Human resources has never been more complicated. HR professionals are responsible for dealing with constant changes from the Department of Labor (DOL) or other regulatory agencies, while finding new talent and retaining employees in an operating environment of heightened awareness about harassment.
“In the last five years, I’ve seen more legislative updates and coverage of HR issues than I’ve seen in my 25-plus years of experience, and I only expect that to continue,” says Renee West, SHRM-SCP, senior manager and lead human resources consultant at Rea & Associates. “These changes can impact employers in a number of different ways through audits, lawsuits and insurance costs.”
Smart Business spoke with West about HR hot topics that employers cannot afford to ignore in 2020.
What are important changes and trends with regards to compliance?
There’s increased awareness surrounding workplace immigration and employment of legal workers. U.S. Immigration and Customs Enforcement opened 6,848 worksite investigations in fiscal year 2018, compared to 1,691 the prior 12 months. That led to 5,981 I-9 audits and more than 2,300 people being arrested at work.
Employers need to ensure the I-9 Form is on file for every active employee hired since Nov. 6, 1986. Companies also must keep I-9s on file for terminated employees for the required time. Penalties for knowingly hiring and continuing to employ illegal workers can range from $375 to $16,000 and up per violation, with repeat offenders at the higher end. Failing to produce an I-9 can lead to penalties of ranging from $110 to upward of $1,100 per violation.
It’s also essential to have an updated employee handbook that reflects the wage and hour laws for overtime, meals and break periods, training and travel time, timesheet reporting, definition of the work week and deductions. During an audit, your handbook will be the DOL’s first reference. Also, because many policies depend on employee numbers, a business may move from one staffing level bracket to another as it grows.
All companies should review the handbook annually to ensure communications are consistent and the staff is up to date. After any updates, employees should sign an acknowledgement page that’s kept on file.
How did federal exempt overtime change?
The new overtime rule raised the ‘standard exempt salary level’ from $455 per week to $684 per week (equivalent to $35,568 per year for a full-year worker). It also raised the total annual compensation requirement for ‘highly compensated employees’ from $100,000 to $107,432 per year, and allows employers to use nondiscretionary bonuses and incentive payments, including commissions, paid at least annually to satisfy up to 10 percent of the standard salary level, in recognition of evolving pay practices.
While the DOL hasn’t changed the current duties tests, the threshold increase means more employees will be eligible for overtime. Employers should review all job descriptions, looking at how they have employee jobs classified, either exempt or nonexempt, and the pay data for exempt workers earning below the new threshold.
What can help minimize the talent shortage and maximize retention?
With a tight labor market, employers need the right fit for pre-screening job candidates. Reviewing and adjusting these procedures also may help ensure new hires stick around. In addition, many employers are looking outside the normal realm of hiring through internship and apprenticeship programs.
Retention needs to be a priority. What compensation and incentives will help current employees stay and attract new talent as well? Consider fringe benefits like paid time off, remote work, stay interviews, development programs, free lunch, etc.
Where does harassment come into play?
With the #MeToo movement, there is more visibility on harassment. It’s a best practice to have an updated, uniform general and sexual harassment policy in the handbook. Employers also should conduct annual training for all employees with a separate training for managers and supervisors, who are often the initial contact if there is a problem. Along with documenting who has been trained, if there’s a solid reporting structure, employees know who to go to.
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