Ask StratEx HR: What to Do When An Employee Lies About Being “Out Sick”


Dear StratEx HR,

brunchIt has recently come to my attention that one of our servers called in sick for her shift on Saturday. As you know, Saturdays are one of our restaurant’s busiest days. This employee claimed that she was sick; however, another server saw her out partying at brunch via her Snapchat story. The other server also stated that the Snapchat story showed the employee partaking in the use of illegal drugs. With the new sick leave laws, I cannot ask an employee for a doctor’s note and clearly she was not sick.

Can we dock this employee’s pay for the day as an unexcused absence? Can we discipline her for lying and going out to party instead of working her shift? Can I terminate her for the use of illegal drugs based on our policy? I don’t want to set the precedent for our other employees that sick time is a free for all.

Sincerely,
Brunch So Hard

Dear Brunch So Hard,

Social media has severely changed the amount, and type, of information that we can uncover about our employees. The first thing that you should always consider in situations such as this one, is whether or not the employee was representing the company while these actions took place.

If the employee is caught drinking or doing illegal activities while on company time, either at your restaurant or out in the community, then it is within your legal right to hold that employee to all applicable policies. On the other hand, if the employee is on their own time, the company cannot manage, coach, or discipline those actions– even if we don’t agree with the behavior from the company’s moral perspective. (Please note that some policies clearly state guidelines that extend outside of the workplace, e.g. harassment. Employers can still hold employees accountable for those infractions even if they occur outside of work.) 

In addition, we never want to discipline an employee based on speculation or rumors. If you have not seen the evidence first-hand, and do not have all the facts surrounding the incident, then your best move forward is to not act in a negative way. Instead, monitor the employee’s performance in the workplace to understand whether or not her performance is being impacted or determine if a concerning pattern is developing.

If you do witness her actions first-hand via a social media platform, the best thing you can do is let the employee know that you are aware of her “unexcused absence” and reiterate the company’s policies on attendance, professionalism, zero tolerance for drugs and alcohol in the workplace, and acceptable reasons for using paid sick leave. After you’ve had this conversation with her, make sure you document everything that was communicated. As a company, you will want to determine if there is a pattern of absences developing and prove that a conversation was had with the employee about the definition of a reasonable absence, per the law.

Let the laws and company policies guide you to a strong and effective management decision. In situations like this, where you know the employee is taking advantage of a policy, determine what other policies might have been violated in the process. For example, did the employee adhere to the call in/out procedure properly?

Overall, we must remember that our employees are allowed to lead lives outside the workplace; however, if we determine they are lying, then we should use all tools available to correct the behavior and reiterate the expectations of the company. Finally, remember that being friends or following your employees on social media is always tricky and can lead to further complications in the company/employee relationship.

Best,
StratEx HR

Ask StratEx HR: Drinking at the Office – A Recipe for Disaster?

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Drinking at the office isn’t just for Don Draper anymore. More and more organizations are starting to implement practices that allow for drinking at the office, including office happy hours and kegs on tap.

Check out this recent submission to Ask a StratExpert, which dips into this intoxicating issue.

Dear StratEx HR,

Recently, we started to allow drinking at the office and have supplied alcohol for employees in the kitchen. It’s a nice way for our employees to wind down at the end of the day, and it fits our company culture.

Last week, an employee started drinking late in the afternoon and fell asleep in a client meeting! How can we prevent this from happening again (or getting worse) but still allow employees to have a casual drink?

Sincerely,
Boozin’ my Mind

Dear Boozin’,

As employees’ work schedules become more flexible and employees may be occasionally working later in the evening or on the weekend, employers may choose to provide provisions so their employees can have a drink (or a few). Some organizations claim the practice is good for employee morale and bonding – and may even claim that informal socializing can lead to better functioning teams and increased creativity.

While most employees will do just fine in using their own discretion to know when and how much to drink, there are several ways you can keep the lid on those that may overindulge on drinks in the office.

1. There’s a time and place for everything
Allowing employees to consume alcohol at any time can open you up to a host of liabilities as an employer. The easiest way to prevent any issues is to designate a specific day of the week and a time as the office “Happy Hour”. Placing limits on this time frame and keeping this time closer to the end of the workday, or even after hours, will minimize the disruption for everyone.

