It is no secret that health care costs for employers and their employees are out of control. Many employers have attempted to hold down these rising costs by offering wellness-program incentives.
The EEOC has signed off on these programs as legal as long as employee participation remains voluntary, which the agency defines as financial incentives for employee participation at or below 30 percent of the cost of coverage. Thus, employees have a choice â participate in the wellness program or pay a surcharge of up to 30 percent.
One area that has remained off limits for employers under these wellness programs, however, has been genetic testing and other personal and family medical histories. A new bill moving through the House of Representatives, however, aims to change that.
Currently, under both the ADA and GINA, employers cannot ask employees about their own personal medical histories and those of their family members as a pre-condition to participation in a wellness program. All employers can do is access anonymous aggregated data collected via wellness programs.
HR 1313 would amend the law to allow employers to ask an employee for his or her personal and family medical histories (which could include historical genetic testing). The disclosure remains voluntary, because an employee could always refuse to disclose and pay the EEOCâs 30 percent surcharge to retain coverage.
This bill is scary. I am admittedly biased on this issue, as my family medical history has a big genetic piece. While I donât hide Donovanâs Noonan Syndome, I also donât want to face the Hobsonâs choice of disclosing it to my, or my wifeâs, employer or paying significantly more for our medical insurance.
Yes, health care and health insurance costs in the country are a big problem. And we must do something to fix it. I do not have the solution (health care is so complicated). I am confident, however, that whatever that solution is, it is not asking employees to sacrifice this amount of personal privacy in exchange for lower insurance premiums.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. To comment, email editors@workforce.com. Follow Hymanâs blog at Workforce.com/PracticalEmployer.
The 11th Circuit Court of Appeals, in Evans v. Georgia Regional Hosp. [pdf], recently held that Title VII does not protect sexual-orientation discrimination per se, and that to sufficiently plead such a cause of action under Title VII, one must allege facts sufficient to establish that the employer discriminated based on non-conformity with sex-based stereotypes.Â
The most curious aspect of the decision, however, comes from the concurring opinion of Judge William Pryor (whom President Trump had considered to fill Justice Antonin Scaliaâs Supreme Court seat).
The unsurprising reality that some individuals who have experienced discrimination because of sexual orientation will also have experienced discrimination because of gender nonconformity by no means establishes that every gay individual who experiences discrimination because of sexual orientation has a âtriable case of gender stereotyping discrimination.â âŚ
By assuming that all gay individuals behave the same way or have the same interests, the Commission and the dissent disregard the diversity of experiences of gay individuals. Some gay individuals adopt what various commentators have referred to as the gay âsocial identityâ but experience a variety of sexual desires. ⌠Like some heterosexuals, some gay individuals may choose not to marry or date at all or may choose a celibate lifestyle. And other gay individuals choose to enter mixed-orientation marriages.
Perhaps the best counter-argument to this position comes from this question, asked by 7th Circuit Judge David Hamilton during oral argument over the same issue in a case pending in that court: âHow do courts draw the line you want us to draw without sounding arbitrary and, occasionally, silly?â
Silly.Â
All gay and lesbian individuals behave the same way in one key aspect â they all are sexually attracted to people of the same sex. Thatâs the very definition of gay. Gay men are sexually attracted to other men, and gay women to other women. And when an employer discriminates against a gay or lesbian employee, that employer is inherently discriminating based on the employeeâs choice of sexual partner, which equals discrimination based on gender. To view it any other way is intellectually dishonest.
Yes, Congress could simplify this issue by passing the Employment Nondiscrimination Act, or the Supreme Court could do so by overruling Evans. Until then, however, understand that the EEOC, most courts, and many states (but not Ohio) and localities disagree with Evans. More importantly, no matter the state of the law, your business is always free to do right by all of your employees by implementing policies banning LGBT discrimination in your workplace.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. To comment, email editors@workforce.com. Follow Hymanâs blog at Workforce.com/PracticalEmployer.
The fact that the current administration is cleaning its Justice Department house by turning over personnel appointed by the prior administration is not notable. Washington bureaucracy is run by the party-in-charge, and right now that means that President Trump is calling the shots on whom he employs and doesnât employ. For example, Attorney General Janet Reno took similar steps in the early days of President Clintonâs administration.
What qualifies Mr. Sessions for a nomination for the âWorst Employer of 2017â is how he handled communicating the news of the terminations. Via NBC News:
The Trump administrationâs sudden request on Friday that all 46 U.S. attorneys resign was met with surprise by multiple federal prosecutors, with at least one first finding out about the demand on social media, a source close to the U.S. attorney told NBC News.
âWe saw it on Twitter,â said the source, who is not the prosecutor and who requested anonymity because he was not authorized to speak publicly about the matter. âŚ
There is nothing easy about communicating a firing. Iâve had to fire people. Itâs the worst part of any job. Itâs also part of what you sign up for when you assume a management role. But, as uncomfortable as it is to tell someone they are losing a job, it is exponentially more difficult to be on the receiving end of that news.
Every employee deserves to learn of a job-loss via a face-to-face conversation. It is never acceptable to fire someone by a phone call, letter, voice mail, email, text message, Facebook message, tweet, or any other method of communication other than a face-to-face conversation.
For this reason, and this reason alone, I nominate Attorney General Jeff Sessions as the Worst Employer of 2017.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. To comment, email editors@workforce.com. Follow Hymanâs blog at Workforce.com/PracticalEmployer.
