I recently opened up a new mobile phone account for my business. The wireless company gave me the ability to buy an insane number of phone lines (like 50) without a deposit, for very little per month.
I’m thinking about whether I should provide cell phones to my staff to sidestep a common issue: does the business owner have to pay for an employee’s cell phone when she uses it for business purposes.
You may be surprised to learn that the employer may be required to pay for it, even if the use of the personal cell phone for business is not expressly at the employer’s request.
As always, the law is most restrictive in California, where reimbursements for gas, mileage, phones and other expenses is required and hard for employers to control.
For me, if I decide to get cell phones for my employees, I am going to tell them it is a benefit. Employees like benefits and they don’t need to know that I am hedging against other legal risks at the same time.
Watch this video to learn a little more about cell phone reimbursement requirements for employers.
Say your employee is “out in the field” a lot and uses her cell phone.
Do you have to pay her cell phone bill?
If she is using her cell phone for business, then you likely have to pay a portion of it.
You can give her a business cell phone to use and make a policy that prohibits the use of personal cell phones for business.
Or you can determine a monthly reimbursement amount up front.
Coming up with a flat amount that approximates the split of business versus personal use of a cell phone is a good way to go.
However, incidental or minimal use of a personal cell phone for work does not have to be reimbursed by the employer.
I own a business, so I might as well have a target on my back that says, “SUE ME.”
It is seriously ridiculous. The lawyer part of me says, “why does anyone own a business?” The entrepreneur part of me says, “screw those guys, they aren’t taking me down!”
But I digress. I was sued. Why? Because I was driving a car when someone broadsided me in an intersection. As the insurance company dawdled on settlement, the woman who hit me learned that I owned a business (through the magic of Google, I presume). She thought she could threaten me and my business insurances and assets.
You see, if you or your employees are driving within the scope of business or employment, then the business can be liable if you cause an accident.
I wasn’t driving anywhere on business nor was I at fault, but those details didn’t seem to matter to her. Fortunately, I own a law firm, so her lawsuit did not last very long.
Still, it made me think about the employer liability rules for employees. Do you have a company car? Or do your employees sometimes go on errands, drive to see clients or take pit stops from lunch or work? Do they go to more than one office?
If so, you have some risk as a business and business owner if they get in an accident. (Uber’s strategy to avoid this is to classify everyone as independent contractors. It won’t work in the end and is not recommended. Uber has a lot of money to spare for legal fees so that they can delay and game the system; but most businesses don’t and this strategy will make things worse for them.)
Here’s a little video outlining some of the things you should consider when it comes to employees driving. Get insurance accordingly. And talk to your lawyer about ways to keep you lawsuit-free.
Say your employee got into a car accident driving home from work. Can you get sued or be held liable for the accident?
Like many questions in law, the answer depends on the facts.
The answer is “yes” if the employee was driving a company vehicle.
The answer is “no” if the employee was driving their own vehicle as part of their daily commute.
The answer is complicated when the employee sometimes uses his or her car for work during business hours.
Or if the employee is not commuting at the time of the accident.
For example, the employee is driving home from a different office or job site than usual.
Or from a side errand run for the employer.
In these scenarios, the employer may get sued, but may win at trial anyway.
Many good and generous employers want to share with their employees.
The idea behind giving employees stock is a sound one. Employees who are owners may be more invested in the business’s success. They may feel more appreciated. It could give them a sense of pride, ownership or purpose beyond anything that they would feel from a simple salary.
These are the main reasons I hear from employers who wish to create an employee stock plan.
For a myriad of business reasons, I prefer not to share stocks with employees. I prefer an employee profit-sharing plan that does not involve equity.
But I understand that many business owners may feel like a stock plan is right for their employees.
So you may be wondering, if I tell my employees that they are entitled to stock options in a letter, memo or at a meeting, is that legal? No. Watch to learn more.
I offered stock options to my employees in a memo. Is that OK?
That is not a good idea. Employee stock plans and stock option grants are complicated.
