Tag: Human Resources

DHS proposes Form I-9 overhaul and extends pandemic-related compliance flexibilities

By Anita Byer, Setnor Byer Insurance & Risk

The Department of Homeland Security is proposing an overhaul of its Employment Eligibility Verification form a/k/a Form I-9. This form is used by employers to verify the identity and employment authorization of every employee hired in the United States, regardless of citizenship. According to the Bureau of Labor Statistics, 78 million people were hired over the past twelve months, so any changes to Form I-9 will affect millions of employers and employees alike.

DHS is proposing the following changes to Form I-9 before the current version expires October 31, 2022. The public is invited to submit comments about the proposed revisions until May 31, 2022.

  • Compress Sections 1 and 2 from two pages to one page to reduce paper use and storage burden on employers. Section 1 (Information and Attestation) is completed by the employee. Section 2 (Review and Verification) is completed by the employer or its authorized representative.
  • Change Section 3 (Reverification and Rehires) to a supplement that provides three separate areas to enter reverifications and rehires within 3 years of the date of the initial execution of an employee’s Form I-9. Employers would only print and use the supplement as needed, further reducing paper use and storage burdens on employers.
  • Update the List of Acceptable Documents to include a link to List C documents issued by DHS and acceptable receipts that may be presented in lieu of a listed document for a temporary period.
  • Reduce and simplify the instructions from 15 pages to 7 pages, further reducing paper usage.
  • Remove electronic PDF enhancements to ensure that it can be completed on all electronic devices and is not software dependent.

DHS also extended the pandemic-related Form I-9 flexibilities until October 31, 2022. Per the initial flexibility announcement in March 2020, the requirement that employers inspect employees’ Form I-9 identity and employment eligibility documentation in-person applies only to those employees who physically report to work at a company location on any regular, consistent or predictable basis. An employee working exclusively in a remote setting due to COVID-19 are temporarily exempt from the physical inspection requirements until they undertake non-remote employment on a regular, consistent or predictable basis, or the extension of the flexibilities related to such requirements is terminated, whichever is earlier.

The broad use of Form I-9 means that any changes will affect all employers. Though transitioning to a new Form I-9 should not be too disruptive, employers need to recognize that confusion and error typically accompany change. Since the failure to ensure proper Form I-9 procedures may expose an employer to civil and possibly criminal penalties, steps must be taken to ensure a smooth and effective transition to the new Form I-9. Employers also need employment practices liability insurance (EPLI) to protect against the uncertainty that accompanies the enactment of any new law.

Please contact us to learn more about protecting your business with Employment Practices Liability Insurance.

EEOC Updates COVID Guidance to Address Pandemic-Related Workplace Retaliation

By Anita Byer, Setnor Byer Insurance & Risk

The Equal Employment Opportunity Commission (EEOC) updated its COVID-19 technical assistance to address retaliation in pandemic-related employment situations. This was prompted in part by the fact that retaliation has been the most frequently alleged form of discrimination for many years. According to EEOC Chair Charlotte Burrows, the update “provides additional clarity on how our laws balance workers’ rights to speak up without fear of retaliation against employers’ responsibilities to create a healthy and safe work environment.”

The anti-retaliation updates apply to the exercise of rights under the federal equal employment opportunity (EEO) laws. Though the laws remain the same, the updated technical assistance communicates the EEOC’s position when it comes to COVID-related retaliation claims. The EEOC notes that retaliation protections apply to current employees, whether they are full-time, part-time, probationary, seasonal or temporary. They also apply to job applicants and to former employees (such as when an employer provides a job reference).

Retaliation includes any employer action in response to EEO activity that could deter a reasonable person from engaging in protected EEO activity, such as reporting or resisting EEO violations, filing a charge of discrimination or requesting an accommodation. Depending on the facts, unlawful retaliation can include:

  • denial of promotion or job benefits;
  • non-hire;
  • suspension or discharge;
  • work-related threats or warnings;
  • negative or lowered evaluations; or
  • transfers to less desirable work or work locations.

