lawsuits waiting to happen: the top ten reasons dealerships get sued by employees
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– KPA CONFIDENTIAL –
Lawsuits Wait ing To Happen: Lawsuits Wait ing To Happen: The Top Ten Reasons Dealerships Get Sued By The Top Ten Reasons Dealerships Get Sued By
Employees Employees We will begin at 10am Mountain Standard Time.
– KPA CONFIDENTIAL –
Lawsuits Wait ing To Happen: Lawsuits Wait ing To Happen: The Top Ten Reasons Dealerships Get Sued By The Top Ten Reasons Dealerships Get Sued By
Employees Employees We will begin at 10am Mountain Standard Time.
Speakers
Moderator Presenter
Becky RossMarketing Manager
303-228-8753
bross@kpaonline.com
John P. Boggs, Esq.Fine, Boggs & Perkins LLP
650-712-8908jboggs@employerlawyers.com
Questions
• If you have questions during the presentation, please submit them using the “Questions” feature
• Questions will be answered at the end of the webinar
Employers are required to comply with a myriad of complicated local, state and federal employment regulations. These regulations are difficult to understand, poorly communicated by regulatory agencies and continually changing.
As the cost of non-compliance continues to skyrocket in both punitive fines and employee litigation costs & settlements, the challenge is made worse by economic downturn and the increase in employee ligation that results from hard times.
EVER FEEL LIKE YOU ARE PREY?
Webinar Overview
Lawsuits Wait ing To Happen: Lawsuits Wait ing To Happen:
The Top Ten Reasons The Top Ten Reasons Dealerships Get Sued By Dealerships Get Sued By
Employees Employees
REASON NO. 1
HIRING THE HIRING THE
WALKING LAWSUITWALKING LAWSUIT
Through Forced FunctionThrough Forced Function
The only way to WIN THE BATTLE is to fol low a standardized step-by-step process
Application InterviewConditional
Offer
Drugand/or Background
Screening
New Hire Packet
Company Policies & Training
FIND QUALITY EMPLOYEESELIMINATE THE “WALKING LAWSUIT”
Bullet-Proof Your Employment PracticesBullet-Proof Your Employment Practices
APPLICATION
New Hire Packet
Company Policies & Training
Conditional Offer
Drugand/or Background
Screening
Application Interview
THE APPLICATION
• Application with Legal Protections
• Review The Application--Look For The Key Indicators of the Walking Lawsuit
– Blanks
– Multiple Employers and/or Short-term Employment
– Reasons for Leaving Employment
– Gaps in Employment
– The Victim Mentality
Web-Based Employment Application
REASON NO. 2
DOING THE TYPICAL DOING THE TYPICAL INTERVIEW INTERVIEW
(Worthless)(Worthless)
INTERVIEW
New Hire Packet
Company Policies & Training
Conditional Offer
Drugand/or Background
Screening
Application Interview
Interview
• Studies show that interviewing a candidate for a job position is only 14 percent effective in determining “job fit.” On a nice day, it would be just as effective and more enjoyable to sit on a park bench and hire every seventh person who walks by!
HIRING IS LIKE COURTING FOR MARRIAGE
• The interviewer concludes, “Well, he/she is not perfect, but I’ll train him after I hire him.”
HOW DO YOU IMPROVE THE INTERVIEW PROCESS?
• Sound familiar? Have you ever regretted hiring someone on the very first day? It hurts, doesn’t it? Or someone asks, “What idiot hired that person?”
• But you don’t give up. You pay for training, trying to mold the person to do a job he will never do well. Eventually you begin the sad process of firing the employee. This, too, is a traumatic and often costly process.
• In our litigious society, it can be very costly.
VELVET HAMMER INTERVIEW
• LISTEN!• STOP TALKING• ASK OPEN ENDED
QUESTIONS• DON’T ASK
ILLEGAL QUESTIONS
Questions to Ask:Work Ethic and Attitude
• What skills are required to get along with and work cooperatively with others?
• Describe the qualities of a good boss? Employee?
• What do you believe is characteristic of bad management? Good management?
• What does being motivated mean to you?
What would your supervisor have to say about you? Co-workers? Subordinates?
How were problems resolved at your last job?
How many weeks did you work without interruption over the past 12 months?
Remember: Open Ended Questions!
•Age or birth date
•Marriage status or child care
•Nationality or background
•Disability
•Club memberships
•Pregnancy
•Can you work weekends?
It is UNLAWFUL to ask for information pertaining to:
InterviewInterview
REASON NO. 3
FAILING TO MAKE EXPECTATIONS CLEAR BEFORE EMPLOYMENT BEGINS
CONDITIONAL OFFER
New Hire Packet
Company Policies & Training
Conditional Offer
Drugand/or Background
Screening
Application Interview
Is it UNLAWFUL to obtain a drug screen BEFORE extending an offer to hire?