2. Know your limits
Be sure to communicate to employees that once the pre-set time of the Happy Hour is up, they’ll need to take the party offsite. This will protect you from potential liability that can come along with late-night drinking. If employees are provided a “shift drink” in a restaurant or hospitality setting, be sure employees serving the drinks are aware of the limit and are consistently trained to recognize when someone has been overserved.

beer_blog_askstratexhr3. Keep hard liquor off the table
If providing an open bar, offering up beer and wine still gives employees a way to have a few drinks without the potential risks that rounds of shots can bring.

4. Provide alternatives
Providing snacks and non-alcoholic beverages is a smart option for the many employees who may choose not to drink for a multitude of religious, health, or personal reasons. Plus, having food and other hydration options can come in handy to prevent employees from being overserved.

5. Arrange for transportation
All employees should be made aware that driving while intoxicated is strictly prohibited. Encourage employees to carpool with a designated driver, take a cab, use public transportation, or walk if possible. To limit your liability as an employer, either allow employees to expense cab rides home for events where drinking takes place or adhere to a strict no drinking and driving policy.

6. Stick to the rules
Be sure to clearly communicate all these policies in your company handbook so that employees are informed, and follow through to ensure you have sign-off that all employees are aware of expectations.

7. Consistency is key
Reliably following the guidelines laid out in your policy (including progressive discipline, if necessary) will get everyone on the same page. A violation of policy should result in the same progressive discipline steps, based on the severity of the violation – regardless of who the offending employee is.

By setting a time and place for drinking at the office and keeping the lines of communication open when it comes to new policies, you can create a policy that works best for your organization. The key is to tailor the policy to fit your organization’s culture and expectations, and to be consistent in responding to violations before any potential issues arise.

Cheers!
StratEx HR

Ask StratEx HR: Sexual Harassment in the Kitchen

Everyone loves music and dancing, right? Well, after a little alcohol, definitely. But let’s say you’re at work. It’s been a stressful day, and you just “gotta loosen up those chains and dance” (thank you to the Dixie Chicks for understanding). We all need to let loose sometimes, so what could possibly be wrong with an impromptu dance party with your coworkers? Let’s take a look at a submission to one of our StratExperts, Ask StratEx HR, to find out.

Dear StratEx HR,

What a week! I am the defacto HR person for a casual restaurant chain, and I need some serious help!

So here’s what happened… One of our employees, Tiffany, was taking a break with a couple of coworkers in the kitchen. The radio was on and, as it was told to me, “Pony” by Ginuwine came on. Everyone started freaking out because “Omg, this is totally my song!!” Tiffany started to feel the beat a little in her shoulders, and then, she said that she just couldn’t help it, she had to break it down. (Seriously?!) Other coworkers started cheering, and a dance circle formed.

Their supervisor, Ron, came back into the kitchen, and, rather than shutting the party down, he started dancing with Tiffany. Not waltzing or leaving room for the Holy Spirit, if you know what I mean. Some would call it freak dancing, juking, or maybe even bumping and grinding. (If you need a reference point, think of the club scene in Save the Last Dance… you get the idea.) Suddenly, Tiffany started to feel uncomfortable, but didn’t want to be the Debbie Downer of the party. After a few minutes, the break was over, so she went back to work and escaped the situation without drawing attention to herself. This is all according to a conversation that I had with Tiffany this morning, so I have not confirmed this story with anyone else yet.

I cannot handle this drama! What action do I need to take??

Sincerely,
Losing my Groove

Dear Losing your Groove,

It sounds like you have had quite the week! While the nitty-gritty details may be unique, this situation is not as out of the box as it may seem (and, in fact, it sounds quite similar to many situations in which StratEx HR has advised our clients). I know that many questions must be running through your head, so I’ve tried to break your action plan down into questions that we typically receive in situations like this.

As her HR Manager, what do you need to consider when Tiffany comes to you the next day to report harassment?

First, as the HR Manager and leader of the investigation, you need to set expectations with Tiffany, including a realistic idea of confidentiality, timeline of the process, and the importance of the integrity of the investigation. She should know that you will be interviewing other witnesses, including the manager she is accusing. This may come as a surprise to her, but the fact of the matter is that these incidents do not exist in a bubble.

While it is best to take action immediately, coordinating these interviews may take some time, so be up front with Tiffany about this. Be sure to ask if she feels comfortable working during the investigation, and if so, schedule her on different shifts from Ron. During this initial discussion, just in case the gravity with which you handle these investigations has not yet set in, you should also include an expectation of integrity as it pertains to the investigation. For example, if Tiffany is also messaging her supervisor on social media during the investigation, then her claim of harassment might be viewed in a different light.

