As we enter the second half of the calendar year, here are some tips and reminders to help you better prepare for HR scenarios your business may experience.
For the last year or so, sexual harassment allegations have been making headlines. Harassment in the workplace is something HR professionals have been fighting for decades, yet more and more allegations against public figures and major companies have been coming to light as of late.
A poll by NBC News and The Wall Street Journal found that 48% of currently employed women in the U.S. have been verbally or physically harassed or had unwelcome advances made at work.
Sexual harassment is something companies cannot ignore and it is becoming more important that they proactively guard against it. Businesses should establish or update processes that not only create a policy and culture of zero tolerance for any type of harassment but that also quickly and thoroughly respond to and resolve any harassment allegations that may arise.
We touched on sexual harassment in a previous blog post and gave advice on ways companies can start combating harassment in the workplace. We cannot stress enough that employers should make the following a priority as they work toward the goal of a harassment-free workplace:
As mandatory training requirements become more common across various states, maintaining compliance with sexual harassment prevention laws will be more and more complex. Continue to watch the evolution of harassment prevention training requirements in the states and cities where your employees work and reach out to your HR services provider for help in addressing your business’s harassment prevention needs.
Create a written policy about harassment in the workplace that includes a description of what harassment is, establishes a zero-tolerance culture, promises prompt and thorough investigations of all complaints with action taken as appropriate (up to and including termination), and conveys clear and understandable complaint procedures and expectations. Any policy should comply with all applicable federal, state and local laws. New York state and New York City employers need to prioritize updating their harassment policies in the coming months due to recently enacted laws focused on harassment prevention that may require policy edits.
Your written policy should be given to employees during the onboarding process after they are hired, when an employee becomes a people manager, when the materials in the policy are updated and otherwise on an annual basis. Employees should be required to acknowledge, with a signature, that they have received the policy. This acknowledgement of receipt should be kept in their personnel file.
Make a harassment-free company part of your culture by instilling throughout your company the belief that nobody should ever fear retaliation from speaking up. If anything, they should fear silence. This means it is everyone’s responsibility to report any incident of harassment, including incidents of potential harassment or unprofessional conduct. Make sure your employees feel not only comfortable and empowered to report harassment but that they understand that speaking up about any issue of harassment is part of their responsibility as a member of your team.
The Obama administration’s Department of Labor (DOL) introduced a final rule in 2016 to increase the minimum annual salary threshold for most “white collar” overtime exemptions (executive, administrative and professional) under the Fair Labor Standards Act (FLSA) from $23,660 to $47,476. This final rule was challenged by many states and preliminarily blocked by a federal court prior to its effective date of December 1, 2016. On August 31, 2017, the federal court issued a final judgment against the DOL, ruling that the DOL exceeded its authority by raising the minimum salary threshold to qualify for those exemptions so high that it created a “de facto salary-only test.”
The DOL intends to announce a new proposed salary threshold for FLSA's white-collar exemption from overtime pay—but likely not until January 2019. This new threshold is anticipated to be in the $30,000 to $35,000 range.
What this means for employers is that a final resolution of this issue will depend on both the DOL likely issuing a new rule in 2019 that will increase the current minimum salary threshold for FLSA exemptions and the appellate court confirming the DOL’s ability to establish that new rule as part of the exemption analysis. In the meantime, it’s a good idea to review your FLSA classifications and have a plan in place to potentially address exempt employees with salaries under $30,000 in case the minimum salary threshold is raised to that level or above. This will help you budget so you can stay ahead of the game.
One of the biggest unknowns is the future of the Affordable Care Act (ACA). President Trump campaigned on the promise to President Trump campaigned on the promise to repeal and replace the ACA and, to date, only limited progress has been made on those efforts. Despite not being repealed or replaced, the ACA has definitely changed. Late in 2017, the House and Senate approved the tax law repealing the individual mandate requirement, effective January 1, 2019.
The IRS began sending penalty notices from the 2015 tax year, which solidifies that the ACA is still in effect and companies that do not comply with the regulations may face penalties. The IRS has also stated that it will reject 2017 tax returns that don’t indicate whether the filer had insurance for the year. It’s crucial that you work with an HR professional who can help you with the complicated ACA reporting requirements.
Toward the end of the Obama administration, a ruling was issued that would have required companies that file EEO-1 reports to provide data on employee compensation and hours worked, categorized by sex, race and ethnicity. This requirement was supposed to apply to the EEO-1 reports for 2017, which would have been due by March 31, 2018 (the deadline for the 2017 EE0-1 report was extended to June 1, 2018).
The Trump administration stayed the wage data reporting requirement of the EEO-1 report for further study. The Equal Employment Opportunity Commission is expected to provide more information in the near future about the revised EEO-1 report’s status and what employers should expect.
Even without this requirement, employers should still take steps to ensure they are providing equal pay to employees who perform substantially similar or comparable work, regardless of factors such as sex, race, ethnicity, etc., in order to comply with any applicable equal pay laws (discussed in more detail below) and anti-discrimination laws, as well as to be at the forefront of best practices. Start by reviewing the current compensation bands within your company. Review your pay bands within each individual job title or each department and see where pay gaps lie. Determine whether there are legitimate bona fide factors for the pay gap and, if not, develop a way in which you can begin to close the gap.
Various companies have taken steps, especially over the last few years, to close the gender gap when it comes to compensation. The trend will likely continue throughout the rest of 2018 as more states and cities enact laws intended to keep employers from asking about—or relying on—salary history as a basis for compensation negotiations. One would expect additional actions from states and municipalities to address this issue as well.
California is on the cutting edge of this trend, having previously enacted the California Equal Pay and Fair Pay Acts. Those regulations allow employees to openly discuss compensation and require equal pay for employees who perform “substantially similar work,” among other provisions. In addition, California recently passed a ban on salary history inquiry that began on January 1, 2018.This ban prohibits California employers from asking about or seeking previous salary history and from including that information in decisions regarding compensation or an offer of employment. Notably, the California law requires an employer, upon reasonable request, to provide an applicant with the pay scale for a position.
Delaware and Oregon also have compensation history inquiry restrictions in place. Massachusetts and Connecticut have enacted such laws in 2018. San Francisco and New York City have also passed similar regulations. Additionally, there are federal laws, such as the Lily Ledbetter Equal Pay Act and the Equal Pay Act, which address unfair wage gaps. You can expect the list to grow over time, as more and more cities and states seek strategies to address pay inequality.
These are just a few of the major HR topics businesses should keep an eye on throughout the rest of 2018 and beyond. As always, TriNet will stay abreast of trends and changing legislation that affect small and midsize businesses. Contact us for more information.
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