Healthcare Employee Wage and Hour Collective Claims: Growing - - PowerPoint PPT Presentation

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Healthcare Employee Wage and Hour Collective Claims: Growing Litigation Threat

presents

Collective Claims: Growing Litigation Threat

Avoiding, Defending and Settling FLSA Actions Against Hospitals and Providers

A Li 90 Mi t T l f /W bi ith I t ti Q&A

Today's panel features: Alison B. Marshall, Partner, Jones Day, Washington, D.C. Lee Schreter, Shareholder, Littler Mendelson, Atlanta

A Live 90-Minute Teleconference/Webinar with Interactive Q&A

Lee Schreter, Shareholder, Littler Mendelson, Atlanta Shanti Atkins, President & CEO, ELT, San Francisco

Wednesday, May 5, 2010 The conference begins at: The conference begins at: 1 pm Eastern 12 pm Central 11 am Mountain 10 am Pacific 10 am Pacific

You can access the audio portion of the conference on the telephone or by using your computer's speakers. Please refer to the dial in/ log in instructions emailed to registrants.

HEALTHCARE EMPLOYEE WAGE AND HOUR HEALTHCARE EMPLOYEE WAGE AND HOUR COLLECTIVE CLAIMS: A GROWING THREAT COLLECTIVE CLAIMS: A GROWING THREAT

Alison B Marshall Alison B. Marshall Jones Day

Why Compliance Matters

• Obama Administration has promised increased

enforcement activity enforcement activity.

• Plaintiffs’ bar has launched an aggressive nationwide

campaign. p g

• Potential high dollar exposure and disruptive litigation.

3

Increased DOL Activity

• March 2009 -- announced addition of 250 new investigators
• June 2009 -- Secretary Solis – “Make no mistake the DOL is back

y in the enforcement business.”

• November 2009 – Secretary Solis announced new worker

awareness campaign; same month, DOL announced initiative targeting healthcare in Connecticut and Rhode Island targeting healthcare in Connecticut and Rhode Island

• February 22, 2010 – DOL initiative targeting healthcare industry

in NY announced

• March 24, 2010 – DOL announced that it will no longer provide

f t ifi id t l th h i i l tt fact-specific guidance to employers through opinion letters.

• April 1, 2010 – DOL announced focus on assisted living

employers in southeast for investigation of FLSA violations

4

Increased Private Bar Activity

• Plaintiffs’ bar using websites like http://hospitalovertime.com
• Aggressively encouraging hourly employees at hospitals and
• Aggressively encouraging hourly employees at hospitals and

healthcare facilities to join wage and hour lawsuits

• Using publicly available data sources to identify

employees/potential class members employees/potential class members

• Cases started in Northeast

– Multiple suits filed in a city on same day (e.g. NYC in March 2010) 2010)

• Copycat litigation proliferating across country

5

Potential Exposure

• December 2009, SSM Healthcare in St. Louis paid $1.7 million to

nurses to resolve unpaid meal break claims. p

• August 2009, Kaiser Permanente paid $1.4 million to settle class

action for misclassifying project managers as exempt.

• July 2009, Partners Healthcare paid $2.7 million to 700

employees who worked in more than one company-owned facility but were not having their hours properly aggregated.

• March 2009, Tenet Healthcare paid $81 million to settle claims

under California law for unpaid overtime under California law for unpaid overtime.

• November 2007, Total Health Home Care Corporation paid $2

million to settle compensable travel time claims.

6

Collective or Class Claims or Both

• FLSA -- § 216(b) collective action – opt-in class

St t R l 23 l ti t t l

• State – Rule 23 class action – opt-out class
• Often see combination of two
• 3 year statute of limitations for willful claims under
• 3 year statute of limitations for willful claims under

FLSA

• Liquidated damages
• Focus here will be primarily on the FLSA – state laws

vary and need to be checked

7

Top Targeted Area: What Hours Count Count

• Meal and rest breaks and automatic deductions

P d t hift h

• Pre- and post-shift hours
• On-Call Time
• Aggregation of Hours
• Aggregation of Hours

8

What Hours Count?

• Employees must be paid for work “suffered or

permitted” by the employer even if the permitted by the employer even if the employer does not specifically authorize the

• work. 29 C.F.R. § 785.11.
• So long as the employer “knows or has reason

to believe” that such work is occurring, the l t b id f th h if employee must be paid for the hours, even if

• ff-site or off-shift. 29 C.F.R. § 785.12.

9

Meal and Rest Periods

• Meal and rest periods not required under FLSA.
• Short breaks (generally 5 to 20 minutes) are hours worked and
• Short breaks (generally 5 to 20 minutes), are hours worked and

compensable.

• “Bona fide” meal or break periods (typically 30 or more minutes)

do not count towards hours worked provided employees actually do not count towards hours worked, provided employees actually take the break and are “completely relieved from duty” during that

• time. 29 C.F.R. § 785.18.
• California requires employers to provide a 30-minute meal break
• California requires employers to provide a 30-minute meal break

for any person who works a period of more than five hours.

