JULY 2022 • Vol.09 • No.07 (ISSN 2564-2006)
TOP 5 REASONS TO OPTIMIZE YOUR REMOTE WORK POLICY - Todd R. Wulffson and Mark S. Spring, CDF Labor Law LLP
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20
Hybrid Work Transformation: 16 Elements To Consider
Flexibility: What It Means To Employees?
Performance Scientist and Author
i4cp
- Dr.
Raman K. Attri,
- Katheryn
Brekken,
27
Top 7 Tips To Create Effective Remote Work Policies - Christine
E. Howard and Marisol Ruiz,
Fisher Phillips LLP
35
Answering The “What-If” Questions In Workforce Planning - Rupert Bade, Anaplan
INDEX
Workforce Management, Time & Attendance, Excellence JULY 2022
Vol.09
No.07
(ISSN 2564-2006)
06
Top 5 Reasons To Optimize Your Remote Work Policy Ensuring employees do not hop from place-to-place
- Todd R. Wulffson, Managing Partner, and Mark S. Spring, Office Managing
On the Cover
Partners & Chair, Traditional Labor Law Practice Group, CDF Labor Law LLP
Articles CHRO Corner
10 Exclusive Interview With Elaine Mak, CPO, Valimail
23 The Office Of The Future
3 considerations for businesses looking to define their ‘new normal’ working environment - Liviu A. Dedes, Vice President, HR, Yoh
15 Remote Work Reimbursements
Are employers supposed to cover all work-from-homerelated expenses? - Mark S. Fogel, Office Managing Partner & Chair,
Brandy L. Taylor, Attorney and Emily C. Gifford, Attorney, CDF
32 The Future Of Work Is Fluid And Always Changing 3 ways you can keep the best of the WFH culture alive in your organization - Omer Glass, Co-Founder and CEO, GrowthSpace
40 Arbitration Agreements: Enforceable Waivers Of Employees’ Individual PAGA Claims Now Included The Viking River Cruises, Inc. v. Moriana ruling is one of the most important decisions for California employees in 2022 - Jeffrey S. Horton Thomas, Partner, and Steven P. Gallagher, Associate, Fox Rothschild
Top Picks
13
INDEX
Hybrid Work Transformation: 16 Elements To Consider A long-term remote work strategy is a must-have to drive accountability in the company
- Dr. Raman K. Attri, Performance Scientist and Author
20
Flexibility: What It Means To Employees? Here are the 3 most important elements of EVP
- Katheryn Brekken,
Senior Research Analyst, i4cp
27
Top 7 Tips To Create Effective Remote Work Policies Ensuring compliance with federal and state laws
- Christine E. Howard, Partner, and Marisol Ruiz, Attorney, Fisher Phillips LLP
35
Answering The “What-If” Questions In Workforce Planning The 3 big questions HR should address to take a strategic role in a company
- Rupert Bade, Vice President,
Human Capital Planning, Anaplan
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Workforce Management, Time & Attendance, Excellence (ISSN 2564-2006)
Critical Elements of Remote Work Policies
T
he Covid-19 pandemic resulted in an unprecedented change in the workplace after stay-at-home orders, isolation and quarantine requirements, and accommodation requests resulted in many employees temporarily working from home (WFH).
In Flexibility: What It Means To Employees?, i4cp’s Katheryn Brekken shares the three most essential elements of employee value proposition, and what employees expect from a flexible work arrangement, according to the respondents of their recent study.
Employers and employees alike recognized certain benefits of remote work arrangements and this led many business leaders to explore hybrid and permanent remote work policies.
Performance scientist and author Dr. Raman K. Attri lists down the 16 elements companies must consider when undergoing a hybrid work transformation.
However, it is critical that in such arrangements you know where your employees are working from, among other aspects of work. What if one of your employees is working from a different state and you are not aware of it? What are the legal repercussions of such oversights? How do you overcome such lapses in your work-from-home arrangements? Check out Top 5 Reasons To Optimize Your Remote Work Policy by Carothers DiSante & Freudenberger LLP’s Todd R. Wulffson and Mark S. Spring, where they discuss why it is critical to have all your WFH-related policies in writing and informing employees of the same.
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This is not all! This month’s issue of Workforce Management, Time & Attendance, Excellence brings you several other informative and educational articles that we hope will help you achieve excellence and efficiency in your workforce management efforts. Happy Reading!
Also, read Fisher Phillips LLP’s Christine E. Howard and Marisol Ruiz’s article, where they discuss the Top 7 Tips To Create Effective Remote Work Policies.
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COVER ARTICLE
Top 5 Reasons To Optimize Your Remote Work Policy Ensuring employees do not hop from place-to-place By Todd R. Wulffson and Mark S. Spring, Carothers DiSante & Freudenberger LLP
M
any workplaces allow employees to work from home. However, often in those situations, the employer does not know from where the employee is working. Recently, one of our firm’s small business clients, based in an employer-friendly state in the south, had an employee move to California without the company knowing. Neither management nor HR was aware that it had an employee in California. This ended up causing some material issues when it came to daily overtime, taxes, and other issues.
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If you have employees working from home (WFH), you should strongly consider implementing a policy that provides that (a) WFH employees cannot work in another state or country for more than thirty (30) days without advanced written approval, and (b) that the exact location of all work performed remotely needs to be communicated to the HR department in writing.
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Top 5 Reasons To Optimize Your Remote Work Policy
There are many reasons for this: 1. You want to know where the employee is working in case they are injured and to assist in tracking any related WFH expenses. Being injured while WFH is a workers’ compensation event. In addition, you do not want to have employees, who are working in an unsafe environment. 2. The laws of every state are different. For example, an employee working in Arizona is required to be paid overtime rates only if he or she works over forty hours in a week. If that employee moves to Nevada, he or she must be paid premium overtime rates for all hours worked in excess of eight hours in a day, even if he or she does not meet the forty-hour weekly threshold. Even within California, many cities and municipalities now have their own minimum wage and sick leave ordinances. It is difficult enough to be in compliance with applicable laws when you know where your employees work. If you do not know where your employee is working, it is virtually impossible to be in compliance with the relevant state and local laws.
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3. If an employee is working outside of California more than occasionally, you may be able to avoid paying them daily overtime. In addition, many states do not have the onerous meal and rest period requirements dictated by California wage and hour law. Finally, your duties to reimburse employees for expenses incurred may be narrower in other states. Thus, you may be able to save significant labor costs in many instances if employees are out of state. However, if you are not made aware where they are working, you will not be able to take advantage of these potential savings. Most other states require payroll taxes to be paid if an employee is working in their jurisdiction for more than a specified period of time. The employer may also owe income taxes to the state where the employee is temporarily working, which must be timely withheld by the employer. In our recent case where the employee moved to California without the knowledge of the employer, discussed above, this was an issue because the employer did not know the employee had moved and was not deducting payroll taxes and submitting them to the California EDD.
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Top 5 Reasons To Optimize Your Remote Work Policy
Other countries - particularly EU ones - may consider a resident employee to qualify for vacation, severance, and other benefits, even if the employee is not permanently residing in that country. As the employer, your company may become liable for such benefits after even 60+ days. It is important to know when your employees are working abroad for any extended period.
Based on some interesting experiences, since WFH arrangements have become so prevalent, we recommend that California employers strongly consider adding written notification requirements to their WFH policies requiring employees to notify the employer, in writing, where they are working if they are working somewhere new for a period of at least thirty days.
