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FROM THE
PRESiDENT
One of
the most common concerns facing our client base deals with the Fair
Labor Standards Act (FLSA) and specifically, how to classify an
employee as exempt (from overtime) or non-exempt. The law
specifically articulates how to do this; however, severe
consequences can accompany misclassification.
The most
common misconception among employers is that labeling an individual
as “salaried”
automatically debars that employee from
overtime pay. This is not necessarily true. Another misunderstanding
is that the job description determines the classification. The
reality is that what a worker really does, not what the job
description states he should do, accurately determines the
classification.
The
following synopsis is adapted from the Society for Human Resource
Management (SHRM) weekly bulletin.
A
class-action lawsuit has been filed in California against IBM Corp.,
alleging the company denied overtime pay to thousands of technical
support workers nationwide. The lawsuit was filed by three IBM
technical support workers whose primary job duties consisted of
installing or maintaining computer hardware and software for IBM and
its clients. The workers claim that they, along with thousands of
other IBM employees who performed similar duties, were misclassified
as exempt from overtime pay under the Fair Labor Standards Act.
Attorneys for the plaintiffs argue that potential class members are
not covered under the overtime exemption for employees who design
computer network systems.
The
lawsuit also claims that since an employee's right to share in
contributions to the IBM savings and pension plan is dependent, in
part, on the employee’s
eligible compensation, which
includes overtime wages, IBM also violated the Employee Retirement
Income Security Act (ERISA) by underpaying them and denying them
proper participation in the plan.
The
class accuses IBM of violating various California wage, hour, and
labor laws. While federal law requires overtime for non-exempt
workers who work more than 40 hours a week, California state law
also requires overtime for more than eight hours worked in a
day.
The
plaintiffs also allege that IBM violated the California labor code
by not paying its employees all of the wages due to
them.
While
all matters may not apply, it is important to note how quickly the
concerns of three people multiplied to class action and then
suddenly encompass an ERISA complaint. If the workers prevail in
this suit, IBM will likely be forced to pay all of their legal fees
as prescribed under FLSA and may be liable to pay each employee
three times what they might have been entitled to otherwise.
If you
have questions about proper classification of workers as exempt
versus non-exempt, please contact Jena Weigel by phone at
443.321.7708 or by email at jweigel@hri-online.com.
Minimum
Wage
Maryland's
minimum wage earners experienced a $1 increase in hourly pay after
the state Senate overturned Gov. Robert L. Ehrlich's veto of a bill
that bumped the rate to $6.15 . The law, effective February 16,
2006, made Maryland the 18th state to increase the minimum wage over
the federal minimum of $5.15 . Employers with people working in
Maryland are required to post the following Wage
and Hour Fact Sheet.
USERRA
Updated
In
December 2005, final changes were made to the Uniformed Services
Employment and Reemployment Rights Act to include service members in
the National Disaster Medical System. Employers are required to post
the most recent version of employees' rights under USERRA. Use this
link
to download and print the required notice. The notice should be
posted in a prominent place where employees will have easy access to
the new information.
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Greetings!
Welcome
to the March 2006 edition of DiRECTIONS. In this issue, Tim
discusses the importance of proper employee classification
under the Fair Labor Standards Act (FLSA). We then observe
compliance changes for Maryland Minimum Wage requirements and
for the Uniformed Services Employment and Reemployment Rights
Act (USERRA).
Next
we discuss the advantages of using Tower Federal Credit Union,
a free benefit for HRi Clients and Employees. Then, we are
excited to introduce our new Vice President of Business
Development, Paul Younkins.
Finally,
we ask you to take this month's survey and we supply results
from last month's 401(k) Participation Survey.
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Tower
Federal Credit Union
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Last
year HRi and Tower Federal Credit Union joined forces to
offer HRi clients and employees the opportunity to
become members of Tower Federal Credit Union. Since last
year, many employees have joined the credit union and
membership requests are still coming in. It’s
not too late to join! At any time, provided
you are an active employee of an HRi client, you may
join the credit union.
Tower
is the largest federal credit union in Maryland and has
over 112,000 members worldwide and over $1.4 billion in
assets. Because credit unions are not-for-profit
financial institutions with no stockholders to pay,
earnings are typically returned to members in higher
rates on savings, lower rates on loans, no monthly
service charges, and no fees. Tower offers 24-hour
online access to your accounts and to loan applications,
therefore providing easy access - even for those
employees who live outside of Maryland.
Some
of the advantages Tower offers are:
- Free
Checking with no fees, no minimum balance, no monthly
service charges.
- Low
fixed rates on credit cards.
- Low
rates on Auto Loans, Mortgage Loans, Home Equity Loans
- New
Member Discount - An extra 1% off the low-rate auto
loan and various other loan products.
- Free
Home Banking
- Higher
dividend rates on savings accounts and Share
Certificates (CDs)
Tower
also offers free seminars to work-site employees on
financial issues such as, Creating a Financial Plan, The
Essentials of Estate Planning, Investment Fundamentals,
Retirement Planning Considerations, College Savings
Alternatives and Preventing Identity Theft.
For
more information on how to join Tower Federal Credit
Union, please visit http://rs6.net/tn.jsp?t=toaqvsbab.0.0.ddcy8zn6.0&p=http%3A%2F%2Fwww.towerfcu.org
or email your Client Service Specialist at HRi to
request a membership package. If you would like to find
out more about one of the free seminars, contact Jena
Weigel by phone at 443.321.7708 or by email at
jweigel@hri-online.com.
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Meet
HRi
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 HRi
is pleased to welcome our new Vice President of Business
Development, Paul Younkins. Involved in the healthcare
industry for over ten years, Paul brings with him an
extensive management background, which includes:
- Group
Benefit Consulting
- Account
Management
- Direct
Sales / Marketing
- Business
Relations
- Product
Development
- Business
Process Improvement
- Identificaiton
and Recovery of lost revenue
Favorite
Quotes:
"Life is not easy and it ought not be easy. It ought to
be hard, it ought to be radical...it ought to take you
to places you'd rather not go." - Henry Nouwen
In
my spare time: Write short stories, poetry, and
thoughts
If I could change one thing in my
life: I would change it!
My greatest
accomplishment: Securing gainful employment at HRi
My favorite restaurant: The Blue Hen - Key
West
Favorite Hobbies: Playing Sports,
reading, telling stories, friends and family
My
Dream Vacation: Spend some quality time in the Swiss
Alps
Advice to Live by: "better to remain
silent and appear stupid than open your mouth and remove
all doubt" -Abraham Lincoln.
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Monthly
Survey
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 Click
here
to participate in this month's survey about Tower
Federal Credit Union. To see the results of last month's
401(k) participation survey, click here.
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