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Top 10 for 2010

Employment & Labor, Employee Benefits & Global Immigration Update
December 14, 2009

The year 2010 promises to bring with it continuing challenges for employers.  There are, however, some action items that savvy employers can do now to better position themselves for the new year.  Moore & Van Allen’s Employment, Employee Benefits and Immigration teams have collaborated to create this Top 10 “to do” list for employers to prepare for 2010.

10.       Review and revise your company’s written vacation policy.  Take a look at your company’s written vacation policy to ensure that the policy provides proper notice of forfeiture, carryover, and accrual of vacation consistent with company practice or to make any desired changes before employees accrue vacation in the new year.  In most states, employers are stuck providing vacation benefits according to their policies.  This means that if the policy provides that employees are awarded vacation hours at the beginning of the new year but does not state that employees forfeit accrued vacation on termination, the employee can quit on January 2, 2010 and be entitled to pay for his accrued unused vacation.  Note that special rules apply in some states (like California) prohibiting forfeiture of any accrued vacation, even with notice. 

9.         Update your company confidentiality agreement and have employees who have access to company confidential information sign a copy.  A solid confidentiality and nondisclosure agreement is a good way to protect your company’s proprietary information and give your company a contract claim against any employees who depart with important company records.  The economic turmoil of 2008 and 2009 has made competition stiffer and has made employees facing termination more willing to take risks in order to obtain employment elsewhere.  As a result, we have seen more employees taking their employer’s confidential, proprietary, and trade secret information to use in new employment.  The law on how broad a confidentiality agreement can be varies from state to state, so be sure to check the applicable law in the states where you have employees.  Also review your confidentiality agreements and policies to ensure they do not prohibit employees from discussing their wages or terms and conditions of employment with their fellow employees.  Although employers can prohibit disclosure of confidential pay strategies and plans to outsiders, a prohibition on employees discussing terms and conditions of employment is viewed by the National Labor Relations Board as an interference with concerted activity and a violation of the National Labor Relations Act—even if your company is not unionized. 

8.        Institute other processes and protections for confidential information and trade secrets.  Implement policies requiring storage of any hard copies of sensitive documents in locked cabinets.  Password protect electronic copies.  Consider implementing clean desk rules and prohibiting or limiting removal of confidential records from the office.  Restrict access to sensitive documents to those employees who need to know the information to do their jobs.  These steps do not replace the benefits of having a good confidentiality agreement with employees.  Rather, they enhance protections against employee misappropriation.  These steps also can strengthen your company’s argument that it has taken adequate steps to protect its trade secrets—an important element of a trade secret claim.

7.        Update your  technology resources policy.  Increasingly employees are boldly downloading, transferring, destroying, or emailing to their home computers portable storage devices confidential or sensitive company information.  The federal Computer Fraud and Abuse Act (and similar laws in some states) prohibit such conduct when it is unauthorized.  A good technology resources policy (covering computer, internet, telephone, and email systems use) can help employers succeed on CFAA claims by clearly defining what actions by an employee are unauthorized.  At the same time, a properly worded policy can give employers a powerful investigation tool by making clear that employees do not have a right to privacy in their use of these resources and by requiring employee consent to employer searches of employee computers and other devices.  There has also been an increase in employees harming their employers’ reputation -- and even disclosing trade secrets -- through postings on blogs, social networking websites, and video sharing websites.  A good technology resources policy can address such conduct and provide a basis for discipline if it does occur.  Don’t have a technology resources policy?   Implement one. 

6.         Get FMLA compliant.  If your company has 50 or more employees, make sure that you post the FMLA poster that the US Department of Labor issued in 2009.  Update your FMLA forms and policies, if you have not done so already.  The DOL prototype poster can be found at http://www.dol.gov/whd/regs/compliance/posters/fmla.htm (Check out whether you are in compliance with other federal posting requirements by using the DOL compliance advisor at http://www.dol.gov/elaws/posters.htm

5.         Get ready to review the company’s harassment policy with employees.  Tell your managers to incorporate a review of the company’s discriminatory workplace harassment policy in their first department meeting of the new year.  Reviewing the harassment policy periodically with employees reminds employees what behavior is not tolerated, shows that the company takes harassment issues seriously, and can bolster the employer’s defenses to most harassment claims.  Be sure to include nonharassment on the basis of genetic information under the Genetic Information Nondiscrimination Act (see item 1 below).

4.        Review the company’s classification of employees as exempt from overtime under federal and state wage and hour laws.   Lawsuits and investigations based on improper classifications of employees continue to be a hot area of the law and can result in significant awards against employers.  For a quick overview, go to the U.S. Department of Labor’s Fairpay website at www.dol.gov.  If your classifications are not in compliance, fix them.

3.        Make sure your health care plan provides the required notice to employees of the provisions of Michelle's Law.  Michelle’s Law, effective for new plan years on or after October 9, 2009, amends ERISA to allow dependent college students who are seriously ill or injured to take up to a year of medical leave without losing their health insurance coverage.  Group health plans must receive written certification by the student's treating physician stating the child is suffering from a serious illness or injury and that the leave (or change of enrollment) is medically necessary. A student on leave is entitled to the same benefits that he or she would have received if the leave had not been taken.  The extended coverage may end earlier if the student ages out of dependent eligibility by exceeding the plan's normal dependent eligibility age.  Plans must provide notice of the Michelle's Law requirements with any notice requiring certification of student status for coverage under the plan.      

2.        Conduct an internal I-9 audit.  Last month ICE (US Immigration and Customs Enforcement) announced that it was issuing 1,000+ new I-9 audits for U.S. employers. Don't wait until you receive the 72-hour Notice of Inspection to find out if you have a problem. 

1.         Get familiar with the requirements of GINA.  The Genetic Information Nondiscrimination Act of 2008 (GINA) restricts the collection and use of genetic information by group health plans, insurers, employers and labor organizations.  Title II of GINA, which applies to employers and labor organizations went into effect on November 21, 2009.  Title I of GINA, covering group health plans, is effective for plan years beginning on or after December 7, 2009.  Genetic information includes (but is not limited to) family medical history and genetic diseases for which an employee believes he or she might be at risk.  The restrictions in GINA could affect how employers run their wellness programs, including prohibiting incentives (such as premium discounts, rebates, or other rewards) for employees who complete a Health Risk Assessment for the wellness program.  In addition, employers cannot discriminate against employees or applicants on the basis of genetic information or retaliate against individuals who oppose practices made unlawful by GINA.  Employers should update their EEO and harassment policies to cover genetic information, revise hiring and medical examination practices to ensure that they do not request prohibited genetic information, ensure that their record keeping practices protect the confidentiality of any genetic information that may be provided by an employee, and post the supplement to the “Equal Employment Opportunity is the Law” poster.  The supplement can be printed off at http://www.eeoc.gov/employers/upload/eeoc_gina_supplement.pdf

A few other reminders.  If you are a federal contractor, * E-Verify became mandatory for you in November 2009.  You can check the new memorandum of understanding and FAQ's here. In addition, the final EEOC regulations on the Americans with Disabilities Act Amendment Act (the ADAAA) are expected sometime in the first quarter of 2010 and will likely broaden further the employees and applicants who will be covered by the protections of the ADAAA.  Employers need to carefully assess an employee’s or applicant’s condition before refusing to offer or provide a reasonable accommodation.

If you have questions regarding these or any other issue related to employment, immigration or employee benefits, please feel free to contact us.