July 2014 issue

Volume 4 : Issue 7 TM

www.HRProfessionalsMagazine.com

Top

How a High-Cost Drug Helps

Avoid

Higher-Cost Complications

Educational Programs for HR Professionals

Cynthia

Render-Leach, PHR

EEOC v. Kaplan Higher Education Corp

HR Professionals in Higher Education

MS SHRM

College Relations

2014 TN SHRM State Conference & Expo

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

Employers spend as much as 15% of their healthcare costs on medications. 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

Anna Blair Harvey Deutschendorf Murray L. Harber Cindy W. Kolb Timothy L. Lindsey Sarah Martin Jennifer Riley Janie Warner Jeff 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.

Features

WEB EXCLUSIVES

4 note from the editor

5 Profile: Cynthia Render-Leach, PHR

HTTP://HRProfessionalsMagazine.com /Exclusives

6 HR Professionals in Higher Education

12 Top Educational Programs for HR Professionals

Out of the Shadows – How to Get the Recognition You Deserve as a Quiet Person by Harvey Deutschendorf, The EI Guy

Departments 10 EEOC: EEOC v. Kaplan Higher Education Corp: A Look at EEOC’s Continued Attack on Pre-employment Background Checks

16 Professional Development – What is Your VQ? (Value Quotient) 19 Employment Law: The Payroll Fraud Prevention Act – Employee v. Independent Contractor

20 Employee Relations: Don’t “Flip Flop” on Your Company’s Dress Code 22 Benefits Strategy: How a High Cost Drug Helps Avoid Higher-Cost Complications

26 MSBGH Business Group Discussed Health Care Solutions 27 Sexual Harassment: Lessons Learned

28 Highlights from Fisher Phillips One Day Many Solutions Seminar in Memphis 30 Immigration: Lessons from OCAHO – Part 2

Industry News 7 Highlights from WT SHRM 4th Annual Human Resources & Employment Law 2014 Spring Conference in Jackson, TN 8 2014 TN SHRM State Conference & Expo in Sevierville

9 13th Annual Employment Law and Legislative Affairs Conference in Little Rock

24 Highlights from the Northeast Arkansas SHRM Seminar in Jonesboro

Next Issue Retirement Planning and Deferred Compensation

Highlights from Strategic Leadership for HR Executives Seminar in Little Rock Preview of Mid-South Compensation Association Annual Seminar

www.HRProfessionalsMagazine.com

3

a note from the Editor

We are excited to be the Official Media Sponsor for the 2014 TN SHRM Conference and Expo in Sevierville September 17-19. Details about the Conference are on Page 8. Our AR SHRM friends will find details about the 13th Annual Employment Law and Legislative Affairs Conference (ELLA) September 18-19 in Little Rock on Page 9.

Congratulations to those who recently obtained their professional designations as a PHR, SPHR, or GPHR during the May-June HRCI certification window! This is a great accomplishment for all HR practitioners. By now, everyone is aware that SHRM and HRCI are separate entities and will be offering two separate and different certifications. Those who are currently certified through HRCI will be given the opportunity to also obtain the new SHRM certification at no additional cost by completing the following by December 31, 2015: ACFE Luncheon – (L -R) Ann Saccomano, Communications Strategist with FedEx Express; Durand Ferguson, President of the Mid- South Chapter of the Association of Certified Fraud Examiners; Lisa May, VP of Marketing and Business Development for Data Facts, Inc., and Sarah Gaither also with Data Facts. Cynthia Thompson and Lisa May were presenters at the May 22 meeting at the University of Memphis Holiday Inn. Their topic was “How Do I Know You’re Really You? Credentials Fraud Exposed!” They discussed the twists and turns of existing and emerging fraud resume schemes, diploma mills, HR law and how to navigate the treacherous waters of social media.

O

ur focus this issue is on HR professionals in higher education. I know you will enjoy reading about some of our colleagues who are dedicated to practicing HR in the university environment. You will

also find great information on some of the top educational programs for HR professionals in Tennessee, Arkansas, and Mississippi.

a. Document that their current certification is in good standing b. Sign the SHRM Code of Ethics c. Complete a brief online tutorial on HR competencies The new certification has caused much confusion for both those currently certified and those who aspire to become certified. SHRM recently announced the new certification will be named SHRM Certified Professional (SHRM-CP) and SHRM Senior Certified Professional (SHRM-SCP.) These new certifications will in no way diminish or nullify the HRCI certifications. You will have the option of becoming “double” certified or choosing one or the other. I will continue to offer the Online HR Certification Exam Prep Class for those who are interested in obtaining a PHR or SPHR. We will begin registration for the August class this month. Watch your email for details.

Don’t miss our July Web Exclusive by Harvey Deutschendorf, The EI Guy. Harvey has written a very insightful piece on how quite people can come out of the shadows and get the recognition they deserve. Here is a link for his article, http//: hrprofessionalsmagazine.com/exclusives.

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

Sign up for our RSS News Feed to receive up to the minute HR Alerts on changing legislation affecting our workforce. www.HRProfessionalsMagazine.com.

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www.HRProfessionalsMagazine.com

Cynthia

on the cover

RENDER-LEACH CYNTHIA RENDER-LEACH, PHR MS SHRM State Council College Relations Cynthia Render-Leach is the Human Resources Director for Highland Community Hospital, a 60 bed acute care medical facility in Picayune, MS which is a part of the Forrest Health System providing regional health services across 19 counties in South Mississippi. As the Human Resources Director, Cynthia oversees the human resources practices and strategies for the facility of 350 employees whose focus is on the delivery of “world class care” to patients every day.

Cynthia’s career in human resources expands over 20 years in healthcare and higher education.

Prior to working for Highland, she was the Human Resources Manager for the University of Southern Mississippi responsible for the HR functions for multi-campus locations along the MS Gulf Coast. Her healthcare human resources background includes work for two multihospital systems in Mississippi and Louisiana, the Singing River Health System and General Health System. Cynthia’s role and responsibilities have encompassed employee relations, organizational development, training, recruitment, employee performance, compensation, and benefit administration.

She currently serves in multiple leadership roles in both her local SHRM chapter as well as the MS SHRM State Council. She is the Treasurer and College Relations Chair for the Gulf Coast Human Resource Association Chapter. On the MS SHRM State Council, she serves as the Sponsor/Exhibitor Conference Chair and College Relations Chair helping to develop the Student SHRM chapters throughout the state.

Cynthia was recognized by her peers with the Spirit of HR Award from the MS SHRM State Council in 2013 as one who best represents the spirit of SHRM in the state of Mississippi and is an outstanding leader within the HR Community.

Born in New Orleans, Cynthia earned her Bachelor of Science degree from Louisiana State University in Baton Rouge and holds a PHR Certification. She has called Mississippi her home since 1995 and resides in Ocean Springs with her husband and her three “feline” babies. 

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HR Professionals in

HIGHER EDUCATION Judy SPENCER, MBA, SPHR

Judy Spencer serves as Chief Human Resources Officer for Mississippi State University where she leads, develops, and manages a comprehensive human resources program aligned with Mississippi State University’s mission, strategic plan, vision and goals.

In close partnership with university senior management, various groups and committees, deans, directors, department heads, faculty and staff, she is responsible for developing and executing comprehensive strategic plans relating to human resources programs, practices, and systems. She provides leadership and vision to ensure effective operations of HRM units that include employment, employment based visa processing, compensation (including salary administration and job evaluation), benefits, learning and development, employee data services, performance management, employee relations, organization development, EEO/AA, workers compensation, employee assistance program, wellness program, drug testing and background screening programs, new hire orientation and onboarding programs, and areas of ethics\compliance related to state and federal laws, IHL Board policies and procedures, and university policies and procedures.

After a successful career in the private sector as a human resources executive where she provided strategic leadership for many corporate human resources initiatives, including international locations, she joined Mississippi State University’s human resources department in 2004.

Ms. Spencer received her Bachelor’s degree in Business Administration from Faulkner University and her Master’s degree in Business Administration from the University of North Alabama. Her certifications include SPHR (Senior Professional Human Resources), Title IX Coordinator and Six Sigma Green Belt. She is currently a member of the Golden Triangle Human Resource Association (a SHRM affiliate), Regional and National Society for Human Resources Professionals (SHRM), National Association of International Educators (NAFSA), National College and University Professionals (CUPA), National Association of ADA Coordinators and National Association of Title IX Administrators.

