new federal law by January 1.

If you only have employees in California, it’s also a good time to review employee compensation and classification to ensure you are complying with California law.

Please reach out to me at michelle@connecttohr.com if you need help reviewing employee classifications.

New Law Impacts California Independent Consultants

As we head into the fourth quarter of 2019, there are a couple of legal updates you should be aware of.

First, Governor Newsom has signed into law AB 5, which further clarifies the distinction between employees and independent contractors. The law goes into effect on January 1, 2020 and is expected to have a big impact on gig-economy companies like Lyft and Uber, as well as app-based services that depend on contractors such as food delivery and dog-walking services.

Second, the deadline for harassment prevention training (now required for all employees of companies with 5 or more employees including independent contractors) has been extended to January 1, 2021. This will allow more time for large employers who previously only trained supervisors to train their other employees and for smaller companies to train both supervisors and employees. As a reminder, training for supervisors must be at least two hours, and training for non-supervisors must be at least one hour. Training must be repeated at least every two years. Remember to keep records of training for both employees and supervisors.

AB 5 adopts the “ABC” test, which I wrote about earlier this year, to determine whether an individual is an employee or an independent contractor.

Under the ABC Test, in order to classify a worker as an independent contractor the hiring entity must establish that the worker meets EACH of the following three factors:

The worker is free from the control and direction of the hiring entity in the performance of the work, both under the contract for the performance of the work and in fact; AND
The worker performs work that is outside the usual course of the hiring entity’s business; AND
The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

One of the things I tell clients is that it’s essential to consider how you define your core business (2) and how does the worker assist you in that core business.

The new law allows for a few exceptions for positions that are subject to the 9-factor Borello test. Some examples of positions that fit into this category are: insurance brokers, physicians and surgeons, hairstylists, attorneys, and accountants.

Please feel free to contact me at michelle@connecttohr.com if you need assistance.

Developing an Injury and Illness Prevention Program

Employers are responsible for maintaining a safe and healthy work environment for their employees.

In California, every employer with 10 or more employees is required by the state (Cal/OSHA) to have an effective Injury and Illness Prevention Program (IIPP). Additionally, they must record injuries and illnesses on Form 301, and prepare an annual summary on Form 300A of all the work-related injuries and illnesses that occurred during the calendar year. Form 300A must be posted between February 1 and April 30. These forms are available from the State of California Department of Industrial Relations. Records need to be maintained in your files for 5 years.

The Injury and Illness Prevention Program must be a written plan that includes policies and procedures on topics such as safe work practices, periodic inspections, what to do in the event of an accident, safety training, and recordkeeping. There are 8 specific elements that must be included in the plan:

Management commitment/assignment of responsibilities
Safety communications systems with employees
System for ensuring employee compliance with safe work practices
Scheduled inspections /evaluation system
Accident investigation
Procedures for correcting unsafe/unhealthy conditions
Safety and health training and instruction
Recordkeeping and documentation

Review your IIPP at least annually to ensure that policies and procedures are up to date and that it includes any newer situations, e.g., active shooter, that you need to be prepared for. FEMA has some helpful information on what to do in the event of an earthquake, fire, or active shooter.

Additionally, to be effective your IIPP must:

Fully involve all employees, supervisors and management
Identify the specific workplace hazards that employees are exposed to
Correct identified hazards in an appropriate and timely manner
Provide effective training

If you employ fewer than 10 employees, you can:

Communicate to and instruct employees orally about safe work practices
Choose to maintain records of inspections only until the hazards identified are corrected
Document training by maintaining an instruction log that you provide to a new employee or to an employee reassigned to new duties

Seasonal employers can use a model program designed specifically for seasonal employers, available at the Division of Occupational Safety and Health (Cal/OSHA) website. Additional IIPP requirements apply to specific industries, such as the construction and petroleum industries.

Cal/OSHA has created a Microsoft Excel workbook that contains Form 300, Form 301, and Form 300A. The forms are linked, so the totals on Form 301 are automatically copied to Form 300A. This facilitates the process of recording illnesses and injuries and transferring them to the yearly summary.

If you need help developing your IIPP plan, please contact me at Michelle@connecttohr.com.

50 or More Employees? Here’s What You Need to Know

When your organization reaches 50 or more employees there are some additional federal, state and local laws you need to start following to ensure you are in compliance. Here are two important areas of compliance that affect employers with 50 or more employees.

Harassment Prevention Training

Since 2005 employers with 50 or more full-time, part-time, and temporary employees or independent contractors have been required to provide supervisory employees with two hours of sexual harassment prevention training within six months of hire or promotion, and once every two years thereafter.

Under recently passed legislation, employers with five or more employees are now required to provide anti-harassment training to all employees – both supervisors and non-supervisors – every two years. California SB 1343 requires that all employees be trained by the end of 2019. Training for non-supervisors must be at least one hour. Training for supervisors must be two hours.

Family and Medical Leave Act (FMLA)

The Family and Medical Leave Act (FMLA) is a federal law that requires covered employers to grant an eligible employee up to a total of 12 work weeks of unpaid leave during any 12-month period for one or more of the following reasons:

For the birth and care of the newborn child of the employee;
For placement with the employee of a son or daughter for adoption or foster care;
To care for an immediate family member (spouse, child, or parent) with a serious health condition; or
To take medical leave when the employee is unable to work because of a serious health condition.

Companies fall under FMLA when they have 50 or more employees in any (not just consecutive) 20 calendar weeks of the current or preceding year.

