Archive for October, 2009

Final Steps to an Effective IIPP – Part 3

Tuesday, October 27th, 2009

In our last post, we discussed the importance of the staff’s compliance with a safety program, hazard assessment and correction, and investigations. We can now look at the final three elements of an effective IIPP:

Hazard Correction

Include methods/procedures for correcting unsafe or unhealthy conditions in a timely manner.

Training

Training is important to not only educate, but to reinforce the requirements listed above (1-6). Training should be done at minimum- when new guidelines are established, to all new hires, and for all supervisors. Additionally, training must be done when new hazards are introduced into the workplace and when employees are assigned new job duties that will expose them to new hazards.

Record Keeping

Record keeping is one of the most important elements of your IIPP. It shows Cal OSHA that you not only have written documentation of your safety program, but that your program is being implemented. Records should be maintained for at least a year. They should include records of scheduled and periodic self inspections as well as safety training. Inspection records should include the name of the person that conducted the inspection, the unsafe conditions or practices identified and the corrective action taken. Safety training records should include the employee name or other identifier, training dates, type(s) of training and the name of the training provider. In addition, while recordkeeping is very important, requirements are less stringent for employers with less than 10 employees.

Conclusions

The IIPP is not only a way to save money, but it also reinforces the importance of workplace safety. A positive attitude towards safety from upper management will go far in promoting safe work habits to all levels of the organization. While all eight requirements are listed, each requirement is extensive. If you have additional questions about the eight requirements, please contact CPEhr’s Risk Management Representative to assist you with creating an effective Injury and Illness Prevention Program for your company.

Three More Pieces to an Effective Injury and Illness Preventation Plan

Monday, October 26th, 2009

In our last post we introduced the importance of creating and managing a comprehensive IIPP (Injury and Illness Prevention Plan). We looked at the first two components of a successful plan – management’s commitment to the plan, and effective communication.

In today’s post we explore the next three elements of an effective plan:

Compliance to the safety program

Make sure that all employees practice safe work habits throughout the day. A great way to ensure compliance is to create a Safety Recognition Program that rewards employees for working safely. The Recognition Program does not have to be costly. It may include: a designated parking space for a quarter, lunch for the top five safe employees, or verbal recognition in a company-wide event. Remember: The best way to seek compliance by your employees is to first gain their commitment. Employees are not motivated when they feel like an initiative is “shoved down their throats.” However, if they feel like they are a part of the solution, their commitment will translate into compliance by being a safety role model. For example, demonstrating initiative by communicating safety hazards to the management team. On the flip side, there should also be consequences established for those employees that are exhibiting unsafe behaviors in the workplace.

Hazard Assessment
An internal assessment of anything that is potentially dangerous must be included in a written inspection report and reviewed by management and/or the safety committee. Hazards that are identified in your assessment must be corrected. However, if they can not be corrected immediately, then establishing a date will demonstrate your commitment and show that there is a plan in place to make identified corrections. Please Note: imminent hazards cannot be postponed for corrections.

Investigations
The investigation process must be documented in your IIPP. This allows for the identification of root causes of the incident, while making corrective actions. The investigation needs to occur after the accident happened, while the facts are fresh. If possible, interview the injured worker at the scene of the accident. Remember, every investigation should include an action plan that addresses the prevention of future accidents.

In our third and final post we will look at 3final elements of a successful plan: Hazard Correction, Training and Record Keeping.

The Importance of an Injury and Illness Prevention Program – Part 1

Wednesday, October 21st, 2009

The absence of an Injury and Illness Prevention Program (IIPP) ranks among the most frequent Cal/OSHA (California Occupational Safety and Health Administration) citations against businesses. Fines for the failure to have an IIPP are upwards to $7,000.  Many California employers are not aware that it is mandated by law to have a written IIPP.  The law (Senate Bill 198) enacted in 1989, and effective on July 1, 1991, requires California employers to develop and implement an IIPP.

In this and upcoming posts we will take a look at eight required sections of the IIPP, along with suggestions that will help you get started in creating an effective safety program. Today, we will look at the first two elements to consider:

1. Management commitment/assignment of responsibilities

A demonstration of safety and health begins with top-level management.  Management’s commitment to safety will set the tone for the rest of the organization.  Appointing a safety captain to be in charge of the program is a great start to demonstrating company-wide commitment.  While the safety captain’s primary role is to ensure that safety work-habits are adopted throughout the organization, they may, also, lead a safety committee comprised of employees representing each department/area of the organization.  Members of the committee can assist the safety captain by executing the organization’s safety goals.

2. Safety Communication system

There are many creative ways that you can communicate the importance of safety to your staff.  They may include:  introducing  your safety program during new hire orientations, include examples of safe behaviors in a company newsletter/company-wide communication, post safety posters throughout your facility or communicate a safety tidbit on a regular basis at a start-up/staff meeting.  Remember, empowering your team to develop creative ideas on how to effectively communicate your safety program will go a long way in motivating them to stay committed.

In our next post, we’ll discuss enforcing employee compliance with the safety plan, how to assess hazards in the workplace, and conducting investigations.

Contributed by: Sara Richards, Senior Loss Control Manager, CPEhr

Wage and Hour Laws Part 2 – How to Calculate Bonuses

Monday, October 19th, 2009

In our last post we reviewed some of the basic guidelines relating to wage and hour compliance, and how California law differs from Federal law. In this post we continue to review wage and hour laws, but move to bonuses.

Discretionary and Non-Discretionary Bonuses

Employers usually pay two types of bonuses: non-discretionary and discretionary.

Discretionary bonuses are usually paid as a gift for past services and are not measurable by an employee’s work performance, and/or hours worked.  An example of a discretionary bonus is a holiday bonus or special occasion bonus.

