A Heads Up on Compliance
Introduction:
As companies grow in size, it is not just important – but imperative – to keep an eye towards the various federal and state employment laws that may now apply to them. In such cases, the companies will be considered covered employers and will have certain obligations to subordinate employees, managers as well as job applicants. An overview of the most important federal and Illinois state employment laws is provided below by Naureen Amjad of Pedersen & Houpt’s Employment Practice Group. In accompanying comments (noted in blue), TalentRISE partner Carl Kutsmode offers specific advice on how to best structure recruitment strategies to support recruiting needs at each stage of growth. Both compliance awareness and knowledge of effective recruiting strategies are critical, notes Kutsmode, as recruiting practices can be widely divergent at different stages of growth and many smaller, growing firms are unaware of more cost-effective recruiting strategies available OR their HR/Recruiting compliance requirements:
According to Kutsmode:
- Companies with fewer than 50 employees typically mainly recruit through friends, family and personal/professional referral networks using an occasional online job posting to fill a position where these networks fall short of sourcing viable candidates.
- Companies with more than 50, and up to 100, employees will often task a business leader/manager with other duties to assume “HR responsibility” and also handle recruiting. Companies at this stage of growth typically still rely heavily on referral recruiting through employees and their networks and supplement more regularly with online job postings. If they need to hire more quickly, they will often also use external contingency or retained search providers for one-off management and executive roles, or use hourly contract recruiters when 10 or more positions need to be filled during a spike or ongoing.
- Things usually change significantly when a company grows to between 100 up to 250 employees. The company may hire an HR Generalist, and/or a dedicated recruiter or contract recruiter who then owns all aspects of recruiting. That person may use contingency and retained search firms for specialized, difficult to fill and more senior roles.
- Beyond that, at above 250 employees, companies usually hire dedicated full time recruiters or HR generalists with recruiting and HR responsibilities to drive and own the recruiting process. These companies may often supplement their in house team with contract recruiters, RPO vendors and third party search firms to augment their efforts during unplanned hiring spikes or to focus on challenging, ongoing need roles.
Title VII – 15 or more employees
One law that applies to all employers with 15 or more employees is Title VII. According to Amjad, Title VII prohibits discrimination, harassment and retaliation against an employee or job applicant because they are in a protected class or engaged in a protected activity. Protected classes are race, color, religion, sex and national origin. Protected activities, include, but are not limited to, filing complaints or charges, participating in an investigation and opposing discriminatory practices. Title VII prohibits employers from taking any adverse employment action, (e.g., hiring, firing, promoting, demoting, transferring, disciplining, suspending, issuing discipline, etc.) against an employee or applicant based upon a protected class or protected activity. Covered employers should have a policy prohibiting discrimination, harassment and retaliation, which provides instructions on how to report and explains how a complaint will be investigated. Employers must also uniformly follow such policy. Amjad recommends that employers consult an attorney for assistance in drafting and implementing such a policy.
Kutsmode adds that it is important that employers, regardless of size, have a recruiting process that is consistently executed, and ideally, has a technology platform that tracks all job applicant sources and demographic data for simplified compliance reporting in the event of an audit. This is especially critical for government contractors subject to a separate set of hiring laws as discussed further below.
Americans with Disabilities Act (ADA) – 15 or more employees
With regard to the Americans with Disabilities Act (ADA), Amjad notes that it also applies to all employers with 15 or more employees and protects qualified individuals with a disability who, with or without an accommodation, can perform the essential functions of the job. Under the ADA, if an employee or applicant makes a request for accommodation, the employer is required to consider and provide a reasonable accommodation, if possible. However, employers are not required to provide an accommodation that would pose an undue hardship or safety threat. For instance, an employer need not create a new job just to accommodate the employee. The key is to have an open dialogue among the employee, the employee’s physician and the employer, which is referred to as the interactive process. Employees should be providing clear and unambiguous requests for accommodation, including the duration for which the accommodation is needed. However, even if the request is not complete, the employer is obligated to work with the employee’s physician to gain a better understanding of the requested accommodation. Failure to do this can result in the employer being accused of a breakdown of the interactive process, which has serious legal ramifications. Best practices dictate documenting each step of the interactive process, in case the matter ever escalates to litigation.
Additionally, Kutsmode notes that federal contractors need to be in compliance with the new and most recent OFCCP VEVRAA requirements. The OFCCP (Office of Federal Contract Compliance Programs) has recently come forth with new rules that sources, in particular, need to know. Because these can be complex, Kutsmode recommends that recruiting teams are well-grounded in ALL of the sourcing compliance and reporting requirements. (Link here for more information on other considerations when recruiting veterans).
“Ban-the-Box” – 15 or more employees
Finally, Amjad recommends that employers take note of certain state of Illinois requirements that apply when interviewing and making an offer to a job applicant. Illinois is one of 14 states that is part of an initiative to ban criminal background checks for job applicants; the law is commonly referred to as “Ban-the-Box”. Prospective employers are prohibited from inquiring into an applicant’s criminal background on the job application or in the early phases of the interview process. Rather, prospective employers must wait until after determining the applicant is qualified and notified of an impending interview or until after a conditional offer of employment has been made. The Ban-the-Box law applies to employers with at least 15 employees. However, this law does not apply to certain employers, such as banks or financial institutions, that are required to exclude applicants with certain criminal convictions (i.e., theft, embezzlement or robbery) from employment under federal or state law.