She has been active in the regional CUPA organization, serving on the Program Committee and as a conference presenter. Since joining MSU, she has been a regular Guest Lecturer for the graduate Sports Law Class, and had the opportunity to teach a graduate level HR Issues class in summer school.

Kathleen MCCOMBER, MA, CCP, SPHR

Kathleen is currently the Associate Chief Human Resource Officer for the University of Arkansas for Medical Sciences she joined UAMS in June, 2002. Prior to that, she was Corporate Vice President of Human Resources for Edgewater in Fayetteville, AR. for five years, prior to this position she was Vice President of Client Service for Express Human Resources, Corporate Vice President of People Services for Acxiom and Vice President of Human Resources for M.M.Cohn.

In her current position, she is responsible for the human resource function in the UAMS which employs over 11,000 employees.

Ms. McComber has over 30 years experience in the human resource profession and has done extensive work in the areas of compensation, benefits, employee relations, performance leadership, diversity and organizational development twenty of those at the senior level in the organization.

She is a member of the Central Arkansas Human Resource Association and the Society for Human Resource Management (SHRM), where she was on the national board for seven years, having served as Chair in 1998. Kathleen holds a lifetime certification from the Human Resource Certification Institute as a Senior Professional in Human Resources and has served a four-year term on their national board. She served six years on the SHRM Foundation Board where she served as Chair in 2003. She also holds a certification as a Certified Compensation Professional from World at Work.

She holds a B.S. in Education from the University of Arkansas and an M.A. in Management from Webster University. She is on the faculty of the University of Arkansas for Medical Sciences in the College of Public Health and Webster University teaching leadership and human resource courses.

Terika ANDERSON, MBA

SHRM member Terika Anderson serves as the Associate Director of Corporate Development and Recruitment for Bethel University in Memphis. In this role, which she has held since 2012, Terika coordinates business development and recruitment for the Greater Memphis Metropolitan Area, participates in networking events, and speaks with HR managers and corporate managers about the benefits of Bethel University’s business-management programs to their organizations. A graduate of Bethel’s award-winning MBA program, she is currently pursuing a PhD in Management with a concentration in Leadership and Organizational Change.

Terika has been a national and local SHRM member since 2010, where she is actively involved with the CEG (Career Emphasis Group). The CEG helps employees in transition refine their skills, while connecting them to other HR specialists. “We want to ensure they are properly engaged, and are aware of emerging trends in the HR field,” she says. “It’s highly beneficial for them to connect with the SHRM chapter in a more intimate setting.”

Terika feels her role with Bethel University dovetails with the goals of SHRM. “We connect the university to organizations and community partners that are developing succession plans. Our program is tailored for the working adult, so whether the individual is working on a bachelor’s or master’s degree, the critical-thinking skills that our program imparts delivers value to the individual, both personally and professionally. I want to offer busy professionals easier access to a quality college education, and SHRM helps me do just that.”

Barbara A. ABERCROMBIE, Associate Vice Chancellor

Barbara A. Abercrombie, a human resources professional with 17 years of management experience, is the associate vice chancellor for human resources at the University of Arkansas. Abercrombie previously served for five years as director of human resources at the University of Oklahoma-Tulsa, where she also taught in the department of human relations.

Barbara has served in a number of capacities with the Oklahoma Chapter of the College and University Professional Association for Human Resources including President in 2010. She has also served as the President and as Treasurer of the Oklahoma Association for Affirmative Action.

Abercrombie is completing her doctorate in workforce education and human resource development at Oklahoma State University. She has a master’s degree in human relations from the University of Oklahoma and a bachelor of science degree from Northeastern State University.

“As a first generation college graduate, I have a strong commitment to higher education and believe that the opportunity to attend college should be available for everyone,” Abercrombie said.

“I bring to the job of human resources the belief that every faculty member, every staff person, and every administrator changes the life of not just our students but the lives of the student’s extended family as well.

“The goal of a human resources department should be to provide a positive working environment and create an atmosphere that enables faculty and staff to do their best work daily because HR is taking care of their personal benefit, payroll and transactional concerns.

“My vision for human resources at the University of Arkansas is to continue the long tradition of your land grant university, to build on the gold standard of work-life balance that you have been recognized for as well as building a strategic vision for Human Resources that encourages everyone on the campus to make a difference and change lives for the better.”

Abercrombie has been a national and regional presenter at both the College and University Professional Association for Human Resources Southern Region Conference in 2011 and 2012, and the National Conference in 2011. She has also presented at the Oklahoma State SHRM conference and is an active member of NOARK. 6

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4th Annual WT SHRM Human Resources & Employment Law 2014 Spring Conference

The WT SHRM Human Resources & Employment Law 2014 Spring Conference

Susan Morris with Express Staffing.

They won the Exhibitor Booth Decorating Contest.

was on May 14 from 7:45 AM to 3:30 PM at the Carl Grant Center at Union University in Jackson, TN. This year’s theme was “Building Better HR Practices.”

109 WT SHRM members attended and there were 26 exhibitor booths.

L-R: John Burleson, Attorney with Rainey, Kizer, Revere, & Bell; and Amy West, WT SHRM President.

Conference Session

Rainey, Kizer, Reviere, & Bell PLC presented the following topics: When Laws Collide: The Intersection of ADA, FMLA and Workers’ Comp Hammering Out the ADA Interactive Process Pitfalls to Avoid for Employee Handbooks

L-R: James Thompson and John Burleson, Attorneys with Rainey, Kizer, Revere, & Bell.

Workplace Bullying – When is the Line Crossed?

Blueprints for Effective Documentation of Employment Issues Case Studies – Hard Hat Areas Construction Crew – Q & A with Attorney Panel

WTSHRM has been recognized by the Society for Human Resource Management (SHRM) as a Merit Award Chapter for excellence in operations and service to members.

L-R: John Burleson, Geoffrey Lindley, Robert Binkley, Latosha Dexter; attorneys with Rainey, Kizer, Reviere & Bell led the Q & A Attorney Panel.

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Tennessee SHRM Conference & Expo September 17-19, 2014 The 2014 Tennessee Human Resource State Conference and Expo will be held in Sevierville, Tennessee, at the Sevierville Convention Center.

Register Now! www.tnshrmconf.com

Keynote Speakers

Dr. Jerry Punch “Life in the Fast Lane”

Connie Podesta “Life Would be Easy...

If it weren’t for other people

Vallie Collins “Miracle on the Hudson”

Hallerin Hilton Hill “The Wisdom Advantage”

This year’s conference provides an opportunity for HR professionals from all over the state to learn, share, network and grow. The TN SHRM State Conference is hosted by the Tennessee Valley Human Resource Association.

16 HRCI credits!

Location: Sevierville Events Center, Wilderness at the Smokies

1424 Old Knoxville Highway, Sevierville, Tennessee 37876 Resort Information: www.wildernessatthesmokies.com For Hotel Reservations: (877) 325-9453 Mention “TN SHRM Conference” when making reservations for the SHRM conference rate of $99.00/night. ________________________________________________________________________ Stone Hill Lodge (attached to Events Center) at $99/night Rate Code: 1209STATEH River Lodge (Lower Hotel at Resort) at $99/night Rate Code: 1409STATEH

Register Now!

Online:www.tnshrmconf.com 8

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13th Annual Employment Law and Legislative Affairs Conference September 18 in Little Rock, Arkansas For most employers, keeping track of workplace legislative and regulatory changes is challenging and takes precious time away from their ultimate goal: successfully managing their employees and their companies. The objective of the Arkansas Employment Law & Legislative Affairs (ELLA) Conference is two-fold: to educate and motivate employers and Human Resources (HR) professionals to communicate with policymakers about legislative issues vital to the HR profession, and to provide critical employment law updates on both the Federal and State level.

The Thirteenth Annual ELLA Conference will take place on Thursday, September 18 and Friday, September 19, 2014, at The Doubletree Hotel in Downtown Little Rock, Arkansas. This year’s conference features exciting new programming and a wide variety of topics that address all levels and functions of HR. Not only has the ELLA Conference moved from the Marriott (formerly the Peabody Hotel) to the Doubletree, but the conference has also been shifted from a Wednesday-Thursday timeframe to Thursday-Friday. The conference will end at noon on Friday to allow attendees the opportunity to explore Little Rock and catch up with their HR friends from across the state.

