January 2014 issue by Cynthia Thompson

Volume 4 : Issue 1 TM

www.HRProfessionalsMagazine.com

ACA’s Impact on Health Benefits and Coverage in 2014

Even the Doctor is Not Immune HR’s Secret Weapon:

The Power of Big Data

2014 Hot HR Topics

Carol Ross-Spang SVP,

Human Resources

Methodist

LeBonheur Healthcare

New Year’s Resolution - Get Your

Welfare Benefit Plan in Compliance

JUST PUT IT ON THE COMPANY CARD…NOBODY WILL NOTICE.

YOU’RE REALLY SHOWING OFF YOUR BEST ASSETS TODAY.

THEY’RE WORRIED ABOUT OVERTIME. I’M JUST WORKING OFF THE CLOCK.

I NEVER WEAR THE SAFETY GOGGLES. THEY LEAVE A MARK.

What you don’t hear can still hurt you. The things employees say when you’re not around can cause legal troubles for you. Fisher & Phillips provides practical solutions to workplace legal problems. This includes helping you find and fix these kinds of employee issues before they make their way from the water cooler to the courthouse.

1715 Aaron Brenner Drive • Suite 312 • Memphis, TN 38120 • 901.526.0431 www.laborlawyers.com

ATLANTA BALTIMORE BOSTON CHARLOTTE CHICAGO CLEVELAND COLUMBIA

COLUMBUS DALLAS DENVER FORT LAUDERDALE GULFPORT HOUSTON

IRVINE KANSAS CITY LAS VEGAS LOS ANGELES LOUISVILLE MEMPHIS

NEW ENGLAND NEW JERSEY NEW ORLEANS ORLANDO PHILADELPHIA PHOENIX

PORTLAND SAN ANTONIO SAN DIEGO SAN FRANCISCO TAMPA WASHINGTON, D.C.

Bringing Human Resources & Management Expertise to You

16%

of large employers not providing health coverage to spouses that have other coverage available www.HRProfessionalsMagazine.com Editor

Cynthia Y. Thompson, MBA, SPHR Publisher

The Thompson HR Firm HR Consulting and Employee Development Art Direction

Park Avenue Design Contributing Writers

Joshua Aversa Misty Wilson Bortowski Harvey Deutschendorf Andrew “Danny” Gattas Jr. Mary C. Hamm Kristi H. Johnson Kristen Minton Michael S. Moschel Paul E. Prather Cristie Upshaw Travis Betsy Weintraub Board of Advisors

Austin Baker Jonathan C. Hancock Ross Harris Diane M. Heyman, SPHR John E. Megley III, PhD Terri Murphy Susan Nieman Robert Pipkin Michael R. Ryan, PhD Contact HR Professionals Magazine: To submit a letter to the editor, suggest an idea for an article, notify us of a special event, promotion, announcement, new product or service, or obtain information on becoming a contributor, visit our website at www.hrprofessionalsmagazine. com. We do not accept unsolicited manuscripts or articles. All manuscripts and photos must be submitted by email to Cynthia@hrprosmagazine.com. Editorial content does not necessarily reflect the opinions of the publisher, nor can the publisher be held responsible for errors. HR Professionals Magazine is published every month, 12 times a year by the Thompson HR Firm, LLC. Reproduction of any photographs, articles, artwork or copy prepared by the magazine or the contributors is strictly prohibited without prior written permission of the Publisher. All information is deemed to be reliable, but not guaranteed to be accurate, and subject to change without notice. HR Professionals Magazine, its contributors or advertisers within are not responsible for misinformation, misprints, omissions or typographical errors. ©2011 The Thompson HR Firm, LLC | This publication is pledged to the spirit and letter of Equal Opportunity Law. The following is general educational information only. It is not legal advice. You need to consult with legal counsel regarding all employment law matters. This information is subject to change without notice.

TO DO

Features 4 note from the editor

WEB EXCLUSIVES

5 Profile: Carol Ross-Spang 6 ACA’s Impact on Health Benefits and Coverage in 2014 13 HR’s Secret Weapon: The Power of Big Data

HTTP://HRProfessionalsMagazine.com /Exclusives

15 Latosha Dexter Named Girls, Inc. Board Chair 16 New Year’s Resolution - Get Your Welfare Benefit Plan in Compliance 26 Religious Challenges to the Affordable Care Act

Departments 11 Employment Law: Even the Doctor is Not Immune 19 EEOC: Best Practices for Responding to an EEOC Charge Part I 20 DOL: DOL Crackdown on Misclassified Employees 23 Immigration: Immigration Law in 2014: An Employers’ To-Do List 27 ER: The 2014 Labor and Employment Law Watchlist 28 Leadership: Leadership in Today’s World 30 EQ: Responding to Criticism

Industry News 7 Highlights from the 2013 Memphis Bar Association L & E Section Annual Seminar 8 Highlights from the “Obama NLRB and Employee Access to Company Property” Littler Breakfast Briefing 24 Strategic Plan Brings SHRM Pinnacle Award Home to Northwest Arkansas

Next Issue Top Companies in Payroll and HRIS Technology Highlights from the TN SHRM Strategic Leadership Conference Legislative Updates and HR Policy Issues www.HRProfessionalsMagazine.com

a note from the Editor

hat an exciting year 2013 was! Perhaps you have made many resolutions for 2014. I hope among them were resolutions to enhance your professionalism and educate yourself on how to become a more strategic HR business partner. Our mission is to inform and educate HR professionals in Tennessee, Mississippi and Arkansas. We have worked hard the past year to bring you educational and informative articles in every discipline of the human resources function. We have also increased our footprint with our Strategic Leadership for HR Executives seminars launching into Jackson, MS in November. In addition, it’s been great partnering with one of our key sponsors, Data Facts, Inc. to bring you monthly complimentary webinars that are pre-approved for business strategy credits. We will continue on this path in 2014 to increase our coverage with new and exciting seminars and webinars! Our focus this issue is HR in Health Care and we are honored to have Carol Ross-Spang, SVP Human Resources for Methodist LeBonheur Healthcare in Memphis, on our cover. I know you will enjoy reading her profile and learning about her exciting career in the health care industry. Health Care Reform continues to be a very challenging topic in the HR community as the law continues to unfold. We thank Cristie Upshaw Travis, CEO of the Memphis Business Group on Health, for providing her insight on the “ACA’s Impact on Health Benefits and Coverage in 2014.” You will also want to read Kristen Minton’s article on “Getting Your Welfare Benefit Plan in Compliance.” Paul Prather also has provided a very informative article on the Challenges to the ACA.” Best Workplaces Ad“Religious - 7.375x4.875_Ad 1/16/14 10:15 AM Page 1

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Another hot topic for HR professionals is how to become more analytical and how to use data to make a business case for your HR initiatives. Joshua Aversa with Ultimate Software provided an article on “HR’s Secret Weapon: The Power of Big Data,” based on his excellent presentation at our November seminar in Jackson, MS. Speaking of big data, please join us on January 28 for our complimentary webinar on “Strategic HR Metrics.” We will help you figure out what metrics are most important to your C-Suite. Watch for your email invitation. I’m looking forward to being in Chattanooga this month visiting SHRM Chattanooga and speaking on “Trending Your Workforce Management Teams” at the lovely Chattanoogan Hotel. It is always a treat to visit this beautiful city and see all our SHRM friends there. I am also excited to be speaking at the 2014 Tennessee SHRM Strategic Leadership Conference this month in Nashville. My topic will be “Strategic Decision Making for HR Executives – IQ or EQ?” Looks like 2014 is going to be another exciting year!! Be sure to follow us on Facebook and LinkedIn as well Twitter @ cythomps and stay informed!

Cynthia Y. Thompson | Editor cynthia@HRprosMagazine.com www.HRProfessionalsMagazine.com

Carol ROSS-SPANG on the cover

Carol Ross-Spang Senior Vice President, Human Resources

Carol Ross-Spang is Senior Vice President of Human Resources for Methodist Le Bonheur Healthcare. She joined Methodist in 2000 as vice president of Human Resources and was promoted to her current role in 2001. In 2003, she was awarded the Methodist Healthcare Sherard Award as Executive of the Year for her work in leading the organization’s human capital strategies. Prior to joining Methodist, Ms. Ross-Spang held a variety of human resources positions at Harrah’s Entertainment, Inc., The Promus Companies and Holiday Corporation. She received both a Bachelor of Science and a Bachelor of Arts degree, cum laude from Bowling Green State University in Bowling Green, Ohio. While a student there, she also received the Distinguished Service Award for academic and student leadership. Ms. Ross-Spang has served on the Board and Executive committee for Shelby Farms Park Conservancy since 2007 and on the Board for the New Memphis Institute (formally the Leadership Academy) since 2009. She is a graduate of Leadership Memphis (Class of 1999) and an active member of senior human resource executive groups through the Society for Human Resource Management (SHRM) and the Healthcare Leader’s Board. Past Board memberships include the Advisory Board for the University of Tennessee Health Science Center, the Memphis YWCA and the Poplar Pike Arts Guild. Ms. Ross-Spang recently received Memphis Business Journal’s “2013 Super Women in Business” award. Ms. Ross-Spang moved to Memphis in 1978 with her husband Mike Ross-Spang, owner of Healthy Habits Fitness. They have two children- Matt, Manager and Sound Engineer at Sun Studio and Allison, a recent graduate of the College of Charleston in South Carolina and the Customer Relations Manager for Spoleto Festival USA. 