When there is no written policy, the employee can persuasively argue that he or she was not aware that notification was required. Having a mandatory written notification policy gives you a better likelihood that you will be timely made aware of your WFH employees’ moves to help you control labor costs and try to ensure compliance. In addition, if the employee fails to notify you, and there is a written policy requiring written notification, you will have a stronger argument that you did not willfully violate the other state or country’s laws.
In addition, employers should also have other, more traditional, provisions in their WFH policies, such as provisions addressing use and privacy of electronic devices and equipment, security of data, safety, and expense reimbursement rules. Finally, WFH employees should be required to sign documents acknowledging their notice of these policies, whenever they are issued or modified. This article originally appeared here.
Todd R. Wulffson is Managing Partner in the Orange County office of Carothers DiSante & Freudenberger LLP. Todd has 25 years of experience counseling and defending businesses in labor and employment issues and has extensive experience representing employers across the entertainment, manufacturing, banking, hospitality, financial services, and retail industries. He focuses on issues related to human resources, and the implementation of proactive measures to reduce risk and cost including substantial experience in the evolving area of Social Media Law.
Mark S. Spring is the Office Managing Partner & Chair of CDF Labor Law LLP’s Traditional Labor Law Practice Group. Mark has almost 30 years of experience handling labor and employment law matters throughout Northern California. His practice is focused on representation of management in unionmanagement relations and handling litigation triggered by all types of employment related disputes.
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CHRO CORNER
Inspiring the Next Generation of HR Leaders
Where do HR leaders draw inspiration from? What are their worst nightmares? How did they stand the test of the changing times? In this segment, we will trace your journey to the top. This is your story - a story that is made of extraordinary accomplishments, methods that helped you overcome adversity, innovative programs that you led, and fundamental changes that you brought in. It's your chance to inspire the next generation of leaders. Elaine Mak is an executive leader of business transformation, culture and brand, talent and equity with experiences at corporate and non-profit organizations moving from start to scale up. She has created performance and business growth for organizations in hospitality, education, healthcare and technology. As Valimail’s chief people officer, Elaine serves as a partner and advisor to the CEO and executive team to drive performance, engagement and efficiency. This includes organization and leadership effectiveness, strategy planning, business operations/ performance, executive succession planning and pipeline development, communications and brand, HR/ talent and DEI. In an exclusive interview with HR.com, Elaine touches upon her journey in HR, why HR leaders must go beyond job performance, hiring, and firing, and why people operations are as equally critical as the sales and finance operations, among others.
Exclusive Interview With Elaine Mak, CPO, Valimail Excerpts from the interview:
What has your HR journey been like and what influenced you the most to have a positive impact on your career?
Q
Elaine: My HR journey has been anything but traditional. I do not consider myself an HR professional and never aspired to be a chief people officer. When people think of HR, they usually think of job performance, hiring, firing, etc., but my focus has never been on these "traditional" functions. Instead, my strength and passion are in helping companies scale up with a People-First model during change and growth. I partner with the CEO and leadership team to shape our business strategies and then develop and align our culture and people practices to enable performance and business growth. As a woman who identifies as a person of color, my career experience has revealed how our male-dominated society exclusively provides the power of choice to white men. The rest of us spend most of our lives fighting for a seat at the table. Ironically, this disparity has positively impacted my career.
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CHRO Corner Name: Elaine Mak Designation: Chief People Officer
positions of power, and I would say all people leaders face a continuous challenge of how best to address misuse of power.
Company: Valimail Number of employees: 92 When did you join the current company?: August 2020 Total experience in HR: 20+ years Hobbies: working out, hiking, traveling What book are you reading currently?: Oh Crap! Potty Training!
Early on, I quickly learned the unspoken rules I now work to break. The system was not designed for someone like me to advance. However, once I understood the rules, I felt empowered to rewrite them and help restore the power of choice as a right to all. My role in HR is to empower everyone in their professional lives with choice and opportunity.
What were your challenges during the early days of your career? What are those today?
Q
Elaine: Through the early days of my career, I struggled to find my place at the table. I am a first-generation Chinese-American female from a low-income background. It is not an easy starting place. However, my parents were immigrants who understood the need to make sacrifices to provide better opportunities for future generations. I applied this same mindset to my approach in the early days of my career. While I did have to sacrifice many years playing by the roles of a misogynistic, archaic system, I have risen above it with the knowledge, experience and drive to provide a better organizational landscape for those who follow. Even though I have earned the privilege of autonomy to steer my organizational leadership's direction, I still do encounter regressive leaders. We often say issues like misogyny and racism are systemic — and they are. But systems always map back to people in
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Q
How do you see workplace culture evolving over the years?
Elaine: I believe that our workplaces are microcosms of our society as a whole. Shifts in one will affect shifts in the other. Currently, we are experiencing significant changes in both. Many companies are starting to recognize the systemic issues we need to address. Likewise, many people have realized the collective strength of the individuals working to end these harmful systems. People lead movements. People drive societal transformation, and they will drive workplace transformation too. The workplace provides new opportunities for individuals to gain decision-making and empowerment in their roles. We need to reimagine their employees' needs, invest in coaching/ development and allow more autonomy regarding work-life balance.
Can you share the top three learnings from the challenges you faced?
Q
Elaine:
1. Hire leaders whose values and mindset align with the business. 2. People-first cultures require making some hard decisions. 3. Recognize that culture-building is a long game. In-the-moment, feel-good culture building differs from sustaining long-term success. Hosting a chocolate martini-making class could feel good at the moment, but it will not help employees thrive long-term.
Where do you draw inspiration from? What do you have to say to those who are still struggling to find a place in the boardroom?
Q
Elaine: My husband. Our partnership is the source of what we co-create in life. Also, my daughter, who brings a new way of seeing the world. They are both sources of daily inspiration. JULY 2022
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CHRO Corner
To those still struggling to make an impact in their organization, it is not your job to come in and change minds. It is the leader’s responsibility — the CEO or board chair — to change the organization. Instead, engage your CEO as a partner. Show them the business value behind investing in people and the benefits (tangible and intangible) of shifting the organization's mindset. Every people leader must learn how to link performance to business outcomes in order to "speak the language" of boardrooms.
Q
Where do you draw the line when it comes to work-life balance?
Elaine: To me, I have learned that work-life integration is about who gets prioritized with day-to-day decisions and the impact those decisions have on one’s quality of life. My rank order of decision-making when it comes to time/decisions is: first, Elaine’s self-care/health. If I do not take care of myself, then everyone around me does not get the best of me. Next is my husband. He and I are partners, and the partnership is the source and sustenance of what we create collectively/ individually. Third, my daughter, then my family/ community and, finally, work. It is not easy, but surprisingly it all works out nicely. I get to show up at my best at home and work.
What fundamental change(s) (in terms of culture) have you brought into your company?
Q
Elaine: The primary change I have brought to Valimail is the implementation of a new leadership model. We have moved from a top-down chain-of-command structure to a collaborative and flexible one. Our goal is to clarify the interdependence of every role across the organization for all employees. In other words, our new design allows everyone to have shared accountability in our strategy.
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Before adopting this new model, we had siloed departments with separate microcultures and protocols. Our current path required some initial difficult conversations and decisions. Without full buy-in from key leadership, we would not have been able to make progress. While old systems do not change overnight, I'm proud of our progress in evaluating our goals and integrating all of our teams (sales, marketing, product engineering, etc.) to collaborate better. Simultaneously, we integrated DEI as a core pillar of our business. Recently, my colleagues raised the possibility of hiring a DEI manager, but I would prefer not to take that step. Why? Because when we do DEI right, we embed it into everyone's jobs, across departments and decision makers. DEI is not a singular role — it is a mindset that companies must embrace from the top down. Instead of hiring a DEI manager, we took steps to diversify our hiring and formed a DEI council to provide our strategy oversight and support.
