Lexington, KY - You have employees, a couple or a couple hundred, but you think your company is too small for an entire department devoted to human resources? Think again. "Small businesses do not get a pass because they are small or do not have an HR depart-ment," said Amy C. Johnson, an attorney with Britton Osborne Johnson PLLC, www.bojfirm.com.
Employment laws come in different shapes and sizes on federal, state and local levels. Certain laws are sometimes deter-mined by how many employees you have and whether your company is public or private. The whole topic is far more complex today than it was years ago, mostly due to the litigious nature of our society.
HR policies
"When an employer has the right policies and practices in place, everything can run smoothly," said Tim Davis, an attorney with Grasch Law, PSC, www.graschlaw.com. "The hardest part is in developing the policies and making sure they are followed."
"The bottom line is that employers of all sizes are required to comply with employment laws," Johnson said. "Every organization must have at least one individual who functions as an HR professional, unless the duty is delegated to someone outside the organization such as an HR consultant, lawyer or other professional."
At-will agreements
Kentucky is an at-will employment state, right? Yes and no. The connotation of the phrase is that employers and employees, at their own will, are able to end a working relationship for any reason. Any reason at all? Not so fast.
"Many employers have learned the hard way that the general rule is being swallowed up by exceptions," said Johnson. If you have at least eight employees, you can't let someone go on the basis of race, sex, religion, age (40 and older), national origin, color or disability. Nor can you fire a smoker or nonsmoker, as long as that employee complies with the workplace policy. Johnson also notes a local ordinance of Lexington adding sexual orientation to the list of protected categories.
"And now, we have the Genetic Information Nondiscrimination Act (GINA)," she said, "which prohibits employers with 15 or more employees from discriminating against employees or applicants on the basis of genetic information."
"By making sure the termination is done properly, the employer can drastically reduce any litigation fees if the employee decides to sue," said Davis.
If you've done your HR homework and feel confident about a firing decision, Johnson suggests a two-part double check: first, is the decision consistent with past practices, and second, was the decision fair?
"While there is no employment law that says employment decisions must be fair," she said, "if it goes to jury, they will instinctually ask this question regardless of the law."
Hiring based on money management skills
Consumers are learning about financial fitness from all kinds of media sources and how a low credit score can negatively affect their chances of being hired. From a hiring perspective, this consideration factor is not as cut and dried as it may seem.
"Recently, bills have been introduced by the Kentucky House of Representatives and the U.S. House of Representatives to further limit an employer's use of credit information in making employment decisions," said Johnson, who advises business owners not to throw common sense out the window.
"What I told my clients 15 years ago is still true today," she said. "If an application question or inquiry has nothing to do with the job or is not vital to determining the individual's ability to perform the job, don't ask it."
Employee classification
"As the economy has turned down, more employers are seeking to save costs by classifying employees as independent contractors as opposed to employees," said Davis.
The labor and treasury departments have allocated $25 million for investigators to enforce proper classification. There's no one-size-fits-all description for an independent contractor, because factors can vary by industry and job description, but check www.IRS.gov for details.
Non-compete agreements
Downloading a form off the Internet may or may not be appropriate for your particular business. Davis has recently reviewed non-competes that were poorly drafted, and the employer wound up not having protection from the competition as originally assumed.
"Many employees didn't even realize they had signed one as part of their hiring process," he said. If you require a non-compete, Davis advises conducting a routine audit of personnel files to make sure employees have signed a valid form.
It's wonderful to think of your employees as one big happy family, but that doesn't mean letting one's guard down.
"Owners need to also be sure that they have the policies in place should something go awry with an employee," said Davis.
Kathie Stamps posts grammar tips at www.facebook.stampscommunications.com.