10

Meal and Rest Periods cont’d

• Ex.: LPNs in the pediatric intensive care unit are given 30-minute

meal breaks. Routinely, they are interrupted by requests to meal breaks. Routinely, they are interrupted by requests to assist patients or to answer phones for the unit. Given their workloads, they also frequently eat lunch at a desk while completing charts. Does the 30 minutes count? p g – Yes. According to a 2008 DOL opinion letter, such breaks would have to be counted since the meal periods are spent working on tasks predominantly for the benefit of the g p y employer.

11

Automatic Deductions

• Subject of numerous collective actions currently pending (e.g.

Fengler v. Crouse Health; Camesi v. University of Pittsburgh g y g

• Med. Ctr.; Gordon v. Kaleida Health)
• Issue is whether employers should or should not take automatic

deductions for meal breaks.

• Ex.: A skilled nursing facility automatically deducts one half-hour

for meal breaks each shift. Upon hiring, the employer notifies the employees of the policy and of their responsibility to take the break Is this lawful?

• break. Is this lawful?

– Yes, but the employer must monitor to ensure that the breaks are actually taken without interruption.

12

Pre- and Post-Shift Hours

• Hours worked prior to or after an employee’s principal

activity are not compensable time unless they are an activity are not compensable time unless they are an “integral and indispensable” part of those activities. 29 U.S.C. § 254.

• But, if the hours worked are integral and

indispensable, they will count as hours worked even if not authorized by the employer if the employer “knows not authorized by the employer if the employer knows

• r has reason to believe” that such work is occurring.

13

Pre- and Post-Shift Examples

• Ex. 1: LPNs assigned to a busy critical care unit routinely stay

post-shift to complete their time sheets and notate patient charts. post shift to complete their time sheets and notate patient charts. Compensable? – Yes. This work is integral to performance of their job duties.

• Ex 2: A medical tech chooses to change into and out of his
• Ex. 2: A medical tech chooses to change into and out of his

scrubs and hairnet in the locker room at the hospital. Is this time compensable? No As employees have the option and ability to change into – No. As employees have the option and ability to change into these items at home, changing gear is not a considered a principal activity and is not likely to be compensable.

14

On-Call Time

• Periods of inactivity while on duty are hours worked

and compensable 29 C F R § 785 15 and compensable. 29 C.F.R. § 785.15.

• Periods during which an employee is “completely

relieved from duty“ and which are long enough to enable him to use the time effectively for his own enable him to use the time effectively for his own purposes are not hours worked.” – The relevant distinction is whether the employee is “engaged to wait” or “wait[ing] to be engaged” -- the former is compensable, while the latter is not.

15

On-Call Time cont’d.

• Ex. 1: Hospital requires its hourly nurses to carry a pager during 1-hour

lunch breaks, but they are allowed to leave the hospital with no other t i ti C bl ti ?

• restrictions. Compensable time?

– No, because they are allowed to leave the premises and have few restrictions on their time. Employees required to remain on-call on

• r close to the employer’s premises such that they cannot use the

p y p y time effectively for their own purposes, however, are considered to be working and the hours compensable.

• Ex. 2: Hospital requires its hourly on-call equipment repair technician to

carry a pager remain sober be available on twenty minutes notice and carry a pager, remain sober, be available on twenty minutes notice, and answer calls usually 3 or 4 times per shift. Compensable time? – Probably yes. Frequency of the calls will be a factor.

16

Aggregation of Hours When an Employee Works at More than One Facility

• FLSA requires employers to include all hours worked

for the same “enterprise ” for the same enterprise.

• “Enterprise” is defined as “the related activities

performed (either through unified operations or common control) by any person or persons for a common control) by any person or persons for a common business purpose, and includes all such activities whether performed in one or more establishments by one or more corporate or establishments by one or more corporate or

• rganization units.” 29 U.S.C. § 203 r(1).

17

Factors Used in Determining Whether Joint Employer or Single Enterprise p y g p

• DOL regulations provide: “if employment by one employer is not

completely disassociated from employment with the other completely disassociated from employment with the other employer(s), all of the employee’s work for all of the joint employers during the workweek is considered one employment for purposes of the act.” 29 C.F.R. § 791.2(a). p p § ( )

• 2005 DOL Opinion Letter: Concluded that the facilities of system

with two acute-care hospitals, a nursing home and one combined long-term hospital and nursing home were under common control g p g

• f the parent company and all hours worked had to be

aggregated.

18

Factors Cited By DOL in 2005 Opinion Opinion

• System was owned by a single, not-for-profit parent holding

company that had no employees. p y p y

• Facilities shared a president and board of directors.
• The Hospital’s HR department provided support to the nursing

home.

• The system’s VP of HR and several senior executives had

responsibility for more than one entity.

• Some of the facilities’ personnel policies were the same.
• Job vacancies were posted within the system before being

advertised publicly.

19

Joint Employer cont’d.

• Will be a fact intensive assessment based on totality
• f the circumstances
• f the circumstances.
• Using separate tax identification numbers, filing

separate tax returns, and maintaining separate p , g p licenses, while relevant, may not be determinative.

• Focus will be on the economic realities of the

relationship relationship.

• Core issue is extent to which there is common control.

20

Current Trends

Healthcare is a Major Target! Healthcare is a Major Target!

