Preventing Whistleblower Suits
The exposing of a company’s unsafe, unethical, or illegal activities by an employee is known as whistleblowing. Employees who file “whistleblower” complaints with law enforcement or a regulatory agency are protected from retaliation by their employers under both state and federal laws.
For the purposes of whistleblower suits, retaliation includes any perceived adverse employer actions, including a demotion, failure to promote, or termination of employment. Employers charged with discriminating against whistleblowers can face significant fines, and even jail time.
Monitor the Company’s Practices
The best prevention against a whistleblower suit is to carefully monitor the business practices of the company, to ensure that no illegal or unsafe conduct is occurring.
The most popular whistleblower suits involve alleged violations of safety or health codes, mismanagement of company finances, violations of government contracting laws, improper Medicare or Medicaid reimbursement policies, improper payment of customs duties, and shareholder fraud.
Ensuring proper business conduct by all branches and employees of the company is the easiest way to avoid whistleblower suits. Meticulous record keeping, compliance policies, and proper training programs should go hand in hand with constant monitoring of a company’s business practices.
Understand Protections Afforded to Whistleblowers
Some federal whistleblower protections are set forth in the Sarbanes-Oxley Act of 2002, which strongly protects financial industry workers who “blow the whistle” on their employer’s allegedly engaged in securities, shareholder, or bank fraud.
Companies should be familiar with state whistleblower protection laws and other federal laws, such as the American Recovery and Reinvestment Act of 2009, or the Family and Medical Leave Act (FMLA), which provide additional whistleblower protections. Employees need only to act in “good faith” in filing their complaint to be protected under these state and federal laws.
Be Responsive to Employee Complaints
Employers can often avoid a whistleblower suit by being responsive to employee concerns and complaints. Most employees will confront their employer directly about a potentially unsafe or illegal situation, prior to filing a complaint with law enforcement or a regulatory agency.
Companies should have well communicated policies in place for the proper handling of employee complaints. All credible complaints should be investigated, and corrective actions taken if needed.
Avoid Retaliatory Behavior
Companies should avoid the appearance of any type of retaliatory behavior if a whistleblower contacts the police or another agency about alleged impropriety.
Some company actions that can be perceived as retaliatory include:
- Failure to promote
- Refusing to give employee earned or cost-of-living raises
- Assigning undesirable or unfavorable shifts or locations
- Ignoring an employee’s concerns
- Reprimanding employee, including “writing them up”
- Excluding an employee from usual business activities, such as meetings
- Lessening an employee’s responsibilities
- Termination of employment
Consult with Experienced Legal Professionals
If a company has a concern about a potential whistleblower situation, the best course of action is to consult with an experienced legal professional who can assist the company in carefully handling the whistleblower complaint. This is especially important in those situations where a whistleblower has violated a company’s policies; or engaged in some misconduct unrelated to the whistleblowing, which would require disciplinary actions; or if the whistleblower becomes the subject of an independent investigation.
If a whistleblowing claim has been made against your company, the experienced employment lawyers at the MacMain Leinhauser can help you prepare the best defense. To schedule your free initial consultation today, call us at 484-318-7106 or contact us online. We serve clients throughout Pennsylvania from our conveniently located offices in West Chester.
Avoiding Liability During Holiday Parties
This time of the year is often filled with office parties and corporate holiday events as many companies celebrate Christmas and New Year’s with employees and clients. The fun of holiday festivities, especially with the consumption of alcohol, also brings an increased risk of sexual harassment and alcohol-related accidents. For some companies, this could mean additional liability exposure if inappropriate or reckless behavior leads to injury. By following some of the helpful suggestions below, companies can limit their liability should a holiday event go wrong.
Understanding Liquor Liability Laws
Serving alcohol at a corporate holiday party places a company at an increased risk for liability. Companies may be held civilly or criminally liable for injuries resulting from an individual’s intoxication if the company provided the alcohol. Liquor liability laws vary state to state but hold businesses liable for serving alcohol to intoxicated or underage persons. Many businesses provide transportation home from holiday parties or arrange for hotel stays to avoid the possibility of an alcohol-related driving accident.