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ACA’s Impact on Health Benefits and Coverage in By Cristie Upshaw Travis

2013 was another year for employer’s focusing on compliance with an eye toward 2014 as the next momentous year of change. Most employers spent time making benefit design decisions to balance compliance with ACA “affordability” requirements and controlling the total cost of the plan. Although generally seen as a relief to employers, the delay of the employer mandate-related reporting requirements and penalties issued in July, was too late for many that had already finalized plan design and contribution strategies for 2014. Other health reform developments also put pressure on the costs of employer-sponsored health plan coverage, for example: • T ennessee’s decision NOT to expand Medicaid eligibility resulted in more Tennesseans being eligible for subsidies on the exchange since TennCare coverage was not an option. Employers with many low-wage workers were faced with the issue of having to limit employee premiums to 9.5% or less to avoid a penalty, which could increase the cost of the employer contribution. • T he individual mandate is likely to increase enrollment in employer-sponsored health plans. According to Mercer, on average, 22% of eligible employees waive coverage for themselves because they receive coverage elsewhere or they forgo coverage completely. With the individual mandate, fewer employees will waive coverage and many of those newly covered will elect dependent coverage, both of which will increase employer health plan costs. • Extension of coverage to all employees working 30 or more hours per week will also increase enrollment. Mercer estimates that about 32% of all employers with 500+ employees will see increased coverage under this rule. Almost half of the wholesale/retail organizations will see increased coverage. Mercer found that the majority of large employers anticipate a 3.5% increase in costs, on average, associated with the new fees and higher enrollment numbers. This increase is on top of normal annual increases. 6

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2014

What changes did employers make to comply with the employer mandate that they thought would be effective in 2014?

Increasing use of account-based, high deductible health plans. As predicted, more employers offered account-based, high-deductible plans to meet both the ACA’s affordability requirements AND keep total plan costs under control. According to Mercer, these plans can cost 17-20% less than a traditional PPO or HMO respectively. These plans are also a way to avoid the 40% excise tax effective in 2018. With about 33% of large employers being at risk now to pay that excise tax, we are likely to see even more growth in these plans. Mercer found that approximately 66% of large employers and 33% of small employers plan to offer these plans within three years. Making eligibility changes that are still allowed under ACA. Some employers (about 16% of large employers according to Mercer) are not providing coverage to spouses that have other coverage available (remember the uproar over UPS’s decision?) or at least implementing a surcharge or special provisions for spouses. Another strategy is to eliminate coverage for part-time employees working less than 30-hours, with Wegman’s grocery store chain being the most visible example when they decided to drop insurance for employees working 20-29 hours. We may see more employers adopt these strategies once the impact of increased enrollment and coverage is evident. Implementing surcharges. 48% of very large employers (20,000+ employees) now have an incentive for employees not to use tobacco. Expect to see more employers do the same as it becomes more acceptable, especially since plans on the health insurance exchange have moved in this direction. Deloitte reports that overall, about 49% of the employers in their survey have increased premiums or implemented surcharges for unhealthy lifestyles. Expanding health management and wellness programs. Mercer found that 52% of large employers now offer financial incentives to increase participation in these programs, which is a 29% increase in just 2 years. They also found that more employers are now providing incentives for actually achieving outcomes (up 2% to 20% in 2013). Deloitte found that over one in three employers are now including family members in these programs (note: results are from a small sample size and are, therefore, directional only).

Given all the changes they have had to make, how do employers feel about health reform? As I studied the results of the Deloitte employer survey, I was surprised to find that among employers with 1,000+ employees, approximately half believe that health reform was a good start in reforming the health system. I was pleased to see that these same employers realize that aligning payment with outcomes, price transparency, and increased use of HIT are among the top health care system improvement strategies. All three of these strategies are incorporated into the ACA. Perhaps these findings show that some employers are taking the long view and are at least hoping that the changes required or facilitated by health reform will, in the end, have a positive impact on the health system, including health benefits and coverage. That said, I imagine not all employers feel this way! Data from the Mercer National Survey of Employer-Sponsored Health plans completed in the late summer 2013 and the Deloitte Center for Health Solutions’ 2013 Survey of U. S. Employers completed in July 2013 were used in this article.

Cristie Upshaw Travis, CEO Memphis Business Group on Health ctravis@memphisbusinessgroup.org www.memphisbusinessgroup.org

Labor & Employment Law Section Annual Seminar December 6, 2013

2013 Tennessee State Law Update

Lisa Lichterman Leach was Chair of the 2013 event.

Supreme Court & Sixth Circuit Update

EEOC Update

US District Court Western District of Tennessee

A Guided Tour of the New Rule 9

Photo 1 Lisa Lichterman Leach with Littler was Chair of this year’s event at the Holiday Inn at the University of Memphis on December 6. Photo 2 Dylan King, Ford & Harrison, and Marcus A. McDaniel, Senior Corporate Counsel, Labor & Employment, ServiceMaster Company, provided the 2013 Tennessee State Law Update. The discussion included guns in parking lots, disqualification of benefits if employee terminated for “misconduct,” prohibition of labor neutrality agreements, and Tennessee Wage Notification. Photo 3 Paul Prather and Judge Julia Gibbons discussed the Hobby Lobby ACA case and Rule 23 Class Actions under FLSA. Photo 4 David Rudolph, plaintiff’s attorney with Bourland Heflin Alvarez Minor & Matthews, was the luncheon speaker. His topic was US District Court, Western District of Tennessee: A Review of Significant Labor and Employment Law Decisions and Jury Verdicts 2013. Photo 5 (L-R) Maureen Holland with Holland & Associates; Katharine Kores, District Director with the EEOC; and Louis Britt with Ford & Harrison, presented an Update from the EEOC. The discussion focused on EEOC guidance on convictions and arrests. Kores advised that the Memphis EEOC ADR Mediation program has been very successful. Photo 6 Ethics – A Guided Tour of the New Rule 9 – Brian S. Faughnan with Thomason Hendrix Harvey Johnson & Mitchell, PLLC, discussed the life cycle of the new disciplinary rule effective Jan. 2014. www.HRProfessionalsMagazine.com

The Obama NLRB and Employee Access to Company Property Littler Breakfast Briefing

Tanja Thompson, Shareholder with Littler, presented, â&#x20AC;&#x153;The Obama NLRB and Employee Access to Company Property,â&#x20AC;? at the Memphis Hilton on December 12.

(L-R) David Pool, Patrick Fleming, Tanja Thompson, and Stephanie Hinrichs with Littler.

(L-R) Virginia Leonard with MLGW and Carl Parnell with Cartus Corporation.

(L-R) Angela Hewlett with MLGW and Barbara Richman with HR Mpact.

(L-R) Catarsha Atkins and Peggy Carroll with Bridges.

(L-R) Janna Rogers with DeSoto County, Barbara Emigh with Medtronic, and Amy Parkison with EdR.

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EMPLOYERS LAWYERS

Working Together in Mississippi Ogletree Deakins lawyers in Jackson, Mississippi work closely with Human Resource professionals, business executives, and inhouse counsel to anticipate, prevent and resolve legal issues in the workplace. Our experience and knowledge of our clients’ industries and legal challenges enable us to serve their interests effectively and efficiently.

We remain committed to providing our clients with an insider’s view of the workplace issues of the day. With more than 650 attorneys in more than 40 offices located in the United States and Europe, the firm combines local knowledge and strength with national resources.

Jackson office attorneys L-R: Timothy Lindsay, Robin Banck Taylor, Kristi Haskins Johnson, Bert Ehrhardt 100 Renaissance • 1022 Highland Colony Parkway, Suite 200 • Ridgeland, MS 39157 • 601.360.0995 www.ogletreedeakins.com LAW FIRM OF THE YEAR Litigation – Labor & Employment LAW FIRM OF THE YEAR Employment Law - Management

Even the Doctor is Not Immune

By Betsy Weintraub

A federal jury recently awarded $350,000 in punitive and compensatory damages to three former employees of Endoscopic Microsurgery Associates, a Baltimore-area medical practice, who were subjected to unwanted sexual advances by Dr. Mark Noar, the Owner/CEO of the practice, and Martin Virga, the Practice Administrator.

Allegations According to the Complaint filed by the Equal Employment Opportunity Commission (EEOC), Noar and Virga made “frequent unwanted sexual comments” to the female employees, as well as “frequent sexually derogatory comments about women,” and he “physically touch[ed] and grabb[ed] female employees in a sexual manner against their will.” Complaint 3. The Complaint further alleges that, “[d]espite repeated complaints to management,” the harassment continued and intensified, evolving “into a retaliatory hostile work environment.” The Defendant even “[threw] papers at female employees…” and eventually terminated one of them, presumably “in retaliation for engaging in protected activity.” Complaint 4.

