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JANUARY 2001
INTERACTIVE WEB SITE AIDS
EMPLOYERS WITH REQUIRED FEDERAL POSTERS: Employers
seeking to determine what Federal Labor Department posters
they are required to display can now find help on a new
interactive World Wide Web site. DOL’s new Poster Adviser
Site is the latest addition to its Employment Laws Assistance
for Workers and Small Businesses (e-laws) Website.
The new poster information site allows employers to print
the posters directly from the department’s e-laws Web site. This
site provides only federal posters; other posters required
under California law are NOT available at this site.
Labor Department posters advising
employees of their rights are required in certain circumstances
under the following acts: the Employee Polygraph Protection
Act, the Fair Labor Standards Act, the Occupational Safety
and Health Act, the Family and Medical Leave Act, the Davis-Bacon
Act, the Service Contract Act, and the Migrant and Seasonal
Agricultural Worker Protection Act. An equal employment opportunity
poster advising employees of their rights under a host of
anti-discrimination laws is also commonly required.
The new e-law poster site joins
a number of other DOL Interactive Adviser Web Sites, which
cover a wide range of laws and are intended to provide easy-to-understand
and accessible compliance assistance information to workers
and small businesses about labor laws and regulations. The
e-law advisers essentially mimic an employer’s interaction
with a Labor Department representative by prompting the user
with a series of questions to help determine whether a workplace
or an individual employee is covered by a specific law or
regulation.
PERSONNEL RECORDS EFFECTIVE
JANUARY 1, 2001: Existing law requires employers to
make employee personnel files available for inspection
by employees, and prescribes procedures for that inspection.
This new law requires an employer to make the contents
of personnel files available to an employee at reasonable
intervals and reasonable times, as provided, but would
exempt from inspection records relating to the investigation
of a criminal offense, letters of reference, and specified
ratings and reports; employers may want to keep these records
in a separate file. Unlike an earlier law, the new labor
code section 1198.5 does not refer to “personnel files;” instead,
the law now states that the employee has the right to inspect
the personnel records “relating to the employee’s performance
or to any grievance against the employee.” This opens up
the possibility that employers would have to make available
any documents that relate to an employee’s performance
or grievance.
OSHA INJURY AND ILLNESS LOG
REMINDER: Each year, for the month of February, most
public and private employers are required to post an OSHA
200 Log in a conspicuous workplace. The log calls for details
about on-the-job injuries and illnesses that occurred between
January 1 and December 31 of the preceding year. Unless
you are in a designated low-hazard industry, you must complete
and post the log if you had 11 or more employees at any
time during the year 2000. For more information, contact
your local Cal/OSHA office.
FEDERAL CONTRACTORS RECEIVE
SIMPLIFIED AFFIRMATIVE ACTION RULES: The Office of
Federal Contract Compliance Programs has issued final regulations
revising and simplifying the rules for written affirmative
action programs. However, the new regulations also substantially
increase the number of employers who must complete the
annual Equal Opportunity Survey and submit personnel and
compensation data. The new regulations can be viewed at
the Department
of Labor website.
FEDERAL COURT ORDERS EMPLOYERS
TO STOP REQUIRING EMPLOYEES TO SIGN ARBITRATION AGREEMENTS: The
controversy over the use of mandatory arbitration for employment
disputes continues as federal and state courts send contradictory
signals to employers. While the California Supreme Court
recently approved the use of mandatory arbitration under
certain conditions, the federal Ninth Circuit Court of
Appeals has said that for some types of claims, such as
age or race bias, mandatory arbitration agreements violate
federal law. The U.S. Supreme Court is expected to
take up this issue in 2001.
In a new development, a federal
judge in Los Angeles has blocked the law firm of Luce, Forward,
Hamilton & Scripps from demanding that its employees
sign arbitration agreements. The ruling resulted from a lawsuit
brought by the Equal Employment Opportunity Commission on
behalf of a legal secretary who claimed he was fired after
he balked at signing the law firm's arbitration clause. Luce
Forward has said the firm would probably appeal the decision
as a test case to challenge the Ninth Circuit's position
on mandatory arbitration because it conflicts with both California
law and federal circuits in other states.
