Smart New Year’s Resolutions for Employers in 2014 (And a Few of My Own)
November 1, 2013 by Russ Brown
Ben Franklin once said, “[b]e at war with your vices, at peace with your neighbors, and let each new year find you a better man.” The end of the year provides an opportunity to reflect on victories and failures, ponder a better path forward, and resolve to pursue great goals. I’m not always successful in keeping my own resolutions; however, with a dash of selective amnesia and a dose of hard-earned wisdom, I keep coming back for more! Wise employers and HR departments go through the same evaluation process at the close of each calendar or fiscal year. As we embark on a new year, here are three worthwhile New Year’s resolutions for employers and HR departments.
1. Appropriately Classify Workers
The U.S. Department of Labor (DOL) has increasingly shown interest in the misclassification of employees as independent contractors. Based upon Supreme Court precedent, the DOL balances several factors, most notably the employer’s control over the worker, in determining whether a worker is properly classified. The IRS also has taken a keen interest in worker classifications and uses a 20-factor balancing test when considering a worker’s classification.
Employers should scrutinize independent contractors’ duties, consider the employer’s control exercised over the contractors, and recalibrate the working relationships when necessary. While certainly not a determinative factor, it also makes sense to have a clear independent contractor agreement in place so both parties’ understand the working relationship. The consequences of neglecting classification issues are wide ranging and can include fines, overtime claims, and defense expenses.
2. Introduce Easy to Understand Social Media Policies
The #wiseemployer knows her workforce engages in social media daily. Twitter, Facebook, Google+, and other emerging social media outlets have become megaphones for those who like to share details about their lives, their jobs, or anything that will make them and their employers look bad. While there are legal pitfalls for employers to avoid (e.g., prohibiting protected concerted activity), employers should resolve to present straight-forward and understandable social media policies. As a result, employers likely will experience fewer social media flare-ups and will be better prepared to address issues when they arise. (If you have no idea why I used a hashtag in the first sentence, click here for an introduction to Twitter #ASAP.)
3. Pay Your Interns
“Paid intern” is an oxymoron to a lot of employers. However, free work from interns is now a red hot issue and legal minefield. In 2011, two Fox Searchlight interns filed suit alleging the film company failed to pay wages for their work on the film, Black Swan. The district court recently granted summary judgment in favor of the interns. The once latte-fetching interns appeared to have a blockbuster of their own in a major class action lawsuit, but more recently the Second Circuit agreed to hear the case on appeal.
The Hollywood Reporter deemed the Black Swan case the third most significant legal issue in Hollywood in 2013. Stay tuned as the Second Circuit could keep the spotlight on the issue in 2014. In the meantime, the wise employer will keep in mind the DOL’s six key factors for determining whether interns may work without pay.
Finally, I can’t close this post without sharing my own New Year’s Resolutions. My three resolutions for 2014:
- Spend more time outdoors (especially with my family);
- Seek forgiveness and grant it freely; and
- Unlike the second half of 2013, actually exercise!