 In 2008 and 2009, more than 530 wage

and hour lawsuits we r e file d against he althc ar e or ganizations

 Wage and hour

c lass/ c olle c tive ac tions

 Wage and hour

c lass/ c olle c tive ac tions against he althc ar e or ganizations inc r e ase d 35% fr

• m 2008 to 2009

inc r e ase d 35% fr

• m 2008 to 2009

22

Heightened Government Enforcement g “Make no mistake h b k

Hilda Solis – Secretary of Labor

the DOL is back in the enforcement f business.”

Pre pare d re marks by Se c re tary Solis Pre pare d re marks by Se c re tary Solis for the Ame r ic an Soc ie ty of Safe ty E ngine e r s c onfe r e nc e , June 2009

23

Heightened Government Enforcement g

Hilda Solis Secretary of Labor

"In early 2010, the department will launch a national public awareness campaign

Hilda Solis – Secretary of Labor

p p g titled "We Can Help" to inform workers about their rights. The department will work closely with advocacy groups and

• ther stakeholders to ensure that the

materials developed for the campaign reach the workers who need them. We ill t t til th l i f ll d b will not rest until the law is followed by every employer, and each worker is treated and compensated fairly."

F 11 19 2009 DOL N R l – F r

• m 11- 19- 2009, DOL

Ne ws Re le ase 24

Heightened Government Enforcement g

 F b

22 2010 DOL P R l t ti th t l

 F

e br uar y 22, 2010, DOL Pr e ss Re le ase stating that le ss than 36% of he althc ar e e mploye r s inve stigate d dur ing the last five ye ar s by Albany offic e we r e in c omplianc e y y y p with the F L SA.

– F

• und mor

e than $2 million in bac k wage s owe d

– Announc e d major

c omplianc e initiative tar ge te d at Ne w Yor k he althc ar e industr y

 In De c e mbe r

• f 2009 SSM He althc ar

e pays $1.7 million in bac k wage s to nur se s for wor k done dur ing unpaid me al br e aks to se ttle DOL lawsuit. me al br e aks to se ttle DOL lawsuit.

25

DOL’s Enforcement – 2008 DOL s Enforcement 2008

 C

ll t d $185 illi i b k

 Colle c te d $185 million in bac k wage s

for 228,000 e mploye e s.

 Conc lude d 28,242 c omplianc e ac tions.  Asse sse d $9.9 million in c ivil mone y pe naltie s.  Complaints de c line d for

4th ye ar to lowe st numbe r in 8 ye ar s. y

 Violations found in 80% of DOL

inve stigations.

26

2010 Policy and Enforcement I i i i Initiatives



ti h lth l f i d

 T

ar ge ting he althc ar e e mploye r s for misse d and inte r r upte d me al pe r iods and failur e to aggr e gate hour s wor ke d aggr e gate hour s wor ke d

 Dir

e c te d r e c idivism audits for past violator s

 A

i f i il lti f

 Aggr

e ssive use of c ivil mone y pe naltie s for r e pe at and willful violations

 Mor

e c oor dination be twe e n the DOL OSHA

 Mor

e c oor dination be twe e n the DOL , OSHA, and OF CCP

 3 ye ar

bac k wage pe r iod for r e pe at and

 3- ye ar

bac k wage pe r iod for r e pe at and willful violations

27

2010 Policy and Enforcement I i i i Initiatives



i id t d d f t illf l i l ti

 L

iquidate d damage s for r e pe a t or willful violations

 L

imite d use of DOL Re le ase (F

• r

m WH- 58) to “f ll i ti ti ” “full inve stigations”

 T

ar ge ting “misde signate d” inde pe nde nt t t c ontr ac tor s

 T

• lling Agr

e e me nts now toll limitations pe r iod for c laims by e mploye e s for c laims by e mploye e s

 Voluntar

y Complianc e Ar r ange me nts ar e in que stion in que stion

28

Plaintiffs’ Lawyers are T ti H lth E l Targeting Healthcare Employers

 T

h & S l L L P Pl i tiff ’ l

 T

homas & Solomon L L P: Plaintiffs’ law fir m base d in Roc he ste r , Ne w Yor k, that i t ti ll t ti th 100 is syste matic ally tar ge ting mor e than 100 he althc ar e e mploye r s in all 50 state s.

 “Me too” lawye r

s tar ge ting othe r he althc ar e e mploye rs. p y

29

Modus Operandi Modus Operandi

 Obt i

l ’ d dd

 Obtain e mploye e s’ name s and addr

e sse s fr

• m public ly available dir

e c tor ie s of he althc ar e lic e nse s lic e nse s.

 Se nd “inve stigator

y” le tte r s to e mploye e s’ home s to offe r assistanc e in pr

• te c ting

home s to offe r assistanc e in pr

• te c ting

e mploye e s’ r ights.

 Obtain “c onse nts” thr

• ugh wor

d of mouth, home g , mailings, and we bsite : hospitalove r time .c om.

 T

ar ge t lar ge st he althc ar e e mploye r s in spe c ific g g p y p c itie s.

30

Modus Operandi (cont’d) Modus Operandi (cont d)

 Si

lt l fil ti i t l t

 Simultane ously file ac tions against lar

ge st he althc ar e e mploye r s in tar ge t c itie s.