What are some major changes you see affecting HR within the next few years?
Q
Elaine: HR must become more integrated into the foundation of business success. HR departments should connect everything they do to their company's performance and outcomes. We need to recognize that people operations are as equally critical as the sales and finance operations. It is all about building the business case for increased investment. In times of economic downturn or uncertainty, the board refocuses on hitting its bottom line. They will always prioritize revenue-generating positions. However, I believe the increased focus on people, diversity and collaboration directly results in improved performance and, therefore, increased revenue. We need to develop more ways to prove it. I think we will see some changes to how HR leaders demonstrate the direct link between people and revenue. Would you like to comment?
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TOP PICK
Hybrid Work Transformation: 16 Elements To Consider A long-term remote work strategy is a must-have to drive accountability in the company By Dr. Raman K. Attri, Performance Scientist and Author
A
ll employees and leaders understood the need for remote working during the pandemic and adapted to changing scenarios. However, most of them deemed it a stop-gap arrangement for a limited period. The way businesses have ripped the benefits of remote working in terms of improved productivity, it is not an understatement to say that it is here to stay.
It comes with tons of confusion among employees and policymakers on where to draw lines. Handling issues case by case on an ad hoc basis is not sustainable. A long-term strategy is a must-have for businesses to drive accountability in the company, project transparent and fair practices and drive compliance with legal and ethical requirements.
Value of Well-drafted Remote Work Strategy
Over the last two years, I have been engaged with stakeholders at different forums, conferences, and advisory positions within various industry segments. We have been debating what a good remote work strategy should look like if it must sustain the current pandemic and persist beyond it. Remote work strategy cuts across various disciplines and functions in any organization. Thus, it is essential
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to pay attention to all critical considerations in a balanced manner. A well-drafted remote work strategy must include clear guidelines on expense claims, insurance coverage, benefits, incentives, allowances, and flexibilities awarded or taken away. It should also outline performance measures, compliance restrictions, and other expectations.
16 Key Elements to Consider
If you are embarking on shaping up your remote work strategy, the checklist below comprising 16 questions will help you drive the right kind of discussions among your functional groups. Human Resources 1. What roles, positions, or jobs will be listed for preferred or mandatory remote working?
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Hybrid Work Transformation: 16 Elements To Consider
2. Will any role-specific restrictions prohibit or encourage flexibility among various modes like working remotely, anywhere, working, and working from home? 3. How rigid will be a remote working arrangement? How easily can one switch between remote working to onsite or vice versa? 4. What are the incentives one gets if one chooses to work remotely? Or what incentives does someone loses? Performance 5. Are the employees expected to consume their time otherwise used in commuting for work-related activities? 6. How are remote workers’ productivity and performance tracked, measured, and awarded compared to onsite employees? 7. What are the general expectations to avoid family interferences, distractions, noises, and other nuisances of working remotely? Financial 8. What are the general expectations to avoid family interferences, distractions, noises, and other nuisances of working remotely? 9. What kinds of home-related expenses (like the internet, aircon, electricity, facilities, furniture) can, or cannot, be claimed? 10. Do remote employees lose allowances like transport and overtime, or do they get additional allowances like internet, phone, etc.? 11. Do remote workers get a pay cut compared to onsite workers, given they enjoy more flexibility and work-life balance?
Or do they get a remote-working bonus for generating saving for the company for not using office infrastructure and facilities? Legal 12. How do the remote working clauses comply with the government, legal, and labor requirements of various countries where the company operates? 13. What is the new definition of what makes up workplace injury or accident for remote workers? 14. How do the insurance claims, accident coverage, and protections differ for remote workers? IT and Security 15. How are internet security, data encryption, data safety, and usage compliance monitored on employee laptops for complete transparency between employers and employees? 16. How do you track the ownership of assets assigned to the employee to work remotely? How will be the asset depreciation impacted or reported? While the checklist above can gear your thinking to consider important elements for sustainable business support, a lot more needs to be done by breaking high-level remote work strategy into functional strategies in terms of IT, finance, facility, customer support, and employee benefits. Given the rapid changes in technology to do remote work more productively and the market shift towards remote
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work preference among the new generation of employees, you may have to adjust this strategy more often than you change others. However, HR leaders and executives should be extra careful that employees work for a physical entity that is identified for its space and existence. When you cut the sense of belonging by making a job role remote, you risk losing loyalty, connection, and motivation. Therefore, you must assess what specific job role trends look like in the prospective employees. A remote strategy should consider the employee side first while evaluating the business benefits of the same.
Dr. Raman K. Attri is a performance scientist, author of multiple books, professional conference speaker, and global learning business leader. He has authored about 20 multi-genre books and holds two doctorates and over 100 international educational credentials. He has been featured in more than 100 media features, articles, interviews, and shows. His recent book ‘Speed Matters’ shows how businesses can stay ahead @ the speed of business.
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Remote Work Reimbursements Are employers supposed to cover all work-fromhome-related expenses?
By Emily C. Gifford, Taylor L. Wendland, Mark S. Spring, CDF
C
alifornia employers have recently experienced a material uptick in lawsuits from employees seeking reimbursement for expenses incurred while working from home. These lawsuits seek a wide variety of expense reimbursement for increased utility costs and for the costs of losing out on the ability to rent out their home offices. Employees typically bring these claims under Labor Code section 2802. Sometimes employees also bring derivative PAGA actions for wage-statement “inaccuracies.”
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Labor Code section 2802 requires employers to reimburse employees for “all necessary expenditures or losses” incurred by the employee in the discharge of their duties or under “obedience to the directions of the employer.” Importantly, Labor Code section 2802 clarifies that “necessary expenditures or losses” include all “reasonable costs, including but not limited to attorney’s fees incurred by the employee enforcing the rights granted by this section.”
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Remote Work Reimbursements
Many California businesses continue to have employees work from home or are now using a hybrid structure. These employers should be aware of their reimbursement requirements under California law and review their policies and telecommuting agreements to ensure employees are being properly reimbursed. CDF covered remote work expenses and employer reimbursement requirements in 2020, which readers can view here.
What Defenses Are Available to Employers Sued for Work-from-home Related Expenses? This question was very recently considered by the Federal District Court for the Northern District of California on June 1, 2022. In Williams v. Amazon. com Services LLC, the court denied Amazon’s Motion to Dismiss after Amazon raised two (unsuccessful) arguments:
1. Amazon’s adherence to government-issued stay-at-home orders absolves them of liability, and 2. Williams did not submit reimbursement requests to Amazon so they could not know that Williams incurred work-related expenses that required reimbursement. The court found that despite these arguments, the plaintiff had sufficiently pled his claim under Section 2802 and denied the motion to dismiss. The court also held that Amazon’s expectation for Williams to work from home after the stay-at-home orders were imposed was sufficient to establish Amazon’s liability. Thus, California employers who adhered to state and/or county mandates to shelter in place and/or work remotely are not likely to be shielded from liability for employee’s work-related expenses incurred during the mandated time period, even though employers were not the “cause” of the shift to remote work. That argument did not work in the Northern District and is not likely to work elsewhere. The court’s analysis of Amazon’s second argument provides guidance on how to determine an employer’s “reasonable” expectations. The court considered both Amazon’s status as a tech company and Williams’ position as a senior software
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development engineer (which entailed duties, such as writing design documents for software systems and being on-call for production system) to determine that Williams’ duties “plausibly requires the use of physical space, internet, and electricity.” Therefore, “Amazon, a major tech company, surely knew or at the very least had reason to know” that its software engineers incurred “basic costs” related to their work while they worked from home and actual notice of the costs was not required.
