When you think about your employment risks (assuming you think about them at all), what do include in that process? Are you expecting employees to walk up to you and say something directly to your face? Or have you and your supervisors been trained to pay attention to the more subtle clues that the company has been put “on notice” for something?

Let’s look at a situation: You’re a supervisor working in your office when you realize you can overhear three  female employees talking in the hallway outside your office. One  says, “Can you believe Tom mentioned sex during yesterday’s sales meeting?” The second says, “Oh, he always talks like that.” The third responds, “Yeah, he always seems to have sex on the mind.” Should you, or are you required to, do anything? Do you consider this “water cooler talk” and ignore it since they didn’t know you could hear? Or do you take action and, if so, what type of action?

Let’s take our situation a step further. Three months later, during your annual sales meeting, a female employee files a complaint alleging that Tom raped her at the hotel. This complaint obviously requires an investigation so I’m not going whether or not you’ll have one conducted. What I want to know is how your company may be affected?

Regardless of your response to the original situation, the complaint that came later makes what you overheard much more believable and serious, doesn’t it? Guess what, the court and jury are going to agree. In fact, any supervisor overhearing employees talk about any type of harassment … whether they know you’re listening or not … is considered sufficient to put your company “on notice” of harassment and requires action by the company.

While it’s a nice dream to think employees will always be up front with you and know the proper way to phrase things so you see a big red flag at that particular moment, that rarely happens. Your company should have a policy that ensures every supervisor is aware of their responsibility and a process on what to do with information learned about possible harassment.

When your company is put on notice in some way, the clock starts ticking. What that means is that a court and jury will look at your actions from the moment they feel you did, or should have, known there might be a problem. If, in the original situation, you didn’t do anything it’s going to look as if the company doesn’t care. Look at it from the jury’s viewpoint… you knew there might be a problem but you didn’t act and it resulted in an alleged rape case. Needless to say, this will really cost you when a decision comes down.

On the other hand, if you immediately reported what you heard, it will show that your company is serious about providing a harassment-free environment because you acted quickly and followed procedure.

Protect your company by making sure your supervisors are well-trained in the various ways harassment may appear in the workplace… and what to do about it. Oh, it might help them be more diligent if you mention that, in California, supervisors may be personally sued in some cases!

Consulting with companies that don’t have or need a full-time HR person (my specialty) continues to bring me surprises. When I first started consulting I discovered that neither the state nor federal government websites offered new employers information about being an employer beyond how to obtain an Employer’s Identification Number (EIN). Not a thing about the fact that hiring employees automatically brings a business into the world of HR … or it should. It was both a surprising and disappointing discovery.

Considering that federal employment laws apply to every employer in the U.S., you’d think some kind of "cheat sheet" would be available to give new (or experienced) employers a heads-up on what they need to do to be compliant with these laws. Yes, you can read the full text of the federal laws but no help is provided in how to implement them or what they mean in the day-to-day running of your business.

I recently reviewed a 45-page booklet provided by the SBA (Small Business Administration). Lots of great information in general for business owners but it only told readers how to get an EIN, not how employment laws may affect how they do business and deal with their employees.

Is it any surprise that so many small (and larger) employers aren’t fully compliant with employment laws? Even the basics are often omitted by a company … usually due to lack of knowledge than a willful omission. However, if you ever ended up with a labor claim or lawsuit, ignorance of the law isn’t considered a defense. A no-win situation. No information and no defense!

Consider this post your information resource for the most basic part of compliance with federal employment laws: the forms you are required to give employees.