Retaliation could also include an action that has no tangible effect on employment, or even an action that takes place only outside of work, if it might deter a reasonable person from exercising EEO rights. However, depending on the specific situation, retaliation likely would not include a petty slight, minor annoyance, or a trivial punishment.

The EEOC notes that engaging in protected EEO activity does not prevent discipline of an employee for legitimate reasons.  Employers are permitted to act based on non-retaliatory and non-discriminatory reasons that would otherwise result in discipline.  This would include non-retaliatory, non-discriminatory action to enforce COVID-19 health and safety protocols, even if such actions follow EEO activity, like an accommodation request.

To reduce the likelihood of claims, employers should proceed cautiously when presented with any COVID-19-related matter. This may include seeking counsel from a licensed professional. Employers need Employment Practices Liability Insurance to cover the high cost of defending actual and alleged claims of unlawful conduct. Why? The EEOC is watching and offending employers are paying.

Please contact us for additional information about protecting your business during the COVID-19 pandemic.

EEOC’s Enforcement and Litigation Capabilities Endure Despite COVID-19

The Equal Employment Opportunity Commission released its enforcement and litigation data for fiscal year 2020. COVID-19, it seems, did not impair the EEOC’s ability to enforce the nation’s equal employment opportunity laws. In 2020, the EEOC:

  • received 67,448 charges of workplace discrimination;
  • responded to more than 470,000 calls and more than 187,000 inquiries;
  • resolved 70,804 charges and 165 merit lawsuits;
  • secured $439.2 million for victims of discrimination;
  • recovered $106 million through litigation (the most in 16 years); and
  • was nearly perfect in court (95.8 percent success rate).

Retaliation remained the most frequently cited claim, accounting for more than half of all charges filed last year. Here is a breakdown of the charges received by the EEOC in 2020. Note that charges often allege more than one category of discrimination.

  • Retaliation: 37,632 (55.8 percent of all charges filed)
  • Disability: 24,324 (36.1 percent)
  • Race: 22,064 (32.7 percent)
  • Sex: 21,398 (31.7 percent)
  • Age: 14,183 (21.0 percent)
  • National Origin: 6,377 (9.5 percent)
  • Color: 3,562 (5.3 percent)
  • Religion: 2,404 (3.6 percent)
  • Equal Pay Act: 980 (1.5 percent)
  • Genetic Information: 440 (0.7 percent)

Employers must have a policy prohibiting discrimination and harassment in the workplace. Managers and employees must be trained to prevent and avoid unlawful behavior. Employers need Employment Practices Liability Insurance to cover the high cost of defending actual and alleged claims of unlawful conduct. Why? The EEOC is watching and offending employers are paying.

Please contact us if you would like to learn more about Employment Practices Liability Insurance.

Florida’s Minimum Wage Going Up In 2020

On January 1, 2020, Florida’s minimum wage will increase by ten cents to $8.56 per hour. The minimum wage for tipped employees, which is in addition to tips, will also increase by ten cents to $5.54 per hour. Florida’s Minimum Wage Act applies to those employees entitled to receive the federal minimum wage under the Fair Labor Standards Act. Employers must pay no less than the federal minimum wage or their state’s minimum wage, whichever is higher.

Florida’s minimum hourly wage is adjusted annually for inflation. According to the Florida Supreme Court, only upward adjustments are permitted. Since 2005, Florida’s minimum wage has gone up $2.41. Florida’s 2020 minimum hourly wage remains higher than the current federal minimum hourly wage of $7.25.

Florida employers must make employees aware of their rights by prominently displaying a minimum wage poster in a conspicuous and accessible place wherever minimum wage employees are employed. Employees can sue for violations of Florida’s Minimum Wage Act, but they must first provide their employer written notice of their intent to sue, which must:

  • identify the minimum hourly wage to which the employee claims entitlement;
  • provide the actual or estimated work dates and hours for which payment is sought; and
  • state the total amount of alleged unpaid wages.