How to Determine Basic Costs
Across a number of cases, employees’ most common “basic costs” include reliable access to the Internet, a phone, and a computer. Importantly, prior to the pandemic, courts have held that employers need only reimburse a “reasonable percentage” of an employee’s use of a personal phone or Internet costs. Beyond that, the “physical space” requirement as referenced in Williams v. Amazon is more difficult to define. Some of the newly filed lawsuits are now demanding payment for the potential revenue employees could have collected had they rented out their home office instead of using it for work. In these cases, employees claim that they lost out on potential revenue of renting out the rooms they used as offices, even where there is no actual rental agreement or even a prospective tenant. There is no published authority supporting an award of such expenses in California, and we believe it is unlikely that a court would find that such theoretical expenses are compensable. In other cases, employees have claimed that they were required to purchase office furniture and equipment to work remotely. In these lawsuits, the employee is likely to be successful if the employee can show that the furniture/equipment was necessary as a direct consequence of the employee’s duties. The date of purchase of the furniture/ equipment may be relevant because if the employee purchased the furniture before being approved to work from home, the employer has a strong argument that the furniture/equipment purchase was not a “necessary expenditure or loss incurred by the employee in direct consequence of the discharge of his or her duties.” Labor Code Section 2802.
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Remote Work Reimbursements
Prior to the pandemic, some employers, particularly tech-based startups, offered on-site perks, such as free meals and dry-cleaning. Some disgruntled employees have since complained about the cost of preparing or purchasing their own meals while working remotely and are now seeking reimbursement for these costs as well. By their nature, perks are not necessary for employees to discharge their duties, so we believe it may be difficult for employees to successfully recover these costs, but in California, one never knows what the courts will do.
The Takeaway
Based on current trends, California employers can expect to be on the hook for at least the “basic costs” of Internet usage, personal cell phone and laptop usage, and some utilities for workers that the employer requires or encourages to work remotely. However, plaintiff attorneys are now testing the bar by seeking reimbursement for furniture, the value of potential rent, and other less traditional expenses.
Mark S. Spring is Office Managing Partner & Chair of CDF’s Traditional Labor Law Practice Group. Mark S. Spring has over thirty years of experience handling labor and employment law matters throughout Northern California. Spring’s practice is focused on the representation of management in union-management relations and handling litigation triggered by all types of employment-related disputes.
It remains to be seen how broadly the California courts will interpret the law in this area. To protect against liability (and attorneys’ fees), California employers should explicitly define each employee’s job duties and use these definitions to determine “reasonable” expectations of the costs of remote work. In addition, California employers should always meet with any employees, who they are allowing/requiring to work from home before the work from home arrangement is commenced. Expectations should be outlined with particularity and expenses should be explored and agreed to. A remote work agreement outlining the expectations (including expenses) would be ideal and may help act as a shield in these types of lawsuits and claims. This article first appeared here.
Taylor L. Wendland is an Attorney at CDF. Taylor has experience drafting motions, discovery, research memorandums and briefs. Wendland has worked on cases involving Covid compliance, class actions, retaliation, harassment, wage and hour, trade secrets, and wrongful termination.
Emily C. Gifford is an Attorney at CDF. Emily provides litigation and advisory services to California businesses and non-profit organizations in all aspects of labor and employment law. Her employment litigation experience involves claims of harassment, discrimination, retaliation, wrongful termination, unfair competition, breach of contract, and wage and hour issues
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Flexibility: What It Means To Employees? Here are the 3 most important elements of EVP By Katheryn Brekken, i4cp
T
he year 2021 saw a record number of workers quit their jobs worldwide. In early 2022, Fortune and the Institute for Corporate Productivity (i4cp), a global business research firm, partnered to better understand the strategic responses of top companies.
The resulting study, The Talent Imperative, included a survey of 1,195 organizational leaders representing 77 countries and follow-up interviews. Most larger organizations (those employing >1,000 people) experienced increased attrition in the past year. We asked the question again in June; the responses indicate that the labor market has yet to improve for employers.
In response, organizations are adjusting messaging about the employee value proposition (EVP) to attract and retain top talent (i4cp defines employee value proposition as the current and evolving
set of relevant benefits—monetary and non—and opportunities provided to employees in return for the skills, capabilities, and expertise they bring to the organization).
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apply to those who can work remotely and those who must work on-site.
To compete for talent in 2022, the three most important elements of EVP cited by those surveyed were: ●● Flexibility (49%) ●● Commitment to diversity, inclusion, and belonging (33%) ●● The purpose/mission of the organization (29%) Only a quarter of respondents cited compensation as one of the top three elements of their organizations’ EVP this year. This indicates that companies are looking to non-traditional benefits to attract and retain talent—elements that speak more to the culture of the organization.
Healthcare, manufacturing and retail have all struggled with demands for increased flexibility, and this is a way to provide workers with more. Employers are adopting technology, such as electronic scheduling platforms, to create virtual marketplaces where employees can swap shifts, express shift preferences, request additional, give up hours, or even swap site locations, all without interacting with a manager. For a more personalized approach, leaders of small teams or units can work with individual employees to understand scheduling needs and preferences and create more customized schedules. Larger operations, particularly in manufacturing and healthcare, can try staggering shifts. The latter can provide 24/7 organizations the opportunity to experiment with four-day (or other configurations) workweeks.
Business leaders are betting on flexibility to attract and retain top talent, however, many are limiting the autonomy and impact of this benefit by confining it to work location. The study found that while 36% of organizations provide employees with considerable choice as to where they work, only 12% reported providing employees with considerable choice as to when work gets done.
In fact, i4cp research found that high-performance organizations are two times more likely to offer staggered hours within a fixed schedule as an opportunity for more flexible work.
High-performance organizations, those defined by i4cp as having the strongest growth in revenue, market share, profitability, and customer satisfaction over a five-year period, were far more likely to do both.
In the current labor market, workers expect more choice and empowerment to dictate the terms of work. And for many, that is about autonomy and having the agency to pursue life and professional goals in tandem. The bottom line about flexibility is that whatever work arrangement is in place, the employer shows trust in its employee to determine when to do their best work.
The analysis found that offering flexibility in terms of when work happens is positively correlated to retention—meaning companies that offered employees more choice about when work is performed and more control over their schedule were less likely to have experienced significant attrition over the past year.
Finally, predictable scheduling also provides a form of flexibility, allowing employees to better plan their lives.
Katheryn Brekken, Ph.D., is a Senior Research Analyst at i4cp.
Providing employees more control over when they work is a critical, if not the most important, component of a flexible work arrangement, as it can
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The Office Of The Future 3 considerations for businesses looking to define their ‘new normal’ working environment
By Liviu A. Dedes, Yoh
A
s Covid-19 restrictions have eased across the country, many businesses are now reopening office doors and determining what their workforce will look like for the rest of 2022. The pandemic introduced new ways of working in a digital world and proved that working from home doesn’t have the adverse effects on productivity that many weary employers once feared. One of the biggest trends to seemingly come out of the pandemic is an increased preference for fully remote working environments. But is that actually
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what today’s workers want? New data shows that assuming all workers prefer remote work or that all desire to be back in the office isn’t exactly correct.
Remote, Hybrid, or In-Person?
What was normal for businesses pre-pandemic might not be normal post-pandemic. Before asking employees to fully pivot one way or another, it’s important to understand how workers today actually feel about their current working environments and if they are ready for change.
