Question: What steps can businesses take to protect their confidential information?

Answer:

Most businesses have information (their “secret sauce,” so to speak) which is critical to their business and provides them a competitive edge in the marketplace. It is essential for businesses to take steps to protect that  confidential information.

Here are 10 suggestions to protect your Company’s confidential information:

1) Limit access to confidential information to those who have a need to know it to perform their jobs;

2) Keep hard copies of confidential information under lock and key and password protect electronic documents and e-folders that contain your confidential information;

3) Require all employees to lock their computers whenever leaving their desks and to change their login passwords periodically;

4) Use “Confidential” headers on documents that contain confidential information (such as monthly sales or commission reports, customer lists, prospect lists, etc.);

5) Require all employees to sign a non-disclosure agreement (NDA) as a condition of employment or continued employment;

6) Include a strong confidentiality policy in your employee handbook that complements the confidentiality provisions in the non-disclosure agreement, and obtain signed acknowledgment forms from all employees for your handbook;

7) Cross-reference the confidentiality policy in your disciplinary policy and/or standards of conduct and clearly state that misuse or improper disclosure of confidential information could result in disciplinary action, up to and including termination;

8) Conduct employee training to ensure employees know their roles and responsibilities with respect to the Company’s confidential information;

9) Require that any disclosure of the Company’s confidential information to third parties (such as vendors) be governed by a non-disclosure agreement. Just like an employee NDA, you should not grant access to your confidential information until after the third-party signs an NDA; and

10) Create a standardized exit process for employees that includes (a) requiring them to return all Company property, including confidential information (in any format or medium); (b) disabling all computer access email accounts, and remote cloud access to business records; and (c) allowing IT to wipe Company data from the departing employee’s personal electronic devices.

Most of these measures are fairly easy to execute. Do not wait to focus on these issues until a key employee leaves and misappropriates your Company’s confidential information. Implement these measures now and know that when an employee with in-depth knowledge of your Company’s confidential information leaves, your information is protected and you will be well-positioned to send a strong letter reminding the departing employee of their ongoing obligations.

 

Question: What are common mistakes employers make with their Employment Applications?

Answer:

Some companies fail to realize the value of a good Employment Application. The Employment Application (and a company’s other onboarding documents) serve as part of a mutual introduction of an applicant to the company and the company to the applicant. You want to put your company in the best possible light by asking professional questions that are current, legal, and well-organized. Likewise, you want to ask questions that will ensure you get the best information possible to help you recruit and hire the best possible candidates for your workforce.

Here are 10 common mistakes on Employment Applications:

1. Asking for protected information, such as date of birth, marital status, dependent information, social security number, national origin, race, gender, religion or sexual orientation;
2. Asking for years of graduation (which will give a good idea of the applicant’s age);
3. Including a question about the applicant’s criminal background that is not compliant with applicable law (the “ban the box” laws are ever expanding);
4. Not getting the information you need to assess an applicant. For example, if the job requires travel or regular overtime work, ensure you are determining the applicant’s willingness and/or ability to do so;
5. Not requiring the applicant to fill out all of the information on the Employment Application, but instead allowing them to submit a resume (there are often inconsistencies, which can turn out to be telling);
6. Not including a statement before the applicant’s signature at the end of the application that attests to the truth of the information provided and the fact that the applicant did not withhold any information that would, if disclosed, effect the application unfavorably;
7. Not including an EEO statement (or using one that is out of date);
8. Not asking the “reason for leaving” each employer in the employment history section;
9. Not including language to help prevent or defend against a wrongful discharge claim (that is, informing the applicant that if any information on the application is found, after hire, to be false or misleading, it will be grounds for termination); and
10. Including questions that were once common and acceptable, but are no longer proper. For example, before the passage of the American’s with Disabilities Act (ADA), it was common to ask whether an applicant (a) had ever received workers’ compensation or disability income payments, and (b) had any “physical defects” (yes, really) which would prevent him from performing some jobs. Asking an applicant questions phrased in this manner today can get you into legal hot water.

As a general rule, if you seek information from an applicant, it will be assumed that you used the information in making the hiring decision. So don’t collect any information that you are not, or should not, be considering. Asking the wrong question, even if it is asked in good faith, can expose you to legal liability. An applicant who sues for failure to hire based on illegal questions may seek compensatory and punitive damages, attorneys’ fees and equitable relief (such as, the job that was denied).

Now, before you go about your day, ask yourself: when is the last time you reviewed your Employment Application? If you hesitated in answering that question, or said more than a year or two, it’s probably a good idea to dust it off and have it reviewed and updated.

Question: When is it acceptable to take deductions from an exempt employee’s pay?