Next, you need to gather statements from all of the witnesses that are available, as well as any other evidence that is available to you. Other evidence could include video footage from a security camera, time records indicating break times, a copy of the schedule, or email communication between parties, to name a few.

Was your sexual harassment policy violated by this supervisor, or is Tiffany at fault for being complicit in the behavior?

pexels-photo-29346One of the main issues we address again and again with harassment is that the intention of the offender does not matter if the conduct is unwelcome, prohibited, and based on a protected category.  So even though Ron may have thought he was being a “cool boss” by joining in, he was, in fact, making Tiffany and potentially others uncomfortable with his actions. Assuming that no other relationship exists outside of work between Tiffany and Ron, it is safe to say that Tiffany may have felt pressured to continue dancing rather than face the intimidating situation of confronting her manager in front of other employees.

That does not mean that other infractions against company policy will not come out during the course of an investigation. For example, if it is against your company policy to take a break in the kitchen, then you may need to coach employees during the process of investigating. You will want to balance consistent enforcement of policies with unintentionally scaring employees from reporting incidents due to their fear of being written up.

Should someone lose their job over a seemingly lighthearted interaction?

This is something that needs to be weighed on a scale of severity and pervasiveness. That means attempting to gauge to what extent or how grossly the incident violated the company harassment policy. It also means looking at performance history to see if this is the first time that an incident like this has occurred with this particular manager or if this has been a pattern. Unfortunately, there is no black and white answer here and will vary on a case-by-case basis.

Depending on your determination regarding the severity and pervasiveness, you need to consider if there a chance that employees will be able to move on working effectively in coexistence following this incident. If that manager has lost the respect of the employees, but you do not feel that the incident was severe enough, consider a transfer to another location. Keep in mind, however, that rumors may still spread to other locations. If you move forward with termination, remember that disciplinary action of any type should only be shared with the employee that action concerns. I would, however, recommend following up with Tiffany as the claimant and letting her know that you have taken action as you deemed necessary following the scope of your investigation (again this does not require specific details though).

The final item that you will want to look out for post-resolution is signs of retaliation, which can come from a few different arenas. The most obvious source of retaliation would be from Ron if he continues to work with Tiffany. This could come in the form of negative performance reviews, or even something subtler like scheduling her for the worst shifts. If Ron leaves that location or the company, other managers could even pick up the mantle of his grudge out of fear that Tiffany would report their actions. An unexpected form of retaliation could even come from Tiffany’s coworkers, who now single her out because they miss having a “fun” boss. I recommend squashing any such behavior before it has a chance to escalate, both to protect the company from further liability and to uphold the tenets of your harassment reporting policy.

I hope that this information helps resolve the drama. I’m confident that you will get back into the groove shortly!

Sincerely,
StratEx HR (aka Groovemaster)

Common Paymaster: What you need to know

After the close of every quarter, businesses are reminded of the many existing tax code intricacies. One lesser known layer not to be taken lightly is the common paymaster rule. This rule can have a major effect on employers with distributed workforces where employees work in multiple locations.

common paymaster

What is a Common Paymaster?

The IRS describes the common paymaster provision as a special rule for paying taxes.  When an employee simultaneously works for several related entities during a given year, the parent entity as a whole will end up overpaying certain payroll taxes. A common paymaster is a designated entity that pays wages to that employee on behalf of the related entities, thus only being charged for that employee’s share of payroll taxes once.

Let’s look at an example:

restaurant serverTom works at a restaurant, Dining Inc. He works at Location A on the weekdays and Location B on the weekends. Dining Inc. will be charged for Federal Unemployment Tax (FUTA) on all of Tom’s wages from each location separately, even if together his wages exceed the $7000 wage base.

This is where a common paymaster comes into play. Under certain conditions, the IRS grants Dining Inc. the right to designate Location A or B as a common paymaster. If Location A is deemed the common paymaster, it can issue Tom a consolidated paycheck that reflects his hours worked at both locations. Instead of the employer being subject to two wage bases for FUTA (and state unemployment tax (SUTA) in states where common pay is allowed) with respect to Tom, the employer is only subject to one.

The IRS also allows the use of a common paymaster for Social Security tax purposes. State laws vary on recognizing a common paymaster for SUTA reporting. StratEx clients can check with their Service Team, and anyone can check with applicable state agencies to see if common paymaster is a feasible option in your state of operation.