 Boile r

plate c omplaints with vir tually ide ntic al

 Boile r

plate c omplaints with vir tually ide ntic al c laims asse r te d against all tar ge te d e mploye r s.

 Issue pr

e ss r e le ase s to gar ne r me dia atte ntion

 Issue pr

e ss r e le ase s to gar ne r me dia atte ntion.

 Ge ne r

ally file motion for c onditional c e r tific ation with c omplaint or ve r y soon afte r filing of with c omplaint or ve r y soon afte r filing of c omplaint.

 F

• r

c e e mploye e s to fight on two fr

• nts by filing

 F

• r

c e e mploye e s to fight on two fr

• nts by filing

c laims in state and fe de r al c our t.

31

Who is Next? Who is Next?

 Ne w he althc ar

e e mploye r s adde d to we bsite fr e que ntly

 Ne w he althc ar

e e mploye r s adde d to we bsite fr e que ntly.

 We bsite lists he althc ar

e e mploye r s in 48 state s, the Distr ic t of Columbia, Guam, Philippine Islands, Pue r to Ric o, and Vir gin Islands.

 Star

te d in Roc he ste r and the n move d to Buffalo and Syr ac use Ne w Yor k

 Star

te d in Roc he ste r and the n move d to Buffalo and Syr ac use , Ne w Yor k.

 Spr

ing 2009 move d fr

• m Ne w Yor

k to Pittsbur gh, Pe nnsylvania.

 Se pte mbe r

2009 file d ac tions against 5 of the lar ge st he althc ar e syste ms i B t M h tt in Boston, Massac huse tts.

 Cur

r e ntly se nding “inve stigator y” le tte r s to e mploye e s’ home s to additional ar e as, inc luding Philade lphia, Washington, D.C., Pr

• vide nc e ,

and Califor nia and Califor nia.

 Nove mbe r

2009 file d ac tions against 7 Philade lphia- base d he althc ar e syste ms.

 Mar

c h 2010 file d ac tions against Ne w Yor k City- base d he althc ar e syste ms. 32

Targeted Areas

33

The Claims The Claims

 Off- the - c loc k wor

k unde r F L SA

 Off- the - c loc k wor

k unde r state law CO l i iff ll i

 RICO – Plaintiffs alle ge se nior

manage me nt c onspir ac y de signe d to unde r pay e mploye e s.

 E

RISA

 E

RISA

 E

stoppe l

 Br

e ac h of Contr ac t

 Br

e ac h of Contr ac t

 Br

e ac h of Implie d Contr ac t

 Assumpsit  Assumpsit

34

The Claims (cont’d) The Claims (cont d)

 Quantum Me r

uit

 Unjust E

nr ic hme nt

 F

r aud

 Conve r

sion

 Conve r

sion

 Ne glige nt Misr

e pr e se ntation

 E

quitable E stoppe l

 E

quitable E stoppe l

 Pr

• missor

y E stoppe l

 F

ailur e to Maintain Ac c ur ate Re c or ds

35

What to Expect:

E l i T i Evolving Tactics

 Othe r

major plaintiffs’ fir m playe r s, as we ll as “c opyc at” playe r s, have not adopte d the T homas & Solomon mode l hook, line and sinke r – tac tic s ar e e volving

36

What to Expect:

S li i i

Plaintiffs’ firms are hiring outside companies to send email blasts to

Solicitation

• ----Original Message-----

Plaintiffs firms are hiring outside companies to send email blasts to employees of target companies. Below is actual text from one such email:

• ----Original Message-----

From: Hours Worked [mailto:medrecallnewscl@gmail.com] Sent: Monday, January 04, 2010 3:50 PM To: [INSERT NAME] Subject: You May Not Have Been Paid For All The Time You Were Permitted To Work

IF YOU WORKED AS AN HOURLY EMPLOYEE FOR A HEALTH CARE FACILITY OR HOSPITAL OUR INVESTIGATION SUGGESTS THAT...

YOU MAY NOT HAVE BEEN PAI D FOR ALL THE TI ME YOU WERE PERMI TTED TO WORK! YOU MAY NOT HAVE BEEN PAI D FOR ALL THE TI ME YOU WERE PERMI TTED TO WORK!

PROTECT ANY AMOUNT YOU MAY BE OWED BY CALLING NOW. (this is not a sales program)

BECAUSE OF SEVERAL EMPLOYMENT LAWS EVERY DAY YOU DELAY MAY ELI MI NATE YOUR ABI LI TY BECAUSE OF SEVERAL EMPLOYMENT LAWS, EVERY DAY YOU DELAY MAY ELI MI NATE YOUR ABI LI TY TO RECOVER MONEY. CALL TOLL-FREE FOR NO OBLI GATI ON I NFORMATI ON (888) 668-3817

37

What to Expect:

S li i i Solicitation

 L

awye r s ar e using ve ndor s suc h as “se r vic e s to lawye r s” (http:/ / se r vic e stolawye r s.c om/ home / ), tr aditionally use d for me dic al malpr ac tic e , wor ke r s tr aditionally use d for me dic al malpr ac tic e , wor ke r s c ompe nsation c laims and c ar ac c ide nt c ase s, to spam e mploye e s of hospitals and he althc ar e pr

• vide r

s with this type of infor mation pr

• vide r

s with this type of infor mation.