False Hiring Promises Eliminated
CONDITIONAL OFFERCONDITIONAL OFFER
REASON NO. 4
DON’T BOTHER TO DO
DRUG TESTING AND
BACKGROUND SEARCHES
DRUG AND BACKGROUND SCREENING
New Hire Packet
Company Policies & Training
Conditional Offer
Drugand/or Background
Screening
Application Interview
Background Screening
Background checks include• Credit hits • Character Checks • Criminal background information • DMV records, etc.• Worker’s Compensation Claims History• Civil Claims History• Sex Offender Registry
Background Screening
Background checks require:1. Initial written authorization2. Proper legal disclosures and info3. Opportunity to get a copy of report4. Intent not to hire and copy of report and federal and
state disclosures5. Final rejection letter
$10,000.00 per violation minimum penalty
REASON NO. 5
HAVING INADEQUATE NEW HIRE PAPERWORK
NEW HIRE PACKET
New Hire Packet
Company Policies & Training
Conditional Offer
Drugand/or Background
Screening
Application Interview
Employment Agreements
REASON NO. 6
FAILING TO DO NEW HIRE TRAINING
COMPANY POLICIES AND TRAINING
New Hire Packet
Company Policies & Training
Conditional Offer
Drugand/or Background
Screening
Application Interview
An employee must have access to the employee handbook to be held accountable to the policies
New signatures should be obtained when any significant change is made
COMPANY POLICIES AND TRAININGCOMPANY POLICIES AND TRAINING
PoliciesPosters
Training
The law requires that dealerships take reasonable steps to prevent harassment
Reasonable steps means:
Anti-Harassment Training
REASON NO. 7
FAILURE TO FOLLOW GOOD WAGE/HOUR RECORD KEEPING
PRACTICES
MEAL BREAKS & REST PERIODS
#1 Basis for Wage/Hour Suits Against Dealers• 30 minutes for each five hours, unless less then six or less
than 12 hours (can be waived only if first not waived).
• Must clock in and out or at the very least keep a record that the lunch break was taken
• 10 minute rest period (paid) for each four hours of employment
• What Should You Do?
• Contact legal counsel to ensure that your policies reflect the most prudent practices relating to meal and rest breaks and tracking employee time.
• Always track hours worked and not worked by all nonexempt employees.
• Make sure supervisors and managers consistently enforce your policies and procedures, in particular, as they relate to meal and rest breaks for exempt and nonexempt employees—Strongly consider a written certification under penalty of perjury confirming that all meal breaks and rest periods were taken.
POPULAR WAGE- HOUR LAWSUITS
• Meal Break and Rest Period Claims• Commission Pay Plan Problems
• Overtime Exemptions Challenges• Unlawful Deductions from Pay
• Charge-Backs• “Costs of Doing Business”
• Proper Overtime Calculations• Regular Rate of Pay Issues
• Bonuses• Variable/Hybrid Pay Plans
COMPENSATION PRIMER: THE BASICS
Fine $100/$200 per Pay Period per Person fineProblem AreasLunch Periods for Sales, F&I, Service Writers
Record KeepingAccurate record of hours worked each day/week and amounts paid and deducted
DEALERSHIP PROFIT-BASED PAY PLANS UNDER ATTACK!DO YOU NEED TO CHANGE YOUR PAY PLAN?
DEALERSHIP PROFIT-BASED PAY PLANS UNDER ATTACK!DO YOU NEED TO CHANGE YOUR PAY PLAN?
• “Packs” represent potential problems, if they are used, they should be specifically identified by dollar amount (no “hidden” “undisclosed” packs) in a signed pay plan. Packs should never be identified as a way to allocate overhead or expenses, but instead should be described as “an amount of the gross profit on which the salesperson is not paid a commission.”
• If salespeople are not paid on under-allowances, or if over-allowances are charged against commissionable gross, that should also be identified. Likewise, if salespeople are not paid on factory incentives and/or holdback, that should be made clear in the pay plan.
PAID VACATIONNo Use it or Lose ItMaximum Accrual is Okay
PTO treated like Vacation
PAID HOLIDAYSBe Careful On Floating Holidays
PAID SICK LEAVEA Good Thing for Salaried Managers
REASON NO. 8
HASTY DISCIPLINARY DECISIONS
1. Do you feel comfortable after your investigation that you will be able to prove, with evidence, that the employee violated the rule, or the standard of performance was not met, and that you have treated other similar situations with the same level of discipline in similar circumstances?
Legal Liability Checklist
2. Are there any prior commitments (written agreements or promises) in employee's personnel file regarding a specific term of employment, continued employment or a requirement of just cause for termination of employment?
Legal Liability Checklist
3. Are there any complaints or claims (formal or informal) that the employee has made against the company, any co-worker, customer or vendor? (e.g., harassment, discrimination, retaliation, unpaid wages, workers compensation claims, safety issues, labor regulation violations, dishonesty, customer fraud or other claims that the company violated the law in any way, etc.)
Legal Liability Checklist
4. If the employee falls into a "protected category" (e.g., minority, race, religion, color, sex, sexual orientation, national origin, ancestry, citizenship status, uniform service member status, marital status, pregnancy, age/over 40, medical condition—cancer related or HIV/AIDS related, disability, or transgender status), does the employee's "protected category" represent a relatively small portion of your workforce or the employee's work group.