Eligibility

Employees who satisfy certain criteria are eligible for Family or Medical Leave of up to 12 weeks during each rolling 12-month period in accordance with applicable law. Employees eligible for Family and Medical Leave are those who:

Have completed 12 months of employment with their employer;
Have worked at least 1,250 hours for their employer during the previous 12 months; and
Work in a facility with at least 50 employees or in a facility where there are at least 50 employees within 75 surface miles. Employees with no fixed work site will be considered to work from the site to which they report, or the site from which their work is assigned, or the site designated as their home base.

NOTE: Companies must continue the same health plans in which the employee was enrolled before the first day of the leave at the same level and under the same conditions of coverage as if they had remained an active employee for the lesser of the duration of such leave or 12 work weeks.

California Family Rights Act (CFRA)

The California Family Rights Act (CFRA) is very similar to FMLA and applies to employers in California. CFRA allows eligible employees to take up to 12 weeks of unpaid job-protected leave during a 12-month period.

CFRA covers private employers with 50 or more workers within 75 miles of the worksite, and public employers with any number of workers. CFRA runs concurrently with FMLA.

CFRA was enacted to provide employees with work leave rights for reasons such as:

Birth of a child.
Placement of the employee’s child through adoption or in a foster care home.
A serious health condition incurred by the worker’s spouse, child, or parent.
The employee is unable to work because of a serious health condition.

Eligibility

Employee eligibility for CFRA is similar to FMLA. For both CFRA and FMLA, time off for sick leave, vacation/annual leave, administrative time off (ATO), compensating time off (CTO), holidays, informal time off (ITO) or personal leave (PL) are not to be counted toward the 1,250 hours of work.

Training Leave for Emergency Rescue Personnel

Employers with 50 or more people must allow temporary leaves of absence — up to a total of 14 days per calendar year—for employees who are volunteer firefighters, reserve peace officers and emergency personnel to engage in fire, law enforcement or emergency rescue training.

You cannot terminate, threaten with termination, demote, suspend or otherwise discriminate against an employee who takes time off to engage in fire or law enforcement training. An employee who suffers any of these consequences is entitled to reinstatement and reimbursement for lost wages and work benefits. The employee can file a claim with the Division of Labor Standards Enforcement (DLSE).

San Francisco Paid Parental Leave

This San Francisco ordinance requires employers with 50 or more employees to supplement California’s Paid Family Leave (PFL) for employees working in the city. The purpose is to allow employees to receive 100% of their gross weekly wages while on a parental leave of absence. PFL currently provides eligible employees with up to 55% of their regular wages. Employees may receive these benefits for up to six weeks in a 12-month period. San Francisco’s law requires covered employers to provide additional wage replacement benefits of up to 45% of the employee’s wages, subject to the weekly maximum.

Please contact me at michelle@connecttohr.com for more information about what you need to consider as a business with 50 or more employees.

The ABC Test – Defining Independent Contractor vs. Employee

I have been getting a lot of calls recently from clients asking for clarification about the distinction between an independent contractor and an employee.

Misclassification can be extremely costly for employers in legal fees, back wages and benefits, and penalties. In addition, you run the risk of having the IRS or Department of Labor audit your business. This can be extremely time consuming and costly.

Of course, you should always consult your employment attorney for questions about specific situations, but here are some guidelines.

Last year, based on a decision in Dynamex Operations West, Inc. v. Superior Court, the California Supreme Court adopted the “ABC Test” as a standard for determining whether workers in California should be classified as employees or independent contractors. In their decision, the Court held that workers are presumed to be employees and that it is up to the employer to prove that they should be classified as an independent contractor based on the ABC Test.

Under the ABC Test, in order to classify a worker as an independent contractor the hiring entity must establish that the worker meets EACH of the following three factors:

The worker is free from the control and direction of the hiring entity in the performance of the work, both under the contract for the performance of the work and in fact; AND
The worker performs work that is outside the usual course of the hiring entity’s business; AND
The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

One of the things I tell clients is that it’s essential to consider how you define your core business (B) and how does the worker assist you in that core business.

In light of this change in the way employees and independent contractors are determined, it’s a good (and timely!) idea to do an overall review of how you’ve classified your workers. Again, as a reminder, it’s important to consult with an employment attorney if you plan to audit your records and reclassify your contractors.

Please feel free to contact me at michelle@connecttohr.com if you need assistance.

Managers Increasingly Held to a Higher Standard

As I discussed in my last blog, recent legislation establishes that managers can now be held personally liable for not following the law, even if they do so unintentionally. Two key areas where this has played out in court are hostile work environments and wage and hour violations.

Managers are being held to a much higher standard.

This means that business owners and senior leaders must be sure they understand and follow the laws, and they must also ensure that their managers and supervisors understand and follow the laws. Some ways to accomplish this are through management training, effective communication, and/or one-on-one coaching.

In the wake of the #MeToo Movement and other workplace harassment situations, the threshold for acceptable behavior has been revised. In the past, plaintiffs had to show a pattern of behavior for a workplace to be deemed a hostile work environment. Today it can be considered as such based on one or two incidents. “But we’ve always had an informal, joking environment,” is not an acceptable excuse.

Managers need to pay attention to behaviors that may be offensive to some and stop them before they become part of the culture. If not, they could be held personally liable for creating a hostile environment. Encourage managers to periodically gauge team interactions and speak with individuals to proactively identify any issues and to promote a positive culture.

Also, senior leadership and all managers and supervisors should model the appropriate behavior they expect from others.

In the past it was very rare for a manager to be named in a wage and hour dispute. Not so today. California’s Labor Code 558.1 states that “a company’s owners, directors, officers and even managing agents can be held personally liable for wage and hour violations.” It’s not enough to say that not following the law was unintentional, or a mere oversight.

If you need help ensuring that you are legally compliant, or in coaching managers around any of these issues, please contact me at michelle@connecttohr.com.