Per Kutsmode, from a recruitment perspective, this means that Illinois employers should periodically assess, and potentially revamp, their recruiting process to ensure compliance. Employment applications, for instance, may need to be re-written. The law also has implications in terms of tweaking ATS system workflows and reports accordingly.
Discrimination in Employment Act (ADEA) – 20 or more employees
Amjad also points to the Discrimination in Employment Act (ADEA) as one that all employers with 20 or more employees need to adhere to. ADEA prohibits discrimination against persons aged 40 years or older in hiring, discharge, compensation, terms, conditions or privileges of employment. As a rule of thumb, employers should not ask applicants or employees to disclose their age, birthdates or dates of military service. Also, management-level employees should never make age-based comments to justify any employment actions. Even innocent comments related to age such as referring to someone as “old school” or as “a millennial” or “old and burnt out” could attribute age-based animus to the speaker. Federal courts have held that general ageist comments made by supervisors (and in rare occasions by subordinate employees) can be sufficient to demonstrate age bias. Proactive effort, such as employee training, is often a good idea to remain compliant with ADEA’s principles.
Kutsmode adds that this is an area in which a little bit of hiring manager training can go a long, long way. He stresses that employers who spend time working with hiring managers to develop good – and legal – interviewing skills not only minimize their risk but also tend to ultimately conduct better interviews, thereby leading to better decisions about the quality of talent they end up hiring.
Family Medical Leave Act (FMLA) – 50 or more employees
As companies grow, Amjad points out that, with 50 or more employees, they become subject to compliance with the Family Medical Leave Act (FMLA). FMLA affords up to 12 workweeks of unpaid leave during any 12 month period to an eligible employee for the following: (1) newborn child, adoption or foster care of child; (2) care of immediate family member (spouse, child or parent) with a serious health condition; and (3) the employee is unable to work because of a serious health condition. In order for an employee to be eligible, the employee must have been employed for at least 12 months and worked at least 1,250 hours during the 12 months before leave will begin. Employees are required to provide 30 days of advance notice when leave is foreseeable, but, if it is not, an employee must provide notice as soon as is practicable and comply with the company’s call-in procedures. Employers must be flexible and accommodating when it comes to defining “care” of an immediate family member. In a recent decision, a federal court in Chicago held an employer to be in violation of the FMLA because the employer did not permit the employee to take a trip to Las Vegas with her ill mother for whom she was the sole caretaker. The employee went anyway and was fired for her unauthorized absence. The court found that the employee’s mother’s basic medical, hygienic and nutritional needs did not change in Las Vegas, and therefore, the employee was still providing “care” to her mother on the trip. The employer was heavily fined under the FMLA for its actions. This is just one example of an FMLA violation. The recommended course of conduct for employers is to fully understand the parameters of any requested leave before making a decision to deny the leave. An employer is well within its rights to seek further information from the employee’s or family member’s physician(s).
Illinois Human Rights Act (IHRA) – 15 employees
On the state level, Amjad recommends that employers with at least fifteen employees understand the Illinois Human Rights Act (IHRA). As it relates to pregnancy specifically, the IHRA applies to employers with as few as one employee. As of January 1, 2015, pregnancy (which includes childbirth or medical or common conditions related to pregnancy or childbirth) is a protected class under the IHRA. This means Illinois employers with at least one employee are required to provide reasonable accommodations to employees and job applicants for any medical or common condition related to pregnancy or childbirth. Examples of accommodations which are considered reasonable include more frequent or longer bathroom breaks, breaks for increased water intake, breaks for periodic rest, private non-bathroom space for expressing breastmilk and breastfeeding, seating accommodations, assistance with manual labor, light duty, temporary transfer to a less strenuous or non-hazardous position, acquisition or modification of equipment, job restricting, part-time or modified work schedule, assignment to vacant position or providing leave. As is the case under the ADA, in order for the accommodation to be considered “reasonable”, it will not pose an undue hardship on the employer. If it does, the employer is not required to provide it. For instance, an unreasonable accommodation would be one that is prohibitively expensive or disruptive. All employers are required to post this poster in a conspicuous location within the workplace. Likewise, an employer must include in its handbook or employment manual the Department of Human Right’s notice summarizing the requirements of this law and information on how to file a charge with the Department.
Conclusion:
The aforementioned employment laws, which will inevitably apply to companies as they grow, require monitoring of employee numbers and updating employee manuals or handbooks on at least an annual basis. Supervisor training is also a necessity, as a proactive measure, as well as a reactive measure after an investigation has been conducted and a violation uncovered.
We thank Naureen Amjad of Pedersen & Houpt’s Employment Practice Group for contributing to this article. The employment attorneys at Pedersen & Houpt, P.C. are well-versed in federal and state employment laws that apply to various workplaces and can review your employment policies as well as provide on-site training. For more information, please visit http://www.pedersenhoupt.com/professionals-Naureen-Amjad.html or contact Naureen Amjad directly at namjad@pedersenhoupt.com or (312) 261-2273.
This communication is provided as a general informational service to clients and friends of Pedersen & Houpt. It should not be construed as and does not constitute legal advice on any specific matter, nor does this message create an attorney-client relationship. This material may be considered Attorney Advertising in some states. Please note that any prior results discussed in this material do not guarantee similar outcomes.
About the Author
Carl Kutsmode has over 20 years expertise in talent acquisition transformation — assessing and optimizing corporate recruiting capabilities for greater efficiency and performance.