 E

mail addr e sse s c an be ide ntifie d e ithe r by:

ide ntifying a domain name ( @little r hospital or g)

– ide ntifying a domain name (____@little r

hospital.or g) and obtaining an e mploye e r

• ste r

– obtaining a list of e mploye e s (suc h as nurse s) from a

f i l li i b d profe ssiona l lic e nsing board

38

Healthcare Employers are a Major Part of the Focus a ajor art of the ocus



In 2008 and 2009, 33% of wage and hour ac tions tar ge te d at he althc ar e or ganizations we r e file d in the southe ast

39

Time, Task and Payroll Systems

 Automate d and inte gr

ate d time , atte ndanc e and payr

• ll syste ms c an

r e duc e wage - hour c omplianc e issue s.

– Mor

e ac c ur ate time r e c or ds.

– Mor

e like ly that e mploye e s will r e c or d hour s. hour s.

– Mor

e diffic ult for manage r s to shave hour s.

40

But... Top Ten Problems with Timekeeping/Automated with Timekeeping/Automated Systems

1. Auto De duc tions for Me al Pe r iods. 2 De duc tions for Shor t Me al/ Re st Br e aks 2. De duc tions for Shor t Me al/ Re st Br e aks. 3. E xc e ption T ime Re por ting. 4. Rounding. 5 E ar ly Ar r ive r s and L

• ng Punc hing

5. E ar ly Ar r ive r s and L

• ng Punc hing.

41

But... Top Ten Problems with Timekeeping/Automated Systems p g y (cont’d)

6 Pr e and Post shift Compute r L

• gging

6. Pr e - and Post- shift Compute r L

• gging

and Othe r Ac tivitie s. i i i 7. Disc r e panc ie s Be twe e n T ime Re c ords and Othe r E le c tr

• nic Re c or

ds. 8. Re mote Wor k. 9 Gar bage In Gar bage Out 9. Gar bage In, Gar bage Out.

• 10. F

ailur e to Inc lude Bonuse s, Inc e ntive s, and Commissions in Ove r time Calc ulation and Commissions in Ove r time Calc ulation.

42

F d Thi ki S i d Forward Thinking Strategies and Remedial Measures to Attack New Challenges and Eliminate Old Problems and Eliminate Old Problems

43

The Good News The Good News

 D

it i i b f l i th

 De spite r

ising numbe r

• f c laims, the r

e ar e me asur e s e mploye r s c an take now to str e ngthe n de fe nse s and make the mse lve s str e ngthe n de fe nse s and make the mse lve s a le ss attr ac tive litigation tar ge t.

 Many “r

e me dial ste ps” c an be quic kly

 Many r

e me dial ste ps c an be quic kly imple me nte d with little or no c ost.

 Most he althc ar

e e mplo e r s alr e ad ha e the

 Most he althc ar

e e mploye r s alr e ady have the basic c omplianc e str uc tur e in plac e on whic h a mor e e labor ate wage and hour c omplianc e a mor e e labor ate wage and hour c omplianc e mode l c an be built.

44

A Word About the Attorney-Client Privilege and Discoverability of Internal g y f Communications

 Gi

l th t f liti ti l h ld k

 Give n r

e al thr e at of litigation, e mploye r s should wor k with c ounse l (inside or

• utside c ounse l) to e valuate

e xisting c omplianc e .

 Inte r

nal c ommunic ations that ar e not pr ivile ge d or disc ove r able .

 E

mploye r s should e xe r c ise c aution in how the y c ommunic ate about pote ntial c omplianc e issue s.

 Plaintiffs’ c ounse l ofte n take disc ove r

y of an e mploye r ’s knowle dge of c omplianc e issue s and what, if any, ste ps e mploye r has take n to addr e ss , y, p p y pote ntial pr

• ble ms.

45

Building a Good Faith Defense t Off th Cl k Cl i to Off-the-Clock Claims

 K

bl f h lth l

 Ke y pr

• ble m for

he althc are e mploye r s is lac k of suffic ie nt e vide nc e to e stablish ti k i d “ d f ith” pr

• pe r

time ke e ping and “good faith” de fe nse to off- the - c loc k c laims.

 Complianc e mode l should be tar

ge te d toward building e vide nc e of e mploye r’s g p y good faith e fforts to e nsure e mploye e s ac c ur ate ly r e por t and ar e paid for all y p p wor king time .

46

Obstacles to Effective Compliance M d l Model

 E

l d h

 E

mploye e s and manage r s have misc onc e ption about r e spe c tive le gal

• bligations and what is c ompe nsable
• bligations and what is c ompe nsable

wor king time .

 E

mploye e s ar e ofte n c ar e le ss time ke e pe r s

 E

mploye e s ar e ofte n c ar e le ss time ke e pe r s.

 Some manage r

s may instr uc t e mploye e s to

• r

k off the c loc k d e to b dge tar to wor k off- the - c loc k due to budge tar y r e str ic tions.

 S

l l f l l

 Some unsc r

upulous e mploye e s may false ly c laim off- the - c loc k wor k.

47

What is a F h /Ell th D f ? Faragher/Ellerth Defense?

