Friday, August 28, 2009

Ohio Supreme Court Reinforces Importance of Signed Acknowledgement of Employee Handbooks for Terminated, Injured Employees Seeking Temporary Total Disability

*By Steve Dlott

The Ohio Supreme Court recently reiterated its long-standing precedent that absent an employee’s signed acknowledgement of an employment manual, injured employees terminated for violating company policy are entitled to temporary total disability. In State ex. rel. Saunders v. Cornerstone, 2009-Ohio-4083 (Ohio Aug. 19, 2009), an employee injured his knee at work and returned to work two days later. One month later, the company fired the employee for insubordination. Following his termination, the employee underwent knee surgery and requested temporary total disability (“TTD”) for his lost wages. The employer challenged his request relying on a policy in the employment manual permitting discharge for insubordination. The Industrial Commission (“IC”) denied the injured employee’s request for TTD, finding that the employee voluntarily abandoned his employment based on his violation of the insubordination policy.

The IC’s decision ultimately was appealed to the Ohio Supreme Court, where it was reversed. The Court noted that although the injured employee signed a written acknowledgement of his receipt of the original employment manual, the employer subsequently revised its employment policy to include insubordination as a terminable offense. The employee denied receiving a copy of the employer’s revised insubordination policy, and the employer did not have any proof of a signed acknowledgement by the terminated employee that he received the revision to the employment manual indicating insubordination was a terminable offense. Accordingly, the Supreme Court held the employee was entitled to TTD.

The Ohio Supreme Court’s decision to grant the terminated employee TTD emphasizes two essential points regarding termination of injured employees for policy violations: (1) all such policies should be in writing; and (2) employers should maintain written acknowledgment from their employees that they received the policies. For workers’ compensation purposes, having one without the other is meaningless. The Saunders decision reaffirms these important and ironclad principles.

*Steve Dlott, an OSBA Certified Specialist in Workers’ Compensation, defends employers in all aspects of workers’ compensation law. For more information about how this decision may affect your practice or any other workers’ compensation issue, please contact Zashin & Rich at 216.696.4441.

Tuesday, August 11, 2009

Employer Information Report (EEO-1) Deadline Is September 30, 2009

*By David R. Vance

Title VII applies to employers who employ 15 or more employees for more than 19 weeks in the current or preceding calendar year. The U.S. Equal Employment Opportunity Commission (“EEOC”) requires private employers, who are subject to Title VII of the Civil Rights Act and have 100 or more employees, to file annually an Employer Information Report (EEO-1) survey. An employer with less than 100 employees also must file an EEO-1 if the company is subject to Title VII and is owned or affiliated with another company which combined employs a total of 100 or more employees. Some private federal contractors must also complete the survey.

If your company has not already, it should receive from the EEOC notification regarding the survey including filing materials. The survey provides numerical data of employees by job category, ethnicity, race and gender and must be completed by September 30, 2009. The EEOC prefers the form be submitted online at http://www.eeoc.gov/eeo1survey/. A hardcopy of the form and further instructions also are available at this website.

If you have any questions about the applicability of the survey to your business, please contact David Vance (drv@zrlaw.com) at 216.696.4441.

*David Vance practices in all areas of labor and employment law. For more information on any labor or employment issue, contact David at 216.696.4441 or drv@zrlaw.com.

Saturday, August 8, 2009

Amendments to New York Insurance Law Extends “Mini-COBRA” Eligibility Period and Benefits for Dependent Children

*By Patrick J. Hoban

New York Governor David Patterson signed two bills into law that require commercial health insurers issuing group health policies under state law to offer up to 36 months of healthcare continuation coverage for eligible employees and extend dependent coverage to covered employee’s children up to the age of 29 respectively.

The amendment to Section 3221 of the New York State insurance law requires insurers to offer policies that extend continuation coverage for eligible employees from 18 to 36 months. As part of the State’s “Mini-COBRA” law, the requirement applies to all employer policyholders regardless of the size of their workforce. The amendment did not change other statutory provisions regarding eligibility, election, and events that terminate continuation coverage. While the change applies to any policies or contracts issued, renewed, modified, or amended after July 1, 2009, the New York State Department of Insurance expects that the new benefit will apply to most policies on its next annual renewal date.

The amendment to Section 3216 requires insurers to offer coverage to the unmarried “dependent” children of covered employees up to the age of 29, without regard to the child’s degree of financial dependence. Children are eligible for this coverage if they are not eligible for employer-provided insurance in their own right, they live, work, or reside in New York or the service area of the insurer, and they are not covered by Medicare. Employers are not required to pay for any of the cost of this coverage. Employees and qualifying dependent children may elect prospective coverage under the new law for up to twelve months after enactment of the law if a dependent child’s coverage was terminated before age 29 under the terms of a prior group policy. Coverage is terminated when a dependent child no longer meets the eligibility requirements, fails to pay premiums, of the group policy is terminated and not replaced with another group policy. The law takes effect on September 1, 2009, and will apply to contracts issued, renewed, modified, altered or amended on or after that date.

If you insure employees under New York State law and have any questions about how these changes will affect your business, please contact Pat Hoban (pjh@zrlaw.com) 216.696.4441.

*Patrick J. Hoban practices in all areas of labor and employment law, with a focus on private and public sector labor law. Contact him at 614.224.4411 or pjh@zrlaw.com.

Wednesday, August 5, 2009

Navigating a DOL Compliant Salary Reduction and/or Furlough

*By Michele L. Jakubs

Salary reductions or voluntary furloughs are increasingly popular for employers facing economic hardship. However, the Fair Labor Standards Act (the “Act”) imposes statutory requirements related to salary reductions and furloughs dependent upon an employee’s non-exempt or exempt status. Under the Act, an employer may reduce a non-exempt employee’s hourly wage and/or scheduled hours so long as the employer pays the minimum wage and statutory overtime due for all hours worked.

Implementing salary reductions or furloughs for exempt employees implicates more complex statutory requirements. Employers implementing these programs have greater considerations. For example, reducing an exempt employee’s salary to less than $455 per week changes the employee’s exempt status to non-exempt. Once an employee is non-exempt, the employer must pay minimum wage and statutory overtime due for all hours worked. In addition, an employer who decides to utilize furloughs in an effort to reduce costs must place its exempt employees on furlough for the entire workweek. If an exempt employee performs any work in a workweek, then the employee must receive his/her full salary for that week. As a result, exempt employees selected for a furlough cannot perform any work, including the most basic work functions such as checking work email from a blackberry or home computer or taking a work related phone call. Employers must pay employees for the furlough week if the employee performs even such basic work functions.

Because of the complexities associated with salary reductions and furloughs, the Department of Labor (“DOL”) just issued an FAQ to assist employers in navigating this potential minefield. Employers may review the DOL’s FAQ at http://www.dol.gov/esa/WHD/flsa/FurloughFAQ.pdf.


*Michele L. Jakubs practices in all areas of employment litigation and wage and hour compliance and administration. For more information concerning the Fair Labor Standards Act or any other employment issue, please contact Michele at 216.696.4441 or mlj@zrlaw.com.