Non-discretionary bonuses are bonuses that are intended to increase an employee’s performance and efforts.  For example, bonuses paid on work performance efficiency and quality, attendance, years of service, and bonuses promised to employees at time of hire are considered non-discretionary.

When paying out non-discretionary bonuses, you must also pay the overtime “premium” on the bonus.  According to the Department of Labor, since the bonus was earned during the regular hours as well as the overtime hours, the overtime “premium” on the bonus is paid on half-time or full-time (for double time hours) on the regular bonus rate (from DLSE Manual). Unfortunately, you cannot just pay an employee a $100 bonus, if they worked any overtime in the pay period for which the bonus was earned.  You must reference the bonus on their pay stubs and note the workweek(s) that the bonus was earned.

Example On How to Calculate Overtime Premium When a Bonus is Paid:

Regular hourly rate of pay………………………………………………………………………………………..$10.00

Overtime rate of pay………………………………………………………………………………………………..$15.00

Total hours worked in workweek = 50

Total regular hours worked= 40 (8 hours x 5 days)

Total overtime hours at time and one-half = 10 (2 hours x 5 days)

Bonus………………………………………………………………………………………………………………………$100.00

Regular bonus rate:

$100.00 (bonus) ÷ 50 (total hours worked) =

$2 .00 ÷ 2 (for half of the regular rate) =

$1.00 x 10 (Overtime Hours) = $ 10.00

Total earnings due for the workweek:

Regular hours: 40 hours @ $10.00 ………………………………$400.00

Overtime: 10 hours @ $15.00 ……………………………………..$150.00

Bonus ……………………………………………………………………………$100.00

Overtime on bonus…………………………………………………………$ 10.00

Total ……………………………………………………………………………$660.00

Remember, wage and hour laws vary by state, it is important that you understand that as an employer you are mandated by law to pay your employees for all hours worked.

The Bottom Line

Confused yet?? There is a lot to know, and a lot to implement. If you are concerned about tackling wage and hour compliance alone, you may want to consider outsourcing some of these complicated laws to professionals who can guide you every step of the way. Please contact us for a free wage and hour consultation.

Contributed by: Thi Ha and Monique Stennis, CPEhr

Wage and Hour Compliance for Small Employers – What You Need To Know

Saturday, October 17th, 2009

Companies both large and small are finding themselves in legal battles against employees for not complying with overtime laws as outlined in the Fair Labor Standards Act of 1938 (FLSA). The complex regulations found in the FLSA code governing proper payment of wages is overseen by the Department of Labor and can result in hefty fines, or possibly prison time, for multiple violations. In this and subsequent posts, we will look at some of the potential pitfalls, guidelines and laws governing wages as outlined in the FLSA.

The Department of Labor states the following on their website:

The Fair Labor Standards Act (FLSA) establishes standards for minimum wages, overtime pay, recordkeeping, and child labor. These standards affect more than 100 million workers, both full‑time and part‑time, in the private and public sectors.

The Department of Labor uses a variety of remedies to enforce compliance with the Act’s requirements. When Wage and Hour Division investigators encounter violations, they recommend changes in employment practices to bring the employer into compliance, and they request the payment of any back wages due to employees.

Willful violators may be prosecuted criminally and fined up to $10,000. A second conviction may result in imprisonment. Employers who willfully or repeatedly violate the minimum wage or overtime pay requirements are subject to civil money penalties of up to $1,100 per violation.

Recent Lawsuits

A New Jersey federal court jury unanimously awarded $2.5 million to Staples, Inc. employees in a class-action lawsuit for failing to comply with the laws that require the correct classification of employees (e.g. exempt or non-exempt) and paying for overtime wages. In another case, Valero Energy Corp. is currently involved in a class-action lawsuit that seeks $100 million in damages. The suit, brought on by three current employees, alleges that Valero required employees to work overtime hours “off the clock” without compensation.

As an employer, it is important that all wage and hour laws are adhered to, including payment of overtime and the pay-out of bonuses.

Understanding California Overtime Hours

While the Federal standards of the Act are complicated enough, California employers must adhere to a different set of guidelines. Most fundamentally, California requires that all hours worked in excess of eight (8) regular hours in one workday or forty (40) regular hours in one workweek will be treated as overtime. Non-exempt hourly employees are compensated as follows for working overtime:

  • Time and a half the regular rate of pay for hours worked beyond eight (8) in a workday;
  • Double the regular rate of pay for hours worked beyond twelve (12) in a workday;
  • Time and a half the regular rate of pay for the first eight (8) hours worked on the seventh consecutive workday in a workweek;
  • Double the regular rate of pay for hours worked beyond eight (8) on the seventh consecutive day worked in a workweek;

Time and a half the regular rate of pay for hours worked beyond 40 in a workweek. There is no “pyramiding,” which means you will not be paid overtime twice for the same hours of work.

Outsourcing Solutions

Considering the complex laws and potentially expensive implications of non-compliance, many employers have elected to outsource the management of their FLSA compliance to outside experts who specialize in these laws. Human Resources specialists recognize violations and can offer immediate solutions to remedy them. Additionally, most small business owners are unable to remain abreast of developing laws and changing regulations. In contrast, Human Resources Outsourcing firms are constantly on the lookout for new laws that my impact their clients, and can quickly implement them. We encourage you to investigate the benefits of outsourcing your payroll and wage compliance to an HR Outsourcing firm familiar with the laws in your state. Contact us for more information.

In our upcoming posts, we will examine how overtime laws impact Bonuses and how to calculate overtime pay based on a sample workweek.

Contributed by: Thi Ha and Monique Stennis, CPEhr