Verdict and Damages The jury returned a verdict in favor of each of the three female employees. The jury found that Defendant had subjected Linda Luz, Jacqueline Huskins and Kimberly Hutchinson to a sexually hostile work environment. The jury further found that Virga’s conduct, at least in part, contributed to the sexually hostile work environment, and that Virga was at least partially responsible for the retaliatory harassment of Luz. Finally, the jury found that Defendant had terminated Luz’s employment “because she complained about and/or opposed sexual harassment.” The jury awarded $110,000 in punitive damages to each of the female employees, and compensatory damages ranging from $4,000 to $10,000 each. In its press release following the verdict, EEOC Philadelphia regional attorney Debra Lawrence stated that the verdict “reminds high-level officials who function as the employer that their high level does not give them license to abuse women – they must treat employees as professionals.” said. Maria Salacuse, the EEOC’s lead counsel in the case, added that the case “emphasizes the necessity of employers having in place meaningful and enforceable policies guarding against such mistreatment.”

Physician Immunity EEOC does not have a history of targeting physicians in Title VII sexualharassment litigation, although among the 7,500 or more sexual-harassment charges filed each year, many of the complainants are employees of medical facilities. The question then is why EEOC chooses the cases it does litigate each year against physicians, and, more importantly, how can a medical facility avoid www.HRProfessionalsMagazine.com

becoming a target? The likely answer to the first question becomes apparent by comparing the above case to one of the few published opinions in the past several years where EEOC has litigated a sexual-harassment claim against a medical clinic: EEOC v. Fairbrook Medical Clinic, P.A., 609 F.3d 320 (4th Cir. 2010). In Fairbrook, EEOC filed suit on behalf of a female physician “Charging Party” against her former employer, alleging a sexually hostile work environment. The alleged harasser in the case was Dr. John Kessel, the sole owner of the clinic and Charging Party’s direct supervisor. The Court of Appeals reversed the district court’s grant of summary judgment in the case, concluding that “[w]hat happened here . . . was . . . a series of graphic remarks of a highly personal nature directed at a female employee by the sole owner of an establishment.” Id. at 322. Among other harassing behavior, EEOC alleged that Dr. Kessel showed the Charging Party and other employees an x-ray of his hip that included “a shadowy image of his penis,” which Kessel referred to as “Mr. Happy” on multiple occasions. Kessel discussed intimate details of his sex life with Charging Party, despite the fact that Charging Party told him that the comments made her uncomfortable. Perhaps the most egregious allegations took place after Charging Party returned from maternity leave, when Kessel frequently commented on her breast size, often asking if he could see her breasts and help her pump her breast milk. Id. at 325. Eventually, Charging Party resigned from the clinic. Id. at 325-26. Significantly, in the Fairbrook case, the clinic had a policy prohibiting sexual harassment, but the reporting system was inadequate. Employees were directed to report complaints of sexual harassment to their “immediate supervisors”; if that method was ineffective, employees were to report complaints to “the partners” of the clinic “and ultimately to ‘a human resource representative or a representative of the EEOC.’” Id. at 326. Not only was Dr. Kessel Charging Party’s immediate supervisor, but he was also the only “partner” at the clinic because he was the sole owner. Charging Party still brought her complaints to Kessel, which he apparently ignored, referring to her as “one of the guys.” Id. at 323, 326. When Kessel failed to change his behavior after Charging Party’s repeated complaints, Charging Party reported his actions to the office manager and possibly the personnel manager. Charging Party exhausted all of her internal resources, yet “[t]he clinic did not conduct an investigation or take any corrective action.” Id. at 326.

Why These Cases? Besides the fact that the allegations in both the Endoscopic and Fairbrook cases are egregious, the cases share another commonality: the medical facility learned about the harassing conduct and did nothing. In any workplace, tolerance of sexual harassment sends a clear message that the workplace considers itself above the law. In the case of medical clinics, however, the message is also one of fear. Physicians often 12

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own or hold shares in the facilities where they work, and their titles alone carry an air of respect and even immunity from wrongdoing. Accordingly, when the physician is the harasser, he or she may seem untouchable, despite whatever harassment policies may be “on the books.”

What HR Professionals in the Medical Industry Can Learn From These Cases First and foremost, assuming the allegations in these cases are true, the harassment should never have gone as far as it did. If these clinics had had effective policies prohibiting sexual harassment in the workplace, the victims of the harassment would have known exactly what to do after the first inappropriate comment and human resources could have taken measures to ensure that the first comment was also the last. Policies prohibiting sexual harassment – or any form of harassment – are meaningless if they do not provide a clear chain of command for complainants. In drafting a policy, the HR professional should put his/herself in the shoes of each employee in the company and determine what that employee would need to do if he/she needed to report a complaint. It is extremely important that each employee has an alternate route to take, in the

More importantly, each individual in the chain of command for reporting complaints must have the authority to take immediate action to resolve the issue. event that the employee’s supervisor is the alleged harasser. More importantly, each individual in the chain of command for reporting complaints must have the authority to take immediate action to resolve the issue. If, for example, the office manager cannot ask a physician to leave for the day while the clinic conducts an investigation into allegations against the physician, the office manager does not belong in the chain of command. Beyond setting forth a clear route for reporting harassment complaints, HR professionals also need to have a plan in place in the event that one of the physicians is accused of harassment. Whereas in some work environments, the company could simply investigate and terminate the alleged harasser, termination is not always an option when a physician is a partner in the medical office, or brings in a large percentage of patients. Accordingly, if an investigation reveals that the physician sexually harassed an employee, the HR professional may need to consider other effective options for remedying the situation. Training sessions are always a good option, but in some situations, the solution may need to involve a more personal solution, such as requiring the physician to attend individual sensitivity counseling. Finally, always remember the complainant. Ask the complainant what he or she thinks about the recommended plan of action. See if there is anything else that would make the complainant more comfortable in his or her workplace. Keep an open line of communication between the complainant and management so that the complainant knows that his or her comfort at work is a priority, and that even physicians are not above the law.

Betsy Weintraub, Attorney Fisher & Phillips, LLP bweintraub@laborlawyers.com www.laborlawyers.com

HR’s Secret Weapon:

The Power

of Big Data By Joshua Aversa

Big Data has generated a lot of big buzz — but what is it really, and what does it mean to your business? While the term may sound like a catchphrase that repackages traditional business analytics, Big Data represents a phenomenon with implications that already extend beyond the corporate world. The massive collection of rich information available in the cloud is only growing larger — and at an exponential rate. In fact, as of 2013, 90% of all data ever collected has been collected in the last two years. There is no question that HR is moving in a data-driven direction, and harnessing these analytics can empower your company to make fact-based decisions about your company’s human capital investments.

What Is Big Data?

We live in a world that is constantly and drastically increasing the amount of available data, doubling all known human data roughly every 1.2 years. In the time you read this paragraph, the Internet will have seen more than 2 million Google searches, $83,000 of merchandise sold on Amazon.com, and 104,000 new photos shared on Snapchat. The term “Big Data” refers to both the monumental amount of obtainable data and the unprecedented opportunity for insight it provides. As the methods for capturing this new information become more refined, forward-thinking business analysts are recognizing the value in applying this to HCM. In contrast to traditional business intelligence, Big Data focuses on gaining insight from much larger sets of data, with the purpose of uncovering hidden or unknown information that can be used to predict future outcomes. These predictive insights — combined with traditional, descriptive BI — can be very powerful when supporting or driving strategic growth. Now more than ever, companies are beginning to realize how valuable using Big Data can be to their bottom line. Numerous studies are showing tangible results from companies that build a culture based on data-driven decisions. In fact, one MIT study found that companies that use data-driven decisions were 5% to 6% more productive than their competitors.

From Subjective to Data-Driven Decisions

By now, you’ve probably noticed an obvious truth: Your workforce is rapidly changing. Many workers from the millennial generation will soon move into leadership positions as their predecessors retire. And each generation brings new expectations that are shaped and influenced by their lives outside of the office. New generations of workers are leveraging Big Data (whether they realize it or not) to make even the most basic decisions: Where should I spend my time tonight? What should I eat? Foursquare and Urbanspoon are just two examples of Big Data sources used in their daily experiences. New generations of employees also use predictive analytics to make purchasing decisions. For example, personalized recommendations from Amazon offer some assurance that your money is being spent on something you’ll like — maybe even more accurately than you’d be able to do for yourself by browsing product descriptions. In addition, members of the ‘digital native’ generation have even started to digitize their physical lives — a movement described as the ‘Age of the Quantified Self.’ This movement

has exploded due to the purchase of wearable computing devices such as the Fitbit, Nike+ SportWatch GPS, and FuelBand. These devices constantly track and analyze sleep, activity, and diet. Users can leverage this data to improve their health and make micro decisions — like performing a relaxation exercise when the device identifies an elevated stress pattern. What does all of this mean for HCM? By using a progressive HCM solution, companies can analyze actions across the employee lifecycle that users perform on a daily basis as well as the factors that drive these actions. Some examples of how this type of analysis can be used: • As recruiters create open job opportunities, they could see a data visualization showing the top skills and competencies for a given position that resulted in a hire decision. • When determining where to post opportunities, a recruiter could view a chart comparing hire and retention rates per posting source for the specific position to help drive their source selection decision The changes in your workforce makeup, along with new technological capabilities, set the stage for the full spectrum of executives, managers, employees, and analysts to make data-driven decisions.

