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Can Employers Require Employees To Get A COVID-19 Vaccine?

By Business Contracts, Business Lawyer

As a general rule, you can require your employees to get a COVID-19 vaccine. But that doesn’t mean it’s a good idea.

Here’s why.

OSHA has taken the position that if you make your employees get a coronavirus vaccine, then any adverse reaction to the shot by an employee is a work-related injury.

So, what happens if you have an employee that gets blood clots or even dies because of the vaccine?

Not only can you have the government breathing down your neck because of safety issues but you may find your business is a defendant in a personal injury or wrongful death lawsuit. Or at least an expensive workers compensation claim.

And that’s just the legal consequences. How do you face an injured employee or a dead worker’s family?

For now, the safer course of action is to make the vaccine optional and make accommodations for at-risk employees to work from home if possible.

If you haven’t done so recently, it’s probably a good time to have an experienced business lawyer review your employment contracts and policies to make sure you’re not at risk with regard to pandemics, epidemics, and other dangers.

Why “Hire” Is A Four-Letter Word

By Business Contracts, Business Lawyer

hire independent contractorWhen you search for individual freelancers to do work for your business, wash out your mouth with soap every time you say the dirty word “hire.” Because you should never hire an independent contractor.

What’s the problem?

The term means “employment.” When you “hire” an individual, you’re getting an employee, not an independent contractor.

Why is that important?

  • Are you registered to do business in the state where the freelancer lives?
  • Are you paying into the government worker’s and unemployment compensation funds?
  • Are you doing payroll tax withholdings? And making employer FICA contributions for Social Security and Medicare?
  • Does the freelancer live overseas? If so, are you setting yourself up to pay an extra month of salary each year. Because many countries require 13-month pay.

Avoid using “hire,” “employ,” or other dirty words unless you want an employee.

Instead, use “contract with,” “select,” “retain the services of,” etc. to procure the services of an individual freelancer.

Experienced business lawyers prepare independent contractor agreements to prevent employment. Yet business owners should stop referring to those workers using employment terms like “hire.”

Should Your Business Avoid Having Workers Based In California?

By Business Contracts, Business Lawyer

california ab5 workers regulationsUnless your company already does business in California, you should avoid having workers based in that state.

Here’s why…

California AB 5  – Many Contractors are Reclassified as Employees

California Assembly Bill 5 (AB 5) essentially shifted the burden to business owners to prove a worker isn’t an employee. And made it hard to meet that burden.

The law provides in part, “a person providing labor or services for remuneration shall be considered an employee rather than an independent contractor unless the hiring entity demonstrates that all of the following conditions are satisfied:

(A) The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact.

(B) The person performs work that is outside the usual course of the hiring entity’s business.

(C) The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.”

Why is that important?

Because if you’ve got an employee working for you in California, you get all of the regulatory and tax baggage that comes with that.

If your company is located elsewhere, you get to register as a foreign entity doing business in California (and pay taxes accordingly).

You also are likely to get hit with penalties for the years you’ve been doing business in the state but didn’t register your entity.

Plus you’ll get to deal with employer withholdings for Social Security, worker’s compensation, unemployment compensation, and any “entitlements” the State of California decides to impose on your company.

At some point, you can expect California’s government to mandate you fill your management positions based on “social justice “ criteria unrelated to skill or performance.

Of course, the government also has no problem stopping workers at the drop of the hat for COVID-19. Who knows what the next reason will be to shutter business? And you can’t count on being exempt from whatever comes down either.

In short, it’s just not worth the downside of using California-based workers unless you’re already stuck in that trap by doing business in the state.

Exemptions From California AB5 For Some Workers

In September 2020, California’s Governor signed a new law that carved out exemptions for freelance writers and certain other workers (e.g. youth sports coaches) from AB5. It’s California Assembly Bill 2257 (AB2257)

But you can’t rely upon piecemeal exemptions like this to protect your company when it’s the policy of the state to loot your business (no matter where you’re based) in order to prop up a social welfare state that’s insolvent.

An experienced business contracts lawyer can help you avoid traps like the ones California sets by preparing the right type of worker agreements that protect your company. And advising you on business-friendly jurisdictions where it’s okay to get the workers you need.

Don’t Treat Your Employees Like Strippers

By Business Contracts, Business Lawyer

employees independent contractorsAs reported by Jessica Anderson in the Baltimore Sun (Strip club dancers are suing clubs over pay – and winning), strip clubs are getting in trouble by improperly treating strippers as independent contractors instead of as employees.

Although there’s no hard and fast rule as to whether an individual working for your company is an employee or an independent contractor, the U.S. Internal Revenue Service (IRS) does provide some guidance on the issue.