First of all, stock grants may create taxable events that impact you as the employer.
Second, stocks and options create duties by the majority stockholders to the minority stockholders under state laws that you may not anticipate.
Third, such a memo may create earned wages and must comply with wage laws.
Fourth, federal securities regulate promises and statements regarding stocks.
In short, employee stock plans create a variety of legal issues that you must understand before you start handing out shares and options.
There are better alternatives if you wish to give your employees a profit-incentive.
For example, you can have a 401(k) set up to include profit sharing or you can set up a bonus program.
Marijuana is well on its way to being legalized in the United States.
I’m going to make a prediction right now. In about a decade’s time, marijuana will be legal to use in the United States. I say that because we are nearing a tipping point in legalization.
By the end of the 2016 election cycle, more than half the states will likely have legalized marijuana in some way.
This presents a problem for employers who have a drug-free workplace. Some employers (i.e. defense contractors) are obligated by contract to have a drug-free workplace. And of course there are safety issues.
Still, I think the law on this is going to rapidly change over the next decade. What is an employers’ obligation to accommodate an employee using marijuana as medicine?
An employee of mine uses medical marijuana. Can I fire them for violating my drug-free workplace policy?
When marijuana was illegal, the answer was yes. But rapid changes in the legal status of marijuana as medicine makes the answer less clear.
Normally, you can fire an employee for being under the influence of drugs while at work.
But when the drugs are medications lawfully prescribed to them to treat a true medical condition, then such a firing may constitute disability discrimination.
For example, if someone uses insulin to control diabetes and this makes him or her act spacey, or be unsafe, you cannot fire them.
When marijuana is legally used to treat glaucoma, cancer or seizures, the employer may be required to accommodate the employee.
Employers also do not have the right to inquire about an employee’s health, medications or medical history, including at a hiring interview.
And in most cases, employers may not drug test current employees.
If you must keep a drug-free workplace by contract, you need legal advice to deal with such tricky situations.
When I first started practicing law, I was asked by a fitness-conscious employer whether he could require his employees to quit smoking.
After some research into the Americans with Disabilities Act, I concluded, “no.” Basically, I concluded that smoking interferes with a major life activity — namely, breathing.
The senior lawyers whom I worked with disagreed.
They had some good points at least politically. Being a smoker is not a sympathetic status in California.
But a decade has passed and the ADA has broadened. And I’ve become more experienced as an employment lawyer, so I have thoughts on other laws that inform this situation.
So this video has my thoughts on whether you can make your employees be non-smoking.
Sometimes employers ask, “Can I require my employees to be nonsmokers?”
Some employment lawyers will say it’s acceptable because it’s not illegal to discriminate against smokers.
But you could be risking a disability discrimination claim because smoking is a physical addiction that may impair a major life activity, such as in situations when the person develops lung or throat disease.
In addition, employers do not have the right to inquire about an employee’s health and medical history, including at a hiring interview.
In requiring your employees to be nonsmokers, you may run the risk of violating these laws.
Employers do have the right to designate the workplace as smoke free.
However, employers do not have the right to dictate how employees spend their breaks, such as unpaid lunch breaks, when employees are free to leave the premises.
If you are worried about your employees’ health, try offering access to a smoking cessation program.
If you offer employee health insurance, many such programs are offered as part of the insurance plans and can be promoted by human resources.
All employers recognize the importance of taking steps to avoid inviting a wrongful terminationlawsuit. However, layoffs and firing are not the only aspects of employment law with which business owners must concern themselves. It is just as crucial to comply with state and federal hiring laws, violations of which can result in civil penalties, litigation, and disruptions to productivity.
If your business is preparing to hire new employees, or if you simply wish to review your current hiring policies to ensure compliance with state and federal law, the experienced employment attorneys of Bellatrix PC can assist. We dedicate our practice to providing cost-efficient hiring solutions to corporations, limited liability companies, and partnerships at all stages of the business life cycle.
To arrange for private consultation, call Bellatrix PC today at (800) 449-8992.