 I

t i f th l t h i d

 In c e r

tain ar e as of the law, c our ts have r e c ognize d some thing c alle d the “doc tr ine of avoidable c onse que nc e s,” whic h pr e ve nts a par ty fr

• m

r e c ove r ing damage s whe r e the injur e d par ty c ould have avoide d har m thr

• ugh r

e asonable e ffor ts.

 U

d f 10 i T itl VII tt f ll i

 Use d for

10+ ye ar s in T itle VII matte r s, following US Supr e me Cour t de c isions in F ar aghe r and Kolstad.

 Cour

ts have now star te d to r e c ognize the validity

 Cour

ts have now star te d to r e c ognize the validity

• f this de fe nse in wage and hour

ac tions.

48

Elements of the F h /Ell th D f Faragher/Ellerth Defense

1 Ad t d bli i l ti k i li i d d 1. Adopt and public ize c le ar time ke e ping polic ie s and pr

• c e dure s.

2. Re quir e e mploye e s to r e vie w, and, if c or r e c t, c e r tify the ac c ur ac y

• f time r

e c or ds. 3. Imple me nt a r

• bust c omplaint me c hanism spe c ific ally tar

ge te d to wage and hour c omplaints. 4 Audit time r e c or ds to e nsur e e mploye e s and manage r s ar e 4. Audit time r e c or ds to e nsur e e mploye e s and manage r s ar e c omplying with polic ie s and pr

• c e dur

e s. 5. Disc ipline manage r s and e mploye e s for violations of time ke e ping polic ie s and pr

• c e dur

e s polic ie s and pr

• c e dur

e s. 6. Re infor c e time ke e ping polic ie s thr

• ugh pe r

iodic re minde r s. 7. T r ain manage r s and e mploye e s on ke y F L SA c onc e pts, 7. T r ain manage r s and e mploye e s on ke y F L SA c onc e pts, time ke e ping polic ie s, and c omplaint me c hanism.

49

Element 1:

Adopt and Publicize Clear Timekeeping

 T

i k i li i h ld i h db k

Adopt and Publicize Clear Timekeeping Policies and Procedures

 T

ime ke e ping polic ie s should appe ar in handbooks, e thic s polic ie s, and c olle c tive bar gaining agr e e me nts.

 Re quir

e signe d r e c e ipt to de monstr ate knowle dge

 Re quir

e signe d r e c e ipt to de monstr ate knowle dge

• f polic ie s and pr
• c e dur

e s.

 Re c omme nd polic ie s should:

p

– De fine wor

king time with e xample s that tar ge t most c ommon misc onc e ptions. dd l i d d i t t l h t t

– Addre ss me a l pe riods, and instruc t e mploye e s on wha t to

do if a me al pe r iod is inte r r upte d or misse d.

– Pr

• hibit off- the - c loc k wor

k but advise that in the e ve nt wor k is pe r for me d, e mploye e s will be paid.

50

Element 1: (cont’d)

Adopt and Publicize Clear Timekeeping

 Re c omme nd polic ie s should:

Adopt and Publicize Clear Timekeeping Policies and Procedures

 Re c omme nd polic ie s should:

–Re quir

e imme diate r e por ting of off- the - c loc k wor k within 72 hour s of oc c ur r e nc e .

–Pr

• vide a me c hanism for

e mploye e s to r e por t off- the - c loc k wor k.

–Re quir

e advanc e author ization for

• ve r

time e xc e pt in the q p e ve nt of an e me r ge nc y.

–Advise e mploye e s that no one is author

ize d to r e quir e off- the - c loc k wor k c loc k wor k.

–Re quir

e e mploye e s to r e por t violations of time ke e ping polic ie s within 72 hour s of oc c ur r e nc e and r e quir e e mploye e s to pur sue alte r native c omplaint me c hanism by c alling 1 800 numbe r if no alte r native c omplaint me c hanism by c alling 1- 800 numbe r if no r e sponse r e c e ive d fr

• m initial c omplaint within 5 busine ss days.

51

Element 2:

ifi i f Ti d Certification of Time Records



Re quir e non- e xe mpt e mploye e s to r e vie w time r e c or ds.



Daily r e vie w is ide al but some thing le ss fr e que nt c an be use d pr

• vide d e mploye e s have the opportunity to r

e vie w ac tual p p y pp y r e c or ds.



Pr

• vide d r

e c or ds ar e c or r e c t, r e quir e e mploye e c e r tific ation as to ac c ur ac y. as to ac c ur ac y.



If r e c or ds ar e not c or r e c t, r e quir e e mploye e to ide ntify any inac c ur ac ie s to pe r mit imme diate c or r e c tion.



Re quir e e mploye e s to r e vie w ac c ur ac y of payc he c k and, if syste ms pe r mit, c e r tify se c ondar y r e vie w. On- line tools make this le ve l of r e vie w mor e available .



Ce r tific ation should c ove r

• ff- the - c loc k wor

k and me al pe riods.

52

Element 3:

Ad b C l i Adopt a Robust Complaint Mechanism

 Most e mploye r

s alr e ady have some type of c omplaint me c hanism in plac e .