The Future of HCM: Talent Insight

One area of business stands out to HR directors clearly over the rest as a key place to apply predictive and prescriptive business insight: talent retention. www.HRProfessionalsMagazine.com

Why should this be a primary focus? According to a Harris Interactive Poll, 74% of people would consider finding a new job today, and 35% of people quit their jobs within the first six months. Studies show that it can cost from $5,000 to $20,000 to replace a single hourly employee, or 30% to 100% of the salary of a knowledge worker. Additionally, the fallout from losing an executive can be immense. Considering the tangible negative impact to your bottom line, futureproofing your talent should be a key imperative. And Big Data analytics can empower your organization to take proactive measures to retain your best talent. With a wide array of metrics now available, modern data scientists are able to develop algorithms that attempt to objectively predict how likely a given employee is to leave your organization. These predictions can even be quantified into a consistent â&#x20AC;&#x2DC;retention scoreâ&#x20AC;&#x2122; for every active employee. Where traditional BI can help with identifying broader trends and reports at the organizational level, predictive analytics like a retention score are designed to provide insight at the employee level. As a result, your company can be better positioned to retain employees that may be at risk. By applying Big Data, you can derive this retention score from information that is available across the employee lifecycle. For example, data you gathered while an employee was a candidate might provide key information that identifies his or her at-risk potential. You can also leverage information including demographic data, benefits history, compensation history, job history, and many other factors. A best-in-class HCM solution will also deliver this retention score in an intuitive way, one that can be easily and quickly interpreted. Managers can even set alert thresholds so that they are automatically notified to take action when an employee reaches a certain level of risk.

Smarter Decisions for the Future

Big Data means thinking big and innovating on how you use the insights available within your data. Applying the power of Big Data to your evolving workforce can lead to real business impact in your organization. You can use it to better source talent, manage compensation and benefits, prepare for demographic shifts, achieve higher talent retention, and stake a competitive advantage. Many organizations today are looking for ways to harness the power of Big Data. Bringing together various data sources to understand your people can help you make better workforce decisions for today and tomorrow. Ultimate Software provides organizations of all sizes and across all industries with a unified HCM solution that has the unique ability to analyze tremendous amounts of people data. Within its UltiPro solution, Ultimate has developed a feature that businesses can use to predict employee retention: The UltiPro Retention Predictorâ&#x201E;˘ is part of a new generation of insightdriven tools that can help organizations proactively and strategically manage their talent.

Joshua Aversa, Senior Technical Product Manager Ultimate Software Joshua_Aversa@ultimatesoftware.com www.Ultimate Software.com 14

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Latosha Dexter, SPHR,

Named Board Chair of Girls, Inc. of Memphis

Latosha Dexter, an attorney with Rainey Kizer Reviere & Bell PLC, was recently named Chair of the Board of Directors for Girls Inc. of Memphis, as well as the organization’s Mentor of the Year. Latosha’s area of practice at Rainey Kizer focuses on employment law. She moved to Memphis in 2003 to get married and open an office for Rainey Kizer in Memphis. Latosha earned a Bachelor of Science in political science from Middle Tennessee State University before obtaining her law degree from the University of Tennessee College of Law in 2000. She was interested in becoming a pediatrician, yet she later discovered a greater interest in history and English. In conversation with a friend in college administration, she worked through these interests to learn where they might lead as a career, and law became the obvious choice for her. In the practice of employment law, Latosha’s focus is on municipalities and governmental liability issues. She left the practice of law briefly to join FedEx Corp in the human resources department as a program management adviser. This experience provided her more insight into working with employers and human resources specialists. She also became certified as a Senior Professional in Human Resources (SPHR). Latosha’s love of helping others led her to serve on the board of the Boys & Girls Club in Jackson. She has been involved with Girls Inc since 2007, but her passion for helping began at an early age. She started mentoring with the Boys & Girls Club in ninth grade. She made a coincidental call to Girls Inc., which had just received a grant from the Memphis Grizzlies Charitable Foundation, to begin a mentoring program and ended up being their first mentor. Currently in the Executive Program with Leadership Memphis, Latosha is working with Kingsbury High School. She has been impressed with the students and faculty, and finds that one of the challenges facing them both is resources. She’s working with seniors toward goals such as identifying the colleges they might want to attend and filling out applications. In addition to her legal work and mentoring, Latosha participates in speaking engagements, is an adjunct professor with ITT Technical Institute, teaching a paralegal class, and writes for HR Professional Magazine on EEOC related topics. Her husband, Michael Dexter, works for Methodist Le Bonheur Healthcare and is the incoming president for the Memphis Chapter of the National Association of Health Services Executives. The couple has two children – Aaliyah, 10, and Jazz Mason, 19, a sophomore at University of Central Arkansas.

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It is that time of year again; time to make those New Year’s resolutions! For 2014, I will:

New Year’s Resolution - G et Your Welfare Benefit

TO DO

Plan in Compliance

(1) Eat Better (2) Exercise More (3) GET MY WELFARE BENEFIT PLANS IN COMPLIANCE WITH ERISA!

By Kristen Minton

While this may sound unconventional, employers need to resolve to get their welfare benefit plans in compliance with the Employee Retirement Income Security Act (ERISA) in 2014. When ERISA was passed almost 40 years ago, a large focus of the law was on retirement plans. Since that time, much of the scrutiny by regulators has been on retirement plans as well. Now with an ever changing landscape in the welfare plan area and with the passage of the Patient Protection and Affordable Care Act (PPACA), Employers are facing more scrutiny from the Department of Labor, the Internal Revenue Service and participants when it comes to employer sponsored health and welfare benefit plans.

DOES ERISA APPLY? Employers should analyze their entire offering of welfare benefits to determine if ERISA applies. Generally, ERISA applies to any employee welfare benefit plan established or maintained by an employer that provides certain benefits such as medical, surgical, hospital care, accident, disability or benefits in the case of sickness or death, along with many other employer provided benefits, unless specifically exempted. THERE IS NO EXCEPTION FOR SMALL EMPLOYERS UNDER ERISA. Two of the main exceptions include church plans and governmental plans. In addition, the regulations provide another exemption where there is an insurance program if: (1) no contributions are made by an employer or employee organization, (2) participation is voluntary, (3) the employer’s or employee organization’s sole function is to collect premiums and permit the insurer to publicize the program, and (4) the employer or employee organization receives no consideration from the program, other than for administrative services. Once an employer determines that ERISA applies, it must understand the requirements in order to comply with the law.

ERISA’S GENERAL REQUIREMENTS ERISA does not mandate that employers provide any certain level of benefits. Employers are generally free to design their own benefit plans. Broadly speaking, ERISA requires plans to provide participants with information about plan features and funding. ERISA contains fiduciary responsibilities for those who manage and control plan assets. Additionally, ERISA establishes a grievance and appeals process for participants to get benefits from their plans, and give participants the right to sue for benefits and breaches of fiduciary duty.

DISCLOSURE REQUIREMENT ERISA requires plans to have a plan document and a summary plan description (SPD). The SPD must be automatically provided to participants within 90 days of becoming covered by the plan and an updated SPD must be provided at least every five years if changes have been made to the plan. The summary plan description is an important document that tells participants what the plan provides and how it operates. It provides information on when an employee can begin to participate in the plan, how service and benefits are calculated, when benefits become vested, when and in what form benefits are paid, and how to file a claim for benefits. If a plan is changed, participants must be informed, either through a revised summary plan description, or in a separate document, called a summary of 16

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material modifications (SMM), which also must be given to participants free of charge. A plan administrator must provide an SMM automatically to participants within 210 days after the end of the plan year in which the change was adopted. However, for health plans, an SMM must be provided 60-days in advance of any material modification. Many employers mistakenly assume that insurance carriers provide SPDs and SMMs or the booklets generated by insurance companies will suffice as an SPD or SMM. Generally speaking, information generated by an insurance company lacks the specific information required to meet the definition of an SPD. ERISA also requires the plan sponsor have a written plan document in place and that the plan sponsor maintain copies of the plan document at the principal office of the plan administrator for examination by participants and beneficiaries. The plan administrator must provide copies of the plan document no later than 30 days after a written request. ERISA imposes penalties for failure to provide these documents to participants or beneficiaries upon request. Fines can reach up to $110 per day.

REPORTING ERISA requires welfare benefit plans to file a Form 5500 with the Department of Labor each year. The Form 5500 is used to ensure that employee benefit plans are operated and managed according to ERISA’s requirements. The filing requirements vary according to the type of ERISA plan. Unless an extension applies, the Form 5500 must be filed by the last day of the seventh month following the end of the plan year. A major exemption for small welfare plans allows many employers to forgo the Form 5500. For small welfare benefit plans (those with fewer than 100 participants on the first day of the plan year) that are fully insured, unfunded, or a combination of fully insured and unfunded, the plan is not required to file a Form 5500. Unfortunately, many employers get in the habit of not filing the Form 5500 for their welfare benefit plans because their plans are fully insured and have less than 100 participants. However, there is no magic alarm that goes off when an employer exceeds 100 participants. Ultimately, it is up to the employer, hopefully with the help of trusted advisors, to know when the requirement to file a Form 5500 is triggered. Under ERISA, civil penalties for failure or refusal to file a Form 5500 can be imposed up to $1,100 per day on the plan administrator. The DOL takes the position that the penalties are cumulative so that the maximum per day penalty may be assessed for each Form 500 that is not filed. The DOL does maintain a late filer program with substantially reduced penalties for plan sponsors that voluntarily file past due Form 5500s. With increased scrutiny of health and welfare benefit plans because of PPACA, now it the right time to make a New Year’s resolution to review your welfare benefit plans to make sure you are meeting the required reporting and disclosure rules.

