In the last issue of Spotlight, we listed a handful of ways in which business owners may knowingly or unknowingly violate state or federal employee regulations. Our list, however, was merely the tip of the iceberg. Given the multitude of complex laws that dictate businesses' human resource policies and procedures, we want to offer a few more examples of how business owners might inadvertently find themselves in violation of government regulations.
-
Job Descriptions – A professional services firm terminates an employee for not performing her job duties, however the firm has no job descriptions in place so the employee was never given anything detailing what functions she was expected to perform.
Consequences: Chances are this employee will be granted unemployment benefits, because lack of performance does not necessarily disqualify her for those benefits. However, if the firm had a well-written job description signed by the employee on file, it would be able to argue that the employee was aware of what was expected and that she agreed to the job duties.
-
Harassment – A supervisor at a mid-sized manufacturing company continually makes sexist comments and tells his subordinates off-color jokes that offend a number of employees. One employee complains, but the company does nothing about it and the negative behavior continues.
Consequence: The employee files an EEO charge, and later, a harassment suit. After incurring sizable legal fees, the company ultimately agrees to a significant settlement. (Title VII violation)
-
Retirement & Pensions – A small business owner prohibits a group of non-exempt employees from participating in the company's pension plan.
Consequences – If an employer maintains a pension plan, ERISA specifies that employees be allowed to participate. In this case, the owner's failure to comply results in a governmental review and a subsequent lawsuit.
-
Safety – A plant owner neglects to make some needed repairs. As a result, his workers are exposed to unsafe working conditions.
Consequences: During an OSHA inspection, the plant owner is cited for violating safety codes and given three months to correct the condition. When after the allowed time period the plant owner still has not "gotten around" to correcting the problems, OSHA fines the plant owner $10,000.
-
Disability Compliance (ADA) – A hearing impaired employee asks his company to provide him a special phone to enable him to perform his job better. However, the company ignores the employee's request and eventually the employee feels forced to resign.
Consequences: Under the Americans with Disabilities Act (ADA), companies with 15 or more employees must provide reasonable accommodations to disabled employees, unless providing such accommodations would result in financial hardship to the company. In this case, the employee files an EEO charge. During an EEOC investigation, it is determined that the company never attempted to enter into a dialogue with the employee to resolve the matter nor would granting the request have been a hardship for the company. The company agrees to pay a reasonable settlement to the former employee.
Even the most astute and well-informed business owners have difficulty keeping up to speed with, and thus adhering to, the vast number of ever-changing regulations. It has been said before, but it bears repeating – the most effective way to ensure your business is in compliance with all the human resource regulations (and steers clear of costly pitfalls) is to hire knowledgeable Human Resource professionals. That is a lot easier for large companies than small ones, yet many regulations apply to companies of all sizes.
"Many small companies cannot justify keeping a full-time HR professional on staff, but they also cannot afford to risk not fully complying with the regulations," said John Allen, President and COO of G&A Partners, a Houston-based Human Resources (HR) and administrative services company.
"Outsourcing HR functions makes sense for a lot of businesses," said Allen. "With someone like G&A Partners managing human resources, benefits, payroll, accounting and risk management, business owners can focus their time and energy on growing the business rather than worry about HR compliance issues."
For more information about regulations governing employee matters or outsourcing human resources, contact Ori Murdock at G&A Partners at 713.784.1811, or via email at omurdock@gnapartners.com.
