When it comes to company policies, it is important for employers to be clear in what they want to manage, but also how they plan to manage those policies. Employers should communicate expectations, work rules, guidelines and information to employees through written employment policies. It is equally important for employers to carefully develop their policies consistent with current federal and state laws, as well as enforcement agency guidance and activity. Once those policies are established, employers should consistently implement and apply them. This tip examines five policies, explains why they may be problematic, and provides best practice guidance, as appropriate. Ask yourself, do you have any of these policies in place?
Policy #1: Prohibiting wage discussions (e.g., "Employees are prohibited from discussing their pay with co-workers.")
· Why this is problematic: Under Section 7 of the National Labor Relations Act (NLRA), employees have, among other things, the right to act together to improve wages and working conditions and to discuss wages, benefits, and other terms and conditions of employment, with or without a union. Both the National Labor Relations Board, which enforces the NLRA, as well as many courts have found that pay secrecy or confidentiality rules violate Section 7 of the NLRA. Indeed, Minnesota currently requires employers who maintain an employee handbook to have a clear policy explaining employees' affirmative right to disclose their own pay information under Minnesota's Women's Economic Security Act. In addition, many states now have laws in place that expressly prohibit employers from taking adverse action against employees who discuss their wages.
· Best Practice: Employers should never take actions or implement policies that could be construed as restricting Section 7 rights under the NLRA. Instead of forbidding employees from discussing their wages, employers should consider taking steps to better communicate information about their company's compensation program and how employees' salaries and wages are determined.
Policy #2: Blanket prohibition on hiring individuals with a criminal history (e.g., "Our company will not hire anyone with a criminal conviction.")
· Why this is problematic: Blanket policies restricting the recruitment and hiring of individuals with a criminal conviction can have a disparate impact on protected classes and may violate federal, state and local laws. It is strongly recommended that employers follow the Equal Employment Opportunity Commission's (EEOC) guidance from April 25, 2012 when developing a recruitment policy, with respect to the inquiry into criminal convictions, and use of that information once it is obtained. In its guidance, the EEOC reiterates its position that an employer cannot simply disregard any applicant who has been convicted of a crime.
· Best Practice: Employers should first screen applicants according to their qualification for the position, then ask about a criminal conviction, then evaluate how specific criminal conduct relates to the duties of a particular position. This generally requires an individualized assessment in which the employer considers a variety of factors to determine whether exclusion based on an individual's criminal record should be applied (such as the facts and circumstances surrounding the offense, the number of offenses for which the individual was convicted, rehabilitation efforts, and employment or character references).
Policy #3: No-fault attendance policies (e.g., "Employees will receive a point for any absence or tardiness, regardless of the reason. If the employee accumulates seven points, the employee will be subject to progressive discipline. After 15 points, the employee will be terminated.")
•Why this is problematic: No-fault attendance policies subject an employee to a specific form of discipline if they are absent or tardy a certain number of times, regardless of the reason. These types of policies are problematic if one or more absences are protected under federal, state, or local laws and the employer still counts the absence against the employee. For example, employees who have the right to take leave under the federal Family and Medical Leave Act or the Americans with Disabilities Act cannot have that leave count against them when evaluating their attendance.
•Best Practice: Employers are permitted to adopt a policy that subjects employees to discipline for excessive, unapproved absences, provided that employees are never subjected to adverse action for taking leave to which they are entitled under federal, state, or local law.
Policy #4: Withholding pay until company property is returned (e.g., "Employees' final paychecks will be held until company equipment is returned.")
• Why this is problematic: Federal law requires employees to receive their final pay by the next scheduled payday. Many states have enacted laws establishing shorter timeframes for providing final pay, such as at the time of termination. Employers must comply with final pay laws even if the individual has yet to return company equipment.
•Best Practice: Whenever possible, employers should reclaim company equipment prior to the individual's departure. Depending on the state, employers may be permitted to make limited deductions from the final pay of non-exempt employees for unreturned equipment, provided they do not bring the employee's pay below the applicable minimum wage and do not reduce any overtime pay due. Some states expressly prohibit any deduction for unreturned equipment. If the employee is classified as exempt, the employer is prohibited from reducing the employee's final pay for unreturned company equipment. Employers should review their applicable law and consider consulting legalcounsel before applying any deduction.
Policy #5: Unauthorized overtime will not be paid (e.g., "The company will not pay employees for overtime that was not authorized in advance.")
• Why this is problematic: Under the federal Fair Labor Standards Act, non-exempt employees are entitled to overtime pay at a rate of one and a half times their regular rate of pay for all hours worked over 40 in a workweek. Note: Some states have additional overtime requirements. If a non-exempt employee has worked overtime, he or she must be paid an overtime premium, regardless of whether the overtime was pre-authorized. The fact that an employer has a policy that no overtime work is permitted unless authorized in advance does not relieve the employer of this requirement.
•Best Practice: Employers should make it clear in their written policies that employees may be subject to disciplinary measures for working unauthorized overtime, and should follow through with disciplining employees who fail to obtain authorization in advance, but in no case may the employer withhold overtime pay.