Kristen Minton, Associate General Counsel Regions Insurance kristen.minton@regions.com www.regionsinsurance.com

Legal Challenges are Coming at HR Professionals from Every Direction

Thatâ&#x20AC;&#x2122;s Why Rainey Kizer Makes Your Business Our Concern The issues facing Human Resources executives are becoming more frequent, more challenging, and more complex each year. Whether you are navigating the Affordable Care Act, tracking changes in the Family Medical Leave Act, or staying current with the latest revisions in workersâ&#x20AC;&#x2122; compensation law, trusted attorneys are invaluable. This is why you need to get to know the employment-law attorneys at Rainey, Kizer, Reviere & Bell PLC. At Rainey Kizer, we make your business our concern. For more than 30 years, our AV-rated firm has advised businesses, non-profit organizations, and government agencies on all aspects of employment law; and represented our clients in state and federal courts and before state and federal regulatory agencies. If you would like to discuss how we can help you, please call.

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Best Practices for Responding to An EEOC Charge: Part I By Kristi H. Johnson

Step 1: Carefully review the EEOC Charge This seems like an obvious point, but oftentimes employers in their haste to begin a factual investigation, overlook key dispute areas. When the notice of charge and charge hit your desk, ask yourself the following questions:

Step 2: Calendar the response and any other deadlines; Seek extensions if necessary If the EEOC initially sent the charge to the wrong address, you may have a very short timeframe in which to submit a response. Make sure you know when your response is due. If the charge is particularly lengthy, witnesses are out of town, or you need time to conduct a full investigation, you may need to ask for more time to submit your response. You can always contact the investigator and let him or her know the particular circumstances that support your request for more time. We have yet encountered an investigator who has denied such requests, particularly where the employer has made an effort to promptly notify the investigator before the deadline passes.

Does the charge identify the correct employing entity? Particularly with respect to those employers with multiple service or business lines, we frequently see charges that do not identify the correct employing entity. Instead, the charge may identify a corporate parent or other subsidiary or affiliate that has no legal relation to the charging party’s allegations. This simple observation can be important for many different reasons, including the triggering of notice requirements and insurance coverage for the proper employing entity. If the charge does not identify the correct employer, you will want to prominently note that fact in your charge response.

Is the charge signed by the employee? Jurisdictions may differ in how they treat the receipt of an unsigned charge. Sometimes, the fact that a charge is unsigned is nothing more than carelessness on the part of the person filing the charge. In some instances, however, it can mean that the employee has actually filed an amended charge that may substantially change the initial allegations in the charge you have received.

Is the charge time-barred? Carefully examine the date of the filing of the charge and the dates the person claims he or she suffered harm. If the employee files the charge with the EEOC in a so-called “non-deferral” state such as Mississippi, then the employee must do so within 180 days after the alleged unlawful employment practice occurred. In so-called “deferral” states, (states that have a local civil rights agency with the power to investigate and contest alleged discriminatory practices), the charge must be filed within 300 days of the unlawful practice. You should check the time limits applicable to your state and determine whether the employee has satisfied those deadlines. In our experience, the EEOC rarely prohibits the filing of a charge based on the fact that it is time-barred. Usually, the responding party must point this out in the charge response.

Am I being asked to submit a response? It is not uncommon for an employer to receive a notice of filing of charge that advises that no response is immediately required. This does not mean that you can file away the notice and forget about it. To the contrary, you should carefully weigh your options of waiting versus starting an investigation to preserve your evidence, including identifying and speaking to potential witness and preventing document “spoliation.”

Step 3: Consider whether you should involve a lawyer When responding to an EEOC charge for the first or second time, especially if you do not have human resources staff experienced in responding to EEOC charges, you should seek legal assistance. Having a lawyer involved early on can save you a lot of money and risk later. You do not have to tell the EEOC that you are consulting with a lawyer. If you prefer, the response to the agency can come directly from you, even if a lawyer was consulted in preparing it. The other advantage to having legal assistance in responding to an EEOC charge is that experienced employment lawyers have been through this process many times before and have seen and responded to dozens of similar charges and complaints. They likely are familiar with the investigators and the process and can help you respond efficiently, expeditiously, and above all objectively.

Step 4: Institute a litigation hold Companies that are put on notice of potential litigation (often through the receipt of an EEOC charge) but knowingly and intentionally destroy or delete relevant documents and information face serious repercussions in court for their actions. A typical sanction for this kind of misconduct is an “adverse jury instruction,” which in a jury trial is where the judge tells the jury that it can expressly infer that the document the company destroyed supported the plaintiff’s case. When you are put on notice of potential litigation, you should consider the need to issue a company-wide litigation hold. A litigation hold typically suspends the destruction, alteration or deletion of any documents, whether in hard or soft copy, related to the legal issues at hand, and involves the immediate suspension of routine document destruction policies and practices. The stakes can be high if you fail to issue the hold, the charging party files a lawsuit, and the charging party’s lawyer is savvy enough to know that you do not routinely issue such holds. Next month’s article will provide a continuation of this topic. Specifically, the article will discuss how to prepare a thorough response to an EEOC charge.

Is there an insurance carrier I need to notify? If you are an employer that carries applicable insurance, such as employment practices liability insurance (“EPLI”), you should promptly notify your carrier of the receipt of the charge to prevent the possible loss of coverage.

Kristi H. Johnson, Attorney Ogletree, Deakins, Nash, Smoak & Stewart, P.C. kristi.johnson@ogletreedeakins.com www.ogletreedeakins.com www.HRProfessionalsMagazine.com

The DOL crackdown

on misclassifying employees as independent contractors and how to evaluate the risks of your contractor arrangements

By Michael S. Moschel

ompanies and the talented individuals who work for them generally benefit from flexible working arrangements. In the 20th Century industrial-based economy, the labor market exhibited a fairly rigid dichotomy where workers were either full-time employees or occasional collaborators employed by another firm. Today, technology has enabled our workforce to evolve into a continuum of relationships from short-term, freelance or occasional on one end to full-time employment on the other. Labor laws in the United States, however, are stuck in the 20th Century: Workers must be classified as either an employee or an independent contractor. The law has not adapted to today’s flexible labor market.

Defining the problem Imagine a small accounting firm that relies on an independent contractor to provide information technology support. Over time, as the firm grows and adds more accountants, the independent contractor spends a greater portion of his time at the firm. Ultimately, he ends up spending four days a week there, working on computers owned by the firm and working closely with the partner who oversees the internal operations of the firm. The contractor even attends office celebrations and luncheons.

Despite these shortcomings in the law, the federal Department of Labor (DOL) and the Internal Revenue Service (IRS), with the assistance of numerous state agencies, initiated a systemic and robust effort to “crackdown” on the perceived misclassification of workers as independent contractors, starting in 2011.

In many cases, a relationship that initially was a true independent contractor arrangement can morph over time into an employment relationship. It is also very common for an individual to start as an independent contractor and then come on full time as an employee. These shifting relationships mean that human resources professionals need to be ever vigilant in evaluating these relationships and must ensure that managers know they need to provide updates when these relationships change.

Human resources executives must ensure proper classification of their workers with a thorough workforce review. HR professionals should be vigilant and know the signs to look for when evaluating both new and long-standing workforce relationships.

The DOL and the IRS are focusing on this issue because misclassification of workers hampers tax compliance and improperly, in the agencies’ view, denies these workers the protections employees receive under federal and state law.

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The risks of non-compliance The DOL initiated its efforts to crackdown on employers who misclassify employees as independent contractors in 2011. Since then, the DOL has hired hundreds of new investigators in the Wage and Hour Division alone. As a result, we have seen an uptick in investigations and employer audits. The DOL has a Memorandum of Understanding (MOU) with the IRS to share information regarding misclassified employees. The DOL also has MOUs with several state agencies. Independent contractor misclassification implicates a broad range of laws and agencies. Included below is a quick summary of the major risks and potential liability an employer can face. Some states may have additional legal considerations.

• Minimum wage and overtime requirements • Withholding federal employment taxes • Immigration compliance • Minimum contribution standards, outlined by the Employee Retirement Income Security Act • Unemployment insurance premiums • Workers’ Compensation premiums (varies by state) The Patient Protection and Affordable Care Act is likely to heighten the IRS’s interest in misclassification, given the role employment status plays in determining whether an employer is covered by the mandate to offer its workers health insurance.

