Delaware Employment Law Blog

Even split into two posts, this is still a long entry, but it’s better than reading the even longer document ( (44 pages!) on this issue.

Employers & Illegal Immigrants
The U.S. Department of Homeland Security (“DHS”) is the agency that issues "no-match" letters. If you’re an employer and you have never received a “no-match” letter from the Social Security Administration (“SSA”), consider yourself lucky and read on anyway. If you have gotten one or more of these letters, or if you suspect that at least 0.5% of your workforce consists of undocumented workers, read on.

In June 2006, DHS issued a notice that it intended to issue a rule designed to interfere with the ability of illegal immigrants to get jobs in America. Currently there are between 11 and 12 million illegal immigrants living in the U.S., and about 8 million illegal immigrants working here. Agriculture, service and construction are the industries that are believed to have the highest number of undocumented workers, but any company that has received mismatch letters from the SSA or a DHS “notice of suspect document” in the past should be paying close attention to this safe-harbor rule, issued by DHS in August 2007.

The rule is called "Safe-Harbor Procedures for Employers Who Receive a No-Match Letter."

What’s A No-Match Letter?
Employers file W-2 reports with the IRS every year reporting their employees’ wages and withholdings. The reports include employees’ names and social security numbers (“SSNs”). The Social Security Administration (“SSA”) issues SSNs and has a database of the numbers, and the name and earnings associated with each number. Each year, the SSA sends letters to employers who have at least 10 employees whose names and social security numbers don’t match the names and numbers in the SSA’s database, if the mismatches constitute more than 0.5% of the W-2s in the employer’s annual wage report.

That letter is called a “no-match” letter.

What Was The No-Match Process Before The New Rule?
Action by the employer to correct mismatches was voluntary. In the no-match letters, the SSA simply asked the employer to check its own records for accuracy and report back if it found the reason for the problem. If the employer did not find a discrepancy in its own records, the employer was advised to tell the employee that there was a problem and encourage the employee to go to the social security administration to get the problem corrected.

Stay tuned for more. Part 2 will address what the safe-harbor procedure provides and why it's so important to you.

The Los Angeles Times recently reported that more than two dozen UCLA Medical Center employees are in the hot seat for illegally accessing Britney Spears’ medical records. The breaches reportedly occurred when Spears was admitted in January.

While the employees were unable to access the troubled pop star’s psychiatric records, they did snoop through records from her previous visits to the facility (including records from when she gave birth to one of her sons). At least 13 employees, none of whom are doctors, will be fired, while 12 others, including several doctors, will be disciplined.

It seems the nosy employee has struck again.

How to Curb the Curiosity?

There is no doubt that privacy can be hard to maintain in the workplace. Have you ever watched Jim or Dwight try to make sales calls on The Office? It seems that nobody’s personal or professional life is protected. Nosy employees love to be a part of everyone’s business, and they love to spread their knowledge down the gossip super-highway. Let’s face it, those UCLA Medical Center employees were not trying to view Spears’ medical records as a part of their continuing medical education.

Here are a few tips to curb curiosity in the workplace and increase your employees productivity.

1. Don’t Tell. Teach your employees to be close-lipped. My mom always said, if you want something to stay secret, then don’t tell…anyone. So, don’t. Also, the juvenile “I’ll tell you, but don’t tell anyone else,” never works. Bottom line, keep it to yourself.

2. Air the Laundry. If you have a secret, let it out. A nosy employee loves secrets. What fun is spreading gossip if it’s not supposed to be kept secret? This is particularly important with respect to big business announcements like promotions, demotions, and relocations. Get out in front of the potential rumor and ensure accurate information is spread.

3. Stand Up for Yourself. Have you ever watched two cowboys stare each other down? Good. Now tell your employees to do that to their nosy colleagues. Just kidding, we all know it’s better to take the high road here. Instead of staring, simply instruct your employees to reply to the Nosy Employee that the subject matter is personal and none of their business. Sure, the Nosy Employee will go elsewhere, but if the source is practicing Tip Number 1, there should be nothing to talk about.

4. Turn the Tables. Teach your employees to reply with a witty (but not juvenile or rude) response, like: “Why are you asking? What have you heard?” Then, refer to Tips Numbers 1, 2, and 3.

Privacy is an important issue for everyone. If your employees feel secure about their business, whether professional or personal, then it’s likely that they will be less distracted and more likely to, well, work.

On April 1, 2008, the United States Citizenship and Immigration Service (USCIS) will begin accepting petitions from employers for H-1B visas for fiscal year 2009. Unfortunately for employers, the H-1B visa category has a yearly maximum of merely 65,000 visas. This limit is also known as the H-1B cap.