The ELLA Committee is also excited to introduce the Handbook Workshop, which will provide participants with an opportunity to ask focused questions

of employment law practitioners regarding handbook preparation and compliance issues. Attendees will also have an opportunity to serve as jurors in a mock sexual harassment trial, presented by the attorneys of Cross, Gunter, Witherspoon & Galchus, P.C. A featured speaker for this year’s General Sessions is Laura Collins with the University of Arkansas for Medical Science’s (UAMS) Project SEARCH®, an international one-year internship program for individuals with developmental disabilities who desire sustainable, competitive employment. Project SEARCH provides real-life work experiences combined with training in employability and independent living skills. UAMS welcomed 12 interns in the fall of 2013 who graduated in May 2014. UAMS partners with Arkansas Rehabilitation Services and ACCESS to help participants develop skills for competitive employment. Collins, the Project SEARCH Vocational Advisor, will speak at Thursday’s luncheon.

At the General Session on Friday morning, Cal Kellogg, PhD, will present an update on employer obligations in light of the Affordable Care Act. Kellogg, Executive Vice President and Chief Strategy Officer at Arkansas Blue Cross Blue Shield, will discuss how the Affordable Care Act and the Arkansas Health Independence Program may influence Arkansas-based employers’ options relative to employer-sponsored health benefits. He will also address upcoming federal employer reporting requirements and strategies for

dealing with those requirements. Kellogg’s goal is to provide employers and HR professionals with proactive approaches to better deal with the forthcoming regulatory changes.

The 2014 ELLA Conference concurrent session topics will include: compensation systems; fiduciary responsibilities and fee disclosures; The Defense of Marriage Act; Department of Labor developments; federal contractor hiring regulations; “Bring Your Own Device” trends and technology in the workplace; and discipline, documentation and termination.

The Arkansas Society for Human Resources Managers (SHRM) State Council was the first SHRM State Council to engage a lobbyist in the assistance of monitoring and regulating employment legislation. As a result, the collective voice of the HR profession continues to be heard by Arkansas legislators in developing laws that affect employers. After attending ELLA 2014, HR professionals will return to their companies and communities better equipped to communicate and act proactively about legislative and regulatory proposals that have potential implications for the workplace.

For additional details, please contact ELLA 2014 Chair Cindy Kolb, J.D. at ckolb@cgwg.com or call 501-371-9999. Details are also online at http://www. arshrm.com/ella2014/. HR Certification Institute and Continuing Legal Education credits are pending.

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EEOC v. Kaplan Higher Education Corp.

Do As I Say, Not As I Do: A look at EEOCs

continued attack on pre-employment background checks

By JEFF WEINTRAUB and JENNIFER RILEY

EEOC’s Crusade against Systemic Discrimination In 2006 the Equal Employment Opportunity Commission (EEOC) announced its “Systemic Initiative,” which established a nationwide program with a goal of improving the agency’s efficiency in combating systemic discrimination. The EEOC defines systemic discrimination as that involving “a pattern or practice, policy, or class where the alleged discrimination has a broad impact on an industry, profession, company or geographic area.” The EEOC’s website lists the following examples of systemic practices: “discriminatory barriers in recruitment and hiring; discriminatorily restricted access to management trainee programs and to high level jobs; exclusion of qualified women from traditionally male dominated fields of work; disability discrimination such as unlawful pre-employment inquiries; age discrimination in reductions in force and retirement benefits; and compliance with customer preferences that result in discriminatory placement or assignments.”

In April 2012 the EEOC issued an updated enforcement guidance that elaborated on how, in the EEOC’s view, Title VII of the Civil Rights Act of 1964 restricts an employer’s use of arrest or conviction records in employment decisions. While having a criminal record is not in and of itself listed as a protected basis in Title VII, a covered employer’s reliance on a criminal record to deny employment may still violate Title VII if that employer’s practice of relying on criminal records results in a disproportionate adverse impact on members of a protected class as compared with non-members of the protected class and there is no business necessity for the practice. In its guidance the EEOC addressed how a practice of screening applicants based on criminal backgrounds may result in disparate impact to a Title VII-protected class based on race or national origin. To support this assertion, the EEOC pointed to statistical findings that African-Americans and Hispanics are incarcerated at rates disproportionate to their numbers in the general population, and, thus, hiring exclusions based on criminal records disproportionately adversely impact Hispanics and AfricanAmericans as compared to other races and nationalities.

In its Strategic Enforcement Plan for fiscal years 2013 through 2016, the EEOC reiterates its commitment to abolishing systemic discrimination by adopting as one of its national priorities, “eliminating barriers in recruitment and hiring” (EEOC: Strategic Enforcement Plan FY 2013–2016).

As a strategy for enforcing this national priority, the EEOC targets class-based intentional recruitment and hiring discrimination, as well as facially neutral recruitment and hiring practices that adversely 10

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impact particular groups. These practices would include the use of pre-employment screening tools, such as checks into criminal records and/ or credit history.

The EEOC’s guidance in 2012 did not specifically mention credit history checks as a practice likely to result in disparate impact; however, other guidance by the EEOC regarding pre-employment screenings suggests that inquiries into an applicant’s current or past credit rating, assets, or liabilities should be avoided, because these inquiries tend to impact women and minorities more adversely. Under this premise, the EEOC has brought several charges against employers who use credit checks as a pre-employment screening tool. Nevertheless, the EEOC seems to be having little success with these claims in the courtroom.

EEOC v. Kaplan Higher Education Corp., et al. is the most recent example of another loss suffered by the EEOC in its attack on employer background checks. EEOC v. Kaplan Higher Education Corp., et al., 2014 WL 1378197 (6th Cir. 2014).

EEOC’s Suspect Legal Theory Evidence of disparate impact is usually provided by an expert’s testimony of statistical proof that the pre-employment screening being utilized is adversely impacting members

of a protected class at a rate disproportionate to non-members. Even with inarguable evidence of such an impact, employers can avoid liability if the employer can show a business necessity for the inquiry as it relates to the specific job position in question.

The EEOC first sued Kaplan Higher Education Corp. (Kaplan), a company offering college degrees to students, under Title VII for using background checks into credit history that allegedly caused Kaplan to unlawfully screen out more African-American applicants than white applicants. When the lower court sided with Kaplan in summary judgment, EEOC appealed. The Sixth Circuit Court of Appeals not only affirmed summary judgment, but also issued an opinion that heavily rebukes the EEOC for its chosen method of attack.

The Sixth Circuit opinion begins by noting that the EEOC sued Kaplan for using the “same type of background check that the EEOC itself uses.”

The EEOC asserted that it had a business necessity for inquiries into applicants’ credit histories where “overdue just debts increase temptation to commit illegal or unethical acts as a means of gaining funds to meet financial obligations” (EEOC personnel handbook). The Sixth Circuit went on to recognize that, much for the same reason the EEOC uses credit checks, Kaplan has a legitimate business necessity for running credit checks for applicants for positions with access to student financial information, cash, or other company financials. Further, in Kaplan’s history, the company had discovered that some former employees had stolen payments that belonged to students and that other former executives had engaged in self-dealing by hiring relatives as vendors. Thus, Kaplan’s use of credit checks was a preventative measure, for positions with access to financial information, to screen out applicants who may have a heightened inclination to commit unethical acts.

the case against Kaplan was not the first time the EEOC has engaged this same expert to try to support a claim of disparate impact. In a 2013 case brought by the EEOC against an employer for purportedly adversely impacting African-Americans and males in criminal background checks, a Maryland federal court found the expert’s techniques to be “laughable” and full of so many fallacies as to “render them completely unreliable.” EEOC v. Freeman, 961 F. Supp. 2d 783 (D. MD. 2013). It’s a safe guess that the EEOC will try to improve its methods of proof and expert testimonies in order to continue to bring cases against employers, alleging disparate impact resulting from the use of pre-screening criminal background and credit checks.

Meanwhile, employers should review their policies of pre-employment screening based on credit and criminal records to ensure compliance with Title VII. Employers should analyze the business necessity of these record checks and ensure that there is, in fact, a legitimate need related to the specific job positions.