What to look for Below is a series of questions to ask when evaluating your independent contractor relationships. The answers to these questions will help you determine which relationships require additional scrutiny. • I s the worker compensated on anything other than a project-by-project basis? Pay particular interest to this if the employee is paid on an hourly basis. • I s the worker eligible for employee-type benefits, including but not limited to retirement plans, insurance, or vacation time? • Is the worker reimbursed for expenses by the employer? • D oes the worker perform the same work as current or former employees? This is of particular interest if a former employee is brought back as an independent contractor. • A re the worker’s hours determined by the employer? Notably, watch for regularly kept hours that mirror those of employees and use of employer time-keeping system. • I s the length of business relationship tied to a defined project or goal? If not, this could be a risk. • Does the employer provide materials and equipment? • D oes the employer instruct the worker on how to accomplish assigned work? Typically, a true independent contractor has some autonomy as to how to accomplish a project. • Is the worker subject to a non-compete agreement?

Identified a problem? Correctly classifying workers from the outset is critical. Be aware there are slight variances between the requirements of the IRS and the requirements of the FLSA to qualify as an independent contractor, though both tests focus on the employer’s right to control or direct the worker. Immigration compliance issues also must be considered. If you do identify a problem, work urgently to remedy the situation. Create a comprehensive strategy for addressing all possible sources of liability. Some agencies currently offer settlement programs that allow employers to avoid interest and penalties and to settle accounts for a small percentage of what would otherwise be owed. Other “fixes” are more complex or cannot fully relieve employers of potential liability if audited. Misclassification issues are like a hydra: Because agencies share information, cutting the head off one problem (by resolving a claim) could result in several more heads sprouting up (as other agencies investigate). Regular reviews of independent contractor relationships, communication with managers about the need to disclose changes in these relationships and quick, comprehensive action to remedy any misclassifications that arise can help minimize the risk that your company will find itself embroiled with the DOL and the IRS.

Michael S. Moschel , Attorney Bass, Berry & Sims PLC Nashville mmoschel@bassberry.com www.bassberry.com www.HRProfessionalsMagazine.com

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> Put our dedicated Employment Law team to work for you. <

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Immigration Law in 2014: An Employer’s To-Do List By Misty Wilson Borkowski

you are looking to reduce stress, the cliché is “Don’t sweat the small stuff.” But, if you want to avoid fines and penalties for I-9 Form violations, “the devil is in the details!” The same can be said for making sure your company’s foreign nationals have, or continue to have, valid work authorization and immigration status. For 2014, here are some items that every employer should resolve to do:

1) Form I-9, Employment Eligibility Verification

After an employer has hired an individual, the employer must verify the identity and the employment eligibility of the newly hired individual. By filling out the Form I-9, the employer is certifying that the person is who she says she is, and that she has permission to work in the United States. 2014 is the year to focus on getting this form completed 100% correctly, 100% of the time.

a. I-9 Compliance Training Sometimes there are so many forms for a new employee to complete that the entire first day on the job is spent filling out forms. In addition to IRS W-2 Form for tax withholding purposes and selecting health, dental and vision options, the employee must complete Section 1 of the Form I-9 on the first day of employment. Moreover, the employer must complete the remaining section regarding identity and employment authorization within three (3) business days of the employee’s first day of hire. Because this form is tossed in with all of the other forms, it is not uncommon that it is viewed as a mere administrative matter with little significance, value or importance. Failure to accurately and correctly complete Form I-9 can have dire consequences for the employer – to wit, fines, penalties and potential criminal imprisonment. 2014 is the year to have your Human Resources employee(s) trained on Form I-9 Compliance.

b. Audit I-9 Forms Think that your company’s I-9 Forms are properly and accurately completed? Guess again! Attorneys who have a keen eye for details regularly report that an audit of their clients’ I-9 Forms for compliance typically have a 90% fail rate. Employees frequently write the date of birth where today’s date should have been written. HR personnel frequently place the information for identification document in the wrong column and/or barely fill in the information regarding the employment authorization documents provided by the employee. Performing an I-9 audit now has two advantages – first, it allows you to catch and properly correct the error before ICE audits and fines your company for substantive violations, and second, it re-emphasizes the I-9 Compliance training of HR personnel as it helps them to see how frequently mistakes are made on what most people would argue is a rather simple form. 2014 is the year to have an experienced attorney audit your company’s I-9 Forms or to provide you with guidance on correcting the errors detected from a self-audit.

c. Organize I-9 Forms First and foremost, make sure the I-9 Forms are NOT in the employees’ personnel file. Second, separate the forms for: (1) Current Employees; (2) Employment Re-Verification Required; and (3) Former Employees. When an expiring employment authorization is subject to re-verify, the date should be calendared so that it is not overlooked or forgotten. And, by all means, when the I-9 Form for a former employee is no longer required to be maintained in accordance with the retention requirements, the form should be destroyed. 2014 is the year to organize your company’s I-9 Forms so that re-verification and retention of the I-9 Forms are properly meet compliance standards.

2) Immigration Matters

As the world gets smaller and smaller, employers in every industry, big and small, find that the foreign national workforce is becoming more the norm than ever before. Employers now have to learn a completely new language – not the native language of the foreign national, but “immigration” terminology – acronyms and terms like OPT, CPT, STEM Extension, H-1B, nonimmigrant vs. immigrant, TPS, PERM process, consular processing, etc. For an employer, immigration matters can be overwhelming and completely confusing. 2014 is the year to learn about immigration matters that may affect your company and be prepared to handle the situation competently.

a. Beware of Expiring Work Authorizations Unless a foreign national is already a “lawful permanent resident” (i.e., green card holder), then in all probability her visa status will expire. Your goal is to know when the visa status will expire and be aware of what steps must be taken in order to keep her in status. There are limitations to how long a foreign national can remain in a certain visa category, so the employer must always be looking ahead at what options might be available for the foreign national and employer. 2014 is the year to not just be aware of the expiration dates of employment authorization, but to be proactive with the foreign national in discussing the direction she plans on going with the employer and her visa status.

b. Beware of Filing Deadlines Immigration attorneys love for an employer to call seeking to start the process for a new visa for an employee. However, if the call comes too late to meet a filing deadline, then everyone loses. For example, if an employee is currently working on OPT status, a call to your immigration attorney on April 7 about filing for the coveted H-1B Visas will leave you devastated as all H-1B petitions must be submitted between April 1 – 5 in order to even be considered for the visa lottery. If you haven’t made contact with an immigration attorney by early March, getting the steps and process completed in time might not even be feasible. 2014 is the year to proactively contact your immigration attorney about what steps need to be taken and what filing deadlines you should be aware of in order to keep your foreign national employees in valid status. Yes, sweating the small stuff is normally not good advice. However, for immigration matters and learning to properly complete the I-9 Form, concerning yourself with the details will, in the end, save you and your company a great deal of stress. 2014 is the year to get a handle on your company’s I-9 Forms and immigration matters.

Misty Wilson Borkowski, Attorney Cross, Gunter, Witherspoon & Galchus, P.C. mborkowski@cgwg.com www.cgwg.com www.HRProfessionalsMagazine.com

Why NOARK? Strategic Plan Brings SHRM Pinnacle Award home to Northwest Arkansas! The Northwest Arkansas Human Resources Association (NOARK) was thrilled to be the recipient of a SHRM Pinnacle Award at the SHRM Leadership Conference at National Harbor, MD on November 22, 2013. NOARK’s Why NOARK? Strategic Plan was the Medium/Large Chapter winner in the “Enhancing the SHRM Community” category. Winners in this category reflect excellence in providing programs and services that support SHRM, meet members’ needs, or further the Chapter or State Council efforts. Activities may include efforts to foster member engagement, retention and acquisition, volunteer development and recognition, or those that support the SHRM Foundation. An executive summary of NOARK’s Pinnacle Award submission follows below: When the 2013 NOARK board met in November, they saw a real need to make changes to their chapter. The last few years have produced little growth in membership and members were voicing some discontent in the value they were getting from their NOARK & SHRM memberships. The NOARK board developed a strategic plan with several key goals to be accomplished throughout the year:

Elizabeth Farmer, PHR NOARK Chapter President

• Educate members on the value of their NOARK & SHRM memberships • Offer additional opportunities to increase HR knowledge and network with fellow HR professionals • Launch a manager’s conference to train managers in core leadership areas • Utilize social and traditional media to promote the NOARK brand and the various chapter events • Assist others in the community

NOARK Members Accept Pinnacle Award at the SHRM Leadership Conference

• Increase membership The NOARK board worked as a team to always keep the focus on their members throughout the year and make decisions based on the value it would add to their membership. As of September, NOARK became the largest SHRM Chapter in Arkansas with a 20% growth in NOARK membership, and 18% growth in SHRM Membership. NOARK accomplished this with the following events: a seminar titled “Advocacy in Action” to educate members on monitoring the legislative process and contacting government representatives on HR related issues; hosted two networking happy hours for the SHRM Foundation; trained members on the resources that were available to them on the NOARK and SHRM websites; launched a manager's conference with over 100 attendees; and partnered with the Chamber of Commerce to host Resume CPR and Interview Preparation at the State’s largest job fair. Other benefits of receiving the SHRM Pinnacle award include a $1,000 reward from ADP to NOARK, awards for all board members, a webinar produced by SHRM featuring the Why NOARK? Strategic Plan that will be featured on the SHRM.org website, and updated logos for the NOARK website plus lots of bragging rights!