Employers then have 15 calendar days to pay all unpaid wages or resolve the claim to the employee’s satisfaction. Otherwise, the employee may file a lawsuit. The Florida Attorney General can also bring a civil action against employers. Each willful violation can result in a $1,000 fine.

Dealing with state and federal wage and hour laws can be hard. To protect against employment practices liability claims, employers should implement a training program and explore their options for insuring against wage and hour claims.

Please contact us for more information about protecting your business from employment-related liabilities.

FLSA Update: Minimum Salary for Exempt White-Collar Employees Increasing in 2020

It’s actually happening. The Department of Labor is increasing the minimum salary threshold for the Fair Labor Standards Act’s white-collar minimum wage and overtime exemptions. On January 1, 2020, an estimated 1.3 million executive, administrative and professional employees will lose their FLSA-exempt status. Without some form of corrective action, employers will have to start paying overtime compensation to these newly-nonexempt employees.

The current standard salary level for exempt white-collar employees is $455 per week. Under the Final Rule, the minimum standard salary level for exempt executive, administrative and professional employees will be:

Weekly:               $684       (+ $229)

Bi-weekly:           $1,368   (+ $458)

Semi-Monthly:  $1,482   (+ 496.17)

Monthly:             $2,964   (+ $992.34)

Annually:            $35,568 (+11,908)

The Final Rule also:

  • increases the total annual compensation requirement for exempt “highly compensated employees” from $100,000 to $107,432 per year;
  • allows nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10 percent of the standard salary level; and
  • revises the special salary levels for workers in U.S. territories and in the motion picture industry.

Employers don’t have much time to evaluate options and take corrective action, which depending on the circumstances, may include:

Corrective actions should be based on business necessity and applied in a uniform, non-discriminatory manner. They must also be implemented no later than January 1 ,2020.

Since change often creates uncertainty, employers should carry Employment Practices Liability Insurance that includes limited wage & hour coverage. Please contact us if you would like to learn more about employment practices liability insurance.

Now What? Preparing for the New FLSA White Collar Overtime Exemptions

On December 1, 2016, it will be more expensive for employers to take advantage of the Fair Labor Standards Act’s (FLSA) so-called white collar overtime exemptions. Since FLSA violations have always been expensive, employers should begin the process of determining whether and to what extent they will be affected by the new overtime exemption regulations .

The new rules focus primarily on the minimum salary and compensation levels needed to qualify for the FLSA’s executive, administrative, professional, and computer employee overtime exemptions. Employers can ask the following questions to determine the potential impact of the new overtime rules.

Are there any employees classified as exempt under one of the FLSA’s white collar overtime exemptions? If no, you should not be affected by the higher standard salary levels under the new rules. If yes, move on to the next question.

Do any of these employees ever work more than 40 hours in a workweek? If no, you should not be affected by the higher standard salary levels under the new rules. If yes, move on to the next question.

Do any of these employees earn a salary of less than $913 per week? (This works out to $1,826 biweekly, $1,978 semimonthly, $3,956 monthly or $47,476 annually.) If no, you should not be affected by the higher standard salary levels under the new rules. If yes, exemption classifications and compensation practices will need to be adjusted before December 1, 2016 to avoid violating the new rules.

Various adjustments can be made to ensure compliance under the new rules. However, the most appropriate adjustment(s) will likely depend on each employer’s specific circumstances, such as the number of newly-nonexempt employees, their salaries, how often they work overtime and how much overtime they work.

Depending on their circumstances, employers may implement one or more of the following adjustments.

Increase Salaries. The obvious adjustment, and the one likely envisioned by those enacting the new rules, would be to increase the salaries of exempt white collar employees to no less than $913 per week. Though this may be the simplest and least disruptive adjustment, it may also be the most unrealistic. Though salary increases for some employees may be nominal, they can be more than double for others.