• Current federal employment law poster – This isn’t something you need to give employees but you are required to hang the poster in a conspicuous place located where all employees will see it. The usual place is the coffee area, next to the time clock, or other place where everyone has reason to go by it. Sometimes you need to get creative. I know a couple of companies who are putting the information as an addendum to their Employee Handbook because their employees don’t come into the office.
• IWC Wage Order – If you look really close at the margins of the employment law poster you may find a little sentence that reminds you about posting this information but most companies miss it. The Industrial Welfare Commission (IWC) has created 17 different wage orders, each directed toward specific industries. You need to determine which IWC Wage Order fits your industry, print it out (about 14 pages), staple it together, and stick it on the wall next to your employment law poster. This gives all the minute details about the wage and hour laws affecting your industry. There may be subsequent "interpretations" written about how to implement this wage order but those don’t need to be posted.
• IRS W-4 form — This is the one form that everyone seems to use … but that’s only because it has information you need when putting an employee on payroll. Although the Internal Revenue Service (IRS) issues a fresh copy each year, nothing but the year imprinted on it has changed in a long time.
• INS I-9 form – Although the Immigration and Naturalization Service (INS) created this form many years ago, it’s been taken over by Homeland Security. That means the form has seen several updates in the last few years and another is expected mid-2009. This form needs to be fully completed within 3 days of an employee’s hire date. There are fines and penalties for partially completed forms, so be sure to finish what you start. The point of this form is to ensure you have hired a person legally authorized to work in the U.S. The documentation an employee may use to prove that is what Homeland Security continues to change. While the form continues to evolve, you don’t need to have a new one completed each time. Just use the newest form with new employees. If an employee is using documentation that expires, you will need to follow up and record the updated documentation as needed.
• Initial Notice of COBRA Rights — You only need to worry about this if you are providing benefits to your employees that are subject to COBRA (Consolidated Omnibus Budget Reconciliation Act of 1985). This issue just got more complicated with Obama’s stimulus bill, so check with your insurance broker to ensure you are doing everything you need for this. The point of this notice is just to let new employees know that, if employment ends, they may be able to continue their benefits via this law.
• Workers’ Compensation Insurance brochure — This is a brochure that you should be able to obtain for free from your insurance carrier. The brochure provides basic information on what the insurance covers and what the employee should do if an injury happens.
• Sexual Harassment brochure — To be honest, I don’t know that this brochure is "required" but I feel it should be (and is in California). It’s a simple brochure that provides a description of sexual harassment and what an employee can do about it. This is really only the tip of the iceberg on this topic and I would strongly recommend you also invest in some type of recorded training that becomes part of your orientation. This is still the most common area for lawsuits so it’s worth the investment to ensure your employees understand what harassment is and, as importantly, that you don’t condone or tolerate that behavior.

California also has several state forms that are required but this post is only about the federal ones. Once you start using these forms, you’ll find that it really isn’t that much extra effort to minimize your company’s risks. You can get the latest versions of INS I-9 form, IRS W-4 form, and COBRA notices here (HR Jungle’s free HR forms). If you have employees that have never received these forms, it’s better late than never to work on being compliant with them. So, get your materials ready and go "paper" your employees!

This year is the first that I can remember where there were more Federal changes to employment laws than California changes. That alone is historic! But the changes to COBRA  almost seem like they should have been California’s idea because they are so favorable to the employee … or, in this case, the ex-employee.

The American Recovery and Reinvestment Act of 2009 (ARRA) was passed on 2/17/09 as part of Obama’s stimulus package. Employers subject to COBRA will now be providing a subsidy to offset the cost of COBRA coverage for employees who were (or are) involuntarily terminated (fired or laid off, unless terminated for gross misconduct) between 9/1/08 and 12/31/09. Yes, it’s retroactive!

You only have until 4/18/09 to get notices out to the affected employees and must send a notice even if they did NOT elect to take COBRA when it was previously offered to them. New employees and newly terminated employees are to receive special notices of these COBRA changes. These model notices can be found in HR Jungle’s free HR forms.

The subsidies are for up to 9 months for COBRA-eligible employees involuntarily terminated and also for affected spouses and dependents who are COBRA qualified beneficiaries. The simple explanation of this subsidy is that the employee/dependent only pays 35% of the COBRA premium and the employer pays 65%. You then get reimbursed for the 65% through a federal payroll tax credit so be sure to keep good records on the financial side of this. The subsidy ends when the eligible employee or dependent (1) gets other insurance coverage or (2) the 9-month subsidy period runs out or (3) their COBRA period ends.

Another aspect of ARRA is that you can offer these employees/dependents different coverage than they had pre-COBRA as long as it costs the same or less, is also offered to active employees, and is not just an add-on coverage (like dental-only, etc.) without including medical insurance. If this option is offered, they only have 90 days after receiving the notice to switch their benefits.

What to do?

Download the new model COBRA forms that the Feds have created. You’re not required to use them as-is but using them will be much easier than creating your own.

Make sure the General Notice is given to new employees with other new hire paperwork. This works for companies subject to either COBRA or Cal-COBRA (California’s version of COBRA for employers with only 2-19 employees). Also distribute the General Notice to all current employees eligible for benefits (whether they participate or not).

On or before 4/18/09, send the Notice in Connection with Extended Election Periods to any eligible employee/dependent who was originally eligible for and offered COBRA from 9/1/08 through 2/16/09. Yes, also send it to those people who declined COBRA. This extended period does not apply to state mini-COBRA coverages, like Cal-COBRA.

You will be wise to coordinate with your insurance broker to ensure you are providing the appropriate forms to the right ex-employees. You might also ask if they are planning to add any services that help with the administrative side of this new law.