How to Avoid Discriminatory Hiring Practices
California is an at-will employment state, which means – at least in theory – that employers are legally permitted to hire or terminate employees at any time, for any reason. In practice, employers must avoid terminating (or selectively failing to hire) employees on a basis which constitutes discrimination.
In other words, employers may not exclude from consideration job applicants based purely on their sex, sexual orientation, race, nationality, religion, age, or pregnancy. If an employer discounts an otherwise qualified applicant based purely on his or her membership in a class which is protected by state or federal law, the employer may become vulnerable to a lawsuit based on sex discrimination, race discrimination, religious discrimination, or other forms of workplace discrimination.
Fortunately, by taking a few simple steps, employers can dramatically reduce the likelihood of accidentally engaging in hiring discrimination. Regardless of the company’s size, nature, or legal structure, all employers should be sure to take the following precautions:
Make sure the job posting is as clear and detailed as possible. List the skills, tasks, duties, experience levels, and education levels which will be expected of qualified hires.
Consider speaking to other business owners in your industry about their standards and expectations for prospective employees. This will help you gauge the sorts of criteria and salary requirements which are reasonable for the position you are trying to fill.
When writing your job posting, exclude any explicit physical requirements which would automatically discount a group of people. For example, while it is fine to note that applicants “must be able to lift at least 30 pounds” for a warehouse position, it is not acceptable to include statements like “seeking men only” or “applicants must be at least six feet tall.”
Take detailed notes during and immediately after the applicant’s interview. This will facilitate an objective comparison of applicants after all interviews are complete.
Do not make any statements referring to protected classes. For example, do not bring up your company’s leave policy for pregnant employees. If an applicant asks any questions related to a protected class, inform them it will not be a factor during the consideration of new hires.
Background Checks and Employee Screening Laws
The vast majority of employers screen prospective hires with some form of background check. While background checks are increasingly common, employers are still required to comply with certain laws when screening job applicants.
In October of 2013, SB 530 amended California’s labor laws to expand the legal protections afforded job applicants with criminal records. SB 530, which took effect on January 1, 2014, prohibits both private and public employers from requiring job applicants to disclose arrests which did not lead to a criminal conviction. Employers are also prohibited from:
“Utilizing [information concerning an arrest or detention that did not result in a conviction] as a factor in determining any condition of employment.”
Asking job applicants to disclose information pertaining to records which have been sealed, dismissed, or expunged.
This further extends to questions about an applicant’s participation in any pre-trial or post-trial diversion programs, such as the “Back on Track” drug diversion program.
Updates to California’s Minimum Wage Requirements
In the past, California’s minimum wage was set at $8.00 per hour. However, California recently increased its minimum wage. Effective July 1, 2014, California minimum wage is $9.00, $1.75 higher than the federal minimum wage of $7.25, which is established by the Fair Labor Standards Act or FLSA. Employers should also be advised that California has already scheduled another minimum wage increase for January 1, 2016, at which point the current $9.00 rate will increase to $10.00.
Exempt employees are typically paid on salary instead of receiving an hourly wage. However, exempt employees – and in turn, their employers – are still affected by current and scheduled minimum wage increases. Because exempt employees must be paid monthly compensation equivalent to at least twice the minimum wage, minimum wage increases also lead to increased monthly salary requirements for exempt employees.
Don’t expand your workforce until you consult with an experienced attorney. Call the law offices of Bellatrix PC at (800) 449-8992 today to schedule a private consultation. Ask about our Employer Protection.
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Alicia I. Dearn is the founder of Bellatrix PC, a woman-owned law firm with offices in Missouri and California. Bellatrix PC handles lawsuits and business transactions. We advise in business, employment, real estate, intellectual property, civil litigation, and election law.
The articles published by Bellatrix PC are for informational purposes only and do not constitute legal advice. If you have a legal issue, please get competent advice from a licensed attorney in your jurisdiction. Use of Bellatrix PC's site is subject to our Attorney Advertising Disclaimers.