[Remember, employees are not exempt simply because their salaries satisfy the increased salary levels under the new rules. Their primary job duties must also involve the kind of work associated with the specific white collar exemption. Employees must satisfy the minimum salary level requirement and the applicable “standard duties test” to be exempt.]

Pay Newly-Nonexempt Employees Overtime Compensation. The alternative to increasing salaries is to re-classify these exempt white collar employees as overtime-eligible employees. If they work more than 40 hours in a workweek, they must be paid one and a half times their regular rate. As with other nonexempt employees, employers must track the number of hours worked each day and the total hours worked each workweek by newly-nonexempt employees. For many, this will be an entirely new experience and will take some getting used to.

This may not be a problem for employees who rarely work or who work very little overtime. These employees can continue working the same number of hours. Though employers will pay more for occasional overtime work, they may still be paying substantially less than $913 per week. The same cannot be said about employees who regularly work or who work a lot of overtime. The cost of paying time and a half to these employees could be very high, and may even approach $913 per week.

Prohibit Overtime. Newly-nonexempt employees can be prohibited from working overtime. If no overtime is worked, no overtime compensation is required. This option may be simple, but it may not be easy. Exempt employees typically work more than 40 hours in a workweek because they have more than 40 hours of work to do. This work must still get done, but someone else will have to do it.

Adjust Personnel, Schedules or Assignments. Those who prohibit overtime may have to make various operational adjustments. For example, workload distribution and workforce scheduling may need to be adjusted to compensate for the loss of overtime work. In some cases, new employees may need to be hired to make up for any lost productivity.

Adjust Wages. If newly-nonexempt employees are allowed to continue working overtime as always, employers will end up paying more money for the same amount of work. Reallocating regular wages and overtime compensation is a way to keep the hours worked by and the amount paid to newly-nonexempt employees largely the same. However, employers may not reduce an employee’s hourly wage below the highest applicable minimum wage (federal, state, or local) or continually adjust wages each workweek in order to manipulate the regular rate.

Employers cannot wait too long to begin planning for the upcoming change. It takes time to properly implement organizational adjustments to exemption classifications and compensation practices, particularly if they are substantial or complex. With all the publicity surrounding the new white collar overtime exemption rules, it’s probably safe to assume that violations will be noticed not only by those employees who are affected by the new rules, but by the Department of Labor too.

Since the Final Rule is sure to bring a level uncertainty and confusion, employers may benefit from having Employment Practices Liability Insurance to protect against various employment-related claims. Limited coverage for wage and hour claims may be available.

Please contact us if you would like to learn more about complying with the FLSA’s new white collar overtime exemption rules.

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Finding the Right Manager for Your Condominium Association

Condominium boards often hire community association managers to help manage and oversee their association’s affairs. However, since community association managers often handle critical and complex matters, it’s important to choose the right one. The first step to confirming the qualifications and experience of a community association manager is to make sure they are properly licensed.

In Florida, community association managers must be licensed to perform specific functions for condominium associations with more than 10 units or with an annual budget of over $100,000. Importantly, a 2014 statutory amendment expanded the types of functions that can only be provided by a licensed community association manager. In addition to controlling or disbursing association funds, preparing financial documents and assisting in the meeting process, a license is required if a community association manager:

  • Determines the number of days required for statutory notices
  • Determines and collects amounts due to the association before the filing of a lawsuit
  • Calculates the votes required for a quorum or to approve a proposition or amendment
  • Completes forms that have been created by statute or by a state agency
  • Drafts meeting notices and agendas
  • Calculates, prepares and responds to requests for assessment and estoppel certificates
  • Negotiates contracts
  • Drafts pre-arbitration demands
  • Coordinates or performs maintenance and other related routine association services
  • Oversees compliance with the association’s governing documents and the requirements of law

New professional standards were placed upon Florida community association managers in 2014. For example, community association managers cannot charge unreasonable or excessive fees and must account for all funds. Community association managers, acting as an agent on behalf of the association, must also discharge their duties:

  • Loyally
  • Skillfully
  • Diligently
  • Honestly
  • Fairly
  • In good faith
  • With care and full disclosure to the association.

