I-9 Revamp Delayed

The Department of Homeland Security's United States Citizenship and Immigration Services has delayed the effective date of its I-9 form revisions until April 3, 2009. Read the full text of the announcement.

The revisions, announced in December 2008, will end authorization to accept expired documents, remove documents that are no longer issued from the list of acceptable documents, and make other technical changes. The original federal register announcement is available here.

For now, you should continue to use the existing I-9 Form, which is available here. After April 3, 2009, you should use the new form.

On The Clock Or On Your Own

A recent decision in a class action by limousine drivers against their employer reminds us that sometimes employers may have to pay their employees for doing nothing. The Second District Court of Appeal in Los Angeles directed the trial court to consider whether the class of drivers should have been paid for gap time, which is what the drivers called their on-call time between assignments. Ghazaryan v. Diva Limousine, Ltd., Case No. B201509 (Dec. 22, 2008).

Although the appellate court did not rule on the merits of the drivers' claims, the facts referred to in the complaint afford an opportunity for exploring the wage and hour aspects of on-call time. In Ghazaryan, the company prohibited the drivers from using their vehicles for personal use, required them to stay near the vehicle and to remain in uniform between assignments. Some drivers were, nonetheless, were able to use gap time for their own purposes. Some drivers were paid on an hourly basis for all their time, including any gap time. Others were paid by the trip. The company's exposure will in large part depend on its obligation to pay for gap time.

An employer must pay for all "hours worked," which Section 3(H) of the California wage orders defines as "the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so." (Wage Order No. 9 applied to the limousine drivers.) Whether or not an employer must pay for time that an employee spends waiting to be called to work depends upon the degree of control that the employer exercises over the employee's activities during the on call time.

Two advisory letters from the Division of Labor Standards Enforcement may help employers understand the principles. In a March 31, 1993 letter, a writer described the following practice: "Assume a regularly-scheduled non-exempt employee who works at a hospital located in a rural area and is not required to remain at or about the hospital or any premises designated by the employer; during his off-duty hours, but is required to be 'on-call' for designated periods of time and arrive at the hospital within 20 minutes from the time he is called by pager or telephone." The Division declined to say whether such circumstances would never require compensation, because the answer to the question is heavily dependent upon all the facts of each case. It pointed out that geographical restrictions and strict time frames for response will often lead to a determination that the time is compensable.

In a December 28, 1998 letter, the Division was asked about the hours worked of apartment managers who lived in the complexes where they worked. Again, the Division was unable to give a definitive answer as to which hours should be paid for, because the requester of the opinion did not provide enough specifics. However, the opinion letter identifies a number of factors that are important to the determination: geographic restrictions, how quickly an employee must respond to a page on a beeper, how frequently the employee is called to work, whether the employee is free to engage in personal activities, and the consequences of failing to respond within the required time.

Layoffs Mean Lawsuits

An article in The New York Times on Saturday, January 31, reports on a trend that should come as no surprise -- Layoffs Herald a Heyday for Employee Lawsuits. While the article is concerned chiefly with WARN notification requirements, other statutes pose much greater liability risks for employers who have to let employees go because of difficult economic circumstances. We'll discuss WARN briefly, and then turn to the other statutes.

WARN

WARN is the Worker Adjustment and Retraining Notification Act, a federal statute that requires most employers with 100 or more employees to provide notification 60 calendar days in advance of plant closings and mass layoffs. Failure to comply with WARN makes the employer liable for the pay and benefits during the period of the violation up to 60 days. The court in an enforcement action may also award a prevailing plaintiff his or her attorney's fees. The United States Department of Labor has detailed information about WARN at this web page. California has its own WARN statute that applies to employers with 75 or more employees and defines the circumstances requiring notice somewhat differently. The California Employment Development Department compares the two statutes on this web page.

Wage and Hour Liability

A discharged employee can make easy extra money if his or her employer is not in compliance with the federal and state wage and hour laws. Misclassification of employees, failure to follow the overtime rules, not providing meal and rest periods, and other violations can easily lead to awards in the several thousands of dollars from the California Labor Commissioner. Read our 10 Tips for Avoiding Wage and Hour Violations to make sure that you are in compliance before you discharge any employees.

Discrimination Liability

That anti-discrimination statutes prohibit discrimination based on race, religion, color, national origin , ancestry, physical disability, mental disability, medical condition, marital status, sex, sexual identity, age, and sexual orientation. That means that every discharged employee has at least four characteristics that could form the basis for a discrimination claim.

Further, the prima facie case approach that applies to discrimination lawsuits makes it relatively easy for the plaintiff in a lawsuit to burden on the employer to justify the discharge. All the employee need show is showing (i) that she has a protected characteristic, (ii) that she was performing her job competently; (iii) that, despite her job performance she was discharged; and (iv) that the position remained open to qualified applicants after her discharge. If the employee makes that showing, the employer must prove that it had a legitimate reason for the discharge.

Retaliation Liability

Discharged employees may also file retaliation claims. We have explored the risks of such claims in two previous posts -- August 17, 2008 and November 16, 2008.

To establish a prima facie case of retaliation, the employee need only establish that he or she engaged in protected activity and was discharged, and that there was a causal link between the two. To establish the link, it is enough to show that the adverse action followed closely on the heels of the protected activity. Such a showing then places the burden on the employer to establish that it had a legitimate reason for the adverse employment action.

What Employers Should Do

The key to limiting the risk of liability is to put yourself in a position to be able to prove the legitimate reason for the discharge or layoff. That means if layoffs are necessary for financial reasons, you must be ready to show the financial difficulties and the reasons why those laid off were chosen.

If performance is the reason, follow this advice:

1. Make sure that each employee's personnel file includes a job description acknowledged by the employee. This will avoid disagreement over job duties if an issue arises about an employee's ability to continue working.
2. Develop a set of written performance expectations for each employee. This will avoid an employee's argument after being subjected to adverse employment action that he or she never understood what was expected.
3. Insist on honest annual performance evaluations. This will avoid an employee's argument that nobody ever told him or her that there were performance issues.
4. Document every communication with an employee about performance or misconduct, no matter how minor. This will avoid a possible argument that it never happened.