Managers Have To Remain Focused!

January 26, 2009

I have handled a number of mediations over the last few months and each one of them have involved managers who are not staying focused with safe-guarding the work environment. We must remain steadfast in ensuring that employees are not going to be subjected to workplace humor, horseplay, and innuendo. Employees are losing their jobs because of layoffs. That means no job, no medical, and no visible means of support. Where does that leave them? If they have even the slightest chance to sue, they will. It does not take much for them to go to an attorney and give any facts that can interpreted  (or mis-interpreted) as a violation of their workplace rights.

It’s not hard. Put out a memo or discuss this in your managers meeting. Remind them that in California they have personal liability. Furthermore, they have to understand that the former employee does not have to come up with money to press the matter to litigation.  Attorneys work on percentages and it only cost them a few hundred dollars to file that “boiler plate” complaint. They merely have to change the name and adjust the facts.

I have been very successful with getting these types of matters resolved through mediation. It’s getting tougher. If you receive a letter from an attorney you must get it to me immediately. If you are actually sued and are served with a lawsuit you must contact me immediately. Mediation can still be an option.

If you need to discuss this any further please call me! In addition, we are in the process of scheduling the mandatory sexual harassment trainings. It is critical that we get in and re-enforce the seriousness of what is going on out there. The managers have got to understand the risk and sometimes hearing it from an outside source is more beneficial.

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What Happens When An Employee Is Overpaid??

January 19, 2009

What happens when an employee gets overpaid? Can you take the money back with or without their written authorization? What about a payroll advance? Well it depends.

Labor Code section 221 sets forth the general rule that it is illegal for an employer to collect any part of previously paid wages.  Section 224, however, establishes several exceptions for withholdings involving: (1) state or federally required or authorized deductions (such as taxes); (2) deductions for insurance premiums, hospital or medical dues, or “other deductions not amounting to a rebate or deduction from the standard wage arrived at by collective bargaining or pursuant to wage agreement or statute,” that are authorized in writing by the employee; and (3) deductions to cover health and welfare, or pension plan contributions.

Case law makes clear that deductions from an employee’s final paycheck for debts owed to the employer are prohibited, even with prior written authorization. In Barnhill v. Saunders (1981), the employer deducted the balance of a loan from a discharged employee’s final check. The court concluded that “an employer is not entitled to a setoff of debts owing it by an employee against any wages due that employee” on the employee’s final paycheck.

In California State Employee’s Association v. State of California (1988), the employer conducted an audit that concluded that they had made numerous erroneous overpayments to hundreds of employees.  The employer notified the employees that they were going to make monthly deductions from employee salaries to recoup the overpayments. The employer did not have the employee’s signed authorizations to make the deductions. The court held that the employer could not make deductions from pay for prior “erroneous salary advances.”

 Employee authorization is critical to permitting such deductions. Labor Code section 224 provides that a deduction that is authorized in writing by the employee does not violate the prohibition in Labor Code section 221 against the unlawful collection of wages. In fact, the Labor Board has previously stated that a deduction for previous overpayment of wages is not unlawful as long as there is a previous written agreement based upon the voluntary consent of the employee, provided that the deduction does not exceed the authorized amount and, after making the deduction, the employee receives no less than the minimum wage for all hours worked in the pay period.

Payroll advances present a problem. The money given to an employee in advance of work performed becomes a debt. The money was never “earned” to make it a wage. If the employee leaves before paying back the entire amount remaining is a “debt” owed to the company. You cannot take the balance out of the final check. I would strongly recommend not giving payroll advances. If you do, limit the time frame for repayment to one payroll period.


Marijuana Disclaimers Must Be Crystal Clear

January 12, 2009

California law prohibits employers from asking  job applicants about most marijuana-related convictions that are more than two years old. Starbucks had a written policy that applicants could omit any convictions for the possession of marijuana (except for convictions for the possession of marijuana on school grounds or possession of concentrated cannabis) that were more than two years old, and any information concerning a referral to, or participation in any pretrial or post trial diversion program.

Starbucks, according to the California Court of Appeals, had a properly written policy but felt that there were “significant problems” with its placement. Aparently Starbucks did not place the disclaimer immediately following the convictions question. Instead, it put the disclaimer at the end of a 346 word paragraph which, in the courts opinion, caused it to loose any value because it had been “submerged  in a veritable sea of boldface type.”

Ok, what does this mean? Employers need to review their policies on convictions and ensure that the language is clear and concise. Any policies regarding marijuana, even if separate, must be stated clearly. In my opinion this in no way prevents an employer from having a policy against employing an applicant  who produces a prescription from a medical provided that he/she can smoke marijuana. As you may recall from an earlier article that the California “Marijuana Compassionate Act” was preempted by federal law.


Employee Expense Reimbursement

January 6, 2009

California Labor Code Section 2802 provides that an employer shall indemnify his/her employee for all necessary expenditures or losses incurred by the employee in the performance of their job.  The main consideraton is whether or not the expense was incurred within the course and scope of their employment. Such expenses are normally such things as mileage, travel and dining expenses and an employee can go back as far as three years to recoup their unpaid expenses.

Typically employers disregard sending a person on a “short errand” as a situation that requires reimbursement. It does but only if they are using their own vehicle (ever send an employee to pick up your lunch?). The Labor Board has previously determined that the use of the IRS mileage allowance, currently at 58.5 cents per mile, will satisfy the expenses incurred in the use of an employee’s vehicle.

Now the good news is Labor Code Section 2802 not a “wage” section which means that there is not a specific time frame for the payment. This also means that there are no waiting time penalties associated with the nonpayment of the expense but there can be interest and attorney fees.

As a final note, remember, under the Industrial Welfare Commission Order, section 8, you can’t hold an employee liable for workplace losses, shortages, or damages.