Legal Updates

Spring Cleaning: Time To Review And Update Employment Policies

Every New Year, we remind employers to review employee handbooks and ensure that personnel policies are up-to-date and legally compliant.  In this regard, “up-to-date” means that the employee handbook reflects all recent changes in applicable federal, state and local laws, any expansion in the employer’s geographic locations (e.g., doing business in a new state), and innovations in the employer’s personnel practices.  Given the myriad ways in which change can and does occur, we recommend that employers review personnel policies annually.  If you haven’t reviewed your handbook since January 2010, it is now time for a review.

Radical Revisions In The Law

Given the number of significant changes in employment laws in the past year, the following issues ought to be addressed, at a minimum.

Nursing Mothers Policy.  Effective March 23, 2010, the federal Patient Protection and Affordable Care Act amended the Fair Labor Standards Act (“FLSA”) to provide certain protections for nursing mothers.  In particular, nursing mothers must be provided with a private room and time off to express breast milk for one year following the birth of her child.  While the requirements apply to all employers subject to the FLSA, employers with fewer than 50 employees are exempt if compliance would “pose an undue hardship by causing the employer significant difficulty or expense when considered in relation to the size, financial resources, nature, or structure of the employer’s business.”  Employers of all sizes should consider including a policy in their handbook to address this new law.

Overtime Policy.  On March 24, 2010, the U.S. Department of Labor’s Wage and Hour Division issued an Administrative Interpretation (“Interpretation”) regarding the administrative exemption under the Fair Labor Standards Act (“FLSA”).  This Interpretation created a distinction between (i) production duties (i.e., doing what the business does), which is no longer exempt under the administrative exemption, and (ii) management duties (e.g., duties related to finance, HR, customer service, and quality control), which continue to be exempt duties under the administrative exemption.  Thus, the Interpretation signals a significant change in the Department of Labor’s views regarding the administrative exemption from overtime requirements.  In addition to this notable Interpretation, there has been significant litigation and enforcement activity related to wage and hour issues over the past year.  We recommend that all employers review their policies, practices, and job descriptions regarding FLSA classifications to ensure that classifications are consistent with the evolving law in this important area.

Benefits.  On July 8, 2010, the U.S. District Court for the District of Massachusetts held that the definition of “marriage” and “spouse” under Section 3 of the federal Defense of Marriage Act is unconstitutional.  The case is currently being appealed to the First Circuit and only applies to the particular plaintiffs in that case.  However, the ruling raises the possibility that both public and private employers may soon be required to recognize same-sex spouses for purposes of marriage-based federal employee benefits.  Accordingly, employers may want to consider reviewing plan documents and policies relative to marriage-based benefits and the definitions of “spouse” and “marriage.”

Personnel Records Policy.  On August 6, 2010, the Massachusetts Personnel Records Statute was amended to include two new provisions.  The first amendment requires employers to notify an employee within 10 days of placing in the employee’s personnel record any information to the extent that the information is, has been used or may be used to negatively affect the employee’s qualification for employment, promotion, transfer, additional compensation or the possibility that the employee will be subject to disciplinary action.  The second provision limits the number of times an employer must provide an employee with access to his or her file.  While neither of these amendments necessarily compels a revision to an employee handbook, employers should review their current policy, practices and training to ensure that personnel files are maintained in compliance with the law.

CORI Policy.  On August 6, 2010, Massachusetts Governor Deval Patrick signed into law Chapter 256 of the Acts of 2010, “An Act Reforming the Administrative Procedures Relative to Criminal Offender Record Information and Pre- and Post-Trial Supervised Release” (“CORI Reform”).  Effective November 4, 2010, the Act prevents most employers from seeking disclosure of job applicants’ criminal record information at the initial application stage.  Beginning in 2012, CORI Reform will impose numerous additional obligations on employers that rely on criminal history records to make employment decisions.  In particular, CORI Reform will require a CORI policy for employers that will annually conduct 5 or more criminal background checks.  Employers should review current practices with respect to criminal background checks and update their relevant policies.

EEO And Anti-Harassment Policies.  The federal Genetic Information Nondiscrimination Act (“GINA”) became effective on November 21, 2009, and the U.S. Equal Employment Opportunity Commission issued corresponding regulations on November 9, 2010.  Employers should review their equal employment opportunity, anti-harassment, and related policies to ensure compliance with GINA and the recently promulgated regulations.

Policy Against Texting While Driving.  Effective October 1, 2010, texting while driving became illegal in Massachusetts.  Many other states (including California, Connecticut, New Jersey, New York, and Washington) and the District of Columbia have likewise banned the use of handheld cell phones while driving.  Other states, such as Maine, have banned “distracted driving.”  Employers should consider implementing a policy to ensure compliance with such laws, while perhaps also outlining the employer’s philosophy about this issue, with respect to company cars and driving during work hours.

Anti-Bullying Policy?  Employers may want to consider adopting a general anti-bullying program, including anti-bullying policies and plans, and anti-bullying training.  While there are no laws that expressly prohibit bullying in the workplace (other than in schools), such laws have been in the works, have come close to being passed, and are likely to be passed in the future.  Further, an anti-bullying program may improve productivity, reduce the risk of litigation and reduce employee turnover.  For example, bullying is frequently cited as a high-risk factor in triggering employment litigation.

Whistleblower Policy.  Whistleblower and retaliation cases are still on the rise.  If they have not done so already, employers should consider implementing a policy that specifically addresses internal reporting procedures and that prohibits retaliation for raising such concerns.

Electronic Communications And Social Media Policy.  Employees’ online activities continue to impact the workplace.  Employers should review their electronic communications and social media policies and practices to ensure that such policies address employees’ blogs and online profiles, while not violating employees’ privacy rights and the right to engage in concerted activity.

Multi-State Employers

Furthermore, we recommend that multi-state employers review personnel policies to consider the laws of all states in which they operate.  In particular, multi-state employers ought to focus on any states into which they have recently expanded, to ensure that written policies comport with state law.  Many states have at least a few unique laws that are dramatically different than the standard laws in other states.  Thus, preparing a multi-state employee handbook and managers’ guide requires thorough research and careful analysis to ensure that any inconsistencies in state law are properly addressed and resolved in the handbook.

Policy vs. Practice

Finally, we recommend that employers carefully review their current, actual practices to ensure that policies accurately reflect current practices.  This is an area in which employers frequently get themselves into trouble.  Unfortunately, many employers do not discover this problem until they are already in litigation, and learn that the policy and the practice are inconsistent.  At best, the result is the embarrassment of looking sloppy to a judge or arbitrator.  At worst, the employer may lose a significant legal claim predicated on breach of contract, employment discrimination or some other applicable theory.  Thus, it is critical that employers ensure that their policies are consistent with their actual practices.

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We encourage employers to work with experienced labor and employment counsel at least once each year to update their employee handbook, and/or managers’ guide, to ensure compliance with all applicable changes in federal, state and local laws and to ensure that the policies accurately reflect current practices.  Please do not hesitate to contact any of us at Schwartz Hannum PC with questions.