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The Office Of The Future
rather than change structures. Remote environments are also preferred by 30% of people currently working in hybrid environments and 28% of people working fully in-person. While there is a strong case for remote work overall, employees in all settings are resistant to changing their current work modalities. Of those who work in a hybrid environment, 54% say they prefer to remain hybrid and 42% of those working in-person prefer to keep it that way. Only 38% of those working fully remote would prefer to switch to hybrid or in-person environments.
A recent survey from Yoh conducted by the Harris Poll finds that the majority of workers are content in their current working structure – whether it’s fully remote, hybrid, or fully in-person. The data shows that 62% of people who work entirely remotely prefer to stay that way, while 54% of people who work both in-person and remotely prefer that hybrid structure, and 42% of people who work entirely in-person prefer that environment. The concept that people are naturally resistant to change has never been truer. Clearly, employees are split in their preferences, creating an interesting challenge for companies looking to shake up current work structures. For business leaders and HR decision-makers, understanding variations in employee sentiment will be key to creating a work structure that keeps the majority of employees satisfied and motivated moving forward. Here are three key considerations for businesses looking to develop a post-pandemic workforce structure.
1. Remote Work Remains Attractive. Employees Are Resistant to Change
For many employees, remote work remains an attractive option even as offices reopen. According to the Yoh survey, nearly twice as many people currently working remotely would prefer to remain fully remote
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Business leaders and HR decision-makers should consider whether changing working environments might be disruptive to employee productivity and engagement because the data says it might be. With the majority of workers across settings preferring to remain in their current work routines regardless of what it is, businesses might consider gradual transitions or allow for employees to maintain their current setup while providing new options.
2. Flexibility is Still a Good Solution for Many Employees
As many companies switched to fully remote environments at the start of the pandemic, it further blurred the line of work-life balance. At the same time, the new working structures allowed for greater flexibility for employees. The Yoh survey found that about a third of employees currently working entirely in-person and a third of those working entirely remote would prefer switching to hybrid work structures with the flexibility to work both in-person and remote for some of the time. Even basic assumptions about working parents’ preferred structures vs those without children in the household may not hold water. The Yoh survey found that both groups have about the same preference for remote work with 19% of those with children in the home preferring to work fully remote and 20% of those without preferring fully remote environments. The majority of workers with children in the household indicated that they’d prefer hybrid work environments that allow for flexibility to be in the office or be at home.
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The Office Of The Future
While working in the office has beneficial interpersonal aspects, the autonomy and flexibility of working from home have become the new working standard coming out of the pandemic. But working structures do not have to be all or nothing. Flexible arrangements like hybrid, or allowing employees to choose their working modality, could be a successful solution for companies looking to ensure that all employees remain satisfied and to increase retention.
3. Employee Demographics Could Influence Their Working Preferences
Every employee is going to have their own opinions and preferences when it comes to working environments, but employee demographics can provide key insights as companies decide which work environment is the best fit. According to the Yoh survey, almost three times as many women currently working fully in-person, who can do their jobs remotely, said they’d prefer to go fully remote compared to their male counterparts.
Today, workforce structures can take many shapes. It’s important that business leaders and HR decision-makers directly gauge employee sentiment on remote, hybrid, and in-person working environments when considering making a change to current work structures. As businesses adjust to the “new normal” and look to redefine their workforce structure, Yoh’s survey results suggest that a gradual transition to new working environments is best as employees prefer to stay in their current situation across the board. Offering flexibility in this transitional phase and beyond can help businesses ensure that all employees feel supported by their working environment and continue to be satisfied, motivated and productive.
Liviu A. Dedes is Vice President of HR at Yoh. Prior to his role at Yoh, he served as Senior Vice President, Chief People Officer for Icahn Automotive, which consists of The Pep Boys retail and service chain, Auto Plus aftermarket commercial parts distributor, Precision Tune Auto Care and AAMCO-owned and franchised service centers, and distribution centers. In this role, Liviu was responsible for all aspects of Human Resources.
The survey also found that employees with a lower household income are four times more likely to work only in person than those with higher household incomes, and they are more likely to prefer to remain in person. Of employed adults with a household income of $50K or less, 12% said they prefer to work in person compared to only 5% of those making $50K-$74.9K, 3% of those making $75K-$99.9K, and 5% of those making $100K or more. For businesses with workforces skewing younger, the data suggests that creating a fully in-person or hybrid work structure would be most beneficial, while a fully remote structure might be better for businesses with older workforces. Understanding employee demographics can help business leaders and HR decision-makers determine which working environment or environments might best suit the needs of their workforce.
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Creating the Best Structure for Your Workforce
The nature of work has completely shifted in the aftermath of the pandemic. Remote work is no longer a rarity, and in-person work is no longer the standard.
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Top 7 Tips To Create Effective Remote Work Policies Ensuring compliance with federal and state laws By Christine E. Howard and Marisol Ruiz, Fisher Phillips LLP
T
he Covid-19 pandemic resulted in an unprecedented change in the workplace after stay-at-home orders, isolation and quarantine requirements, and accommodation requests resulted in many employees temporarily working from home.
Employers and employees alike recognized certain benefits of remote work arrangements, which led many business leaders to explore hybrid and permanent remote work policies.
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While remote work arrangements are not practical for every job or desired by every employer, when such arrangements are embraced and become embedded into a company’s policy, employers need to ensure they are taking proper precautions.
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Top 7 Tips To Create Effective Remote Work Policies
Below are seven tips that employers should consider when implementing remote work policies. 1. Create a Written Remote Work Policy You should consider creating a written policy establishing the criteria and guidelines for working remotely. Will all employees and roles be eligible? Identify the roles that are critical to your business operations and determine whether those individuals can carry out their jobs while working remotely. Set performance standards and expectations from the start, and include policies on security and data protection, safety, and expectations about equipment and materials. 2. Review Rules on Expense Reimbursement Be sure that your pay practices for all employees – those who work onsite and those who work remotely – comply with the applicable federal and state wage and hour laws. In some states, such as California, employers must ensure all business expenses that are “reasonable” and “necessary” to perform the job remotely are reimbursed. At least ten states – California, Illinois, Iowa, Massachusetts, Montana, New Hampshire, New York, North Dakota, Pennsylvania, and South Dakota − and the District of Columbia have enacted laws requiring employers to reimburse employees for certain remote work expenses. Even if the applicable state does not require reimbursement,
failure to reimburse could lead to allegations of federal wage and hour violations for those paid at or near the minimum wage. For example, under the Fair Labor Standards Act (FLSA), employers generally do not have to reimburse employees for work-related expenses unless the costs would cause the employee’s earnings to fall below the minimum wage. This means you should take extra care to ensure that any additional expenses remote employees incur for business-related items – such as office supplies, internet access, and printers — do not bring their wages below the required rates or cut into their overtime pay. Additionally, exempt employees working remotely should be paid the full salary to which they are entitled, subject to lawful deductions. If allowable, any expenses they are responsible for covering should not bring their salary below the required threshold for the exemption. Expenses can take many forms, and employers should examine the perks and amenities they typically provide to onsite employees to determine which perks they plan to provide to remote workers. For example, if traditional employees are provided with a monthly free lunch, consider whether you will reimburse remote employees for a personal meal of equal value. Travel is another important consideration for remote workers—if non-exempt
