Notice Periods

Here's a scenario for you to think about:  An employee's notice of resignation comes at 1:47PM via an email, with the employee departing immediately without speaking to his/her supervisor.   As an employer this surprise resignation may shake you a bit.  Stepping past your surprise and astonishment, my question to you is "what notice should an employer expect from employees?"

 

Let's remember that most of the US is "at will" employment, which means both the employer and employee are free to end employment at any time, with or without notice or cause. This implies that either party is entitled to terminate employment without notice for any reason, unless the termination violates federal or state laws or public policy (and/or unless obligated by an existing contract). Generally Texas Law does not require that either the employer, or the employee, provide notice of ending at-will employment.  In this case, the employee chose to exercise the right to exit immediately. 

Two weeks notice is an ethical standard, a courtesy.   From a 10,000 foot level a notice period will allow the company and the employee to attend to transition details. A departing employee generally has some body of specialized knowledge that will be lost to the organization if it is not fully documented before s/he leaves.  This notice period will allow:

• the exiting employee to transition their project, employee knowledge, etc., onto other employees.
• the employee and the company to carefully review work in progress.  
• the company time to find a replacement or to just shuffle resources to cover the vacancy. 

A notice period may be specified by company policy, for example in the Employee Handbook, and this could affect at-will status.  So please be mindful of how your policies are written.    In this particular situation, to avoid affecting at-will employment, the payment of a fringe benefit, i.e., unused vacation leave, was tied to a two week notice period.   In this scenario the employee was somewhat disturbed to find that the brief notice period provided didn't quite meet the two week requirement outlined in the policy.

Yes, it is sometimes desirable to transition the employee out of the organization as quickly as possible.  I am of the opinion that in most circumstances, the moment an employee resigns psychologically s/he is out of the company.  We have all heard of "short timers syndrome."  The employee may hang around to complete their mandatory notice period.  Despite their feelings about the job they are leaving behind, it's human nature to take a detached approach to something you know is coming to an end.

Resignations are an emotional time for everyone.  Let's all please ensure we handle them professionally and legally.

Healthcare Reform

The majority of us are aware that there are a lot of changes pending in response to healthcare reform.  No one was making a move on the issue unless/until Obama was re-elected.  While the Affordable Care Act doesn't go into effective until 2014, with his re-election there is now increased activity and focus on the issue. In July of this year Governor Rick Perry announced that Texas would not establish or participate in a health care exchange.  That allows some of us "off the hook" with respect to a few requirements of ACA.

 

So, here we are.  Even before 2014, there are a few requirements that fall into place in 2013 that we need to be aware of.  These requirements include:

 

1. Summary of Benefits and Coverage (SBC) Statements.  All plans are to supply plan participants with SBCs and a glossary of commonly used terms during this year's open enrollment period.  Moving forward, firms that distribute SBCs to workers in a county where 10% or more of the population speaks the same non-English language need a "prominently displayed statement" in the non-English language about how workers can access the plan's language services.  In reviewing the "2012 Culturally and Linguistically Appropriate Services (CLAS) County Data, if your organization resides in Harris County you're looking at an 18% Spanish population.
2. W-2 Reporting.  Employers issuing 250 or more W-2 forms have to include the value of each individuals health plan benefits on their forms. 
3. Let's talk about the hidden "$64.00 per head" fee that employers may face in 2014.  It appears as though the fee will be based on the level of participation in your health plan.  The information is rather vague at this time as to how that fee is collected or its effective date.   The money from the fee will be pooled in an account managed by the HHS.  The funds will be used to reimburse insurance companies who end up covering a large share of individuals with pre-existing conditions.  The fee is expected to be phased out after 2016 - unless Congress votes to extend it - and will decrease very year.  In 2015 the fee is expected to drop to about $42 per participant per year and further decrease to $26 per participant in 2016. 

Keep your eyes on the healthcare reform issue - more changes could be around the bend!

Employee Turnover

Granted, it's early in December and maybe a bit early to begin calculating my 2012 turnover rate.  I'm concerned that the organization is developing a revolving door when it comes to the employees.   After calculating I find my turnover is at 20.48%.    Should I panic? 

  

Turnover can be a result of many factors and oftentimes it isn't about the money. It's about the environment. The employee can be unhappy, feel under appreciated. They may experience supervisor conflict, or the supervisor may have poor leadership skills.  Employee pay may be unequal or substandard.   If their skills are in demand, they may be lured away by other employers.  Perhaps the employee feels that he/she has no future in the organization.

 

When an organization must replace an employee, the organization will incur direct and indirect expenses.  Expenses such as recruiting, new hire training, loss of productivity, etc.  To replace even an entry level employee can cost up to 25% of his/her salary.  And then there are other hidden costs of high turnover.   Surviving employees have to absorb the work of the departing employees,  may experience increased stress levels, feel demoralized and ultimately move on as well. 

Take a look at your turnover.  Is it beneficial or harmful?  What steps can you take to halt and/or reduce employee turnover?

 

 

Moonlighting Policies

In light of the economy and U.S. unemployment situations, moonlighting has a new appeal for employees.   Employees are working second jobs to make ends meet or just to pay down debt.  And with the holiday season upon us, more people are becoming multiple jobholders.

 

According to the Monthly Labor Review, May 2012,  from 2010 - 2011, the multiple job-holding rates in Texas increased from 3.8 to 3.9%.  In 2011, a Elance survey found that 36% of respondents were starting or operating a business while working full or part time traditional jobs. 

 

To protect business interests, should the employer implement a moonlighting policy?  Well, typically employers won't prohibit employees from moonlighting - unless there is a direct impact to business. One must consider that prohibiting someone from having a second job, where there is no harm to the employer, and taking action against the employee, may have unfortunate legal ramifications. If an employer fires an individual for having an outside job, where there has been no negative impact to the employees duties, performance, etc., a jury might later suspect that the employer was motivated by some form of illegal discrimination.

 

So let's talk about your policy.  At the minimum a Moonlighting Policy should contain:

• Statements addressing conflicts of interest.  Any policy should clearly state that employees are not permitted to accept or engage in any activity / employment that would conflict with the interests of the primary employer.
• Statements addressing interference with the primary job.  Interference may be experienced via impact to the employees performance.  Additionally, the employee may be unable to work overtime due to a commitment to the second job.   Is there an increase in absenteeism or tardiness?
• Your approval for outside employment.  Ultimately the employees true commitment should be to their primary job.

A carefully written policy may protect your organization without intruding too far into employees' personal lives.  And remember, many state laws protect employees' personal lives.  Be cognizant of Lifestyle Discrimination Laws of which some laws address a specific activity and others encompass a wide array of off-duty conduct.  For instance, California, Colorado and New York prohibit discrimination based on any lawful activity by an employee off the premises and during non-working hours.  At this time Texas does not have lifestyle-discrimination laws.

 

Whether or not you decide to institute a Moonlighting policy, clearly communicate your expectations to your employees.