To satisfy their fiduciary obligation, condominium boards must make an effort to hire a qualified community association manager. Beyond confirming that a community association manager is properly licensed, board members must make sure that the individual has a thorough command of all the administrative and financial tasks associated with the job, strong communication skills and absolute integrity. Multiple candidates should be interviewed and references should be checked.

Setnor Byer Insurance & Risk’s Condominium Program provides clients with access to various risk management services, such as Setnor Byer’s Risk Management Group and Unit Owners’ Report Line, as well as our affiliate’s online Board Member Education, which has been approved by the Division of Florida Condominiums, Timeshares, and Mobile Homes to satisfy Florida’s new board member education training.

If you would like to discuss how Setnor Byer Insurance & Risk can serve you and your condominium association, please contact us.

Preventing Data Security Breaches

Every business must be able to identify the likeliest source of a data security breach so that they can also identify how to prevent it. Is it an executive’s laptop computer, the copy machine or the office’s wireless network? Could it be something else? Since the first step to preventing a data security breach is understanding the risk, it’s time to learn more about your business’s sensitive data.

Effective data security starts by assessing the kind of information a business has and identifying who has access to it. Evaluating data security vulnerabilities requires an understanding of how sensitive data moves into, through, and out of a business, and who has or could have access to it. Here are some tips from the Federal Trade Commission.

Take Inventory

Take an inventory of all devices and equipment capable of storing sensitive data, such as laptop computers, mobile devices, flash drives, off-site servers, disks and digital copiers. Do employees work from home? If so, add their home computers to the list.

The type and location of sensitive data should also be inventoried. Don’t stop with the office’s filing cabinets and computer systems. Sensitive data may also be received from other sources, such as websites, contractors or call centers. Every possible source and destination for sensitive data must be considered.

Track Sensitive Data

It is important to know how the business obtains, stores, shares and disposes of sensitive data. Every department should be consulted, including sales, information technology, human resources and accounting. Don’t forget about contractors and other third-party service providers.

This process should provide a business with a thorough understanding of:

  • Who provides sen­sitive data? Does it come from customers, credit card companies, banks or other financial institutions, credit bureaus, job applicants, contractors, third-party service providers?
  • How is sensitive data received? Does it come via phone, fax, mail or email? Is there a website designed to request and receive sensitive data? Are there any other possible entry points?
  • What kind of sensitive data is collected? Do business operations require or permit collecting financial information (credit cards, bank accounts, credit reports), personally identifying information (drivers’ licenses, social security numbers) or medical information?
  • Where is sensitive data stored? Is it kept on disks, tapes, laptops, smartphones, tablets or other mobile devices? Employees’ personal computers or mobile devices? Where are data backups and copies stored?
  • Who can access sensitive data? Is access to sensitive data limited to only those who need it? Are there security measures in place? Is sensitive data protected against unauthorized access by contractors or other third-party service providers?

Throughout this process, pay particular attention to certain kinds of sensitive data. Identity thieves typically look for social security numbers, credit card and other financial information.

Organizations should also consider protecting against data security breaches with insurance.Various cyber liability products are available to protect against privacy injuries, such as identity theft, and to cover the cost of complying with various data breach notice laws. Given the complexity of the risk, an experienced insurance agent should be consulted to ensure that adequate coverage is obtained. If you would like to learn more about insuring against data security breaches, contact us.

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Protecting Sensitive Data: How Secure is Your Wireless Network?

In previous articles we discussed how laptop computers and the office copy machine increase the risk of data security breaches. Another significant risk to an organization’s sensitive data is the wireless network. Since today’s workplaces are increasingly “going wireless,” the Federal Trade Commission recommends taking the following steps to protect wireless networks.

