Independent Contractor vs. Employee

Diane Faulkner, , Leave a comment

In the past few months, I’ve had a few friends who are freelance writers and editors tell me they’d been approached by some companies who would like to hire them as independent contractors. The thing is, when they tell me about the gig, it always sounds as though the company is looking for an employee or at least a temporary employee.

Why do I say that? Well, the companies are requiring on-site work, requiring work be done on company-owned laptops, and requiring a specific number of hours be worked during any given week. The companies also want to pay by the hour rather than by the job. All big no-nos when talking about independent contractors.

The National Labor Relations Board (NLRB) is very clear on what factors determine whether or not someone is an employee or an independent contractor. They are:

  • The control the company exercises over the details of the work to be performed.
  • Whether the person performing the work is “engaged in a distinct occupation or business.”
  • The type of occupation, including whether the work is normally supervised or performed without supervision.
  • The skill required.
  • Whether the company or the worker provides tools, equipment, and/or a worksite.
  • “The length of time for which the person is employed.”
  • Whether the person performing the work is paid by time or by the job.
  • Whether the work is part of the company’s regular business.
  • Whether the person performing the work and the company believe they are creating an employment relationship.
  • Whether the person performing the work is in business.

The NLRB has ruled that employers should use these common-law factors alone to determine whether a person is an independent contractor. The board also noted, “There is no shorthand formula…all the incidents of the relationship must be assessed and weighed with no one factor being decisive.”

What Happens if Any of Those Factors are Met?

If any of these factors are met, then the person doing the work is recognized as an employee, regardless whether there is an independent contractor agreement that states the person is an independent contractor. That means the person performing the work is entitled to the same benefits as employees, e.g. benefits, PTO, 401K, etc. The company would be liable for employment taxes.

Does the NLRB Rule Over My Situation?

Most employees in the private sector are covered by the NLRA. However, the Act specifically excludes individuals who are employed

  • by Federal, state, or local government
  • as agricultural laborers
  • in the domestic service of any person or family in a home
  • by a parent or spouse
  • as an independent contractor
  • as a supervisor (supervisors who have been discriminated against for refusing to violate the NLRA may be covered)
  • by an employer subject to the Railway Labor Act, such as railroads and airlines
  • by any other person who is not an employer as defined in the NLRA

Other Laws

HR professionals, business owners, freelancers/independent contractors, and employees need to keep in mind there are other tests for independent contractor status under other state and federal laws that may produce different results.

 

 

 

Independent Contractor vs. Employee

Help Wanted-Preferably Caucasian

Diane Faulkner, , , Leave a comment

Oh, boy. Can that headline actually exist somewhere? Surely not.

Well, have you ever heard of Cynet Systems? They’re a recruiting firm based in Sterling, Virginia, and they actually did post a job that had a preference listing for Caucasians.

Unbelievable. You’d think a recruiting firm of all places would know better. Apparently not, though, because someone else found that the same firm posted this ad that specified “female-only.”

The company was lambasted on social media and quickly removed the offending job postings, but the damage had been done.

Cynet Systems put out a statement that the ads were written up and posted by a new employee, but that excuse falls a little flat to me. It’s only been, what, 55 years since race-specific employment ads have been illegal and 52 years since gender-specific ads have been illegal?

You Had ONe Job

Cynet Systems’ whole reason for being is to help their clients find employees. If it was true that the ads were posted by a newbie, then it’s on management for not having reviewed the work before it was posted for all the world to see.

Good grief!

Help Wanted-Preferably Caucasian

OFCCP Brings Back PDNs

Diane Faulkner, , Leave a comment
Ricardo Gomez Angel pic of tunnel worker
Photo by Ricardo Gomez Angel on Unsplash

Are you a federal contractor? There’s a bit of good news for you from Washington. The Office of Federal Contract Compliance Programs (OFCCP) is bringing back the PDN–predetermination notice.

In recent years, OFCCP had been reserving PDNs for systemic discrimination cases, allowing regional and district offices discretion on whether to issue PDNs prior to Notices of Violation (NOVs). February 27, 2018, OFCCP Director Ondray Harris put an end to that with is directive. He ordered the OFCCP to issue PDNs “at the conclusion of compliance evaluations where contractors have not provided adequate explanations to proposed discrimination findings.” This goes for both individual and systemic discrimination allegations.

