Time Records and the 11 P.M. Email

In our HR Consulting practice, we field inquiries from creative employers and startup businesses that express the sentiment that hourly timesheets are a “nuisance”.  Managers don’t want their employees to perceive the timesheet as old-school or “punching a clock.” They often claim that such systems are inconsistent with the culture they are trying to create. We point out the balance that must be struck between a startup culture and wage and hour laws. The absence of good records always works against the employer. The fact is, there is value and security in accurate time recordkeeping, both for the organization and for the employee.

California employers must keep detailed records of non-exempt employees’ time worked.  The record should include time in and out, including for lunch breaks, and certification of accuracy by both the employee and the supervisor. Time & Attendance software integrated with your HRIS & payroll system streamlines this into a paperless (and hopefully painless) process.

Good Tracking Systems / Policies

In our constantly-connected world, employees feel a temptation to check and respond to email outside of the normal work day.  This “always on culture” can result in significant overtime liability. One way to address this issue is to implement a policy that non-exempt employees may not work after-hours and weekends.  Most business issues can wait until normal work hours, and the company reinforces the importance of work/life balance by sending this message.

If you do have non-exempt employees performing functions that require work on nights or weekends, you must have employees include that work time on their timesheet.  Whenever possible, you should require employees to obtain approval from their supervisor in advance for overtime and any off-hours work, and have the employee provide specific detail about what function was performed.

Another danger is that time spent outside of normal work hours can slip unintentionally into a compensable on-call or waiting status category. If your “culture” effectively restricts employees such that they cannot pursue normal, day-to-day personal activities due to geographic or response time requirements, for instance, their time waiting for a work call or email could be found compensable if challenged.  The potential penalties for getting this wrong can be significant.  Class action wage and hour claims are the most popular claims by plaintiff counsel due to the potential awards.

Significance

It is possible to maintain a “startup culture” and work within wage and hour the laws of California – but it takes some analysis of your workforce, organization structure, good software systems and appropriate policies.  In our experience, some thoughtful analysis in these areas turns out to be good for your workforce and business as well.

Amy Kelemen, SPHR – Director of Professional Services, Senior HR Consultant

Disclaimer: Some information contained herein has been abridged from numerous sources and may be protected by various copyright laws. Such information should not be construed as consulting or legal advice. Please contact our office for specific advice and/or referrals.

Bay Area Human Resources Services

San Francisco’s Paid Parental Leave Benefits

As we mentioned last December in our article on San Francisco’s unique sick leave and parental leave laws the San Francisco Paid Parental Leave Ordinance (SF PPLO) is now in force for its first tier of larger (50+ headcount) employers.  This ordinance took effect on January 1, 2017 and requires employers to provide supplemental compensation to their San Francisco employees to bond with a new child.

Paid Family Leave (PFL) is a California benefits program that provides eligible employees with up to 55% (in 2018, the rate will increase to 60% or 70%, depending on income) of their weekly wages for up to 6 weeks to bond with a newborn, newly adopted or foster child. Under the SF PPLO, employers are required to provide employees receiving state PFL for new child bonding with “Supplemental Compensation” equal to the difference between the employee’s PFL benefit amount and the employee’s normal gross weekly wages such that the employee receives up to 100% of their weekly wages, subject to a weekly maximum benefit amount, for up to 6 weeks.

Application of this law to employers with fewer than 50 employees will roll out over time.  On July 1, 2017, employers with 35 or more employees will be required to follow this regulation, and on January 1, 2018 it will apply to employers with 20 or more employees.

To determine whether you employ the required number of employees, employers must include in the count all employees regardless of their status or classification as seasonal, permanent or temporary, full-time or part-time, contracted or otherwise, and include both those employees who work within San Francisco and those employees who work outside of San Francisco.

To receive benefits under PPLO, an employee must file a claim for California Paid Family Leave (PFL) benefits for new child bonding through the Employment Development Department (EDD). Employees can file a claim for PFL benefits using SDI Online or a paper claim form: (http://www.edd.ca.gov/Disability/SDI_Online.htm)

Next, the employee must complete the San Francisco Paid Parental Leave Form (PPL Form) and provide it to the employer.  A form is available at www.sfgov.org/pplo . Once the employee files a claim for State PFL, EDD will send the employee a form entitled Notice of Computation (DE429D) which describes the employee’s weekly State PFL benefit amount.  This can be used to calculate how much the employer needs to supplement in order to comply with the ordinance.

The SF PPLO permits employers to require the use of up to two (2) weeks of an employee’s accrued, unused vacation time to cover the cost of the required Supplemental Compensation, but it does NOT permit the use of sick time to cover the same cost.

Employers with a presence in San Francisco are advised to review their leave policies and employee handbooks to ensure that they comply with this unique City ordinance.

Saul Macias, MBA, PHR – Vice President of HR Services

Disclaimer: Some information contained herein has been abridged from numerous sources and may be protected by various copyright laws. Such information should not be construed as consulting or legal advice. Please contact our office for specific advice and/or referrals.

Bay Area Human Resources Services

California Expected to Prohibit Salary History Inquiries

The California State Assembly has taken another step in what it views as closing the gender pay gap.  Assembly Bill 168 would prohibit employers from asking an applicant to disclose salary history.  Under AB168, applicants would also be able to request a pay scale for the position in sought.  The Bill has passed the Assembly with bipartisan support and has now been sent to the Senate. Most expect the legislation to reach Governor Brown’s desk and indications are that he will sign the bill into law.

Potential Challenges for Employers

Hiring is already an expensive and complex process.  Losing the ability to gauge a pay range based on previous salary history may make recruiting costs higher and it eliminates another criterion often used to assess past performance.  Supporters of the legislation argue that the ability to request salary history perpetuates the glass ceiling and fosters lower tier wages for women and others.  Opponents to the Bill point out that salary discussion now becomes a one- sided poker game. By requesting salary information, employers have the ability to adjust unrealistic expectations to match the current market rate for the job position in question.  Additionally, many smaller employers rely on the discussion of salary history to promote their other non-pay benefits in order to remain competitive.

Tips for California Employers

Don’t wait for legislation to force changes – here are some steps you can take now:

  • Conduct an internal HR audit of hiring and pay practices.
  • Implement pay practices that make sense to everyone, including salary levels/range if necessary. Make pay practices measurable.
  • For lower level positions – establish a clear wage scale with progress levels based on skill / tenure
  • Keep documentation of what factors impact merit increases, bonuses, and promotions.
  • Use of compensation surveys or other objective data in order to assist in making salary determinations.

Significance

While this is the third attempt by the state legislature to pass this type of Bill, there is a strong likelihood that this iteration will pass in the near future.  Although the Bill is heavily opposed by the California Chamber of Commerce, similar bills have already been passed in Philadelphia and Massachusetts, and related legislation is pending in New York and New Jersey.  Other states are considering similar measures.  Employers are advised to be proactive and take steps to ensure they do not have compensation structures that may be construed to support discrimination claims.

Meredith Delia – HR Consultant

Disclaimer: Some information contained herein has been abridged from numerous sources and may be protected by various copyright laws. Such information should not be construed as consulting or legal advice. Please contact our office for specific advice and/or referrals.

Bay Area Human Resources Services