Stefanie Riehl, assistant VP of employment and labor policy at the New Jersey Business and Industry Association, has seen businesses make the same mistakes through the years when it comes to hiring, firing, leaves of absences, employee classification, and any number of other human resources related opportunities for missteps. After having seen so many enterprises blow up, she wants to let other business owners know where the landmines are buried.
For example, calling someone a “manager” when they are really just mopping a floor could lead to a costly lawsuit at some point down the road, though you wouldn’t necessarily know that unless you were familiar with government overtime regulations. “You don’t think you need HR until you do,” she says. “It’s really important to understand the basics of HR law.”
The New Jersey Business and Industry Association will hold an employment law seminar Wednesday, September 18, from 8:30 a.m. to 1 p.m. at the Pines Manor in Edison. Visit njbia.org or call 609-393-7707, ext. 9481. Cost: $129 for NJBIA members and $169 for nonmembers. The seminar will feature four lawyers specializing in HR: John C. Romero of Gibbons, John P. Quirke of Archer & Greiner, Michael A. Shadiack of Connell Foley, and Mark Tabakman of Fox Rothschild.
“Whether they are seasoned HR professionals, business owners or consultants, it’s really critical that they have these skills and understand the law and their obligations,” Riehl says. “What are the legal ways to hire and fire someone? If you don’t do it the proper way, you really set yourself up for a lot of problems.”
Riehl says there are a few areas where people run into trouble over and over again. “One of the biggest areas that people have questions in and one for which there are significant financial penalties if you get it wrong is worker classification,” she says. Certain classes of employee, such as managers, are exempt from overtime. Other hourly employees must be paid time-and-a-half if they work more than 40 hours a week or eight hours a day. Some businesses classify regular workers as “managers” in a deliberate attempt to circumvent overtime requirements, and other times they just don’t know the rules. Either way, they expose themselves to legal repercussions and enforcement action by regulators — as Dunkin’ Donuts found out when it had to pay $197,787 in back wages after a U.S. Department of Labor investigation (U.S. 1, August 28).
Riehl wants to make sure businesses know exactly how to classify employees correctly, so they can stay on the right side of the law. “We want to make sure there is a clear understanding of the law,” she says. “We never try to defend bad actors. We try to give people the skills, materials, and resources they need to be good actors. There is a whole list of standards that has to be met under federal and state law to make someone exempt from overtime, and those standards are often misunderstood.”
Another way employers can mess up classification is to improperly classify people whom they consider freelancers or independent contractors, when according to government regulations they would be employees.
“The best thing that an employer can do is to belong to a trade association and keep reading updates in a timely fashion. They should commit to professional education like attending seminars,” she says.
One entire segment of the seminar is devoted to classification. Another, appropriately titled “Tackling the Tough Stuff,” deals with leaves of absences, reasonable accommodations for disabilities, drug testing, and office romances. These topics are too tricky for one-size-fits-all tips. Instead, business owners must make informed decisions based on the individual situation and the law. Office romances, for example, depend on the employee handbook and whether the lovebirds work in the same department or if one romantic partner has authority over the other. “Those questions come up a lot around Valentine’s Day,” Riehl says.
Riehl, who is moderating the seminar, has an extensive background in HR and employment law. She grew up in Hamilton Township. Her father was a Trenton firefighter and her mother worked in HR for the state government. Riehl is a graduate of the College of New Jersey and Syracuse, where she got a master’s degree in public administration.
Riehl found herself drawn to the field of human resources from early in her career, she says. “I had an interest in politics and communications, and I was able to dabble in a few labor issues throughout my career,” she says. “I had an interest in it, and this job opened up.” Her first job out of college was for the New Jersey Builders’ Association, where she was a government policy specialist. Today, in addition to working for the NJBIA, Riehl volunteers her time to the Princeton Human Resource Management Association, where she is management chair for the board of directors.
Though many businesses have an HR expert on staff to worry about the kinds of problems Riehl deals with on a day-to-day basis, that is not the case with small businesses. “Small employers may have 10, 15, or 20 people,” she says. “In a lot of cases, the companies don’t have someone designated for HR, and the owner of the company has to secure new contracts and be the HR person.”
Learning the fine points of HR law can be a process of trial and error for many business owners. “You’re not necessarily going to be an expert on employee leave until you have an employee come to you and say they’re pregnant, or if they unfortunately have to take disability leave for whatever reason.”
Another fraught scenario is firing an employee. There is a right way to do it, and thousands of wrong ways. The right way involves tons of paperwork. “One of the biggest things we tell people with any kind of employee issue is, ‘document, document, document.’ Document good and bad performance, and give objective performance reviews. You should really be taking the time to document any kind of discipline, even if it’s just verbal discipline, such as ‘you’ve been late three days this week.’ All of that should be documented.”
Another complicated area of employment law is leaves of absence. There are eight federal and state laws under which employees can take leaves of absence for disability, pregnancy, and other reasons, and employers need to be familiar with all of them. The NJBIA is planning a seminar in November just to deal with leaves of absence.
So, should employers give a worker a leave of absence to go to this seminar?
“We would certainly support an employer allowing an employee to do that,” Reihl says.