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Third Sector Innovations

Top Ten Employment Law Mistakes
June 22, 2012

by Suzy Keith

Employees are an organization's most valuable asset.  At the same time, employees can be a definite liability to an employer.

Whether your organization is a business, government or nonprofit organization, you are fully subject to employment laws.  The workplace is subject to a myriad of state and federal rules re: wages and hours, nondiscrimination, etc.  Violations, even those made accidentally, can result in costly law suits, including civil and criminal penalties.

So, how can you ensure that your organization is in compliance with employment laws?  For starters, avoid these ten top mistakes employers make that can result in liability:

Failing to consult an attorney specializing in employment law.  It is important to consult an specialist in employment law; an attorney to help you navigate the web of federal and state employment law.  An attorney can help you develop sound personnel policies that, if followed, will preclude problems.

Not providing an employee handbook.  Employment expectations and policies must be in writing, can dispel confusion, and will lead to treating employees consistently.  An employee handbook creates transparency and an orderly workplace.              

Not documenting employee performance.  Well-managed organizations communicate employee expectations through job descriptions; they train employees and have a system for documenting employee performance, both good AND bad.  Failing to document performance can lead to employer liability in a lawsuit.

Misclassifying employees as “exempt” or “nonexempt” from overtime pay.   All employees are generally eligible to receive minimum wage and overtime pay unless they qualify for “exempt” status.  The test for exemption is strict, and employers frequently misclassify employees. 

Not providing reasonable accommodation for disabled workers.  Disability law requires employers to provide “reasonable accommodations” to allow disabled workers to perform the essential functions of a job.  Accommodation could include restructuring a work schedule or providing assistive devices; the law does not require making accommodation of “undue hardship.”

Making contract-like promises.  Contractual obligations may arise when an employer makes promises to an employee, so use caution when making statements or adopting policies that may present difficulties in some situations.

Not treating employees consistently.   The perception of disparate treatment has led to countless law suits.

Not complying with state wage and hour laws.  State laws often have specific requirements on how an employer pays  employees.  In Colorado, for example, the law addresses deductions from wages, commission, bonuses, vacation, pay periods and pay days, final pay and pay statements.

Not training supervisory-level employees on Equal Employment Opportunity laws.  State, federal and local laws alls address equal employment opportunity (EEO).  Employers are forbidden to take adverse action against an employee, such as termination or demotion, based on an employee’s “protected characteristics,” which generally include: race, color, sex, religion, national origin, marital status, disability, age, and sexual orientation.  Managers must not take (or even appear to take) employment actions based on these characteristics, and may not retaliate against an employee for making an EEO/discrimination complaint.

Misclassifying employees as “volunteers” or “contract employees.”  Very few individuals meet the legal test for “independent contractor” status.  Unless individuals meet the test, they qualify for the same employment protections granted an employee.

Posted by Suzy.
DISCLAIMER: This information is not intended to provide specific legal advice to address every situation that might occur. Please consult your legal advisor to supplement and verify what you learn here.


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