Risk Management
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Creditor Self-Defense Or How to Avoid Being Mugged Financially
When you take a basic self-defense class, the instructor will almost always engage in some anti-socialization training. In other words, they will try to undo the years of training from your parents to be polite and respectful. The instructor will try to bring out your ancient instinctual wariness. The instructor will tell you not to give the potential attacker the benefit of the doubt, but to take action to let the potential attacker know you see them and are prepared to take action before they are in range to do harm.
Your business needs to engage in financial self-defense with your account receivables. Yes, they are “good clients” but only if they pay their bills. So don’t give them the benefit of the doubt. Take action before they get in range to do you harm. The initial action does not have to be rude or disrespectful. You don’t have to call them dead beats yet, you do have to say the financial self-defense equivalent of : “Hey, I am aware that your bill’s late and I am watching you closely.”
Nonpayment or late payment has a huge ripple effect. If your debtor doesn’t pay you, then you can’t meet your obligations, and then your creditors can’t pay their bills. No one is happy.
Research has shown that telephone calls are more effective than letters. So pull out that pile of past due notices and make a few calls. Be sure to follow up if payment is not forthcoming. As always, comply with the Fair Debt Collection Practices Act. Information is available through
wwww.faircreditreporting.com/FCRA.htm and others, or contact us for advice or additional information.
Family and Medical Leave Act Qualifications
The protections afforded to workers overlap and intertwine. How does an employer know when an employee is qualified to take a Family And Medical Leave Act (“FMLA”) leave? The best advice is to analyze each situation step-by-step, using a checklist or question list developed for that purpose. Let’s take an example:
A construction worker, Chuck , who has worked for you for many seasons, had a work accident. He has been off work for two months and you’re not sure he will be released to full duty, including climbing.
Question: Is Chuck qualified to take FMLA leave? Should you insist he take FMLA leave concurrently with his workers compensation disability leave? To what sort of job will Chuck return when he is released?
Answer: If Chuck’s employer has more than 50 employees in a 50-mile radius at any time in the year preceding his leave request, the employer is obligated under the provisions of the FMLA. If Chuck has worked for more than 12 months for his employer and meets the hours worked requirements, he is qualified for leave under the FMLA. His work injury is a qualifying condition under the Act. His company’s policy should require him to exhaust his FMLA leave time concurrently with his workers’ compensation injury. If he is released without restrictions, he is entitled to be returned to his former position.
As an employer, are you obligated to comply with the FMLA?
Yes, if you have 50 are more employees within a 50-mile radius of the location where the employee requesting leave works.
You may need to count temporary workers.
Are all of my employees eligible to take FMLA leave?
Yes, if they have worked for you for 12 months or more and have worked at least 1250 hours per (an average of 25 hours per week) in the 12 months prior to the leave request.
Is FMLA leave paid leave?
No, but an employer may require an employee to take their paid leave concurrently with the FMLA leave. In other words, to exhaust paid time off at the same time as using the unpaid FMLA leave.
How much leave is allowed?
12 weeks per year
If an employee takes 12 weeks of leave when is that employee entitled to more FMLA time?
That depends on what your FMLA policy says about the method of counting the years. If your policy is silent, then the employee gets to choose the method of counting and may be entitled to another 12 weeks immediately.
Does that 12 weeks have to be taking in one month?
Does the employee have to specifically request “time off under the FMLA?”
No. If the employee is on a reduced schedule, for example he works six hours a day out of an eight-hour a day, the time is not worked. Two hours a day counts against the 12 weeks total leave.
No. The employee does not have to mention “FMLA.” Any request for leave should be evaluated to see if it is an FMLA qualifying situation (the employees own or an immediate family member’s serious health condition). If it is, leave should be offered by the employer to the employee.
If the employee tells his supervisor something about a medical condition that may qualify, how does the supervisor respond?
Make an immediate referral to your human resources department. FMLA requests involve medical information that must be kept private and confidential. For example, in Gay v. Gilman paper Co., the employee was admitted to a psychiatric hospital. Her husband called to say she would not be in. He was afraid to say what was wrong so he said his wife was admitted “for tests.” He would not give the supervisor anymore information. The court said that “for tests,” without more information was not enough to shift the burden to the employer to determine if FMLA leave was appropriate.
Do I have to notify the employee that the leave will be counted as FMLA. leave?
Absolutely. Notify the employee, in writing, before you start counting the weeks. Failure to do so is one of the easiest ways to extend the leave beyond the 12 weeks.
Contact us for advice or additional information.
Ten Human Capital Resolutions from Watson Wyatt – a global consulting firm:
Clearly explain the reasons behind major business decisions
Promote only the most qualified employees, not those with the highest age and tenure, and terminate employees who perform unacceptably
Act on or at least respond to employees suggestions and opinions
Encourage employee involvement
Establish self-directed work teams
Help employees handle job related stress
Prepare employees to deal with corporate change
Link reward programs to business objectives
Offer flexible work arrangements and mean it
Clearly communicate the value and reward of benefit packages.