Important Employment Factors

Two key factors that favor employment status are setting the work schedule and controlling how the work must be done by the person. For strip clubs, this meant club management telling the dancers when they had to perform and dictating what they could and couldn’t do when stripping/dancing.

What’s the potential damage by mislabeling employees?

If you treat your employees as independent contractors, you may be liable for back wages, statutory damages, penalties, employment taxes, plus contributions to workers compensation and unemployment compensation funds. These misclassified employees may also be eligible for benefits you’ve provided to your other workers, such as 401k contributions, paid vacation, and health insurance.

How to this problem?

If your workers are really employees, treat them as such from the time you extend an offer to work for you. Pretending they’re independent contractors when they’re not creates a ticking time bomb of legal and tax liabilities you don’t want.

On the other hand, if a worker truly is an independent contractor, it’s often a good idea to make that relationship clear in a professionally prepared written independent contractor agreement signed by the parties. If the contractor decides to assert employment status, you’ve got a contract to point to when trying to convince a judge or government agency that the worker is not an employee.

IRS Form SS-8

If it’s truly unclear whether your workers are employees or independent contractors after consulting with an experienced business lawyer, you may wish to file a Form SS-8 “Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding” (PDF file) with the IRS for a determination as to the workers’ status.

How to Get Employees to Give Two Weeks’ Notice When Quitting

By Business Contracts, Business Lawyer

employee two weeks noticeAs a general rule, giving two weeks notice is a courtesy extended by an employee to the employer. It is not a legal requirement, particularly when it is at-will employment.

So how do you get your employees to provide such advance notice when they resign? After all, an employee who leaves abruptly generally puts your company in a pinch because you’re short-staffed without a replacement to fill the worker’s duties.

According to Business Contracts Attorney Mike Young, it’s important to create a system of rewards and punishments (carrots and sticks) that encourage the employee to do the right thing by letting you know at least 14 days in advance of the last day of employment.

Reward the Employee for Providing Two Weeks Notice

Even if you’re upset that an employee is leaving, it’s important to have a policy in place that encourages the right behavior, particularly for giving prior notice of quitting.

For instance, you may have a severance package that the employee gets. This can include receiving payment for paid time off (PTO) that was not used during employment, a positive letter of reference, and even a reduced workload during the final two weeks.

If a portion of the departing employee’s responsibilities is train a replacement, you may include a little extra something (e.g. a Starbucks or Amazon gift card) to express your appreciation for the employee making your life easier by doing so.

Handling the Employee Who Leaves Without Notice

Although there is certain conduct you cannot do in retaliation for an employee quitting, there are plenty of opportunities to provide economic disincentives for terminating employment without adequate notice.

For example, you may want to take away compensation for unused PTO from an employee who quits abruptly. Instead of a positive letter of reference, you may simply agree to confirm dates of employment and the employee’s title/role at the company.

Things Not to Do to an Employee Who Quits

Business Contracts Lawyer Mike Young says that you should not wallow in the muck trying to punish an employee for leaving with or without notice. In addition to being petty, such misconduct can expose you to legal liability to the employee.

Unless there is a genuine risk to your business or coworkers’ personal safety, do not have an employee escorted in a “perp walk” out of your company by security upon providing notice.

If the employee is extending you the courtesy of providing advance notice of leaving, don’t terminate the employee upon the spot when providing notice unless there are specific articulable grounds for believing ongoing employment would jeopardize your company or other employees.

Never give out a negative reference to the departing employee’s future prospective employers. When in doubt, give a neutral reference with regard to roles, responsibilities, and dates of employment.

You should also take into account federal and state laws that may affect your ability to enforce your two weeks notice policy on a case-by-case basis. For example, if an employee is quitting without notice because of becoming disabled, you may have to accommodate such in your response to the employee leaving.

Make Your Quitting Policy Clear

Your policy for advance notice should be clear and in writing. This may be a separate policy, incorporated into your employee handbook (if you have one), or included in a written employment agreement.

Make it Easy to Give 2 Weeks’ Notice

Every employee should know exactly how to give advance notice of resignation and to whom it should be given (e.g. immediate boss or designated HR employee).

Should the notice be given as an email, in letter format, or some other type of written communication?

Whatever format you pick, provide your employees with a template they can use so there’s no additional stress and anxiety created by the thought of preparing such notice. This is not a time for an employee to be reinventing the wheel trying to come up with a proper way to “I quit.”

Implementing Your Advance Notice Policy

Your business lawyer will help you create and implement a two weeks notice policy that makes the most sense for your business. The mechanics of your policy will vary depending upon your specific needs, including whether it applies to new employees, existing staff, full-time employees, and/or part-time workers.