Washington state employers face a great body of city, state and federal employment laws that they must navigate, and it would take a book to outline all of them. There are a few keys areas, however, that stand out above the rest as frequently causing problems and leading to expensive litigation for employers. Let’s look briefly at these problem areas and steps employers can take.
Note: The “What to do” steps in each area should be carried out in consultation with a human resources expert or employment attorney.
1. Hiring Issues:
The problem:
Our first issue is actually made up of three common pitfalls during the hiring process:
- Asking prohibited questions (on paper or verbally) about criminal convictions and other protected categories
- Improper background checks or screening tests
- Improper processing of I-9 forms
What to do:
- Confirm employment application(s) are current
- Double-check a sample of completed I-9 forms
- Assess need for background check and screening tests (if any) and related forms
2. Classifying Workers:
The problem:
Many costly lawsuits center on misclassification of employees in either of two important areas:
- Workers owed overtime pay (non-exempt employees) and those who are not (exempt employees)
- Employees (protected by wage and hour laws) versus independent contractors (non-employees excluded from protections)
What to do:
- Determine the extent of exempt and independent contractor classifications
- Evaluate your process for determining employee status
3. Compensation Requirements:
The Problem:
There isn’t just one “minimum wage,” especially in Washington State, which boasts one of the highest minimum wages in the country. Federal minimum wage does not apply here. In the City of Seattle, minimum wage can be even higher. And, construction companies working on federally- or state-funded projects, must pay the prevailing wage.
What to do:
- Collect names, jobs, and locations for all employees
- Evaluate the company’s status for purposes of Seattle’s minimum wage
- Identify any projects subject to prevailing wage
- Assess sub-contractor compliance as well
4. Work and Break Time Reporting and Requirements:
The problem:
Accurate time reporting is crucial, especially for non-exempt employees. Timesheets seem simple, but many employers fall short. There has been much litigation in Washington lately about missed (paid) rest and (unpaid) meal breaks.
What to do:
- Take a look at your current time reporting system – is it detailed enough?
- Are current rest and meal break practices up to snuff, along with related policies?
5. Protected Leave Entitlements:
The problem:
Many employers are unaware of all of the laws entitling employees to leave from work. The most commonly used leave includes: family medical, pregnancy disability, family care, and paid sick and safe. Additional laws provide leave for military duty (employee or spouse), victims of domestic violence, and disability. Plus, paid leave comes to Washington state next year.
What to do:
- Fill gaps in any written company policies
6. Risk Class Reporting and Tracking Hours:
The problem:
Workers’ comp premiums in Washington vary by type of work, with more than 300 classifications in use. It’s crucial to have the right ones assigned to your company.
Risk classes are established when each company opens its workers’ comp account, but problems crop up when employers:
- Put employee hours in the wrong class
- Fail to keep adequate records
- Change their business, or add new types of work, without updating their risk classes
Report into a risk class that’s too expensive and you’re overpaying each hour. Underpay by using a cheaper risk class and you risk an audit, citations, or worse.
What to do:
- Analyze risk classes and project descriptions to evaluate whether employee hours are being properly reported
7. Record Keeping and Notice Requirements:
The problem:
Many employers fail to keep employee records for the recommended 5-6 years or don’t have all of the required information. They can also be tripped up by requirements for employee notices, both at time of hire and when conditions change, which vary by jurisdiction. Finally, paystubs must advise the employee of sick leave balances.
What to do:
- Assess employment information given to employees at hire.
- Review a sample of paystubs to evaluate adequacy
8. Handbook Review:
The problem:
Employee handbooks don’t get reviewed and updated as often as they should. No law requires handbooks, but a well-drafted and up-to-date handbook can ensure consistent communication, resolve problems quickly, and be useful in legal defense.
What to do:
It is crucial that handbooks and other policies be reviewed to ensure they are up to date with the ever-changing and expanding state and federal employment laws.
Conclusion
This is not an exhaustive list of the state and federal law that Washington employers face. These eight areas are, however, the most common pitfalls that employers can fall into. Ensuring compliance in these areas will go a long way towards protecting your company from potential problems and expensive litigation.
Article by Karen Galipeau Forner
Managing Attorney at K-Solutions Law in Bellevue, WA