Jeff Weintraub, Managing Partner Fisher & Phillips Memphis Office jweintraub@laborlawyers.com www.laborlawyers.com

Jennifer Riley, Paralegal Fisher & Phillips Memphis Office jriley@laborlawyers.com www.laborlawyers.com

While the Sixth Circuit is quick to acknowledge the business necessity of Kaplan’s use of credit checks, the meat of the Court’s opinion focuses on the lack of reliability of the EEOC’s expert testimony presented to show the disparate impact created by Kaplan’s credit checks. To demonstrate that Kaplan’s credit-check process rejected more African-American applicants than white applicants, the EEOC needed to learn the race of Kaplan’s applicants. Since Kaplan’s credit-check policy was racially blind, the EEOC (rather than just contacting the applicants directly) tried to learn the race of the applicants from records obtained from various state departments of motor vehicles. Where some states provided records that expressly identified the race of the applicant, other states provided color photocopies of the applicant’s driver’s license. Five “race raters” were employed to review the drivers’ license photos and purport to determine the individual’s race. Notably, none of these “race raters” had experience with methodologies to identify race by visual means. The “race raters” reviewed the photos separately, and, if at least four of the five raters agreed upon a particular applicant’s race, then that race determination was accepted as correct.

The opinion goes into great detail as to the numerous reasons this technique is so obviously unreliable, concluding by saying, “The EEOC brought this case on the basis of a homemade methodology, crafted by a witness with no particular expertise to craft it, administered by persons with no particular expertise to administer it, tested by no one, and accepted only by the witness himself.”

EEOC’s Impact on Employers Despite its setback suffered in Kaplan, the EEOC’s aggressive agenda of pursuing what it deems to be discriminatory practices resulting in disparate impact in violation of Title VII, is likely to continue. After all, www.HRProfessionalsMagazine.com

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TOP

Educational Programs for HR Professionals

MISSISSIPPI STATE

UNION UNIVERSITY

Educational Programs for HR Professionals

MBA Program

In addition to a concentration in Human Resources for Management undergraduate students, Mississippi State University provides students with a variety of opportunities to learn from and build relationships with human resources professionals through its Student Chapter for Human Resource Management (SHRM). Each semester a guest speaker series is held in which HR professionals from the region speak to members about fundamental HR issues. By getting involved in MSU’s student SHRM chapter, students can learn more about HR, network with HR professionals, and take advantage of leadership as well as volunteer opportunities.

The Master of Business Administration program at Union University Germantown prepares its students for leadership in today’s dynamic business environment. The MBA is both valuable and versatile, providing a competitive edge for career development. Students benefit from faculty’s commitment to teaching excellence and personal attention to students. Union University has met the need for higher education in West Tennessee since 1823 and continues this tradition among students from across the United States and around the world today.

Dr. Laura Marler Templeton, who has served as the faculty advisor for MSU SHRM for the past five years, currently serves as the College Relations and Workforce Readiness Officer on the board of the Golden Triangle Human Resource Association (GTHRA), which is a SHRM affiliate. Dr. Templeton is excited about strengthening the ties between MSU SHRM and GTHRA. This fall the organization will jointly launch a mentoring program in which MSU Student SHRM members will be partnered with a mentor from GTHRA. A summary of activities the chapter members have enjoyed include 20 guest speakers, tours of local industries, and networking with student members from another state chapter. Volunteer opportunities have included speaking engagements, hosting a roundtable and lunch for a distinguished speaker, hosting a Dress Your Best booth on multiple occasions, and assisting at two state HR conferences.

At Union University, students will receive an education from one of the top business schools in the world.

The McAfee School of Business Administration is fully accredited by AACSB International, an honor awarded to fewer than five percent of business schools worldwide. Union is one of three private schools in Tennessee—and the only one in West Tennessee—to achieve this level of accreditation.

For more information, visit www.msstate.edu

Students work with an outstanding faculty having diverse

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intellectual perspectives. Union University's McAfee School of Business Administration faculty members have been published over 74 times in top research journals during the past five years.

Multiple MBA schedule options are available. The MBA program is designed to allow students to continue in their careers. Convenient, one-night-a-week classes offer personal interaction with class peers and professors. This degree option can be

completed in 24 months. In addition, a 14-month degree option is also offered, with classes meeting two nights a week. Union’s online MBA option provides students with an online, two-year program. This option is ideal for individuals who travel often, work non-standard schedules or have commitments that interfere with traditional class times. Hybrid MBA scheduling options of classroom and online are available also. Call 901-312-1920 or email rvictory@uu.edu for additional information.

LIPSCOMB

Leading the way in human resources studies The field of human resources is evolving, and Lipscomb University’s College of Business is taking an innovative approach to preparing the next generation of HR leaders with its Master of Human Resources (MHR) degree.

Lipscomb’s MHR program is not merely producing generalists in the field. It is training human resource professionals to be strategic thinkers who will more effectively lead, grow and serve an organization’s human capital as well as provide valuable input to the company that will help it better utilize the skills and talents of its employees.

“Lipscomb’s program is unique in that the first class our graduate students take is built on business strategy,” said Allison Duke, associate professor of management and director of the Master of Human Resources program at Lipscomb. “HR professionals must understand the strategy of the company and how human capital supports the execution of that strategy. At Lipscomb we are equipping students with the knowledge and tools they need to be a valuable strategic partner in their organizations.”

Interest in the human resources field is on the rise. Based on income, hiring outlook, stress level and work environment, careers in human resources are ranked No. 3 in a recent survey of 200 career areas, and the demand for strategic leaders in this field is expected to experience significant growth through 2020.

Duke said that Lipscomb University's innovative Master of Human Resources program is the ideal program for professionals to gain the skills and knowledge needed to take advantage of these exciting trends and to advance their careers by equipping an organization to succeed through its most valuable asset: its people.

The Lipscomb MHR was created for working professionals. The 30-hr graduate program offers classes in a weekend format over just 18 weekends.

The curriculum is SHRM approved and taught by academic experts as well as industry leaders from the Nashville business community.

Because no workplace is without difficult moments, Lipscomb’s MHR includes classes in conflict management through Lipscomb’s Institute for Conflict Management. A global experience is built into tuition, giving the student a unique and valuable learning opportunity.

This spring, Lipscomb’s MHR students, alumni, and faculty developed the “Top 10 Hot Topics for Success” that human resources professionals are—or should be—discussing. These include global human resources, corporate strategy, corporate culture, the multi-generational workforce, analytics and big data, diversity, talent acquisition, silos to systems, crosscultural training and pivotal positions. Visit onedegreeaway.lipscomb.edu to read the Hot Topics or learn more about the Lipscomb MHR degree. www.HRProfessionalsMagazine.com

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As an HR professional, you know your craft well.

You know the issues, the procedures, the pitfalls and possibilities. Now add “strategist” to your skill set with a degree of difference from Lipscomb University: the Master of Human Resources. Designed to develop your skills as a part of your organization’s leadership team, the program includes leadership, organizational strategy, analytics and more—and is one of the few that includes significant conflict management course work in the curriculum. For more information, visit our website. And begin making a difference in your career, your life and the lives of others.

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UNIVERSITY OF MEMPHIS The Department of Management in the Fogelman College of Business and Economics at the University of Memphis offers AACSB-accredited training in human resource (HR) management and organizational behavior. The following faculty have an expertise in these areas: Drs. David Allen, Rabi Bhagat, Carol Danehower, Alex Rubenstein, Chuck Pierce, Bob Renn, and Bob Taylor.

They offer undergraduate courses on HR topics such as introduction to human resource management, compensation & performance appraisal, employee relations, staffing organizations, and employee training & development.

The University of Memphis offers MBA and executive MBA courses on topics such as managing human resources and strategic human capital management.

They also offer a doctoral research seminar on human resource management.

In addition, they have a student chapter of the Society for Human Resource Management (SHRM).

Finally, they are in the process of developing an undergraduate certificate in HR management. For more information, please contact Dr. Chuck Pierce, Chair of the Dept of Management (capierce@memphis.edu; http://www.memphis.edu/ management).