Limit Alcohol Consumption
If alcohol is to be served at a company party, businesses can encourage employees to drink responsibly by using drink voucher systems limiting the number of drinks everyone may be served or shortening the time that alcohol drinks will be offered. Offering food and non-alcoholic drink alternatives may also help limit alcohol consumption at a holiday party. Cash bars can decrease the amount of alcohol consumed as employees drink less when they must purchase their own drinks. Hiring a professional bartender to handle the serving of drinks can also help a company monitor the alcohol consumption of the party attendees.
Communicate Sexual Harassment Policies
Companies should review their sexual harassment policies with all employees prior to holiday party season. All sexual harassment policies should include guidance with respect to employer sponsored social events. Employees should be made aware these policies apply not only at work but at company functions occurring off the work premises. Some companies chose to make holiday parties more family-friendly with the inclusion of spouses and children to discourage inappropriate and harassing behavior. Businesses can proactively ban certain customs that could potentially lead to allegations of a hostile work environment, such as hanging mistletoe in the office and the exchange of adult-themed risque gifts.
Follow Wage and Hour Laws
State wage and hour laws will determine whether a company needs to pay its employees for attendance at a holiday party. Mandatory attendance at a holiday party would require a company to pay for the employee’s time. If attendance at the party is not mandatory but strongly encouraged, courts may find the company implicitly required the employee’s attendance. By making attendance entirely voluntary, companies may be able to avoid paying additional compensation to its employees.
Obtain Proper Liability Insurance
Despite a company’s best efforts to reduce all injury or harassment risks, incidents inevitably will occur during holiday parties. As a precaution, all businesses should have the proper liability insurance to provide financial protection, including commercial general liability and employment practices’ liability policies. Some businesses may need to purchase special event coverage depending on the nature of the holiday celebration.
With offices conveniently located in West Chester, Pennsylvania, our team at MacMain Leinhauser proudly represents businesses throughout Philadelphia and Chester County. Call us today for more information about protecting your business from liability at 484-318-7106 or contact us online.
Questions Arise Over DOL’s Shared Employer Liability Rule
Shared employer liability continues to be a controversial labor topic, as it affects a wide range of businesses and employees, particularly those who work in staffing and franchise organizations. The Department of Labor (DOL) will be issuing a new policy by the end of the year that would dictate when businesses would be legally responsible for payroll violations, including those pertaining to minimum wage and overtime. While some believe that the DOL does not have the power to make legally binding legislative rules, others believe it is within their power.
According to a senior counsel for the National Employment Law Project, based on the language of the Fair Labor Standards Act (FLSA), the DOL does not have the authority to make the rule legally binding. They can only publish an interpretive rule, which does not carry the same weight as a legally binding rule. An administrator for the DOL Wage and Hour Division commented that the DOL can issue regulations on joint employment issues in order to clarify parts of the FLSA that may not be clear.
Many large corporations, including McDonald’s Corp. and Microsoft, have had claims filed against them saying that they are responsible for labor violations against franchisee and staffing organization employees. Businesses and legislators have been putting pressure on Secretary of Labor, Alexander Acosta to move forward on the policy. However, the impact of the new policy may be limited in court if the DOL is unable to proceed with creating a rule. Acosta has been quoted saying that agencies should not use interpretive guidance documents to take short cuts and avoid going through the formal rulemaking process.
Defining Joint Employment
While the FLSA allows the DOL to draft regulations for certain issues, including overtime exemptions and child labor issues, it does not give them the power to define joint employment. Therefore, unless the language in the FLSA changes, any ruling put out by the DOL will not be legally binding.
In a court of law, legislative regulations carry more weight in the courtroom than interpretive regulations. According to the former administrator for the DOL’s Wage and Hour Division, a legislative regulation may be challenged over minimum wage and overtime disputes, which is when the court may be asked to apply the regulation. The test of a rule will depend on the how the court interprets the rule and the level of deference it gives. Regardless of how the courts view the DOL’s joint employment regulation, it will have an impact on the agency’s ability to enforce minimum wage and overtimes requirements. It will provide much-needed clarity both for internal Wage and Hour enforcement officers and the business community.
Philadelphia Employment Law Attorneys at MacMain Leinhauser Provide Counsel on FLSA Issues
To discuss your employment law matter with an experienced employment attorney at MacMain Leinhauser, call us today at 484-318-7106 or contact us online. Our offices are conveniently located in West Chester, where we serve clients throughout Pennsylvania.