The end of the year is busy with wrapping up projects, planning parties, attending holiday functions, shopping, and not enough time to do it all. Here are three things that should be on the radar for South Carolina employers to help start the New Year off right.
Salary Threshold for FLSA Exemptions is Increasing
The minimum guaranteed salary for employees who are exempt from overtime and the minimum wage is going up starting January 1, 2020. Salaried employees who are exempt under the Fair Labor Standards Act’s executive, administrative, or professional exemptions must be paid a minimum weekly salary to qualify for the exemption. Since 2004, the minimum salary has been $455 per week. Starting January 1, the minimum salary is increasing to $684 per week or $35,568 per year. In addition, the salary threshold for applying the simplified highly compensated employee rule is increasing from $100,000 per year to $107,432. (For more information about the changes, please click here to see our previous post.)
If you have not already, your organization should start planning to comply with the new salary thresholds for the New Year. This may involve increasing salary levels to the new minimum or moving employees from exempt to non-exempt status and ensuring that they accurately record and report all time worked. In addition, while reviewing salaries for compliance, employers should also take the opportunity to review their exempt employees’ duties to ensure that they meet one of the duties tests applicable to the executive, administrative, or professional exemptions.
Policy and Handbook Updates
Regular policy reviews and updates are important because they help ensure that policies keep up with changes in the law and changes in your business. From changing marijuana, hemp, and CBD laws to the new wage and hour regulations to state pregnancy accommodation requirements to ever-shifting rulings of the National Labor Relations Board, the legal and regulatory landscape never stands still. Beyond employment and labor laws, many industries must also adapt to changes in regulations that govern their core businesses. If those weren’t enough, businesses also face changing consumer preferences, the need to compete for talent in a tight labor market, the reach of social media and the internet, and the uncertainty of market forces. Taking the time to review your organization’s policies can help you get in front of changes to avoid costly compliance mistakes or just getting left behind.
Review Your Risk
Does your organization know its greatest risk exposures? Could a government investigation or a lawsuit sap resources your business needs to fund its operations and growth? Regular review of your organization’s human resources processes and procedures is an important way to help reduce the risk of errors and find opportunities for improvement and efficiency. Management and supervisory training help ensure that policies are put into action the way your organization intended.
The best-run businesses make mistakes and claims can arise even when a plan is perfectly executed. Many employers insure against the risk of employment-related claims with the purchase of employment practices liability (or “EPL”) policies. EPL coverage can also be added to many errors and omissions or other general liability policies. If part of your risk management plan includes EPL coverage, do you know what is covered and what is excluded? Many EPL policies exclude certain types of claims and key types of damages. For example, most policies do not cover claims made under state and federal wage and hour laws. Some exclude coverage for violations of leave laws, or for allegedly intentional conduct. Even where a claim is covered, many policies exclude back wages, one of the most common types of recovery in employment cases, leaving employers self-insured for part of the claim. When you are reviewing your coverage or considering new coverage, ask your broker which types of claims and damages are excluded.
When you are considering a health plan, one of the first questions you ask is whether your doctors are in your plan’s network. If your organization works regularly with legal counsel for employment and labor law matters, do you know if your organization will be able to use your lawyer if a claim arises? You may be surprised to find that, unlike health plans, most liability carriers assign their claims to a very small group of lawyers or law firms in your region. Like most health plans, however, if you wait until a claim arises to ask to use your organization’s lawyer, the carrier most likely will deny your request. Just like your own doctor often knows you best and is in the best position to provide you care, your organization’s lawyer often knows your organization best and is in the best position advocate for you in the event of litigation or an administrative charge. Ask your broker if your policy, or a policy you are considering, allows you to choose your own defense counsel. If not, ask your broker about finding a policy that will, or working with the carrier to add a rider that allows you to use your organization’s lawyers or law firm.
We’re Here to Help
Our goal at Gignilliat, Savitz & Bettis is to help your organization succeed. From large employers with thousands of employees in highly regulated environments to small businesses with a handful of employees, we can provide employers counseling to help you comply with the law and develop solutions that meet your organization’s needs. If we can help you, please contact us