The directive explains, “As part of OFCC’s ongoing efforts to achieve consistency across regional and district offices, increase transparency about preliminary findings with contractors, and encourage communication throughout the compliance evaluations process, OFCCP is instituting a uniform approach to the use of PDNs in compliance evaluations where the agency believes discrimination findings may exist.”

The directive also directs the Office of the Solicitor to review PDNs before submission to the OFCCP’s national office for review and approval.

So, no more discretion for regional offices. Transparency just became a mandate. Yea!

OFCCP Brings Back PDNs

4 Tips to Prevent and Respond to Sexual Harassment

Diane Faulkner, , , , , , Leave a comment
Young blonde woman holding up a #MeToo placquard in front of her face
Photo by Mihai Surdu on Unsplash

Over the past weeks, an avalanche of sexual harassment allegations has blanketed the country. Women–and men–feel a new confidence. They’re coming out in droves to denounce sexual harassment and other misconduct experienced in the workplace recently–and not so recently. The sheer number of (mostly) women telling their stories inspired one woman to create a Twitter hashtag, #MeToo. More than 1.7 million people in 85 countries have re-Tweeted the hashtag to speak out and name their harassers.

Ousters and Settlements Increase

Business Management Daily featured a PricewaterhouseCoopers study which revealed that over the past five years, 5.3 percent of chief executive officers have been forcibly removed due to lapses in ethics. That includes harassment. The 36 percent increase is “due in large part to increased public scrutiny and accountability of executives.”

In the United States alone, the study showed a 102 percent increase in CEO removals from the previous five years.

The settlements have been costly. In 2016, pre-Harvey Weinstein, harassment claims cost U.S. companies upwards of $482.1 million in Equal Employment Opportunity Commission (EEOC) settlements, which is an all-time high. (Note: Post-Harvey Weinstein, the EEOC sexual harassment section of its website experience a four-fold increase in visitors).

Corporate Vulnerabilities Show

With people feeling freer to report their alleged harassment, more people are expected to come forward with allegations in businesses of every size. Legitimate or not. That’s when social media, PR, and legal disasters can set in.

Now is the time to assess vulnerabilities. Brush off and tidy up (or create) complaint procedures. Develop a response plan before a response is needed. Start yearly, mandatory, in-person, interactive anti-harassment training for everyone, including board members. And make sure anyone who supervises anyone is trained on how to spot harassment, take complaints, conduct investigations, determine punishments and work with legal to finalize results.

The #MeToo movement is also bringing out more harassment victims. The EEOC, which received about 30,000 harassment complaints each year, estimates “only six percent to 13 percent of individuals who experience harassment file a formal complaint.” This makes educating supervisors on how to spot and stop harassment even more critical. Knowingly allowing harassment of any kind to go on creates a hostile work environment, which can force people to quit–and then sue.

Tips to Prevent and Respond to Sexual Harassment

Before the first complaint comes in–and definitely after–take action to protect employees and the business from future allegations.

  1. Tweak Training. Anti-harassment training is usually seen as a human resources requirement aimed at limiting liability. Nothing more. People will attend, but not engage. Make clear in communications, modeling by leaders, as well as in training that the corporate culture is one of equality and hands-off respect. Dump online training in favor of face-to-face role-playing so attendees know what kind of behavior is tolerated–and not.
  2. Increase Reporting Avenues. Usually, the affected person is directed to HR or their supervisor or some third-party hotline. That’s not good enough, especially when the harassment is coming from the supervisor. Harassed employees are unlikely to file complaints if they have to go to their supervisor. Make every lead worker, supervisor, manager, director, vice president, the president, and even board members contact points. Ensure they are given yearly training on how to handle harassment complaints along with their usual anti-harassment training.
  3. Be Blunt with CEOs and Top Executives. Explain the complaint. In the case of executive harassers, discuss how to protect the business from an expensive lawsuit in light of the executive’s actions. Courts hold executives and management to a higher standard. Keep in mind, if what’s potentially going on is known and no one tried to put a stop to it, the business–and the business owner and anyone else in charge–is open to corporate and personal liability.
  4. Get Help if Needed. Not everyone has the time to train to do investigations, especially in small businesses. There are outside agencies to turn to, not the least of which would be the business’ legal counsel. These people are better able to perform investigations, and they can explain any legal risks as well as provide guidance on how to proceed. Business owners who do proceed alone should have legal counsel review steps taken in the investigation, any notes and evidence before making a disciplinary or termination decision.