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employees work from home and are required to travel to their employer’s office after the start of their workday – such as for a meeting – they may also be entitled to compensation for their travel time to the office in addition to a per-mile fuel reimbursement. Your remote work policy should include a section on reimbursements that complies with the laws of the states in which you operate. Address which expenses may or may not be reimbursable and whether you will provide a stipend that you anticipate will reasonably satisfy such costs. To ensure that reimbursements are documented correctly, consider the following tips: ● Itemize reimbursements on employees’ paystubs. ● Clearly explain whether you will require a pre-authorization before an employee submits a reimbursement request. ● Determine whether there will be a cap on the amount that an employee can request to be reimbursed. ● If you deny a reimbursement, document the reasons. 3. Provide Access to an Effective Time-tracking System An effective computer- or app-based timekeeping system can help employees accurately track their work hours and help you monitor time records for accuracy. You may want employees to sign
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their timesheets and verify their accuracy. Additionally, you should consider training non-exempt employees and their supervisors on timekeeping requirements and what constitutes “hours worked.” Be sure to pay non-exempt employees for all hours worked, including overtime hours worked, and let them know – just as you would onsite employees – that “off-the-clock” work is not permitted. You may discipline employees who fail to properly account for their hours or work unauthorized over time, but you must pay them for all hours worked. 4. Be Prepared for Potential Workers’ Compensation Claims Work-at-home arrangements do not immunize employers from workers’ compensation claims. Work-at-home accidents may be compensable if they arise out of work conducted during the course and scope of employment. If the employer did not contribute to the risk of the accident resulting in injury, however, a state’s workers’ compensation law may not require the employer to cover the cost of the injury. State workers’ compensation laws vary, so be sure to check the applicable rules and consult with counsel. 5. Establish Business Hours Remote workers may have a more difficult time than onsite workers when it comes to turning off their computers and ending work for the day, especially if their superiors contact them outside of general business hours. You
can show respect for employees’ personal time by establishing business hours and times for breaks and meal periods. Note that some state laws require non-exempt workers to take rest and meal breaks at particular times, which would continue to apply to remote workers. Setting business hours should also reduce the potential for off-the-clock claims in the case of non-exempt workers. 6. Security and Privacy The combination of modern technology and remote work presents unique security and privacy concerns. Your remote work policy should highlight the importance of online security measures to ensure work-from-home arrangements do not make systems vulnerable to cyber-attacks and viruses. You can implement certain protocols to reduce vulnerabilities, including: ● Informing employees of your security expectations. Educate your employees on what you expect of them when working remotely. ● Requiring secure apps for work-related communication. Employers should only use a protected secure app or work email to communicate to ensure work-related information stays protected. ● Requiring employees to lock their computers when not in use. Employees may feel more comfortable leaving
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their devices unattended while working remotely than if they were in the office, but it is important for employers to make clear how critical it is to keep company information confidential regardless of an employee’s location. ● Instruct your employees to use unique and complex passwords when signing into work accounts. Weak passwords are the main gateway to a security breach, and this small change can make a big difference. ● Using a VPN. Virtual private networks, or VPNs, are often used to allow employees to access the same information they would at work but from a remote location. ● Requiring employees to use a monitor privacy screen. Some employers may feel more comfortable mandating employees to use privacy screens to shield others from viewing personal information. ● Providing employees with a secure work computer. Having your employees complete their work only on secure, company-provided devices offers better protection than the use of personal electronics. ● Using up-to-date, encrypted conferencing software.
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Many employers use platforms for meetings, such as Zoom and Microsoft Teams. Requiring all employees to use the same encrypted software adds another layer of protection for confidential company information. ● Setting clear procedures for employees to follow if a data breach occurs. No matter the steps an employer takes to protect remote workers, accidents can still happen. Make sure employees clearly understand the steps they should take to report and mitigate a security breach if it happens to them. 7. Give Remote Workers an Opportunity to Review Policies Particularly since the Covid-19
pandemic began, many workers have been interviewed, hired, and started working from home without ever meeting anyone in person or going to a physical worksite. Ensure these workers are oriented and trained on company policies just like onsite employees and that they have online access to these policies and to federal and state posters that would commonly be posted in a breakroom. For example, an employee with a qualified disability under the Americans with Disabilities Act (ADA) may be entitled to a reasonable accommodation for their home office, such as specialized equipment or technology. Be able to demonstrate that the company published its reasonable accommodation policy to that employee as well
Christine Howard is a Partner at Fisher Phillips LLP. Christine focuses her practice on the defense of employment discrimination, harassment, and retaliation complaints, wage and hour litigation, and employee leave related complaints. She has successfully handled many dispositive motions, hearings, arbitrations, and trials on behalf of employers.
as provided training to their virtual manager on the ADA to address that employee’s need. Just because individuals are not located on-site does not mean that discrimination will not occur, so be sure that remote workers know their rights and how to make requests or report concerns internally.
Conclusion
A purposefully managed remote work policy can increase employee flexibility and drive exceptional results. Taking proper precautions and carefully implementing these policies will go a long way to ensure your compliance with applicable federal and state laws. This article originally appeared here.
Marisol Ruiz is an Attorney at Fisher Phillips LLP. Marisol advises businesses on a range of matters including claims of employment discrimination, retaliation, and harassment. She also helps clients navigate employee terminations and mitigate their exposure to future employment-related claims, such as those arising from Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act (ADA), and the Family and Medical Leave Act (FMLA).
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The Future Of Work Is Fluid And Always Changing 3 ways you can keep the best of the WFH culture alive in your organization By Omer Glass, GrowthSpace
T
he pandemic created waves in the world of work. Organizations have been given a once-in-a-lifetime opportunity to pause, reset, and revaluate their future. Now is the time for a new approach to work. It’s been said again and again, but what I think while we’re trying to strategize for what that future will look like, we’re at risk of throwing away some critical lessons from the ‘Work from Home’ era. While leaders want to move away from the chaos, stress, and uncertainty caused by the pandemic, the status quo from before the pandemic wasn’t exactly working. What we need is a reconfiguration of work - bringing what worked from work-from-home (WFH) into play. Why throw away valuable lessons learned? Here are three ways you can keep the best of the WFH culture alive in your organization, no matter
what work model you end up adopting.
1. Don’t Forget the Data
Organizations now have the data on both pre-pandemic in-office work and WFH remote work. Now, it’s time to put your data to work. During WFH, HR was able to uncover powerful insights about work, their workforce, and the workplace. Between new and old methods of data collection: performance appraisals, data on learning and development (L&D) performance, exit interviews - as well as stay interviews, a successful retention strategy and manager input, organizations now have critical data to work with. These are the insights that show leaders both the impact employees have on the business, and the impact the business has on the employee. Employee data can also help leaders unsure of what their
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organizations’ future of work looks like to find the sweet spot work model for their needs. Most organizations are opting for hybrid, with an Accenture survey finding that 63% of high-growth organizations have already adopted a hybrid, ‘productivity anywhere’ workforce model. If you haven’t found your work model sweet spot, A/B testing different variations can help you find the right balance now that people are feeling more comfortable with returning to at least some amount of in-office work. Use employee and manager surveys - along with your own productivity data - to learn what works and what doesn’t in all areas, and continue to tweak as needed. You may even find that different departments have different needs:
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Some departments may need to work in-office three days a week while others only two days a week to collaborate effectively, and still other teams may need only one day together. Why have we chosen a hybrid model? For lots of reasons, and Gartner’s research sums up the main points well, finding that hybrid work: ● Reduces fatigue by 44% ● Increases intent to stay by 45% ● Boosts performance by 28% This may change in the future, but it works for us now. The future of work is fluid and always changing, and it’s important for leadership to keep that in mind.