COCA-COLA AGREES TO RECORD
DISCRIMINATION SETTLEMENT: Coca-Cola Co. agreed to
pay $192.5 million—the largest racial discrimination settlement
in U.S. history—to end a class-action lawsuit filed by
2,200 African-American employees. The case was brought
by African-American workers who claimed they were systematically
bypassed for raises and promotions. The workers, who said
they were routinely discriminated against in pay, promotions
and job educations, will receive an average of $40,000,
depending on their years of service. Coke has also agreed
to a complex company-wide restructuring plan with pay equity
adjustments phased in over 10 years. Plus, Coke will link
the compensation of senior managers to the company’s diversity
performance and set up an independent oversight panel with
limited authority to change company personnel policies.
The settlement also calls for Coke's employment and hiring
practices to be monitored for the next four years by a
seven member task force selected by management and plaintiff
attorneys.
DOL CRACKDOWN ON RETIREMENT
FEES: The Department of Labor is cracking down on employers
for 401(k) fees that are costing employee participants
thousands of dollars. The Labor Department is forcing employers
to refund fees that have been paid from the retirement
plans. The effort affects both pensions and 401(k) plans
and focuses on a variety of fees, including the cost to
shut down a plan. Federal law says that pension and retirement
plan assets can be used only to pay benefits and legitimate
expenses to administer the plan. Among the fees that the
Labor Department says companies should pay out of their
own assets: IRS penalties, the cost to conduct union negotiations
and the cost to convert a pension to a cash balance plan.
For more details, contact your plan administrator.
IRS ISSUES NEW MILEAGE REIMBURSEMENT
RATES FOR 2001: The IRS has increased the standard
mileage rate for business use of a car from 32.5 cents
to 34.5 cents per mile. The new rate—which applies to miles
driven beginning Jan. 1, 2001—was prompted primarily by
the increase in gasoline prices. This is the rate that
many employers use to reimburse their employees for miles
driven on their personal autos for business purposes. In
addition, the standard rate for use of your car for medical
reasons, or for computing deductible moving expenses, will
increase to 12 cents a mile from 10 cents. The standard
rate for use of a car when providing services to a charitable
organization will remain unchanged at 14 cents a mile.
For more details, contact your tax or accounting advisor.
INDEPENDENT CONTRACTOR REPORTING
REMINDER: Beginning Jan. 1, 2001, you’re required to
report independent contractor earnings information to the
Employment Development Department. The new law is designed
to track down parents who are delinquent in paying child
support. Private and public employers need to report payments
made to independent contractors if you expect to pay at
least $600 to the contractor in a calendar year. You must
report to the EDD within 20 days of hiring the independent
contractor or of becoming aware that the $600 threshold
will be reached, whichever is later. Although the EDD must
keep the information confidential, the new rules could
trigger audits of your classification of workers as independent
contractors.
2001 RATES (JUST A REMINDER!): At
the risk of over informing, we remind employers once again
of the following rates that are in effect for 2001:
• California minimum wage rises
to $6.25 per hour beginning January 1, 2001. On January 1,
2002, wages will again increase to $6.75 an hour.
• California's minimum sales
tax rate of 7.25 percent will drop to seven percent beginning
January 1, 2001. Most of the 58 counties in California impose
extra sales tax. San Francisco has 8.5 percent; Los Angeles
is 8.25 percent. Rates in each county will fall by a quarter
percent in 2001.
• The taxable earnings base
of OASDI (Old Age, Survivors and Disability Insurance) program
in 2001 will rise to the first $80,400 a worker earns, up
from $76,200 in 2000.
• The self-employment tax remains
at 15.3 percent.
• FUTA (Federal Unemployment
Tax Act) will remain at 0.8 percent in 2001, paid by employers
on the first of $7,000 paid annually to each employee.
• FICA (Social Security) tax
rates for both employer and employee will remain at 7.65
percent in 2001. |