These resolutions will contribute to higher levels of trust and senior leadership employee commitment, which in turn yields superior financial performance. For more information on the Watson Wyatt research visit their web site: www.WatsonWyatt.com
What’s Your Supervisor Needs To Know
Work Injuries And Return To Work Efforts
Assume that you are an employer or insurer of a metal parts machining plant. You have a number of assembly lines and perform contract work for a variety of customers. Some of your machine parts are relatively heavy – 50 to 60 pounds. Other lines turn out parts ranging from several ounces to several pounds.
One of your workers has a compensable back injury. After several weeks, Chris is released with restrictions that preclude her from returning to her normal job on the heavy manufacturing line. You have a number of current assembly vacancies on one of your lighter manufacturing lines. Unfortunately, the work being performed on that line will finish in several months. Chris is assigned to that line and accepts this assignment. Chris continues employment without interruption until the production contract is nearly completed. With approximately one week remaining, she and two other workers are laid off. At the time of lay off she’s told by the supervisor that, “You’re the first to go. Your production work performance hasn’t been working out since your injury.” After layoffs she reports immediately to human resources and demands workers’ compensation benefits
Job reassignment or alternative placement pose increasingly complex decisions for management. What information and how much information regarding personal injuries does a front-line foreman or supervisor need? How should such information be used?
First, return to work obligations exist under the Minnesota Workers’Compensation Act. Temporary partial disability contemplates that the employee will work at a partially disabled condition post-injury. In 1995, statutory amendments increased employer’s obligations to retain injured workers as current employees. Employers who refuse to offer continued alternative employment to injured workers, when work within the employee’s limitations is available, could be penalized. Such a refusal imparts civil liability for up to one year’s wages or $15,000. Second, “job reassignment” may be a reasonable accommodation for workers with any disability covered under the ADA.
In our hypothetical, your supervisor’s disability based comments probably secured Chris’s workers’ compensation claim and seriously undermined any defenses based on economic downturn.
Could this have been avoided? We say yes:
Have Human Resources/Workers’ Compensation Administrators verify precise medical restrictions post-injury
The same managers should identify reasonable reassignment option
- Provide the treating physician with a current accurate job description of essential job functions
- If approved by the doctor, Human Resources/Workers’ Compensation Administrators, not the supervisor, should make the job reassignment
- The employee’s supervisor should be provided only as much medical or disability information as is necessary to ensure that the job duties remain within the employees limitations
- Those supervisors should be told that the employee has been medically cleared for the reassigned work, is capable of performing that work, and should be held to the same work or production standards as any other employee in that area
- Performance or quota problems should be immediately reported to Human Resources/Workers’ Compensation Administrators
- Discipline should be imposed in an evenhanded manner by, or with the acknowledgment of Human Resources/Workers’ Compensation Administrators
- Avoid any comments about disability, medical conditions, or physical limitations
- At contract completion or another economic event forcing a reduction or elimination of work, there should be no reference to disability, treatment, or medical condition as a factor considered as a basis for layoff
- These steps may not entirely eliminate your liability, but will be of great benefit in minimizing future claims. Contact us for advice or additional information.
Written employee performance evaluations present problems for employers and their attorneys when management takes an action that is adverse to an employee’s employment rights. Many employers conduct employee evaluations for the purpose of determining bonuses, promotions, and salary increases. If written evaluations are used, they must be candid, specific, objective, and not unlawfully discriminatory. Here are some hints:
When you complete the written evaluation, consider whether there are any issues that may warrant discipline or demotion in the near future.
Do not indicate “needs no improvement” or work is “unacceptable” when there has been discipline or performance concerns in the past year. Any problems whatsoever should be restated or noted and then the appropriate category should be checked such as “needs improvement” or “employee is being monitored in counseled on…”
When the written evaluation is reviewed with the employee, once again, be specific, candid, and objective. For example, if there are tardiness or absenteeism concerns, discuss those with the employee. The written evaluation should reflect that discussion and what actions will be taken by management and the employee to address attendance in the upcoming year.
Always ask the employee to sign the written evaluation. Write any comments he or she wishes. This will prevent that employee from later claiming that he or she was not aware of these performance issues and/or had not been given an opportunity to address those issues.
If your Human Resource Department does reviews, have the employee’s supervisor complete a written evaluation independent of the evaluation being performed by the Human Resource Department. Both evaluations should be discussed with the employee. The employee should sign both.
In wrongful termination, harassment, and discrimination cases, this office routinely finds written evaluations in the personnel file that indicated that the affected individual was an excellent employee or an employee who needed no improvement in any aspects of his or her job performance. When management takes an adverse action against the employee, and tries to argue that the employee’s lack of work performance was the reason, the employee uses their written work evaluation to refute the employer’s arguments. The employer then has to explain why his or her own documents failed to support the action taken.
Contact us for advice or additional information.