The difficult economy, lack of job openings and preponderance of students and others willing to accept unpaid internships can create a tempting situation for employers.  But this lawsuit sends the message that it’s probably no longer safe for employers to reason, “everyone does it.”  The Department of Labor has long had a six factor test for unpaid internships so if you’ve not already done so, and you have interns, you should become familiar with it immediately.

Here are a few additional tips:

• Implement procedures that ensure the HR department is always in the loop and managers can never bring anyone on board without HR’s prior knowledge and approval;
• If the internship is not tied to an academic program, your chances that it qualifies as unpaid go down;
• If the intern is brought on board in lieu of a regular employee doing the work, the intern is actually an employee and the FLSA and state laws apply;
• If HR determines the internship position does pass the DOL six factor test, supporting documentation should be kept on file;
• Understand and document what interns are doing, how their work is overseen and by whom;
• Check state laws as well to ensure both federal and state compliance;
• The FLSA makes an exception for bona fide volunteers in the non-profit sector or for state or local government agencies.

The punishment for violating the FLSA can be severe and may include steep fines in addition to back regular pay and back overtime pay, back taxes, and attorneys’ fees for the opposing side.   Even when companies prevail, lawsuits are generally costly.   It will be interesting see how this version of the Black Swan story turns out.

So what does this 17th century French fable have to do with HR? The American Heritage Dictionary defines the term “cat’s paw” as a person used by another as a dupe or tool. Earlier this year, the Supreme Court issued a ruling based on cat’s paw theory. The case involved an army reservist, Vincent Staub, who worked at a hospital. After review of his personnel file, which included a prior disciplinary action, and after speaking with his supervisors, the HR Manager made the decision to terminate him.

Staub sued for wrongful discharge, contending that he had been fired in violation of the Uniformed Services Employment and Reemployment Rights Act (USERRA) based on time off for military service. The Supreme Court agreed with Staub that the prior disciplinary action in his personnel file was based on biased reporting by his supervisors who maintained an anti-military mindset. They further determined that these biased supervisors had influenced the final decision-maker, the HR Manager, when they caused the prior discipline to be entered into Staub’s records. So, while the HR manager herself showed no anti-military bias, she relied on information that was discriminatory in making the decision to terminate. Under cat’s paw theory, she served as the dupe used by the supervisors.

So what does this mean for your organization? Well, clearly, one should tread carefully with all adverse employment actions. This means thorough fact-finding investigations. You shouldn’t necessarily take a supervisor’s word alone without further digging. Review all anti-harassment policies and all grievance and investigative procedures. Train supervisors in all your policies but particularly in nondiscrimination and anti-harassment. Supervisory performance reviews should reflect how well supervisors coach and develop staff. There are never full guarantees against lawsuits, but implementing sound policies, procedures and training will keep your risk to a minimum to keep you from getting burned!

This Supreme Court decision reverses a prior ruling by the 9th District Court of Appeals of San Francisco.   If allowed to proceed as a class action suit on behalf of 1.6 million current and former female employees, Wal-mart’s already substantial costs would likely have soared into the billions of dollars and it is likely that similar suits would have cropped up against other organizations.   While this ruling is a clear victory of sorts for the big box giant and perhaps other large businesses, litigation by at least two of the several plaintiffs may continue individually meaning Wal-mart is not yet off the hook, though it is a decidedly smaller hook than it would’ve been.  Wal-mart claims that its policies prohibit discrimination and that it has taken steps since the suit was filed to address problems.

In order to address this issue further, the company has agreed to hire a consultant to analyze their current process, create a new position called “vice president of people”, as well as unveiling a new online application system for current workers seeking managerial jobs.  This new system will be available for employees to have direct access to apply and test for job openings across the country.  In addition to creating the vice president of people job, OSI spokesman Joe Kadow said they had enlarged its human resources staff and increased their role.

Cultures of discrimination can lead to very costly lawsuits as Outback Steakhouse learned the hard way.  There are many ways to help protect your company including have clear and effective policies and procedures in place for hiring, firing, promotions, and evaluations.  As the number one online provider of hr forms, documents, policies, laws, training, and education, HRSentry can help you.  Visit our homepage for more information on how you can reduce your risk today.

The Courts found that:

(1) although Kelly Services argued that the promotion decision was consensus-based, the other managers couldn’t recall reaching a consensus, and one stated that the manager ultimately made the decision;

(2) His actions prevented full consideration of the woman for the job by the other managers;

(3) He favored Fellowship members and the co-worker in particular (for example, paying the co-worker a higher salary for the same job she held and frequently hiring Fellowship members as temporary contractors and giving them management jobs).

