Employer-friendly Featured

8:00pm EDT October 26, 2009

In an employee-friendly state such as California, employers may feel that they don’t have many rights. And while there are some things you can’t do to control your workplace policies and environment, there are actually a great many that you can, says Diane Crandall, director of compliance consulting services at ManagEase Inc.

But before you take action, it’s important to be aware of the requirements of the law.

“It’s very hard to be an employer in California because there are so many rules that you need to follow,” she says. “I don’t think most employers willfully do the wrong thing, but mistakes are common due to lack of knowledge.”

Smart Business spoke with Crandall about the things you can — and can’t — do as a California employer to stay on the right side of the law.

What rights do many employers think they have but may not automatically be entitled to?

Many employers would like to have employees work 10-hour days, four days a week, but they can’t just automatically have employees work that schedule to avoid paying overtime. In order for an employer to implement a 4/10 workweek, the schedule has to be voted in by two-thirds of the employees.

The employer has to file certain paperwork with the California Division of Labor Statistics and Research. Without doing that, the company can still have an employee work 10 hours a day, but it would have to pay overtime for those extra two hours each day.

Another area that confuses employers is exempt versus nonexempt status. Some employers think that they can classify employees as exempt or nonexempt as they choose, but the Industrial Wage Orders set criteria that employees must meet before they can be classified as exempt from overtime. The employer doesn’t just get to pick and choose.

What other mistakes do employers make?

Companies will often want to hire employees as independent contractors, but they can’t just deem someone an independent contractor. That person has to meet certain requirements. For example, an independent contractor is generally someone who sets his or her own hours, uses his or her own tools and works for multiple clients or customers.

If employers aren’t sure they want to hire someone full time, they can instead hire the person as a temporary employee to see if the employee is the right fit.

What rights do employers have that they may not realize they have?

Employers have the right to change employees’ job descriptions, their hours of work, their benefits (including whether to have holiday pay and paid vacation time) and their wages. For example, if the economy experiences a downturn, employers can require that all employees take a 5 percent wage cut. They don’t have to have the employees’ permission to do that, but they should give employees notice and not just say, ‘When you come to work tomorrow, you’re going to have a 5 percent decrease in your paycheck.’

Employers also have the right to run their business in the hours they choose and in the way they see fit. They can close a particular division of their company and outsource the work. They could also eliminate their entire sales force and decide to sell only over the Internet.

Employers can also monitor what their employees do at work. With today’s technology, they can track what someone does on the employer’s computer system and access anything they want to at any time on an employee’s computer. The best practice would be to advise employees of the employer’s rights upon hire or change in position.

What other rights do employers have?

Employers have the right to require a professional dress code. They can require that people wear suits and ties, and if they have casual Fridays, they can say employees may wear jeans but dictate that they have to be free of holes and they can’t be wrinkled or have stains.

Dress codes can also come into play with safety. If someone is working on a machine with moving parts, employers can require them to keep long hair tied back so it doesn’t get caught in the machine or to wear clothing with fitted sleeves so that they don’t get tangled in something.

Employers also have the right to have surveillance cameras in the workplace. It’s a best practice to disclose that fact to employees, and it’s best to get them to sign off acknowledging that they understand their actions, behaviors and conversations may be taped or recorded.

Additionally, they can demand a drug and alcohol-free workplace. They can demand accurate time records for nonexempt employees. And they can require ethical behavior, even when someone is not on the clock.

How do you communicate these policies to employees?

Initially, employers should communicate them through new-hire documents when someone first comes on board. When they provide all the documents that California requires them to give to a new employee, they can also include things that communicate their own policies. Another good way to distribute information is through an employee handbook, which should include a summary of company policies. Employers can also communicate policies through company meetings and memos.

However it’s done, employers should always require a signature from employees acknowledging they received the information or written document and will follow the policy. And if employers communicate policies at a company meeting, they should have a sign-in sheet so employees acknowledge their attendance.

Diane Crandall, SPHR, is director of compliance consulting services at ManagEase Inc. Reach her at dcrandall@managease.com or (714) 378-0880.