 E

xisting c omplaint me c hanisms ofte n do not

 E

xisting c omplaint me c hanisms ofte n do not spe c ific ally r e fe r e nc e wage and hour issue s.

 Re vise e xisting c omplaint me c hanism to e nsur

e

 Re vise e xisting c omplaint me c hanism to e nsur

e it spe c ific ally addr e sse s wage and hour issue s.

 Public ize c omplaint me c hanism in handbooks,

p

• pe n door

polic ie s, c olle c tive bar gaining agr e e me nts, e thic s handbooks, and othe r e mploye e c ommunic ation c hanne ls e mploye e c ommunic ation c hanne ls.

53

Element 3: (cont’d)

Ad b C l i Adopt a Robust Complaint Mechanism

 T

r ain manage r s and payr

• ll pe r

sonne l to be ale r t to payr

• ll c onc e r

ns and tr e at any c omplaints with same le ve l of atte ntion as othe r e mploye e r e lations same le ve l of atte ntion as othe r e mploye e r e lations c omplaints (i.e ., se xual har assme nt).

 Pr

• mptly inve stigate payr
• ll c onc e r

ns using same te c hnique s and c ontr

• ls as othe r

type s of inte r nal c omplaints.

 If d

t i d t b i t t k t

 If de te r

mine d to be appr

• priate , take pr
• mpt

and e ffe c tive r e me dial ste ps.

 E

ffe c tive r e me diation may r e quir e payme nt of

 E

ffe c tive r e me diation may r e quir e payme nt of bac k wage s.

54

Element 4:

A di Ti d f C li Audit Time Records for Compliance

 Adopt an audit pr

• toc ol to e nsur

e e mploye e s and manage r s ar e following polic ie s and pr

• c e dur

e s.

 A dit pr

• toc ol sho

ld be de signe d to be disc o e r able

 Audit pr

• toc ol should be de signe d to be disc ove r

able in the e ve nt of futur e litigation as par t of Company's good faith de fe nse .

 Pr

• mptly inve stigate and r

e me diate any disc ove r e d violations.

 Imple me nt appr

• pr

iate disc ipline for manage r s and e mploye e s in the e ve nt of violations.

55

Element 5:

Impose Appropriate Discipline for Policy

 I

t d l h

pose pp op ate sc p e o o cy Violations by Employees and Managers

 In some r

e por te d c ase s, e mploye r s have be e n c r itic ize d for quic kly disc iplining e mploye e s for time ke e ping violations but e mploye e s for time ke e ping violations but not doing so for manage r violations.

 Manage r

misc onduc t is inc r e asingly be ing

 Manage r

misc onduc t is inc r e asingly be ing c har ac te r ize d as wage the ft.

 Manage r

misc ond c t sho ld be pr

• mptl

 Manage r

misc onduc t should be pr

• mptly

addr e sse d and, whe r e c onfir me d, c onside r e d se r ious violation of the Company's se r ious violation of the Company s most impor tant polic ie s.

56

Element 6:

P i di R i d

 T

i k i li i d d

Periodic Reminders

 T

ime ke e ping polic ie s and pr

• c e dure s

should be r e infor c e d thr

• ugh available

i ti c ommunic ation me ans.

 Annual le tte r

to all e mploye e s. p y

 Ne wsle tte r

s.

 Postings.  Re fr

e she r tr aining

 Re fr

e she r tr aining .

57

Element 7:

T i i Training

 R

t E L T S f 2 000 L l & HR

 Re c e nt E

L T Sur ve y of 2,000+ L e ga l & HR Pr

• fe ssionals:

– 60% said the ir e mplo ye e s we re no t ac c urate ly re c o rding ho urs wo rke d, o r we re n’ t sure if the y we re o r no t; – 40% said the ir e mplo ye e s wo uld no t kno w ho w to c o mplain inte rnally, abo ut wag e c o nc e rns.

58

Why Train? A id P bl t B i With Avoid Problems to Begin With

‐ Teach your employees about your

• rganization’s key wage and hour rules (e.g.,

prohibition against off‐the clock work; meal prohibition against off the clock work; meal and rest breaks; etc.), AND where to turn to internally if they have wage problems; ‐ Teach your managers about your

• rganization’s policies and their special role

in ensuring the policies are followed and in ensuring the policies are followed and enforced, and all issues are addressed.

59

How Training Helps Defeat Off th Cl k W k Cl i Off-the-Clock Work Claims

 Inc r

e asingly the avoidable c onse que nc e s doc tr ine

 Inc r

e asingly, the avoidable c onse que nc e s doc tr ine is be ing r e c ognize d in F L SA and r e late d state wage and hour c ase s, as a c r itic al de fe nse for e mploye r s.

 Cor

ne r stone of the de fe nse is e mploye e and supe r visor y tr aining on wage and hour topic s. p y g g p

60

Training Reduces D E Damages Exposure



2 yr

• s. vs. 3 yr
• s. bac k pay



Re duc e s liquidate d (double ) damage s r isk



Re duc e d attor ne ys’ fe e s



Re duc e d inte r e st



Re duc e d c ivil mone y pe naltie s

61

When To Train When To Train

 Should be inte gr

ate d into

 Should be inte gr

ate d into e mployme nt r e lationship.