The case went to a jury which awarded the employee $647,000 for economic and noneconomic losses, in addition to a whopping $5.9 million in punitive damages.

Workplace favoritism can be an expensive issue, Here are some tactics for avoiding similar problems as seen on BLR.com:

• Have clear policies to govern how promotion and hiring decisions are made.
• Make sure the promotion selection process includes oversight and review by upper management and/or human resources.
• Provide training for managers on the policies and procedures governing promotions.

Get all your policies and desktop training for employees at HRSentry.

With the workforce aging as baby-boomers near retirement, the issue of age discrimination is becoming increasingly prevalent. With this type of discrimination on the rise, employers need to address the situation before it becomes a problem. According to Aging Workforce News, “A Hewitt Associates survey of more than 140 mid-size and large employers has found that 55% have already evaluated the impact that potential retirements could have on their organization and 61% have developed or will develop special programs to retain targeted, near-retirement employees. Even though only 21% believe that phased retirement is critical to their company’s human resources strategy today, 61% believe so when looking ahead 5 years.”

To learn more about age discrimination, the impact on businesses, and what you can do about it visit the Department of Labor, AARP, or one of many events such as the Aging Workforce Summit.

* Promotes class action lawsuits against employers—The bill would require that employees “opt-out” of a gender discrimination class action, rather than the current law requirement that employees must give their written consent to join a class action. This will invariably increase the number of plaintiffs in class actions.

* Exposes employers to unlimited damages—The bill would lift the Equal Pay Act’s current limits on punitive and compensatory damages for which employers would be liable, in addition to current liability for back pay. Such damages would apply to even unintentional pay disparities. By exposing employers to potentially millions of dollars in damages, the bill would compel employers to settle wage discrimination claims, even in cases where no discrimination occurred.

* Restricts employer defenses—The bill would prohibit certain employer defenses for pay disparities. For example, the bill would eliminate an employer’s ability to justify paying different salaries to workers based in different locations with different costs of living.

* Encourages salary disclosures—The bill would effectively encourage employees to publicize their co-workers’ salaries by preventing employers from retaliating against employees who disclose or discuss the wages of other employees.

SHRM went on to urge the public(especially employers) to write their Representative calling for them to vote “No” on this bill. SHRM further explains their position by stating that “SHRM opposes all forms of unlawful
discrimination in the workplace, and believes any intentional misconduct against employees in any sector should be promptly addressed and resolved. Accordingly, SHRM believes the so-called Paycheck Fairness Act would be an unnecessary expansion of the Equal Pay Act. It would limit an employer’s ability to determine compensation for its workforce, and it could potentially punish well-intentioned employers”

For more information on this bill visit GovTrack or the SHRM website.

With the number of retaliation claims on the rise, now makind up 32% of all claims filed with the EEOC, companies need to understand how to defend themselves against such situations. The first step to take is making sure that all supervisors and managers are aware of the retaliation law and its consequences. Providing training in this area as well as discrimination(many retaliation claims originate with discrimination claims against that company) will help to reduce the risk, and show that you are actively working to stop this type of behavior. It also helps if HR has the confidence of the employees. As I have continually stressed throughout this blog, a good HR department will cause workers to talk to them instead of a lawyer. Workers who seek legal advice are much more likely to suit then if your HR department can remedy the situation in a fair yet cost effective way for all parties.

A list of strategies to prevent retaliation claims as seen on Findlaw.com

• Establish a policy against retaliation
• Communicate with the complaining employee
• Keep confidential any complaints that you receive
• Document, document, document…
• Know the law – Even if the original complaint of discrimination or harassment turns out to be unfounded, an employee who can prove that something negative happened because of the complaint can still win a retaliation claim.

The case discussed in the HRTechNews article describes a lawsuit brought by an employee who claimed she was let go for taking FMLA leave. One of the key pieces of evidence against the employer was a deleted email that explained why the woman was fired. When the employee was fired, her manager sent an email explaining the termination to her department. After she suited the manager was told to save all relevant documents for the coming court proceedings. This email was deleted(the employee got a copy anyway). Although the manager said it was deleted by mistake, the judge ordered the company to be sanctioned, meaning that at trial the jury will be told the company deleted the email on purpose, looking like they were attempting to hide evidence.

In this case the company acted properly in asking the manager to save the deleted email. However by not having a backup plan, and trusting the manager entirely, they took the control out of the companies hands resulting in a damaging sanction. One thing that can be done to prevent this is to make sure that IT is archiving all email messages company wide for present and past employees. Another good tip is to make sure that when an employee is fired or leaves the company, all paperwork and communications discussing that personnel change are copied and put in the employees file. This ensures that in case of a delayed lawsuit, all the information pertaining to that employee is readily available.