Overtime

Common paymaster provisions can also come into play when calculating overtime. First, a company and its related entities must meet the IRS’s criteria for common paymaster AND the Department of Labor’s requirements for joint employment. Then, the designated common paymaster can be used to calculate overtime for employees who work across the related corporations. Since it is a single entity, the common paymaster makes it much easier to calculate overtime for the employees paid under it rather than manually calculating overtime across the different entities.

Is common paymaster in play for your business?

The exact verbiage of the rule states that “If two or more related corporations employ the same individual at the same time and pay this individual through a common paymaster that is one of the corporations, the corporations are considered to be a single employer.”

Corporations are considered “related” for instances such as when fifty percent of one corporation’s officers are also officers of the other corporation, or when thirty percent of employees simultaneously work between the two corporations. The common paymaster is also responsible for keeping payroll records and remitting payroll taxes for the employees it pays as a common paymaster.

For more information, you can see how the IRS lays out exact provisions for common paymasters in Publication 15-A and Regulations section 31.3121(s)-1.

Do Dogs in the Office Make us More Productive?

img_3876-1Working in an office can become very routine. The same office. The same desk. The same faces. Well… what if there were new faces? New, furry, cute faces.

Take Your Dog To Work Day (TYDTWD) is a great way to “shake up” a routine day. It’s held each year on the Friday following Father’s day, which makes today, June 24th, the 18th annual TYDTWD.

Some offices love the idea of dogs in the office so much that they allow it on a daily basis. Society for Human Resource Management (SHRM) conducted a survey in 2015 that found 8 percent of U.S. employers allow dogs in the work place. This statistic has gone up 3 percent since their 2008 survey.
Whether it’s their fluffiness, companionship, or sloppy kisses, there is no doubt that dogs can bring happiness to the office. They can help reduce stress, increase job satisfaction, improve camaraderie, and even encourage longer work hours. Happy workers make for a happy work environment.

Bringing dogs to work can even attract a younger workforce. Millennials are projected to make up almost half of the workforce by 2020, according to Stifel Equity Research. In addition, they will soon be the largest pet-owning cohort, surpassing baby-boomers. Like most pet-owners, these 19-to-35-year-olds view their animals as not only their best friend, but family as well.

Amazon, Etsy, Google, Bissell, Clif Bar and Petco are just a few examples of companies today that embrace this idea. CNBC spoke to the manager of culture and engagement at Etsy, Sarah Starpoli, who said:

“Millennials make up a lot of our workforce. As the population has increased in our offices, the dogs have grown with us. People want it. People know about it when they come in and are hired.”

TYDTWD_2In order for animals, employees and visitors to the workplace to remain safe and happy, a policy should be formed with some guidelines. Here are some suggestions to consider when creating and implementing a policy:

[slideshare id=63392957&doc=slidesharebyptwd-160623205632]

These suggestions mostly pertain to allowing employees’ personal pets in the office. Some employers may be hesitant to the idea of having multiple creatures in the office, or it may not make sense with the type of work happening in the work environment. However, that isn’t the only option to having animals in the workplace. Benefits can still be seen by just getting a company fish for everyone to enjoy. Nemo (or Dory!) is an easy way to brighten the office after years of the same routines.

It may be too late to join the official Take Your Dog To Work Day happening today, but it could start a conversation at your office to determine if it could be right for you. Hopefully, with the suggestions for a policy above, you’ll be reaping the rewards of having a furry faced co-worker soon.

Other sources:

http://www.wsj.com/video/pets-in-the-workplace-a-petiquette-primer/4DE7F97F-4D41-44B1-8CE2-89587F7F7287.html

http://www.wsj.com/articles/the-office-pet-is-a-pig-no-really-1435708431

http://www.forbes.com/sites/joshbersin/2012/06/13/new-research-unlocks-the-secret-of-employee-recognition/#17a4ffc2d949

The Ripple Effect of Minimum Wage Ordinances

img_3876-1On Thursday, April 14th, groups of labor protesters walked the city streets of Chicago. Their demand: raise the minimum wage to $15 per hour. Protests like these continue to impact the trends of City and State minimum wage increases across the country.

So, how do the growing demands of groups like these impact small businesses, customers and job seekers alike?

Let’s take a look.

First, here is a quick breakdown of three recently passed minimum wage ordinances: the City of Chicago, the State of California, and three different ordinances throughout the State of New York.