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What is Your VQ*? (*Value Quotient)

By JANIE WARNER

As

human resource professionals, we usually have the responsibility of training (although I prefer to think of it as educating) the employees of our companies. We conduct gap analyses, seek out or create educational opportunities in an attempt to increase the knowledge base of our employee population. We look for ways to motivate workers to WANT to learn new things. Often we are successful in doing so, while other times it is more challenging. But somewhere in there, we ignore - or deny - our own learning needs and in so doing, we fail to improve our worth to our employer. I call this ratio of pay to comparable worth the “Value Quotient.”

Compensation plans tell us that an HR professional with X amount of education and X amount of experience should be worth X amount of salary. We then tack on any perks, benefits and bonuses. We confuse this amount of total comp with our worth - we must stop that. Remember: what we are paid and what it costs to replace us are two different things.

As you know from your HR experience, we often have employees whom it is cheaper to replace than to tolerate (I know…that probably never happens where you work!). At the end of the day, an employee’s worth is determined by what they bring to the work environment.

Loyal, committed, intelligent, creative people are much harder to replace than an average employee whose main goal is to stay out of trouble and pick up a paycheck every pay day.

So the question becomes, how do you increase your value to your organization? It’s really fairly simple – purpose to learn something new - if not every day, at least every week or so.

How does one go about doing this? Here are a few easy ways:

1. Read. Subscribe to a journal or magazine that isn’t strictly HR-related. Learn about your business by reading about what others in that business are doing. Relate that information to what you do in HR.

4. Experience. Job shadow someone in each of the departments in your company. Your eyes will be opened to actual working conditions, and morale issues. You will become much more knowledgeable about the business of your business. What better way to show value to your organization than to be someone who can speak intelligently about the work that every employee does. It will also put you in good stead with the supervisors and managers. You will be able to “speak their language” and you will reap the rewards of that 10 times over.

In your zeal to make your HR department “Best in Class,” do not overlook your own development.

Purposing to improve your own Value Quotient can position you for promotion and/or recognition, and that will lead to an increase of your personal bottom line.

So, what have YOU purposed to learn this week?

This month? This year? Opportunities abound!

Be sure you don’t ignore the possibilities to increase your Value Quotient! In the meantime, pass this article along to your management team members…it applies to anyone who is pursuing opportunities to grow.

2. Collaborate. Take the knowledge you’ve gleaned from #1 above and look for folks in your organization with whom you can partner to make improvements. This is especially impressive if these improvements lead to revenue growth.

3. Take a Class. Take a class for which your company doesn’t want to pay. We hear this a lot from employees, “I would have learned that, but my employer didn’t want to pay for it.” Sometimes, we have to take the initiative and seek our own knowledge. That means we should budget every year to take a class that will further our education. Maybe a business accounting class so we can relate to the CFO? Crazy, right?

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Janie Warner, MS-HRM SR HR Consultant Regions Insurance, Inc. Janie.warner@regions.com www.regionsinsurance.com

SETTING YOU ON THE RIGHT PATH

FOR SUCCESSFUL BENEFITS MANAGEMENT Monitoring changes with today’s employee benefit laws can be overwhelming for even the most seasoned HR professionals. And, with more than 50 categories of regulations, nearly every aspect of the employer-employee relationship is impacted.

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We remain committed to providing our clients with an insider’s view of the workplace issues of the day.

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The Payroll Fraud Prevention Act

By ANNA BLAIR

Employee v. Independent Contractor: Legislation Aimed at Those Who Misclassify

In May 2014, Rep. Joe Courtney (D-CT) introduced the Payroll Fraud Prevention Act in the House of Representatives to target employers who intentionally misclassify employees as independent contractors. According to Rep. Courtney, the bill is intended to “help ensure that workers are properly classified so that they received adequate protections and employers fulfill their legal responsibilities.” The bill is companion legislation to a Senate bill of the same name introduced by Sen. Bob Casey (D-PA) in November 2013.

Mechanics of the Payroll Fraud Prevention Act The proposed legislation seeks to expand the Fair Labor Standards Act (“FLSA”) to cover the misclassification of individuals as independent contractors rather than employees.

The bill has a number of new provisions, but the one most likely to garner attention is the requirement of every employer to provide notice to all workers of their classification as either an “employee” or “non-employee.”

Generally, a person is considered an “employee” if he or she is subject to another’s right to control the manner and means of performing the work. The proposed bill would create a new definition of “non-employee” under the FLSA. A “non-employee” under the proposed legislation would be “an individual who (1) a person has engaged, in the course of the trade or business of the person, for the performance of labor or services; and (2) is not an employee of the person.”

The bill requires every employer to accurately classify all workers performing labor or services “as an employee or a non-employee.” Most importantly, the bill also requires the employer to provide written notice to the worker informing the worker of such classification. This notice directs the worker to a U.S. Department of Labor website for further information about his or her rights under the law and explains what to do if he or she has been misclassified. If the bill becomes law, employers would have to provide this notice no later than six months after the date of enactment of the bill.

If the employer fails to provide adequate written notice to the worker, the bill creates a rebuttable presumption that the worker is an employee. The presumption can only be rebutted with clear and convincing evidence that the worker is not an employee.

Any employer found to be in violation of the bill would be subject to a civil penalty for each employee or other individual who was the subject of such a violation, in an amount not to exceed $1,100. If the employer repeatedly or willfully commits a violation, the maximum civil penalty increases to $5,000. In addition, employers in certain industries that have frequent incidence of misclassifying employees as non-employees will be targeted for auditing purposes.

Legislative Posture of Bills in Congress Pundits have mixed opinions about whether the bill has a chance for passage this year due to the political climate in Washington D.C. Currently, the House bill has been referred to the House Education and Labor Subcommittee on Workforce Protections as well as the Committee on Ways and Means. The bill is still in Subcommittee and Committee, respectively. The Senate bill has been referred to the Committee on Health, Education, Labor and Pensions and is, likewise, still in Committee. Employers should stay abreast of the progress of this legislation.

Current Risks of Misclassifying Workers Even if the Payroll Fraud Prevention Act does not pass Congress this year, employers need to understand the significant exposure they risk by misclassifying workers. In some recent high profile cases, the U.S. Department of Labor has sued employers for the misclassification of workers under the FLSA. In one ongoing case, the DOL has sued Wang’s Partner Inc., doing business as Hibachi Grill & Supreme Buffett, and its

owner to recover unpaid wages and damages under the FLSA. The DOL alleges that investigators found that the employer misclassified servers as independent contractors, failed to pay servers and kitchen staff at least the federal minimum wage, and failed to pay overtime compensation, among other allegations. The DOL is seeking $1,997,726 in back wages and liquidated damages for 84 employees. This case is still in the early stages of litigation, but it highlights the significant monetary risk in misclassifying workers.

In taking on these cases, the Department of Labor has explained that the misclassification of workers presents problems for the affected employees, employers, and the economy as a whole.

The DOL highlights that the affected employees are often denied family and medical leave, minimum wage, overtime, and unemployment insurance. The DOL further argues that employee misclassification generates substantial losses to state and federal treasuries, to Social Security and Medicare funds, and to state unemployment insurance and workers compensation funds.

In addition to the DOL, state legislatures and the Internal Revenue Service have actively been working to crack down on misclassification.

Minimizing Risk of Exposure To minimize risk of misclassification, employers need to understand who qualifies as an employee under the FLSA as it currently stands. Under the FLSA, an “employee” is defined as “any individual employed by an employer.” The term “employ” is further defined as “to suffer or permit to work.”

To give effect to these extremely broad definitions, courts use an “economic reality” test on a case-by-case basis to determine if a worker is an “employee” under the FLSA, as opposed to an independent contractor.

The economic reality test encompasses the following non-exhaustive considerations: (1) the permanency of the employment relationship; (2) the degree of skill required for rendering services; (3) the worker’s investment in equipment or materials for the task; (4) the worker’s opportunity for profit or loss, depending upon skill; (5) the degree of the alleged employer’s right to control the manner in which the work is performed; and (6) whether the service rendered is an integral part of the alleged employer’s business.

If the employer determines that an employer-employee relationship does exist, the employer must afford the employee all the benefits of such under the law.