2. Embrace the Changing Role of Managers
In the chaos of the first lockdowns and the beginning of the WFH era, HR was overwhelmed with the digital and cultural changes happening overnight, putting the weight of employee well-being on the manager. The change hasn’t been easy for many managers, who still may need upskilling and help with leadership skills. But it’s created a tighter feedback loop, with managers having a much better understanding of their teams’ day-to-day. Teams completely reshaped their methods of collaboration, often giving managers more visibility into employee performance
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than ever before. This has been a huge game-changer for many managers who had limited visibility and based performance reviews more on hours worked and projects completed. Because of the increased transparency between managers and employees, managers also have deeper insights into where their employees could learn certain skills and have a better eye for spotting potential talents. Developing current employees for unfilled roles is smart for the business, and L&D has become a critical component of employee retention. Your managers’ increased visibility into their employees’ skill gaps enables better accuracy and efficiency.
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More importantly, the empathy Covid brought out in teams created a new sense of team belonging, no matter the distance. Part of change management was ensuring team members were ok, and Zoom meetings around the world became more human and more caring. Pre-Covid, the manager was all about performance. Post-pandemic, being a great manager and being a great remote manager is nearly identical. Empathy makes all the difference, apparently. And that empathy-based management is going to be a critical part of retention strategy in the coming months if not years.
3. Become More Human-Centric
And it’s not just managers who need to be more empathetic organizations need to become more human-centric if they want to keep their best talent around. Employees got a taste of the
greater autonomy and flexibility offered by WFH - and flexibility in and outside the office will do wonders for retention and engagement. This applies to where and when employees work, with performance reviews and HR reporting shifting from hours worked to projects completed and other tangible, performance-based activities. The point isn’t to squeeze the hours out of the employee to ensure he or she hits their necessary time requirements. Your job as a leader is to try and get the best out of your employees. Help them grow, and they’ll help you grow - by starting with the human side of things, you’re letting your employees know you trust them and want the best for them. There really is no ‘return to normal’ when it comes to the workplace. Work has changed for
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good - and if we’re smart about it, for the better. Continue to engage your employees in the process to understand what they really want and need. Communicate broadly so that everyone understands how hybrid arrangements will improve productivity, rather than drain it. And keep developing your employees as you plan your future so that your workforce is set up to succeed today and in the future.
Omer Glass is the Co-Founder and CEO of GrowthSpace.
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Answering The “What-If” Questions In Workforce Planning The 3 big questions HR should address to take a strategic role in a company By Rupert Bade, When I Work
S
ince the HR profession first flourished in the 1950s, it has become a trusted governance and operational partner to executive leadership. But as we know all too well, HR aspires
to excel beyond operations and compliance. In the last two decades, HR has eagerly sought out ways to alleviate its various
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administrative burdens, aiming to free up time and resources for the intensive work of crafting organizational agility and talent strategy.
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Answering The “What-If” Questions In Workforce Planning
HR technology constantly holds the promise of liberating HR. But with each new wave of innovation, HR seems increasingly buried under more processes, bureaucracy, workflows, systems, and data maintenance. As the global economy appears to be operating in shorter and more erratic cycles, HR is taking on an expanded role in one of the most critical elements: renovating the workforce. For some organizations, this means putting the workforce back to work across their organizations. For others, it involves adapting to a functionally different business environment, perhaps even on a scale comparable to converting wartime efforts to peacetime prosperity. Whatever the case, workforce planning represents a unique opportunity for HR to become highly strategic and collaborative and leverage
technology to reduce its administrative burdens.
organization and the respective business functions and results.
Using a “what-if” scenario planning approach, HR gains a more significant ability to address top-level strategic questions, factor in the effects of the workforce, evaluate the impacts organization-wide and do so with speed and agility. Let’s look at three big “what-if” questions that HR can address and take on the role of a strategic partner to senior leadership.
“But even more, “what-if” scenarios help HR create options for executive leadership. “What-if” scenarios define the boundaries of what is possible, feasible, and optimal, along with forecasting what to expect by re-working the percentages. For example, what if we could allow 30 percent of our workforce to work from home permanently? Could we reduce real estate and labor expenses over the next three years? Would that also increase retention due to greater job satisfaction? If that allowed us to recruit talent from a larger geographic range, could we fill key positions quicker and start or complete key projects sooner? Would our talent decisions access a more inclusive and innovative candidate pool than competitors, who are limited to talent markets close to their offices?
1. “What if we could actually do this?” Executive leaders like hearing that they have options, not being told, “here’s why that won’t work.” “What-if” scenarios give executive leaders across the organization a clear understanding of the best, worst, and most likely effects of a specific workforce plan and the impacts on both the overall
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Answering The “What-If” Questions In Workforce Planning
2. “What if we don’t have the data to make a good case for this?” Executive leaders like transparent, solid, and convincing business cases, especially those that enhance critical strategic initiatives. Unfortunately, the correct data to support such cases is not always available. For example, to help us exceed the revenue goals of an aggressive new product rollout, what if we invested more in developing a premium sales training program or provided more targeted incentives for existing revenue producers and enablers while hiring fewer new sales personnel? What if we allocated more of our talent to inbound marketing? Could that generate more demand in key segments? Or are we better off just hiring a bunch of contract sales personnel and giving them basic training, a desk, and a phone? By starting with a driver-based model in “what-if” scenarios, HR leaders develop a powerful tool to test and demonstrate the effects of numerous possible workforce plans across multiple departments. Simple heuristics and ratios embedded in a multi-dimensional framework (for e.g., by business and region/ country) allow business leaders to make quick decisions and try out different scenarios. 3. “What if we can’t wait until the next planning period to assemble the right workforce?” Executive leaders operate on executive time, which doesn’t always coincide with tidy
reporting periods. HR needs to excel at anticipating hiring needs, specifying the right places for the right people, and developing an overall workforce plan where it all happens at the right time and cost, rather than being dictated to by the months and quarters of the accounting year. Getting the timing right is a significant challenge, as hiring operations are notorious for being hurry-up-and-wait affairs. They are often initiated reactively when a manager discovers an urgent need. But then things get delayed by all the back and forth that ensues, first during requisitioning and later during the actual hiring process. On average, it takes 40-50 days to fill an open position, though it can be much longer for specific roles. This means that the approval to source candidates and open roles needs to occur well in advance of when the hire will actually start. And all of this can vary by business function, location and level – making the need for an agile and constantly updated plan that aligns with Finance even more critical. By enabling HR to develop an agile workforce plan, “what-if” scenarios build the confidence amongst business leaders that critical workforce initiatives will deliver the right talent in the right quarter. Such a plan is always visible to business leaders across the organization. And, especially for executive leadership, it allows them to treat workforce planning as a futures market and not a spot market.
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Giving Data a Voice, Even When it Cannot Speak Up on its Own Behalf
Decisions don’t always wait for data, and data alone doesn’t always drive sound decisions. “What-if” scenarios help tell the story when the data doesn’t yet have a voice, illuminating causal relations and interdependencies and foreseeing the consequences of decisions versus punting those decisions down the road or basing them on gut feel. “What-if” scenario planning isn’t just a thought exercise but rather a fundamental part of responsible, modern workforce planning. This article is adapted from here.
Rupert Bader is the Vice President, Human Capital Planning at Anaplan, where he leads Anaplan’s workforce planning approach and solutions internally, as well as partnering with the Workforce Planning solutions team to connect Anaplan’s capabilities with customer, partner and prospect use cases. Building on his leadership roles in workforce planning and analytics at Expedia, Microsoft, Avaya and other global organizations, Rupert is driven by his mission to help all organizations create inclusive, productive and dynamic workforces through exceptional Connected Planning.