Legal Liability Checklist
5. Has the employee taken any leaves of absence within the last year? (Medical leave, Family Care leave, Pregnancy leave, Drug/Alcohol Rehabilitation leave, Workers Compensation leave, etc.)
Legal Liability Checklist
6. Have you disciplined others for this same general rule violation or performance deficiency?
Legal Liability Checklist
7. Has the level of discipline imposed been substantially the same for the same violation or performance deficiency for other employees?
Legal Liability Checklist
8. Have you failed to discipline anyone for the same general rule violation or performance deficiency, even though some other employees may have been disciplined for it?
Legal Liability Checklist
9. Have you given different levels of discipline to different employees for the same general rule violation or performance deficiency?
Legal Liability Checklist
10. Do you plan to terminate the employee?
Legal Liability Checklist
REASON NO. 9
LOSE THE BATTLE OF THE WITS ON CALIFORNIA LEAVE AND
DISABILITY LAWS
TYPICAL TYPES OF LEAVETYPICAL TYPES OF LEAVE
- VACATION (PAID), PAID TIME OFF (PTO OR PDO)- SICK LEAVE (PAID AND UNPAID)- MILITARY LEAVE (non-FMLA)- FLOATING HOLIDAY (PAID)- CIVIC DUTY LEAVE (E.G. JURY DUTY, WITNESS DUTY, VOTING LEAVE)- UNPAID FAMILY SCHOOL PARTNERSHIP LEAVE- PREGNANCY DISABILITY LEAVE OF ABSENCE (non-FMLA, PAID OR UNPAID)- FAMILY LEAVE (non-FMLA, UNPAID OR PAID)- LEAVE FOR VICTIMS OF FELONY CRIMES - LEAVE FOR VICTIMS OF DOMESTIC VIOLENCE & SEXUAL ASSAULT- TIME OFF FOR EMERGENCY DUTIES- BEREAVEMENT LEAVE- ALCOHOL/DRUG REHABILITATION LEAVE- PERSONAL LEAVE OF ABSENCE (OTHER)- FAMILY AND MEDICAL LEAVE ACT (AND STATE LAW EQUIVALENT)- WORKER’S COMPENSATION INJURY/ILLNESS LEAVE- DISCRETIONARY MEDICAL LEAVE (non-FMLA for ADA)
FMLA and Workers’ Comp Conflicts
• Employees injured on the job under the Worker’s Compensation provisions may still be eligible for FMLA leave.
• Employees on Workers’ Comp must be put on FMLA leave -- just as if they were on a non-work related injury medical leave
• Employees on FMLA leave are entitled to have their health insurance covered for the first 12 weeks of Workers’ Comp, then they should be put on COBRA if your Health Plan is governed by ERISA.
What if the Employee Won’t Return the Health Care Provider Certification?
• Reasonable period of time of not less than 15 days - what’s that?
• What action can you take against the employee?
– Deny the leave retroactively?• What happens to the leave?
– It becomes absence without approved leave.
FMLA vs. CFRA
• Under FMLA, pregnancy is a serious health condition
• Under CFRA, pregnancy is not a serious health condition.
PREGNANCY
• Result is that a pregnant employee gets:
– Up to 4 months of pregnancy leave due to pregnancy or pregnancy-related disability
– Up to 12 weeks of leave under FMLA as pregnancy is a serious health condition
– Up to 12 weeks of leave after the baby is born for “bonding” purposes.
• YES, that’s up to a total of 7 months of leave.
American with Disabilities Act
• A qualified individual with a disability who, with or without reasonable accommodation, can perform the essential elements of the employee’s job
• A physical or mental impairment that substantially limits one or more of the employee’s major life activities. A record of such an impairment. Or being regarded as having such an impairment.
• Interactive process
• Provide a Reasonable Accommodation– Discretionary Medical Leave, for example.
Definitions Overlap and Conflict
ADA –Disability is not always FMLA serious health condition.
FMLA – A serious health condition is not always ADA disability.
Employees on Workers’ Comp Disability may not be covered by ADA or FMLA.
Temporary impairments are not covered by the ADA.
• An available light duty position must be considered as a form of reasonable accommodation under the ADA.
• Workers' Compensation gives employers the option of providing light duty, but it is not required. The system encourages employers to provide light duty by financially penalizing those who do not.
• Yet FMLA prohibits employers from requiring employees to return to light duty positions during their 12-week protected period.
FMLA and Workers’ Comp Conflicts
Reminders
• FMLA and Workers’ Comp may run concurrently
• Make sure the employee has received written notice re: FMLA designation
• Rely on medical opinions
• Make sure FMLA poster is displayed
REASON NO. 10
IGNORE PROBLEMS
UNTIL THEY BOIL OVER
ACT FAST AND FIX THE PROBLEM
1. Use the HotlinkHR Employee Hotline
2. Use the HotlinkHR HR Advice Hotline
3. Talk to the Employee
4. Talk to Witnesses
5. Make a decision
6. Follow-up with the Employee
FREE CONSULTING TIME!!!
Contact Information
www.kpaonline.com
bross@kpaonline.com
866-356-1735
A copy of the recorded webinar and presentat ion slides wil l be emailed to you today.
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