Anna Blair, Attorney Burch, Porter & Johnson, PLLC ablair@bpjlaw.com www.bpjlaw.com www.HRProfessionalsMagazine.com

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Don’t “Flip Flop”

on Your Company’s Dress Code

M

By CINDY KOLB

ost employers would agree that an employee who shows up at work for the day wearing swimwear is clearly not wearing appropriate workplace attire. But, what about when Jane in accounting, who is headed to a barbeque after work, shows up at the office wearing a short, summer dress with spaghetti straps? What about when Joe in sales, who is headed straight to the lake after work, comes to work for the day in shorts and flip-flops? As the human resources manager, what should you do?

As the weather heats up, companies are often faced with employees who may blur the line of what is considered appropriate workplace attire. Flip-flops, revealing clothing and even beachwear sometimes make an appearance at work during the summer months. As reported by a Workplace Solutions LLC. poll, 63% of businesses don’t alter their dress code policies in the summer, while nine percent indicated that employees are not required to wear professional clothing during the warmer months.

Many more employers have a practice somewhere in between that allows for a relaxed standard during the summer or at least one casual day per week. The best practice is to be proactive about having and enforcing a dress code. One reason to have a written dress code in place is to relieve managers and supervisors of having to make judgment calls on what is and is not acceptable. Subjective apparel standards by managers and supervisors can lead to complaints by employees of inconsistencies, or worse, discrimination.

A written dress code policy is necessary for health, safety and productivity. It also is necessary to protect the image you want to project to your customers and clients. A dress code policy should state the business justification for the dress code, such as to present a professional environment or to ensure a safe workplace. The dress code should be clear about what is and is not appropriate attire and should give examples. For example, are open-toed shoes or sleeveless tops acceptable? Don’t just say “business casual” in your dress code as that term can be interpreted in many ways and sometimes one person’s “casual” is another person’s “inappropriate.” Also, be clear about what days are designated for casual dress. Be precise in the language of your policy in an effort to avoid misinterpretation and to provide your employees with a good guidepost for what is acceptable workplace attire.

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It is also good to set out in writing how the policy will be enforced and what will happen if an employee violates the dress code. An inadvertent or initial violation may warrant just a reminder to the employee while a flagrant violation may result in sending the employee home to change. The written dress code should also state that repeated violations - - as with any policy - - may result in disciplinary action, up to and including termination. Be consistent about enforcing the dress code no matter the person’s age or position in the company. If one person is permitted to break the rules, others will also break the rules making it difficult to enforce the dress code. The dress code should be distributed to all employees and receipt should be acknowledged by a signature. That way, no one can claim they were unaware of the dress code, its requirements and the fact that disciplinary action may be taken for violating the dress code.

Employees should also be advised that they can request exemptions or accommodations as necessary. Title VII of the Civil Rights Act of 1964 prohibits employer discrimination based on gender, race or religion so close attention must be paid to any provisions in the dress code that make a distinction between men and women or affect religious dress.

Even though a majority of summer attire addressed in a company’s rules may be aimed at women’s clothing, such as halter or tube tops, dresses with spaghetti straps, short or sheer

clothing, and bare legs, it is imperative that employers pay attention to both men and women’s summer fashion choices and that dress code standards address both genders. For example, an employer that imposes a dress code on its female employees without imposing a comparable dress code on its male employees may face an investigation by the Equal Employment Opportunity Commission (EEOC) and a sex discrimination lawsuit. In one case, the EEOC investigated a complaint where the employer required female tellers, office and managerial employees to wear a uniform, but male employees in the same positions were only required to wear customary business attire. The EEOC concluded that the employer’s female dress policy constituted a “disparity in the terms and conditions of females as a class" and that possible customer preference for uniforms was not a defense to an employment policy which makes a distinction upon grounds not permitted by Title VII, such as gender. The Court found that the written dress code for female employees even discriminated with respect to compensation because the employer treated the cost of the two-piece uniform, which it furnished, as income to women employees and withheld income tax on that amount from the female employees’ wages.

However, Courts have held that just having differences between grooming and dress standards for male employees and female employees is not sex discrimination within the meaning of Title VII. In one case, an employer implemented a new grooming policy that prohibited men, but not women, from wearing long hair. A group of employees, all men with long hair, refused to comply with the policy. The men timely filed a charge with the EEOC that issued right to sue letters. When the plaintiff’s brought their lawsuit claiming sex discrimination, the Court cited precedents holding that differing hair length standards for men and women do not violate Title VII and the discrimination claim was dismissed. The employee must show, beyond the mere fact of differential treatment, some additional disparity or harm, such as that the particular requirements at issue are more burdensome for women than for men or that they perpetuate stereotyped views of women as inferior or as sexual objects.

• When an exception is made as a religious accommodation, the employer may still refuse to allow exceptions sought by other employees for secular reasons.

• Neither co-worker disgruntlement nor customer preference constitutes undue hardship.

• It is advisable in all instances for employers to make a case-by-case determination of any requested religious exceptions, and to train managers accordingly.”

Finally, state in the policy to whom employees should go if they have questions about the dress code or want to request an accommodation. Be sure the people designated to answer such questions, whether a Human Resource manager, supervisor or office manager, are prepared to answer questions about the dress code and to determine and enforce violations.

In summary, your workplace dress code should state the reason for the policy; what is appropriate for men and women (with examples); what is inappropriate attire (with examples); whether there is a “casual” or “jeans” day during the work week; who will enforce the policy and what type of discipline may be issued for violation of the policy; and, where to go if the employee has a request for an accommodation or any questions.

With a written, thorough and consistent dress code policy, employers can ensure that their company won’t melt down in the heat of the summer!

Cindy Kolb, Attorney Cross, Gunter, Witherspoon & Galchus, P.C. ckolb@cgwg.com www.cgwg.com

Employers should also be aware that in most instances, they will be required by federal law to make exceptions to their usual rules or preferences to permit employees to observe religious dress and grooming practices. The EEOC has recently issued two technical assistance publications addressing workplace rights and responsibilities with respect to religious dress and grooming under Title VII. Examples cited by the EEOC of religious dress and grooming practices include wearing religious clothing or articles (e.g., a Muslim hijab (headscarf ), a Sikh turban or a Christian cross); observing a religious prohibition against wearing certain garments (e.g., a Muslim, Pentecostal Christian or Orthodox Jewish woman's practice of not wearing pants or short skirts), or adhering to shaving or hair length observances (e.g., Sikh uncut hair and beard, Rastafarian dreadlocks or Jewish peyes (sidelocks)).

The EEOC’s Fact Sheet on Religious Garb and Grooming in the Workplace: Rights and Responsibilities notes, “Title VII requires an employer, once on notice that a religious accommodation is needed for sincerely held religious beliefs or practices, to make an exception to dress and grooming requirements or preferences, unless it would pose an undue hardship.

• Requiring an employee's religious garb, marking, or article of faith to be covered is not a reasonable accommodation if that would violate the employee's religious beliefs.

• An employer may bar an employee's religious dress or grooming practice based on workplace safety, security, or health concerns only if the circumstances actually pose an undue hardship on the operation of the business, and not because the employer simply assumes that the accommodation would pose an undue hardship. www.HRProfessionalsMagazine.com

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How a High-Cost Drug Helps Avoid Higher-Cost Complications

By SARAH MARTIN

For more information on Lockton, please contact Ashley Pace in Lockton’s Memphis office. 901 757 6902 apace@lockton.com

Today, employers often spend as much 15 percent of their healthcare costs on medications. With a wave of specialty drugs in the pipeline, which typically come with high price tags, that percentage is sure to surge over the next few years.

One such specialty drug is Sovaldi, an oral treatment for hepatitis C that was approved in December 2013. This drug, featured in a recent Wall Street Journal article, is typically offered as a 12-week therapy, with a treatment price tag of approximately $84,000. (That’s $1,000 a day, for those doing the math.) Despite the high costs, some analysts predict Sovaldi could become the top-selling drug of all time, even outselling Lipitor.

What’s So Special About Sovaldi?

Unlike any other medications currently available, Sovaldi eliminates the hepatitis C virus in nearly 90 percent of patients. This is important news because if not treated successfully, the resulting liver disease may require a liver transplant down the road. To put the cost into perspective, consider the estimated U.S. average 2011 billed charges per liver transplant at $262,900.† Suddenly a curative course of treatment at $84,000 may look a bit more palatable, both to employer and employee.