Answer:

An employee is considered to be paid on a “salary basis” under the Fair Labor Standards Act (FLSA), if the employee receives a preset amount of pay each work week and that amount is not subject to reductions based on changes in the quality or quantity of the work performed. Except in limited circumstances, an exempt employee must receive his full salary for any work week in which he performs any work, regardless of the number of hours or days worked. On the other hand, an exempt employee does not need to be paid for any workweek in which he performs no work. An employee is not paid on a salary basis if deductions from the employee’s preset compensation are made for absences caused by the employer or the operating needs of the business. If an exempt employee is ready, willing and able to work, deductions may not be made from his preset salary when work is unavailable.

Here are the limited circumstances when deductions from an exempt employee’s pay may be made, despite the salary basis requirement:

(1) When an exempt employee is absent from work for one or more full days for personal reasons, other than sickness or disability;

(2) For absences of one or more full days caused by sickness or disability (including work-related accidents) if the deduction is made consistent with a bona fide plan, policy or practice of providing payment for loss of salary caused by such sickness or disability. In addition: (a) you need not pay any portion of the employee’s salary for full-day absences for which the employee receives compensation under the plan, policy or practice, and (b) deductions for full-day absences may be made before the employee qualifies for benefits under the plan, policy or practice, and after the employee exhausts the leave allowable under such plan, policy or practice;

(3) For penalties imposed in good faith for infractions of safety rules of major significance, which include those relating to the prevention of serious danger in the workplace, such as rules prohibiting smoking in explosive plants, oil refineries and coal mines; or

(4) For unpaid disciplinary suspensions of one or more full days imposed in good faith for violations of workplace conduct rules. Such full-day suspensions must be imposed pursuant to a written policy that applies to all employees. (A good reason to have an employee handbook or other written policy with standards of conduct and disciplinary rules.)

In addition to these exceptions, employers are not required to pay an exempt employee his full salary: (1) in the employee’s first or last week of employment; or (2) in weeks when an exempt employee takes unpaid leave under the Family and Medical Leave Act (FMLA).

Finally, while employers cannot make deductions from an exempt employee’s pay for absences caused by jury duty, attendance as a witness or temporary military leave, employers may offset any amounts received by an employee as jury fees, witness fees or military pay for a particular week against the salary owed that week without loss of the exemption.

So, now you know when you can make deductions from an exempt employee’s pay without losing the exemption, but how do you calculate the amount of such deductions?  You may use the hourly or daily equivalent of the employee’s full weekly salary or any other amount that is proportional to the time actually missed by the employee. In the case of a deduction as a penalty for violations of major safety rules, you may make the deduction in any amount.  Who says the FLSA isn’t fun!?

Question: How much severance should be provided to a departing employee?

Answer:

You have decided to let an employee go and to provide severance, but now you’re trying to figure how much severance is appropriate. Employers first need to consider whether they have a severance policy and if there is a past practice of providing severance. If there is no severance policy or past practice to follow, then you need to start somewhere. In better economic times, two weeks of severance for every year of service was pretty typical. Then there was a swing towards little to no severance being offered. Currently, one week of severance for every year of service is fairly common. Generally, employers do not count partial years of service. Sometimes there are minimums and maximums, such as, one week of severance for every full year of service with a minimum of one month’s severance and a maximum of 12 weeks. Severance packages for executive level employees often are higher and can range from 6 months to a full year of base pay. However, severance packages for executives often are negotiated on the way in, either in an offer letter or employment agreement.

Other common components of severance packages are:

• healthcare benefits (that is, continuing to pay the company-share of health insurance premiums during the severance period if the departing employee timely elects COBRA),
• outplacement services or
• allowing the departing employee to keep equipment, such as their company cell phone, tablet or laptop. (Don’t forget to wipe Company email and data from these devices before allowing the employee to retain them.)

Consider what types of severance may be important to the departing employee and tailor severance packages accordingly. On the other hand, employers always should be cognizant of the potential precedent being set and consider the Company’s willingness to provide the same severance benefits to someone else.

Question: What are some things to avoid when it comes to termination meetings?

Answer:

Here are 10 things not to do when conducting an employment termination:

1. Don’t argue or negotiate. Use the right words and tone, sufficient to convey the decision, but not to inflame or become argumentative.
2. Don’t get into detailed reasons for the decision. Keep the meeting short.
3. Don’t get into how you’re going to transition the employee’s duties.
4. Don’t make up reasons why you are terminating the employee. Prepare a script and stick to it.
5. Don’t make any admissions or apologies.
6. Do not compliment the employee in an effort not to hurt her feelings. Mixed messages can be confusing.
7. Don’t argue with the employee in an effort to justify the decision. Instead, let the employee have an opportunity to have a say, and pay close attention to what is said.
8. Don’t make reference to sex, age, race, religion, national origin, sexual orientation, disability or any other protected class during the termination meeting.
9. Don’t answer questions about other employees. If asked about others, respond generally, such as: “I know this must be difficult news, but we’re here to discuss your situation. We cannot discuss other employees.”
10. Don’t forget to document what was said during the termination meeting. You want a record of who was present, what was said and any comments the departing employee made.