Greater Memphis Employee Benefits Council

January Meeting (L-R) Linda Yoakum, Co-VP Programs; Russ Henderson, VP Programs; Marie Swartzwelder, VP – Intellectual Capital Team with Prudential Retirement, and Antoinette Wiseman, Co-Secretary. Marie was the Speaker for the January luncheon meeting at the Crescent Club in Memphis. Her topic was Retirement Plans Market Trends.

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Social Media and Your Company: Dos, Don’ts, and OMGs! With the explosion of social media in recent years, the line between employees’ business and personal lives has grown increasingly blurred. Employers must clearly understand when, if, and how they can manage employee personal behavior in the social media universe. In this highly interactive session, our attorneys will lead a group discussion on topical scenarios that examine the legal, regulatory, technological, and social issues that are dramatically reshaping the modern workplace and review practical ways of dealing with increasingly common issues such as: • An employee embarrasses herself on social media such as Facebook or Twitter and is now the number one topic of conversation— and distraction—among other employees. What can you do? • Should supervisors “friend” subordinates on social media? Or does that potentially give the employer too much involvement in and knowledge of the employee’s private life? • Exactly what can an employee say about his company online? What control can the employer exercise over employees’ online and electronic lives? • Can employers prohibit employees from engaging in political or religious activities using company electronic resources? What if employees are doing it on a company-provided device, but on their own time? • If you use technology such as video cameras in work areas and GPS tracking devices in company vehicles to monitor and/or control behavior, what are the possible legal consequences—and are they worth it? • What are the potential wage and hour implications of texting, IMing, or communicating with employees via social media or electronic devices after regular work hours? • Can posting on Facebook or other social media be protected activity? • Should employees be prohibited from using technology like smartphones to videotape or record workplace interactions with coworkers or supervisors?

Littler Mendelson speakers: Elizabeth Rudnick, Esq. and Alex Boals, Esq.

Thursday, February 6, 2014 Registration and Breakfast: 8:00 am – 8:30 am Program: 8:30 am – 9:30 am For more information on how to register please contact Kellie Nurko at knurko@littler.com. This program is complimentary and seating is limited. Approved for 1.0 PHR/SPHR; CLE credit pending.

www.littler.com • Littler Mendelson, P.C. 3725 Champion Hills Drive, Memphis, TN 38125 • 901.795.6695

Religious Challenges to the Affordable Care Act

–the Sixth Circuit Has Spoken and the Supreme Court Will Review the Issue Autocam Corp. v Sebelius, 730 F.3d 618 (6th Cir. (Mich.) 2013). By Paul E. Prather

Autocam Corporation and Autocam Medical, LLC are for-profit secular entities engaged in manufacturing in the automotive and medical industries. Both entities are owned and controlled exclusively by the Kennedy family, all of who are practicing Roman Catholics. Autocam and four individual members of the Kennedy family filed suit seeking to enjoin enforcement of the contraceptive mandate of the Patient Protection and Affordable Care Act of 2010.

The Religious Freedom Restoration Act (RFRA) The suit asserted claims under a variety of constitutional and statutory theories, including particularly a claim under the Religious Freedom Restoration Act (RFRA). The plaintiff owners asserted that they exhibit and profess their faith through the businesses that they own and control and that an element of their faith is the provision of health care coverage for employees who work in the Autocam businesses. The plaintiffs asserted that the enforcement of the contraceptive mandate would require the individual owners of the business entities to violate their own religious faith by either providing material cooperation in the provision of contraceptives or by not providing health care coverage to their employees and paying the mandate tax. The district court denied the plaintiffs’ application for a preliminary injunction.

The Sixth Circuit Opinion The Sixth Circuit, the federal court of appeals for Tennessee, affirmed. First, the court concluded that the claim was not precluded by the AntiInjunction Act. In reaching the conclusion, the court characterized the claim as an attack on the mandate and rejected that this was an effort to avoid the tax. Second, the court concluded that while the business entities had standing to challenge the mandate under Article III, the individual business owners lacked standing to challenge the mandate which is directed to the corporate employer. The court rejected the argument that the corporate shareholders had distinct injuries from the business entities subject to the mandate and also rejected a similar “pass through” argument to assert shareholder religious rights. Finally, the court held that Autocam is not a “person” capable of religious exercise as protected by the RFRA and affirmed the decision on this basis. “The legislative history makes no mention of for-profit corporations.”

Secular Business Entities Not Protected by the First Amendment or RFRA The Sixth Circuit joined the Third Circuit in concluding that secular business entities are not protected by the First Amendment or by the RFRA. Conestoga Wood Specialties Corp. v Secretary of HHS, 724 F.3d 26

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377 (3d Cir. 2013). The Tenth Circuit reached a contrary conclusion in Hobby Lobby Stores, Inc. v Sebelius, 723 F.3d 1114 (10th Cir. 2013).

Supreme Court to Review March 25 The United States Supreme Court has agreed to review this issue in both the Hobby Lobby and Conestoga Wood cases. Argument is scheduled for March 25, 2014. The court will almost certainly be divided on this issue. The Supreme Court should issue its opinion by late May or early June. Footnote: On December 31, 2031, Supreme Court Justice Sonia Sotomayor granted a temporary stay from the imposition of the birth control mandate for the Catholic Churches. Sotomayor acted on a request from an order of Catholic nuns, the Little Sisters of the Poor Home for the Aged, in Colorado whose request had been denied by the lower courts. Interestingly, Sotomayor denied Hobby Lobby’s stay request last year. Justice Sotomayor has been criticized for issuing the stay order because of the fact that she is Catholic She may ultimately decide to deny this group’s request also after hearing from the government.

Paul E. Prather, Shareholder Littler Mendelson pprather@littler.com www.littler.com

The 2014

Labor and Employment Law

Watchlist To keep your company out of court in 2014, keep an eye on the following issues and trends. The Social Media Minefield

By Mary C. Hamm

• 189 million of Facebook’s users are “mobile only,” and ninety-five percent of Facebook users log into their accounts daily. Instagram has an average of 7.3 million daily active users. These statistics confirm what you already know about the American workforce: it is increasingly tech savvy and engaging in social media both during and outside of work hours. • This creates opportunities and obstacles for employers. On the one hand, your employee’s popular tweets or posts promote your business. But can her comments place you at risk for a lawsuit when, for example, she tweets on the weekend (#off-theclock) or she makes disparaging comments about other employees or your company (#harassment and #concertedactivity)? Make sure that your social media policy is comprehensive and tailored to your company’s needs.

A New Protected Class? Not Yet, But Stay Tuned • Although the Employment Non-Discrimination Act, which would prohibit employment discrimination on the basis of sexual orientation and gender identity, has not yet passed in the House of Representatives, the state of LGBT employees’ rights continues to be a controversial subject. • The United States Supreme Court struck down part of the Defense of Marriage Act (DOMA) in United States v. Windsor, 133 S. Ct. 2675 (2013), and held that federal laws that apply to opposite-sex spouses apply equally to same-sex spouses. With the DOL and other government agencies beginning to provide guidance in the wake of Windsor, how federal regulations and benefits apply to same-sex couples will be an important issue for employers.

Tread Carefully When Scoping Out Potential Employees and Monitoring Existing Ones • The EEOC had a record year in 2013: obtaining $372.1 million from its pursuit of private sector workplace discrimination claims. As the EEOC continues its aggressive stance this year, employers must exercise caution in how they investigate job applicants. The EEOC has focused in particular on employers’ use of criminal background checks, claiming that the use of these checks has a disparate impact on minority applicants. If your company uses criminal background checks or credit checks on potential and/or current employees, make sure you are following the right steps to minimize exposure for claims. Reviewing the EEOC’s 2012 Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII would be a good first step. • The legal consequences of employer surveillance of Facebook, Twitter, and other social media websites for information about job applicants and current employees continue to evolve. As tempting as it may be to peek into an applicant’s or employee’s lifestyle, gathering information about, for example, his health, military status, or religion, places employers on dangerous ground.

When Looking Over Your Shoulder for Enforcers, Don’t Forget About the NLRB • The NLRB continues to exert its influence over non-unionized business. Over the past few years, we have seen the NLRB issue decisions and guidance regarding whether an employer can require confidentiality during workplace investigations and whether it can penalize employees for their social media use. Ever vigilant of the “chilling” effect that such practices can have on an employee’s Section 7 rights, the NLRB is poised to remind employers that concerted activity can manifest itself in a variety of ways. • Employers can breathe a small sigh of relief when it comes to one issue: the notice posting rule. The NLRB recently announced that it will not seek Supreme Court review of two U.S. Court of Appeals decisions that invalidated the NLRB’s rule requiring businesses to post notifications explaining employees’ right to unionize.

Waging War on Wage and Hour Claims • Stay on your guard when it comes to classifying your employees as exempt from the Fair Labor Standards Act. Misclassifying an employee as exempt and, as a result, failing to pay minimum wage and overtime wages, can lead to lawsuits with hefty damages. • Wage and hour lawsuits increased by ten percent between 2012 and 2013, and there is no indication that this pace is slowing down. As plaintiffs’ attorneys continue to target employers with collective action lawsuits, we will see more decisions on whether collective action waivers are enforceable. Auditing your employees’ status and monitoring your timekeeping and pay practices should be a top priority in 2014.