What’s in the Pipeline?

Unfortunately, Sovaldi doesn’t have many competitors at this time, but other similar drugs are in development and may be released as soon as 2015. Once there are competitors in the marketplace, health plans and pharmacy benefits managers (PBMs) will be able to negotiate with the various drug manufacturers to achieve lower acquisition prices, and perhaps negotiate rebates as well.

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The Importance of Specialty Drug Expertise Because of the difference in genetic makeup for each patient (referred to as a genotype), Sovaldi works differently.

It may be prescribed in combination with other hepatitis C medications that have been on the market for some time.

Although the new drug appears to be highly effective, treatment of hepatitis C remains complex, due to various therapies available for different genotypes, each requiring a different drug combination with different durations.

That’s why it’s important for employers to partner with a specialty pharmacy or a PBM with a specialty program that conducts close clinical reviews. In addition, a quality specialty pharmacy or PBM will remain in close contact with each hepatitis C patient to ensure medication compliance. After all, when patients are not compliant with their medications, plan costs can more than double—paying for the expensive medication and then covering the potential liver transplant that may occur later due to complications from non-compliance.

For some employers, increases in specialty drugs to treat diseases like hepatitis C may warrant the decision to carve out specialty pharmacy fulfillment and management.

Lockton has the experience required to effectively work with your current carrier or PBM to make sure they are managing this and other conditions appropriately.

What Are the Odds?

Are you thinking this scenario is not relevant to your employees?

Think again. Even if you don’t have a high prevalence of hepatitis C in your employee population today, you can expect to in the future. According to the same Wall Street Journal article, approximately 3.2 million people in the U.S. may have hepatitis C. As this new drug and the disease receive more attention, more testing will be conducted and more people will be diagnosed, making it more important than ever to create the right strategy for handling the associated treatment costs. † http://www.transplantliving.org

Sarah Martin Vice President Senior Actuarial Consultant Pharmacy Analytics Lockton Benefit Group

Ashley Pace Lockton’s Memphis Office 901 757 6902 apace@lockton.com

www.HRProfessionalsMagazine.com

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Linking Organizational Change and Leadership Janyne Peek Emsick, Ph.D Dr. Janyne Peek Emsick is an expert in leadership development, organizational change, and adult learning.

She has over 20 years of experience with global experience designing and leading custom programs.

On June 3, the Northeast Arkansas Society for Human Resource Management and the Jonesboro Regional Chamber of Commerce presented, “Linking Organizational Change and Leadership.” The seminar was from 1:15 PM to 4:30 PM at the Centennial Bank in Jonesboro. The seminar speaker was Janyne Peek Emsick, Ph.D. She led the NEA SHRM members in an energizing dialogue with inspiring yet practical keys to facilitating change in their respective organizations.

Dr. Emsick’s insightful and energetic approach impacts positive change in individuals, which leads to successful transformation of teams and businesses. She advocates for leaders around the world to walk their talk, one leader at a time, by serving as catalysts for positive change in individuals and organi-

ONE AREA OF PRACTICE. ONE FOCUS.

zations they lead.

The workshop bridged theory and practice and demonstrated how two

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Presented by: Tanja Thompson and Brenda Canale Location: Littler Memphis 3725 Champion Hills Drive, Suite 3000 Memphis, TN 38125 For direct registration and questions, please contact Kellie Nurko at knurko@littler.com or 973.848.4752.

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Business Group Discussed

Health Care Solutions

By MURRAY L. HARBER

The Mississippi Business Group on Health held its second meeting of the year on June 5th, 2014 at Table 100 in Flowood, Mississippi with 86 attendees.

Representatives Butler Snow, Trustmark Bank, Ingalls Shipbuilding, the National Federation of Independent Businesses, and St. Dominics served on an employer panel sharing their organizations’ perspectives.

“Our annual meeting was a real success based on the comments and response from our membership. The expertise and experience of the group really mixed well with our program and content. The turn out and enthusiasm verified the interest level and commitment of employer or make a difference in Mississippi in both health care cost and wellness of their employees. The continued growth of the MSBGH will be a real difference maker in helping provide solutions to improve the management of health care and its associated costs in our state,” stated Billy Sims, President of the MSBGH and VP of Human Resources for Southern Farm Bureau Life Insurance Company.

The focus of the meeting was on building collaboration with all players in the employer health and health care system. Attendees listened to national experts and local employers on ways to build effective partnerships along with learning about the updates to the Patient Protection and Affordable Care Act. “We had great participation in our annual meeting with high quality participants including C-suite and other senior leadership listening and sharing ideas for effective solutions to the health and health care issues facing employers moving forward,” reported Murray Harber, Executive Director of the Mississippi Business Group on Health.

Murray L. Harber Executive Director Mississippi Business Group on Health murraylynnharber@gmail.com www.msbgh.org 26

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LESSONS

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By TIMOTHY W. LINDSAY

Preventing, investigating and remedying claims of sexual harassment in the workplace can be most challenging. This challenge appears in all work environments regardless of industry. As reflected in the recent Fifth Circuit Court of Appeals decision of Hague v. University of Texas Health Science Center at San Antonio, issued on March 28, 2014, the field of education is not immune.

Monica Hague, a registered nurse, was employed by the university as full-time instructor in its Continuing Education Division under a term contract on December 15, 2008. The contract had been renewed twice for an additional year. During her brief employment, Hague took issue with and complained about certain workplace conduct. In September of 2010, Hague complained that a fellow faculty member, Dr. Manifold, sexually harassed her by reading an explicit magazine article out loud during a meeting. She also alleged that Dr. Manifold gave one of her co-workers a sexually explicit doll. The university investigated and concluded that Dr. Manifold’s conduct was “unprofessional and inappropriate for workplace or classroom” even though the actions did not rise to the level of sexual harassment. Dr. Manifold received a reprimand for his behavior.

Hague filed a formal grievance with the university in October of 2010 alleging that her superior, Dr. Villers, treated employees differently and fostered an uninviting work environment. Hague did not claim that the differential treatment she perceived was the product of gender discrimination. An investigation was conducted by the university and Dr. Villers was cleared of the allegations, although it was recommended that Villers improve communications within his department.

On June 17, 2011, Hague filed a charge with the EEOC. The charge listed only allegations of sexual harassment, not sex discrimination. On June 20, 2011, the university provided a letter to Hague notifying her that her employment would end August 31, 2011, the expiration date of her current contract. The university received notice of Hague’s EEOC charge on June 21, 2011, the day after its letter to Hague.

Upon receiving the EEOC’s notice of right-to-sue, Hague filed her complaint with the district court alleging sexual harassment, termination based on her gender, and unlawful retaliation.

The district court granted summary judgment on all claims in favor of the university.

Hague appealed to the Fifth Circuit. The Fifth Circuit’s opinion is where multiple lessons can be learned for even the most educated employer.

LESSON # 1

The Fifth Circuit affirmed dismissal of Hague’s claim of wrongful termination based on sex discrimination because her EEOC charge alleged only “harassment” and not disparate treatment based on her sex. An aggrieved party must first exhaust her administrative remedies, i.e. file a charge with the EEOC, prior to filing a complaint in court. Claims of sexual harassment and claims of disparate treatment based on sex are distinct for exhaustion purposes. The court observed that Hague’s EEOC charge could not have included an allegation of gender bias since she did not receive the non-renewal letter until after she filed the charge. Consequently, the EEOC’s investigation could not reasonably be expected to include a claim of sex discrimination. Since Hague failed to exhaust her administrative remedies on the claim of termination based on “sex discrimination,” dismissal of the claim was appropriate.

Lesson To Be Learned: Review allegations in an EEOC charge very closely. Do not assume allegations of sexual harassment juxtapose a claim of disparate treatment based on sex, or vice versa. Catching this distinction early can be the difference between winning and losing a lawsuit later.

LESSON # 2

The Fifth Circuit affirmed dismissal of Hague’s sexual harassment claim. Hague asserted she was harassed by Dr. Manifold’s reading the explicit article and giving a co-worker the sexually explicit doll.