Understand how a wireless network works. Going wireless generally requires connecting an internet access point to a wireless router, which sends a signal through the air, sometimes as far as several hundred feet. Any computer within range can pull the signal from the air and access the internet. Unless precautions are taken, others can “piggyback” on the network or access information on the computer.

Use encryption. Encryption encodes the information so that it’s not accessible to others. It is the most effective way to secure a network. Two main types of encryption are available: Wi-Fi Protected Access (WPA) and Wired Equivalent Privacy (WEP). WPA2 is strongest so it should be used whenever possible. Since some older routers use the less secure WEP encryption, consider upgrading to a newer, more secure router. Note that wireless routers often come with the encryption feature turned off, so be sure to turn it on.

Use anti-virus and anti-spyware software. Since hackers are constantly developing new ways to attack computers and networks, security software is necessary. This software needs to be updated periodically so systems should be set to update automatically whenever possible.

Change the name of the router. The name of the router (often called the service set identifier or SSID) is likely to be a standard, default ID assigned by the manufacturer. Change the name to something private and unique.

Change the router’s pre-set password. Manufacturers typically assign a standard default password to a wireless router. Default passwords should be changed. Visit the manufacturer’s website to learn how to change the password.

Limit access to the wireless network. Every computer that is able to communicate with a network is assigned a unique Media Access Control (MAC) address. Wireless routers usually have a mechanism to allow only devices with particular MAC addresses to access the network. However, since MAC addresses can be mimicked, don’t rely on this step alone.

Turn off wireless network when it’s not being used. A wireless network cannot be accessed when it is turned off.

Be cautious when using a public wireless network. Many cafés, hotels, airports and other public places offer wireless networks for their customers to use. These “hot spots” are convenient, but they may not be secure.

Organizations should also consider protecting against data security breaches with insurance. Various cyber liability products are available to protect against privacy injuries, such as identity theft, and to cover the cost of complying with various data breach notice laws. Given the complexity of the risk, an experienced insurance agent should be consulted to ensure that adequate coverage is obtained. If you would like to learn more about insuring against data security breaches, contact us.

If you would like to learn more about preventing data security breaches, take our online course Information Risk Management: Strategies for Preventing and Mitigating Information Security Breaches.

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New Deadline for Affordable Care Act’s Employer Notice Requirement

Under the Affordable Care Act (ACA), employers are required to give employees written notice about their options for purchasing health insurance through Affordable Insurance Exchanges (Health Insurance Marketplaces). Though the original March 1, 2013 deadline was delayed, the Department of Labor (DOL) recently announced the new deadline for employers to begin giving this notice.

Beginning October 1, 2013, employers must provide the required ACA notice to new employees at the time of hiring. In 2014, the DOL will allow employers to satisfy this requirement by providing the notice within 14 days of an employee’s start date. An employer’s current employees must receive their notice no later than October 1, 2013.

Notice must be given to each employee regardless of their plan enrollment status or their part-time or full-time status. Employers are not required to provide a separate notice to dependents or other individuals who are or may become eligible for coverage under the plan. The notice, which must be understood by the average employee, may be provided by first-class mail or, in some instances, electronically.

The ACA’s notice requirement applies to employers covered by the Fair Labor Standards Act (FLSA). The FLSA generally applies to employers with one or more employees who are engaged in, or produce goods for, interstate commerce. Also the FLSA typically does not cover enterprises with less than $500,000 in annual dollar volume of business. However, the FLSA does cover specific entities regardless of their dollar volume of business, including hospitals, preschools, elementary and secondary schools, institutions of higher education, and federal, state and local government agencies.

To help employers satisfy their notice requirement, the DOL has prepared two model notices. There is one model notice for employers who offer a health plan to some or all employees, and another model notice for employers who do not offer a health plan. Employers may also use modified versions of these model notices as long as the required information is present.

If you would like to learn more about your obligations under the Fair Labor Standards Act, click here. If you would like information about insuring against FLSA claims, click here.

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