 

4 Tips to Prevent and Respond to Sexual Harassment

Cut Your Hair! Grooming Policy Under Fire

Diane Faulkner, , Leave a comment

Big business or small, everyone has a certain image they want to present to their customers. For many, maybe most, that image is professional. That means dressing nicely, perhaps pantsuits or skirt-suits for women and suits or blazers and ties for men or some version of business casual for everyone. When it comes to grooming, the word neat springs to mind. Trimmed up and styled for women and trimmed up no lower than the collar for men.

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But, wait a minute. Can an employer’s grooming policy really dictate how a person presents, right down to hairstyle?

That answer to that is yes, but sometimes no.

Yes

A famous example of violating a grooming policy happened in Baseball a little more than 20 years ago. Baseball fans might recall back in 1991 the late George Steinbrenner, then owner of the New York Yankees, not only benched one of his players, Don Mattingly, but also fined him $250 dollars plus $100 dollars a day for every day he kept his hair long. A no-no in the Yankee organization. Donny Baseball was too shaggy for the owner’s taste. Steinbrenner wanted clean-cut players, and clean-cut players he was going to get. There was a long-standing grooming policy in place, and Mattingly’s contract stated that he would abide by team standards and rules.

Another, not-so-famous case occurred in 2013. The Equal Employment Opportunity Commission (EEOC), sued a company, Catastrophe Management Solutions (CMS) on behalf of an African-American woman, Chastity Jones, whose job offer was rescinded, because she wouldn’t cut her curl-locks, a variation of dreadlocks. Dreadlocks violated CMS’s grooming policy. In 2014, the suit went to the District Court for the Southern District of Alabama, Southern Division, where the EEOC lost. The suit was then bumped up to the Eleventh Circuit Court of Appeals where, again, in 2016, the EEOC and Jones lost.

No

Where a grooming policy doesn’t work is when it becomes so rigid, it doesn’t accommodate for protected characteristics, such as religion (think Title VII). Family Foods, Inc., a North Carolina corporation that operates a Taco Bell chain in that state, learned their policy went too far when one of their employees, Christopher Abbey, was fired, because he refused to cut his hair. He refused on the basis of his religion. A practicing Nazarite, he had not cut his hair since he was 15-years-old.

The termination violated Title VII of the Civil Rights Act of 1964, which requires employers to attempt to make reasonable accommodations to employees’ sincerely held beliefs as long as the accommodation doesn’t pose any undue hardship. Family Foods did not.

Undue hardship is, of course, undefined.

Family Foods paid a dear price for firing Abbey: $27,000 and other relief. They also had to adopt a formal religious accommodation policy and conduct annual training on Title VII and its prohibition against religious discrimination and retaliation in the workplace. They also had to post a copy of its anti-discrimination policy in all of its facilities.

Guidelines

The EEOC vs. CMS (Chastity Jones) case in the Eleventh Circuit Court, if read all the way through, does provide some guidelines that help employers navigate creating a grooming policy that won’t land it in court.

It states:

  • Title VII protects persons in covered categories with respect to their immutable characteristics, but not their cultural practices.
  • Discrimination based on the basis of black hair texture (an immutable characteristic), is prohibited by Title VII.
  • A hairstyle, even one more closely associated with a particular ethnic group, is a mutable characteristic.
  • Adverse action on the basis of a black hairstyle (a mutable choice) is not [unlawful].
  • A hiring policy that distinguishes on some other ground, such as grooming or length of hair, is related more closely to the employer’s choice of how to run his business than equality of employment opportunity.

So, the key word in grooming policy guidelines is mutable. If a characteristic such as a hairstyle can vary or be changed, you can ask for a change or make a change (termination, suspension, etc.). Just be certain the request for change doesn’t violate Title VII or other current labor laws.

Remember, there are federal, state, and local laws, so it’s always wise to check with a local labor attorney before making drastic actions.

Information provided on this site is not legal in nature. All reviews and opinions are submitted and based upon extensive research, experience in the human resources and labor relations fields, and are not, in any way, legal opinions.

 

Cut Your Hair! Grooming Policy Under Fire