Last spring, the H-1B cap was reached on the very first day of filings. USCIS will not accept any additional petitions after the cap is reached. Therefore, employers seeking visas should move quickly to complete and submit form I-129 and the necessary supporting paperwork. (Click here for the forms page on the USICS website)

New Rule on the Use of Multiple Petitions
As part of the gear-up for April 1, USCIS published an interim rule in the Federal Register dealing with the number of petitions that can be filed per employee. The rule was issued on March 19, 2008 and prohibits employers from filing multiple H-1B petitions for the same employee.

Do You Feel Lucky
You might need some luck. The interim rule sets out the process for how petitions that are received after the cap has been hit. USCIS will use a lottery system. A random selection process will determine that it has received enough petitions to reach the cap within the first five business days.

The wise sages at the Workplace Professors Blog, (link to the site here), have posted an excerpt from an article-in progess by Franita Tolson (law clerk to Seventh Circuit Judge Ann Claire Williams).

The theoy of the paper rests on how the courts' involvement is needed to remedy unconscious discrimination. The article, The Boundaries of Litigating Unconscious Discrimination: Firm-Based Remedies in Response to a Hostile Judiciary, is availale on SSSN as an abstract. Here's an excerpt from the abstract:

Unconscious discrimination is actionable under Title VII ..., but scholars [agree] that court regulation of it has failed. Contrary to the alternatives suggested in the literature, placing the burden on the firm to regulate discrimination ex ante is more likely to minimize unconscious, discriminatory behavior, at least more so than tinkering with the ex post remedies available for those few violations that can be proven through Title VII. [T]his article proposes alternative mechanisms for addressing unconscious discrimination that account for its peculiar nature, mainly firm-based remedies that will be more successful than the courts have been in addressing this problem. The difficulty comes in incentivizing the Delaware courts [can incentive] ... firms to address unconscious discrimination ... [via] the duties of care and loyalty, corporate norms, and economic pressure from corporate giants like Wal-Mart.

Hat tip to the Workplace Profs Blog

You may find this hard to believe but I am about to use the words "S.E.C." and "cool" in the same sentence. It's true. The U.S. Securities & Exchange Commission has an interesting (read: cool) new online tool. It's Executive Pay Finder allows you to search SEC filings to find out how much and in what form the nation's top executives are being compensated. There are currently 500 companies included in the database. The SEC explains the tool:

This interactive tool is designed to illustrate some of the ways that interactive data can improve the quality and usability of executive compensation disclosure. It relies on interactive data tags that were applied by the Commission to the summary executive compensation disclosure in the public filings of 500 large companies for 2006.

The tool allows you to search for a specific company, by revenue, or even by industry. And that's just the tip of the iceberg for its search capabilities. Once you find the company or companies that interest you, the tool actually gives you the capability to compile them into a single table for comparison purposes and then, you can even send your data to a Microsoft Excel Spreadsheet, create charts and graphs, Oh my!!!

For those of you who may be working on a compensation audit or getting ready to revamp your pay structure, this tool may provide some helpful insight. For the rest of us, it's just plain interesting cool!

Oh, Starbucks! Why is it that everyone always seems to be picking on you?!

This time, it seems that some baristas don't like to share.

On Thursday, March 20, a California Superior Court judge in San Diego awarded a class of 100,000 baristas an astounding $105 million in unpaid tips. Now that's a LOT of quarters tossed in the metal milk frother, eh?

The suit was initiated by Jou Chau, a college student who worked at a San Diego Starbucks location in 2003-2004. He filed the suit that was later converted into a class action.

The claim alleges that supervisors wrongfully shared in the employees' tips. California law permits tip pooling--where everyone tosses their tips in the pool and then the tips are divided evenly among all who contributed. But pooling wasn't the problem. California law prohibits restaurant owners or their "agents" from sharing in the pool. "Agents" has generally been interpreted as managers and supervisors.

Like the counter employees, ("baristas" as they're known to most), shift supervisors at Starbucks make coffee and serve customers. They do the same work as the beloved baristas but they are also responsible for setting work schedules and managing employees.

Fair or Unfair?

So why can't they share in the reward? To some, this line might seem a bit attenuated. The purpose of the division between supervisor and employee is a reasonable one. Owners and managers who don't have to slave away with the employees who deal directly with the public shouldn't be able to swoop in at the end of the shift just to take their "share" of the booty. In that context, the law seems perfectly fair.