 Should be done r

e gular ly to

 Should be done r

e gular ly to r e infor c e polic ie s and unde r standing:

– E mplo ye e o rie ntatio n. p o ye e o e a o . – Ne w manag e r training . – Whe n the re are ne w le g al de ve lo pme nts o r po lic y p p y c hang e s. – E ve ry 2 ye ars. – Mo re o fte n fo r hig hly g y spe c ialize d c o mpe nsatio n jo bs.

62

Who Should Be Trained Who Should Be Trained



Manage r training should foc us

• n e mploye e topic s, plus:

– Co mplianc e re spo nsibilitie s. Co mplianc e re spo nsibilitie s. – Handling e mplo ye e c o mplaints. Manag e r misc o nduc t – Manag e r misc o nduc t. – Pro hibitio n ag ainst re taliatio n. G d d k i – Go o d re c o rd ke e ping prac tic e s.

63

Who Should Be Trained Who Should Be Trained



E mploye e tr aining should foc us on the basic s, suc h as:

Re vie w o f ke y po lic ie s – Re vie w o f ke y po lic ie s. – De fine ho urs wo rke d. – No o ff-the -c lo c k wo rk.

• o

e c o c

• .

– Me als and re st pe rio ds. – Rule s re lating to OT . – Re po rting e rro rs and misc o nduc t.

64

Training Solutions Training Solutions

 L

i t i i

 L

ive tr aining:

– I nstruc to r le d and tailo re d to audie nc e (i.e ., se nio r le ade rs). – Whe n hig hly c usto mize d mate rials re q’ d.

 E le ar

ning: 40% + (and g ro wing ) o f

 E

• le ar

ning: 40% + (and g ro wing ) o f

e mplo ye rs to day c ho o se e -le arning so lutio ns.

I nte ra c tive a nd e ng a g ing hands o n – I nte ra c tive a nd e ng a g ing – hands o n e xpe rie nc e . – Sig nific ant c o st saving s. – Cre ate s e le c tro nic re c o rds and – Cre ate s e le c tro nic re c o rds and e mplo ye e ac kno wle dg me nts.

Vie w a de mo: www.e lt- inc .c om.

65

The Power of eLearning The Power of eLearning

 Abilit to a to mate an  Ability to auto mate an

e nte rprise -wide mandato ry training e ffo rt.

 I

rre futable trac king o f all le arne rs.

 Co mple te re c o rd o f c o nsiste nt  Co mple te re c o rd o f c o nsiste nt

training c o nte nt.

 L

e arne r c e rtific atio n re g arding g g po lic y c o mplianc e .

 L

e arne r c e rtific atio n o f training c o mple tio n c o mple tio n.

66

Critical Training Components Critical Training Components



E duc ate your wor kfor c e about the basic s of the law – both state and fe de ral. (Conte nt ne e ds to c onfigure fe de ral. (Conte nt ne e ds to c onfigure by state .)



E duc ate your wor kfor c e about your

policie s policie s.



T ranslate c ritic al me ssage s into re al- life stor ie s that your e mploye e s will unde rstand and re me mbe r unde rstand and re me mbe r.



Spe c ific ally de signe d to he lp e stablish powe r ful affir mative d f de fe nse s.

67

ELT’s Wage & Hour Course ELT s Wage & Hour Course

E mploye e s must c e r tify that the y:



Co mple te d the



Co mple te d the c o urse .



Re vie we d yo ur & h d wag e & ho ur and payro ll po lic ie s and will abide by the m.



K no w who to c a ll with any que stio ns

• r c o nc e rns.

68

Wage & Hour Training: A Case St d Study

69

Training: A Case Study Training: A Case Study

 “S

t

”

 “Symptoms”: L

arg e Ne w E ng land-base d he althc are syste m, with 6,000+ e mplo ye e s,

• pe rating in se ve ral state s, was fe aring the

p g , g immine nt filing o f a wag e & ho ur c lass ac tio n.

 Majo r c o nc e rns with o ff-the -c lo c k wo rk and me al

and re st bre ak manag e me nt.

 T

his “pa tie nt” pre se nte d itse lf to E L T in July 2009.

70

Training: A Case Study Training: A Case Study

 “T

t t”

i i

 “T

r e atme nt”: I

n Oc to be r 2009, c lie nt partne rs with E L T to pro vide o nline wag e and ho ur training to c lie nt’ s 6,000+ e mplo ye e s, syste m-wide , in vario us , p y , y , state s.

 Clie nt re que sts c usto mizatio ns inc luding imbe dding its

wag e and ho ur po lic ie s within the training c o urse . E L T ho sts the c o urse o n its L MS.

 Co urse re ady to launc h  Co urse re ady to launc h

De c e mbe r 1, 2009.

71

Training ROI Training ROI



Pr e ve nt inadve r te nt fe de r al and



Pr e ve nt inadve r te nt fe de r al and state law violations.



Pr e ve nt c laims:

• Po lic ie s are c le ar and

irre futable .

• Plaintiff c re dibility?

Plaintiff c re dibility?

• Mo re diffic ult to c e rtify a c lass.



Re duc e damage awar ds and pote ntially build a good faith

de fe nse .



Build a c ultur e of c omplianc e . p

72