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Arbitration Agreements: Enforceable Waivers Of Employees’ Individual PAGA Claims Now Included The Viking River Cruises, Inc. v. Moriana ruling is one of the most important decisions for California employers this year By Jeffrey S. Horton Thomas and Steven P. Gallagher, Fox Rothschild LLP
I
n a much-needed win for employers, the U.S. Supreme Court has ruled that waivers of employees’ individual claims under California’s Private Attorneys General Act of 2004 (PAGA) are enforceable. The court’s decision in Viking River Cruises, Inc. v. Moriana, released on June 15, is a lifeline for employers in California and will prove to be one of the most important decisions for California employers this year. For many years, employers operating in California have suffered a barrage of costly lawsuits brought under PAGA. The Viking River decision gives employers the most valuable means of protecting themselves from PAGA since the enactment of the law. However, to benefit from the decision, employers must update their arbitration agreements to bring them in line with the Viking River decision and take related actions explained below.
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Setting the Stage
PAGA authorizes employees and former employees to sue their employer for civil penalties arising from the employer’s alleged violations of the California Labor Code. PAGA plaintiffs typically claim that their employer failed to pay for off-the-clock work, underpaid overtime, did not provide meal periods or permit rest breaks, failed to pay final wages when due, etc. As long as the plaintiff alleges they suffered at least one violation in one pay period, they may bring a PAGA action for penalties arising from Labor Code violations suffered by not only the plaintiff, but all other nonexempt employees in the subject time period. Even in a modest-sized workforce, potential penalties for the alleged violations can quickly amount to hundreds of thousands or millions of dollars.
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Arbitration Agreements: Enforceable Waivers Of Employees’ Individual PAGA Claims Now Included
When a PAGA plaintiff recovers money from an employer, 25% is distributed among the “aggrieved employees” identified in the case and the remaining 75% is paid to the California Labor & Workforce Development Agency. A prevailing plaintiff also may be awarded their attorney’s fees.
The Issue in Viking River
For some time, to prevent PAGA lawsuits, employers have included in their arbitration agreements a waiver by the employee of the right to bring a PAGA claim. The California Supreme Court, however, ruled in 2014 in the Iskanian decision that such “PAGA waivers” are unenforceable. The California Supreme Court reasoned that, because plaintiffs, in an important respect, bring PAGA lawsuits on behalf of the State of California, they do not have the power to waive the right to bring a PAGA action. The Viking River case involved Angie Moriana, who entered into an arbitration agreement when she was hired by Viking River Cruises, Inc. The agreement included a PAGA waiver. When her employment ended, contrary to the PAGA waiver, Moriana filed a PAGA lawsuit against Viking River. In the state trial court and on appeal, Viking River sought to enforce Moriana’s PAGA waiver. Adhering to the Iskanian decision, the California trial court
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and Court of Appeal ruled against Viking River, finding Moriana’s PAGA waiver to be unenforceable, and ruling that Moriana’s PAGA lawsuit could move forward. The U.S. Supreme Court had long refused to consider the issue of PAGA waivers. Nevertheless, Viking River sought review by the Court, asking it to decide — once and for all — whether PAGA waivers are enforceable. In a happy surprise for employers and their counsel, on December 15, 2021, the U.S. Supreme Court accepted the Viking River case for review.
The U.S. Supreme Court’s Ruling
The court, in an opinion written by Justice Samuel Alito, found that a PAGA action does not consist of a single legal claim. Rather, a PAGA claim consists, first, of the plaintiff’s claim for penalties arising from Labor Code violations plaintiff suffered — “the Individual PAGA Claim” — and second, the claim for penalties arising from Labor Code violations suffered by all of the other “aggrieved employees” on whose behalf plaintiff brought the lawsuit — “the Non-Individual PAGA Claim.” Prior to the Viking River decision, neither California state courts nor the U.S. Supreme Court had viewed PAGA claims as consisting of two claims in this manner.
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Arbitration Agreements: Enforceable Waivers Of Employees’ Individual PAGA Claims Now Included
By refusing to enforce the PAGA waiver contained in Viking River’s arbitration agreement — at least insofar as Moriana’s Individual PAGA claim was concerned — the California state courts had run afoul of the Federal Arbitration Act (FAA), Justice Alito reasoned. The U.S. Supreme Court found that the FAA mandates that Moriana be free to agree with Viking River as she wished with respect to her Individual PAGA Claim and that, to that extent, the FAA preempted the rule set out in Iskanian that PAGA waivers are unenforceable. According to the U.S. Supreme Court, the rule declared by Iskanian, in effect, bars parties from dividing PAGA actions “into [their] constituent parts” and “unduly circumscribes the freedom of parties to determine ‘the issues subject to arbitration’ and ‘the rules by which they will arbitrate,’ and does so in a way that violates the fundamental principle that ‘arbitration is a matter of consent.’” Thus, the U.S. Supreme Court held in Viking River that employees are free to agree in an arbitration agreement to submit their Individual PAGA Claim to arbitration and to waive them.
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The court then held that once the plaintiff’s Individual PAGA Claim is diverted to arbitration, the plaintiff no longer has standing in the PAGA lawsuit pending in Superior Court, as the plaintiff is not an “aggrieved person” in the PAGA lawsuit. “When an employee’s own dispute is pared away from a PAGA action, the employee is no different from a member of the general public, and PAGA does not allow such persons to maintain suit [under PAGA].” As a consequence, Justice Alito wrote, “the correct course is to dismiss [the employee’s] remaining claims” under PAGA in the trial court. In summary, the U.S. Supreme Court found in Viking River that employees are free to agree by an arbitration agreement to submit their Individual PAGA Claim to arbitration (and to waive their Individual PAGA Claim) and that upon enforcement of such a provision, the PAGA plaintiff loses standing to litigate the Non-Individual PAGA Claim in court, requiring dismissal of the court action.
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Arbitration Agreements: Enforceable Waivers Of Employees’ Individual PAGA Claims Now Included
Action Items for Employers
Viking River offers employers a valuable opportunity to protect themselves against future PAGA lawsuits. In order to take advantage of the opportunity, however, employers must act. Important action items include: ● Update your arbitration agreements to ensure they expressly comply with Viking River. ● Determine whether you will use your new arbitration agreement only with new hires going forward or you will attempt to get current employees to sign the new agreement in the place of any earlier agreement. ● Evaluate whether you will adopt a mandatory or voluntary arbitration program. Employers’ risk tolerance will vary. The jury is still out, so to speak, on the question of whether mandatory arbitration programs are lawful in California. The challenge to California Labor Code section 432.6, which seeks to make mandatory programs unlawful, is still pending. ● This is an opportune time to review your arbitration agreements from top to bottom and revise them in ways that may be helpful in enforcing them. Ensure they clearly and obviously comply with California law. Arbitration agreements should be standalone documents and be fair, straightforward and clear.
● Where an arbitration agreement is electronically signed, confirm that audit trails are enabled and that appropriate security measures are taken to ensure that only the assigned employee has access to sign the agreement. ● Translate arbitration agreements to reflect the languages of the workforce. ● Do not use “browserwrap” agreements in electronic arbitration agreements. That is, the terms of the agreement should be on the electronic display in the agreement, as opposed to making any terms accessible only through a hyperlink.
Key Takeaways
There is no time more important than the present to review and update arbitration agreements for use with California employees. Arbitration agreements should be revised to take advantage of the Viking River decision. Keep in mind that California law concerning arbitration agreements has become intricate and that Viking River leaves open questions. Whenever you revise your arbitration agreement, involve counsel knowledgeable in California employment law. This article first appeared here.
Jeffrey S. Horton Thomas is Partner at Fox Rothschild.
Steven P. Gallagher is an Associate at Fox Rothschild.
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