But in the Starbucks scenario, the fairness seems to fade some. If the dividing line between "supervisor" and "employee" is little more than who makes the weekly schedules and who has the pleasure of taking customer complaints, it doesn't seem strikingly unfair that they should share in the tip pool. Afterall, their expert frothing skills likely helped earn some of the tips.

Wider Implications

Starbucks, the Seattle-based coffee chain, said it would appeal the decision, which it described as "fundamentally unfair and beyond all common sense and reason." But if the appeal is unsuccessful, the implications of the decision could have real impact on the day-to-day operations of stores. Starbucks would likely have to stop using supervisors for double-duty--they could either do supervisory duties or employee duties, but not both.

Given the size of the stores, does it really seem practical to have a supervisor assigned to every shift who hangs out in the office while the baristas sweat it out at the espresso machine? Probably not. But why would supervisors do the work required of the baristas and not be eligible for the same rewards? And don't forget the cost! An added employee would be needed to cover the work that the supervisor can no longer perform.

But the real question on the minds of coffee lovers across the nation is, "Will this mean a price hike for our morning cup?" Now that is a serious implication, for sure!!

The N.Y. Times reported this story on Friday, March 21. And the Starbucks Union (IWW Starbucks Workers Union) has a different viewpoint, which you can read about here.

[Hat tip to the Class Action Defense Blog]

The Society for Human Resource Management (SHRM), having come under attack by nonprofits such as The Epilepsy Foundation for its opposition to the ADA Restoration Act, has issued a statement explaining its position. In its statement, SHRM says that it supports the purpose of the ADA but is concerned that the proposed bills would expand the definition of “disability” so much that it would cover people with temporary, minor physical or mental impairments like headaches, skin irritations and sprained ankles.

Good point. Having to “reasonably accommodate” people with temporary mental or physical impairments does not seem to be what the ADA was ever intended to do.

SHRM is also worried about the provision that would shift the burden to employers to prove that an individual with a disability was not qualified for a position. Currently, the employee must prove that he or she is an “otherwise qualified individual with a disability.” SHRM says the proposed provision would hinder rather than help efforts to employ more individuals with disabilities (the SHRM statement does not explain why, however). Clearly, it is a benefit to employers not to bear the burden of proof on any legal issue.

F-M-L-A.

Four little letters that strike terror in the hearts of HR Managers around the country. And it's not for want of trying. Employers want to comply--they really do. But the FMLA doesn't make it easy. Enacted with good intentions, the statute and its enforcement regulations have become one of the biggest employer complaints. Business groups have been calling for a substantial revision of the "FMLA Regs" for some time. The Regs have made compliance cumbersome and difficult to truly understand. Unfortunately, they have also enabled the statute to be grossly misused by not-so-well-intended employees.

On February 8th, the Department of Labor took a major step towards an answer to the cries of employers and business-protection organizations by publishing new proposed regulations. Getting here has been a long time in the making. In 1996 and again in 2001, the DOL published studies on how the FMLA was being administered. Several decisions from the Supreme Court and countless lower court rulings have also had a great impact on how the Regs have been interpreted. And, in 2006, the DOL posted a Request for Information (RFI), in response to which it received 15,000 public comments, which were summarized in the DOL's June 2007 Report on the RFI.

The Notice of Proposed Rulemaking (NPRM) is intended to be the culmination of these sources of comment and feedback.

At this stage of the rulemaking process, the proposed Regs are open for comment until April 11, 2008. Comments can be made online through the Federal eRulemaking Portal. After the commenting period closes, the DOL will review the comments and, at some point, publish new regulations.

Employers are encouraged to post their comments to the proposed regs as we work towards a clarified and improved set of FMLA rules.

How loyal are your employees? Really, how loyal? How about $276 million dollars worth of loyalty?

Apparently, the Tax Office at the Monogalia County Sheriff's Department in Charleston, West Virginia is doing something right because that is exactly how loyal their employees are. Eight employees of the Tax office claimed a winning Powerball ticket worth $276.3 million on Tuesday, having seen their numbers selected during the Saturday night drawing. But that was only after they reported to work on Monday, business as usual.

The "Lucky Eight" range in length of service at the Tax Office from 1 yr to 35 years. But they all went back to work, though Linda Fominko, who bought the winning ticket, said that they weren't necessarily going to work forever and some may consider retiring early. But not right away she said, "Who knows, down the line, in a few months or a year?"

After taxes, each woman will take home $11.9 million. Yet each of them felt passionately enough about the work that they do and about the community that they believe relies on them, to return to work on Monday morning. Obviously, these individuals are pretty level-headed to reserve the major celebrations for after they check in with financial planners, attorneys, and the like. But level-headed or not, their extreme loyalty to their work must say something about their working environment and, likely, their employer.