Chicago:
Effective Date

Non-Tipped Employees

Tipped Employees
Current $10.00 $5.45
1-Jul-16 $10.50 $5.95
1-Jul-17 $11.00 Increases with CPI
1-Jul-18 $12.00 Increases with CPI
1-Jul-19 $13.00 Increases with CPI
1-Jul-20 Increases with Consumer Price Index (CPI) Increases with CPI
California:
Effective Date

26 or More Employees
25 or Fewer Employees
1-Jan-17 $10.50 $10.00 (current rate)
1-Jan-18 $11.00 $10.50
1-Jan-19 $12.00 $11.00
1-Jan-20 $13.00 $12.00
1-Jan-21 $14.00 $13.00
1-Jan-22 $15.00 $14.00
1-Jan-23 $15.00 $15.00
New York City: Effective Date
11 or More Employees

10 or Fewer
31-Dec-16 $11.00 $10.50
31-Dec-17 $13.00 $12.00
31-Dec-18 $15.00 $13.50
NY Employers in Nassau, Suffolk and Westchester Counties: Effective Date
31-Dec-16 $10.00
31-Dec-17 $11.00
31-Dec-18 $12.00
31-Dec-19 $13.00
31-Dec-20 $14.00
31-Dec-21 $15.00
NY Employers in remaining part of State:
Effective Date
31-Dec-16 $9.70
31-Dec-17 $10.40
31-Dec-18 $11.10
31-Dec-19 $11.80
31-Dec-20 $12.50
1-Jan-21 Rate will increase to $15.00 on an indexed schedule to be set by the Director of the Division of Budget (DOB) in consultation with the Department of Labor.

 

It is probably too early to say who will be impacted the most by such legislation. A growing concern for small-businesses located outside of the City of Chicago may be whether they can afford to compensate employees to compete with the Chicago market, especially as the minimum wage continues to increase. On the opposite end of the spectrum, small businesses, within the city limits of Chicago, may find themselves asking whether they can afford to continue operations in the city. This in turn, may drive businesses to consider relocating jobs.

ChicagoProtests2

Last summer, one of my clients provided feedback they had received from reputable employment agencies, Pro Staff and AIG: there was a shortage of available seasonal workers. They attributed this shortage to employees that were not as willing to work for wages below Chicago’s $10 per hour minimum wage.

That leaves us with the question:

“Will people be willing to work for a lower minimum wage in surrounding areas, whether that be Chicago’s suburbs, or in the surrounding states of California and New York, knowing that they may be able to find employment nearby for a higher wage?”

If suburban companies continue to see a decline in available workers, how will those companies respond …Increase their labor costs? Offer employees other forms of compensation? Raise price of goods?

HiringI would be remiss not to mention the arguments behind these recent minimum wage increases. One primary argument is that this addresses the cost-of-living increases; Chicago city officials estimate that more than 400,000 Chicago workers will benefit for this reason alone. In addition, proponents for raising the federal minimum wage argue it would increase economic activity, reduce poverty as well as government welfare spending, and spur job growth.

Economists from the Federal Reserve Bank of Chicago predicted that a $1.75 rise in the federal minimum wage would increase aggregate household spending by $48 billion the following year, thus boosting GDP and leading to job growth; however, such labor increases may end up of having the opposite effect on workers and job seekers, as job-creation may begin to halt.

In certain industries, they already have.

According to an article posted on Investor’s Business Daily, recent Labor Department data shows that job creation is actually on the decline, at its slowest pace in at least five years, specifically in the leisure and hospitality sector. Chicago had their slowest year of job growth in the leisure and hospitality sector since 2009. Employment gains from October through December of 2015 averaged less than half the pace seen in 2014 at just 1.1 percent. In addition, increasing labor costs may drive businesses to increase their prices, if they wish to continue to seek profits, which in turn may negatively impact the consumer. Specifically in the fast-food industry, the Federal Reserve Bank of Chicago stated that if minimum wage is increased, fast-food restaurants would pass almost 100% of their increased labor costs on to consumers.

There’s no doubt that the increase of minimum wage will create a ripple effect felt by customers, job seekers, and employers.

Employers, particularly small-businesses located in areas near Chicago, California and New York, should begin analyzing whether to compensate their employees to match the local minimum wage hikes, especially if the trend of “employees not-as-willing to work for a lower wage” heightens and leads employees to migrate to companies and or locations that will.