Dr. Manifold was not Hague’s supervisor and had no authority over her. Consequently, Hague had to prove the requisite elements of a hostile work environment: (1) member of protected group; (2) unwelcome conduct; (3) conduct based on sex; (4) conduct effected a term, condition, or privilege of employment; and (5) the employer knew or should have known of the harassment and failed to take prompt remedial action. Under the 4th element, the courts look to the frequency of the conduct, its severity, whether it involves physical threats or humiliation as opposed to mere offensive utterances, whether it unreasonably interferes with work performance, and whether the conduct undermines a plaintiff’s workplace competence. Hague only identified two incidences with no physical or sexual advances were made directly to Hague. This was insufficient.

Lesson To Be Learned: Implement clear policy/procedures for reporting, investigating and remedying sexual harassment complaints in the workplace. Monitor those who are given authority over others - train annually in how to avoid and handle workplace complaints. Not all objectionable conduct rises to the level of illegal harassment. Avoid using the legal term “sexual harassment” to describe conduct in your internal investigative reports and/or conclusions – use “objectionable conduct” or “inappropriate behavior.”

LESSON # 3

The Fifth Circuit reversed the district court’s dismissal of Hague’s retaliation claim. The Court found sufficient proof of pretext: (a) Dr. Villars refused to give Hague any reason for not renewing her contract at the time but supplied a “laundry list” during his deposition; (b) contracts of two other female employees who supported Hague were not renewed; (c) testimony of Hague’s direct supervisor rebutted reasons offered by the university for non-renewal; (d) inconsistent reasons had been given for the non-renewal; (e) Dr. Villers’s said “it came down to issues of trust” as to Hague; and (f ) Dr. Villers’s trust issues were based on his belief that Hague lied in her grievance.

Lesson To Be Learned: Regardless of the validity of the employee’s underlying complaint, a claim of retaliation is the real threat. Reaffirm your policy against retaliation before and after allegations are made. Where legitimate reasons exist for an adverse employment decision, identify them and be consistent. Never let disbelief of allegations in an internal complaint be the cause for “trust issues” that result in disciplinary action.

Timothy Lindsay, Managing Partner Ogletree Deakins Timothy.lindsey@ogletreedeakins.com www.ogletreedeakins.com www.HRProfessionalsMagazine.com

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One Day, Many Solutions

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Employment Law Coast-to-Coast Seminar

Attorneys from the Memphis office of Fisher & Phllips LLP presented “One Day, Many Solutions,” on May 2 at the Hilton Memphis from 9 AM to 5 PM. They explored practical solutions to employers’ most common problems and provided the tools and skills needed to identify, avoid and resolve many of today’s workplace issues.

Attorneys participating in the seminar were: Jeff Weintraub, Managing Partner; Craig Cowart, Sally Barron, Betsy Weintraub, and Courtney Leyes Tomlinson

Topics included were: • She Said What?!? Effective Workplace Investigations • Taking the Bully by the Horns: Understanding and Preventing Workplace Bullying • Breaking Bad Behavior: Drugs, Alcohol, Medical Marijuana, Cigarettes, Cursing, Social Media, Attire, Tattoos, Piercings, Missing Underwear, Body Odor, etc.

• Which Is Riskier? Hiring Criminals or Conducting Background Checks?

• Everybody Gets a Trophy: Avoiding Performance Management Mistakes • Think Twice Before You Delete That Email: Computers and Employment Law Nightmares • If a Stripper Is Not an Independent Contractor, Who Is? • Healthcare Reform Check-Up: Key Concerns for Employers • Only in This Town . . . State and Local Employment Law Developments and Trends

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Lessons FROM

OCAHO PART 2

By BRUCE E. BUCHANAN

For most employers, the thought of an Immigration and Customs Enforcement (ICE) inspection at the workplace is terrifying. In the spirit of raising awareness, and as a follow-up to my previous article, I am writing this article discussing some of the most recent I-9 enforcement decisions from the Office of Chief Administrative Hearing Officer (OCAHO), and common I-9 errors found, which caused substantial fines.

M&D Masonry Decision A case that reflects the typical type of substantive errors for which an employer is fined is U.S. v. M&D Masonry (2014). ICE cited the employer for 339 violations in its Notice of Intent to Fine (the ICE filing that starts the fine process). Specifically, the following errors were the most commonly cited: • • • • • • • •

Failure to prepare and/or present an I-9 form for employees – 87 Failure of the employee to sign Section 1 – 34 Failure to place a checkmark for type of status – 60 Failure to provide Alien (A) number in Section 1 – 10 Failure of the employer to sign Section 2 certification – 81 Failure to provide both List B and List C documents – 29 Failure to provide a document number on Lists A, B or C – 25 Failure to record an issuing authority on Lists A, B or C – 21

Based upon the number of I-9 forms provided, ICE determined M&D Masonry had an 84% error rate. If there are 50% or more I-9 forms with substantive errors, the baseline penalty is $935 per violation. ICE then aggravated the fine amount by 5% for the seriousness of the violations. Overall, ICE sought penalties of over $332,000. OCAHO reduced the penalties to approximately $228,000 by reducing the penalty per violation to $750 for failure to prepare/present I-9 forms and $650 for the remaining violations.

Failure to Prepare I-9 Form As shown above in the M&D Masonry decision, the most common violation is the most basic: failure to prepare an I-9 form. This violation occurred in most of the 22 OCAHO decisions in the past 12 months. In several cases, U.S. v. Red Bowl Asian Bistro, U.S. v. Kobe Sakura Japanese, and U.S. v. Kobe Sapporo Japanese, the owners stated they were simply were unaware of the requirement to complete an I-9 form for their employees. Ignorance of the law, even if it is the truth, is no defense.

Section 1 Errors A second common violation is failure to ensure the employee properly completes Section 1 of the I-9 Form. This occurred in approximately 50% of the 2013-14 OCAHO decisions.

The typical Section 1 errors are: failure of the employee to sign Section 1, failure to place a checkmark for type of status, and failure to provide an Alien number. These types of violations are easily preventable simply by the employer conducting a thorough review of Section 1 before proceeding to Section 2.

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One of the arguments commonly asserted by employers is they were not responsible for the completion of Section 1; therefore, they could not (or should not) be penalized for those errors in Section 1. However, the responsibility for executing an error-free I-9 form rests solely on an employer, even if Section 1 must be completed by an employee. After all, ICE does not have the resources to seek out each individual employee and levy a monetary fine against the offending employee.

Section 2 Errors As reflected in the M&D Masonry decision, employers also commit a wide variety of errors in the completion of Section 2. Some of the other OCAHO decisions which discuss these types of Section 2 errors are U.S. v. Black and Blue Steak and Crab - Buffalo, and U.S. v. Super 8 Motel.

On some occasions, employers, who did not record any information in Lists A, B or C, have argued that supporting documentation attached to the I-9 form should amount to substantial compliance of the I-9 form requirements. However, OCAHO has repeatedly stated, this reasoning is not tenable. Affixing photocopies of I-9 support documents to an incomplete I-9 Form, which has failed to record any of the relevant information in List A or B/C, does not satisfy an employer’s legal duties. However, if an employer fails to record one or two pieces of data, such as the document title and/or the expiration date of a document, the attachment of those documents, which includes that data, to the I-9 form, when presented to ICE, will cause only a technical violation, not a substantive violation. (Technical violations can be corrected within 10 business days of ICE’s Notice of Technical Failures without incurring a financial penalty.)

Backdating of I-9 Forms Another common I-9 error that is often reflected in OCAHO decisions is the backdating of I-9 Forms.

Backdating occurs when the form is signed and the date indicated is not the date the form was actually signed, but when the form should have been signed, days, months or even years prior. Often, this violation is committed in conjunction with the failure to complete the I-9 Forms until after the service of the NOI. Examples of such cases where this occurred are U.S. v. Kobe Sakura Japanese and U.S. v. Kobe Sapporo Japanese. These types of violations can lead to a finding that the employer lacked good faith, which creates a 5% aggravating factor.

Conclusion Now that you are more aware of the common I-9 errors, it is incumbent upon your company to take a pro-active approach to I-9 compliance. Specifically, employers should conduct regular internal I-9 audits, under the supervision of an immigration compliance attorney, and conduct regular I-9 compliance training.

Bruce E. Buchanan, Attorney Siskind Susser P.C. bbuchanan@visalaw.com www.visalaw.com