Obamacare • Although the mandate to employers to provide employees with government-approved health insurance has been delayed until 2015, other obligations under the Affordable Care Act are already in effect, such as the requirement to provide coverage within ninety days of employment to an eligible employee. If you have not done so already, make sure you are following these requirements. How the Affordable Care Act unfolds in 2014 will be extremely important for employers. Being proactive and understanding the costs of compliance (and the penalties for non-compliance) for 2015, should be on many employers’ 2014 to do lists.

Mary C. Hamm, Attorney Burch, Porter & Johnson, PLLC mhamm@bpjlaw.com www.bpjlaw.com www.HRProfessionalsMagazine.com

Leadership in Today’s World:

Words of Wisdom from Successful Leaders

By Andrew “Danny” Gattas Jr.

“ Being president is like running a cemetery: you’ve got a lot of people under you and nobody’s listening.” - William J. Clinton Anyone who has ever considered themselves a leader can empathize with this quote. It often seems your followers aren’t listening or are too apathetic to care. This feeling is the innate difficulty associated with being a leader of any organization. However, effective leadership is one of the most important aspects of successful organizations. Society can witness this by looking at individuals like Steve Jobs, Warren Buffett, and Bill Gates, all of whom led their respective companies to greatness. But you don’t have to be Bill Gates to be considered a renowned leader. The traits that constitute a great leader are in us all. But, what does it take to become an one?

“Where there’s a will there’s a way”- Unknown First, it seems that many people are fooled into thinking that there exists some simple paragon that if followed will make you a great leader but this is not the case. There is not a standard set of traits or steps and there exists no profound self-help book that will teach you how to be an effective leader. However, there are seven beneficial traits that are frequently correlated with successful leaders. 28

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Seven of these Traits are being someone who is:

1. 2. 3. 4. 5. 6. 7.

Empathic Service Oriented Innovative Supportive Dedicated Intelligent Compassionate

“ Do not let what you cannot do interfere with what you can do.”- John Wooden

“ Show me your friends and I'll show you your future.” - John Kuebler

Rather than modeling your life around these traits, it is better to look at your personal strengths and utilize them to inspire your workforce. People often begin their path to self-improvement by working on their weaknesses and fail to see the benefits from playing to their strengths. For example, look at a baseball manager. It wouldn’t make sense for a manager to focus on improving the batting average of his pitchers because that isn't their greatest asset to the team. But it would make sense to improve their pitching skills, their fastball, curveball, or even their change-up. A good leader is a lot like a shrewd baseball manager. They possess the awareness to understand strengths and weaknesses and thus recognize it as optimal to delegate weaknesses to people who identify them as proficiencies.

Being a great leader requires dedication, determination, and a relentless pursuit of your dreams and aspirations. In both smooth and rough waters, being a leader requires inspiring your followers to stick with your vision to reach your destination. But being a good leader of an undesirable group of people will ultimately lead your organization to failure. The vitality of any organization is as dependent on the quality of the leader as it is upon the individuals who are following you. That is why when any leader is considering where they would like to go it is very important to consider the quality of the people who they want to be surrounded by once they arrive. Failing to do this leads to disastrous consequences.

“ The best way to find yourself is to lose yourself in the service of others.”- Gandhi

It is important to focus on these concepts when intrinsically analyzing our personal leadership qualities because the importance of leadership is critical when considering the future vitality of any organization. Despite discouraging adversities, always seek solace in the fact that you possess the necessary attributes to become a great leader.

People often think that a great leader is someone who learned how to lead by reading a book or by studying at a prestigious university. However, becoming a great leader is learned by serving and being mentored by someone who is an effective leader. I can personally attest to this by looking at my personal mentor Austin Baker. Someone who truly cares about my development and taught me the principles of being a servant leader. Being a servant leader is centered upon the premise that to lead, you must be willing to relate, educate, and motivate individuals to follow your vision. It represents the true essence of leadership. A servant leader is willing to show you the way through guidance and by supporting your development the entire way. They take less credit for a job well done and more blame than necessary when things don’t work out. The servant leader shows their followers the way so that, when they do arrive, they understand how they got there. Lastly, the servant leader is one who believes in the quality of their vision and, more importantly, the quality of their followers. By engaging in servant leadership, leaders are capable of getting the most and best out of their followers.

“ All our dreams can come true, if we have the courage to pursue them.”- Walt Disney

Andrew “Danny” Gattas Jr, Intern HRO-Partners dgattas@hro-partners.com www.hro-partners.com

“ The only safe ship in a storm is leadership.” - Faye Wattleton People don’t work for companies, they work for their leaders. People don’t adhere to the vision of their companies, they believe in the vision of their leaders. People don’t trust in the judgment of companies, they have faith in the judgment of their leaders. A prime example of this is when Salomon Brothers, once a very successful Wall Street Investment Bank, was associated in a Treasury bond scandal that led the Securities and Exchange Commission to reprimand them with the largest fine ever issued to any company at the time. Their punishment would have been much worse had it not been for Salomon’s former CEO stepping down and Warren Buffett’s emergence as their new leader. Both the SEC and the public had so much faith in Buffett’s leadership ability, economic knowledge, and sense of morality that they lessened their punishment to a mere 290 million dollar fine. This example proves that people are willing to put their faith in the judgment and wisdom of excellent leaders. www.HRProfessionalsMagazine.com

Responding Effectively to Criticism

By Harvey Deutschendorf

Hard wired in our brains from the time humans first walked on earth is a “fight” or “flight” response. Even though our brains have evolved over the eons we still share this response with animals. It is our most basic response and was responsible for our survival at a time when we competed with wild beasts for food. Today, however, few things are a matter of life and death, but our fight or flight response is still triggered in many situations. One of these can happen when we are receiving criticism. The response can very according to who is giving the criticism and how much power we perceive that person having over us. The more power we see the person having, the more likely we will feel a strong flight response. The fight response will be stronger the more we feel that the criticism is unjustified or unfair. Whatever the situation, the fight or flight response does not serve us well when we are criticized. Whether we feel we deserve the criticism or not, there are techniques that we can help us make the most of a situation.

Prepare yourself

Chances are we have, or will, receive negative feedback at work at some point in our lives. Like any other situation coming up we can prepare ourselves. Think of a time in the past when you received some unwanted feedback about your performance. How did you feel, and react? If you had a chance to do it over again, would you handle the situation differently? In your mind replay the scenario in a way that would result in the outcome you wanted. If it helps, role- plays with a trusted friend, colleague, or family member. Come up with some responses that would help keep you on track that you can call up in future situations. Come up with a word, sound, phrase, or song that will remind you of the ideal situation that you had envisioned and repeat it whenever the situation comes up again.

Wait out strong emotions

We feel before we think. To our old reactive brain, criticism will feel like we are being attacked. It will see negative feedback as a verbal attack. This may bring out powerful emotions that can temporarily cause us to react before our thinking brain kicks in. The good news is that these strong emotions will quickly subside as our rational brains take over. If we feel these strong emotions coming up the first thing to do is give ourselves time before we react. Take a couple of deep breaths, count to ten, or do whatever you can to distract yourself. If the emotions are still highly volatile ask for a time out and tell the person you will get back to them once you’ve had a chance to collect your thoughts. Give yourself a chance to respond, rather than react. Rather than reacting in an emotional state, responding gives us a chance to use our thinking powers and increases the chances of getting the outcome that we want. 30

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Feedback what you heard

A great way to start your response is to repeat back, in your own words what the other person said or what you heard them say. Most likely the person is expecting some push back from you, perhaps anger or denial and has prepared him or herself for this. By simply giving them back what you thought they said, you will diffuse their defensiveness and make them more open to your feedback. Momentarily relieved that you are not responding in the way that they were afraid you would, the person is likely to relax a little and be more open to your feedback. When you give feedback you are not taking blame, or apologizing, you are simply making sure that you understand what the person is saying.

Overcoming our natural urge to defend ourselves and just listen

When we feel we are being attacked, as we do when we are on the receiving end of negative feedback, the last thing we feel like doing is listening. Our natural inclination is to fight back, tell our side of the story and defend ourselves. However, if we can overcome this urge and simply listen, we have mastered a powerful tool that will help us make the most of the situation. Listening will allow the other party to feel less defensive and more open, willing to share information that they would otherwise withhold. It also makes them more open to hearing your side of the story.

Engaging and negotiating

respectfully

Even though you may disagree with the feedback you are receiving you can still make it a win/win situation for both of you. You can acknowledge that the person who is confronting you may feel that way, even though you disagree. This moves the scenario away from someone having to be proven right or wrong, which results in stalemate as neither wants to be wrong. By agreeing that you have differing viewpoints it moves the conversation to a place where real progress is possible. If we agree with the other person we acknowledge we acknowledge their information and even thank them for bringing it to your attention. Let them know how their sharing this with you will help you in the future. If you don’t agree, suggest other ways you think would work better or ask for help if you feel you need it.

Harvey Deutschendorf Emotional Intelligence Expert, Speaker, and Author of The Other Kind of Smart Harvey.eiguy@shaw.ca www.theotherkindofsmart.com Twitter@theeiguy