The Supreme Court reversed an earlier decision that would have heard the appeal of a 4th Circuit opinion granting a transgender boy the right to use the bathroom of his identified gender.
The March 6 decision comes on the heels of the Trump administrationâs policy change [pdf], which revoked the Obama administrationâs guidance that protected the bathroom rights of transgender students in public schools.
As a result, the lower court must now answer the thornier question of whether federal law (and not just a White House interpretation of it) equates gender-identity discrimination with sex discrimination.
From a legal standpoint, this case is fascinating. From a human standpoint, I ask this question â why is this an issue with which are grappling in the first place?
Consider what I wrote on this is very issue just last year:
If an employee genuinely believes she is female (regardless of whether she was born a male), why do we care if she uses the womenâs restroom?
Iâm certain I have readers who are thinking, âI donât want those freaks in my bathroom.â Well, this post isnât for you (or maybe itâs especially for you). You are doing exponentially more harm to the mental well-being of your transgender employee(s) if you force them into the wrong bathroom or segregate them in a single-gender bathroom, than you are doing to your other employees by having them share their bathroom with their trans co-workers. Any other answer to this issue is bigotry, period. And, in 2016, we should be well beyond institutional bigotry of any kind.
This issue is one of the most glaring examples Iâve ever seen of a solution in search of a problem.
Employers, do right by all of your employees, and letâs make this the last time I need to write about this as an issue of concern in the workplace.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. To comment, email editors@workforce.com. Follow Hymanâs blog at Workforce.com/PracticalEmployer.
CNN reports that a ransomware attack has locked the computer network of the Pennsylvania Democratic Caucus. This is what we call a teachable moment.
What is ransomware? Ransomware is malicious software that locks one’s computer or network until a sum a money is paid, at which point the cybercriminal provide a code to unlock the system. If the ransom is not paid with a set timeframe, they will wipe the data. And, any organization that relies on access to data, and cannot afford to lose access to that data at any time, is the prime target of a ransomware attack. Does that sound like your business?
How does one become infected with ransomware? Like any other virus or malware, most often by clicking a suspicious link in an email or on a website.
If you become victim to a ransomware attack, your options are limited. Depending on the type of encryption used by the cybercriminals to lock your system, you may be able to break the encryption. But that is unlikely. Much more likely, you either pay the ransom, or rely the quality of your system back-up and the expense that goes along with restoring it.
No business is immune from suffering a cyberattack. Being proactive is better than being reactive.
Either way, plan on a ransomware attack costing you. In 2015, for example, victims of these attacks paid a collective $24 million in ransom to these cyber-extortionists, and another $325 million to disinfect machines and restore backup data. In other words, ransomware is big business and a bigger threat, and it’s not going away anytime soon.
The best cybercrime offense is a good defense. Here are four tips to best protect your organization from suffering a crippling and expensive ransomware attack.
1. Diligently back up everything. If you invest in quality and reliable system backups, then you remove most of the risk of suffering a ransomware attack. In the event of an attack, you simply wipe your computers and servers, and start from scratch via the last uninfected backup.
2. Avoid suspicious emails and links. This, of course, is easier said than done, especially if your employees do not know for what to beware. Even a little bit of cyber-training goes a long way, and with the right training, your employees will learn to vet before they click. Your employees are the prime targets of these attacks, and they are also your first, and best, line of defense. 3. Patch software and block suspicious emails and websites. This step does not work without training your employees. The cybercriminals are at least one step (if not two three, or more steps) ahead of software patches and email/website blacklists. Nevertheless, have the latest version of everything installed lets the security experts working for your software providers do their jobs. 4. Disconnect immediately upon an infection. Any cyberattack is easier to contain and correct and limited to one desktop. Once it spread to multiple machines or, worse yet, servers, it becomes more difficult and exponentially more expensive to remedy. Once you learn of infection, notify IT and get everything offline as soon as possible. Quarantining the infected machines is the only way to stop ransomware from infecting your entire network.
No business is immune from suffering a cyberattack. However, being proactive is better than being reactive. Taking these four steps will help position your company best to avoid a cyberattack such a ransomware and to respond when it occurs.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. To comment, email editors@workforce.com. Follow Hymanâs blog at Workforce.com/PracticalEmployer.
To say that I have not felt overly optimistic about our nationâs course over next four years would be a bit of an understatement. One area, however, about which I am very optimistic is the expected retooling of the National Labor Relations Board.
This week, the U.S. Chamber of Commerceâs Workforce Freedom Initiative published a comprehensive report outlining the areas of federal labor law that the NLRB must address to restore balance to the workplace.
Authorizing small groups of employeesâor âmicro unionsââto organize.
Restricting unions and employers from voluntarily agreeing to resolve unforeseen bargaining issues via âmanagement rightsâ clauses.
Forcing employers to bargain with a union before the two parties even reach a first contract.
President Trump has already taken a step in the right direction, by naming Philip Miscimarra (a vocal and outspoken critic of his own agency over the past few years) as acting chair of the NLRB. While it will take time for Trump to turn the board over and appoint a majority of NLRB members, I am confident that by the end of his term in office, the landscape of our federal labor laws will look very different than it does now.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. To comment, email editors@workforce.com. Follow Hymanâs blog at Workforce.com/PracticalEmployer.
Edward Prieto, the sheriff of Yolo County, California, likes to hug his co-workers ⌠a lot. According to Victoria Zetwick, a county correctional office and the plaintiff in Zetwick v. County of Yolo (9th Cir. 2/23/17) [pdf], during the 12 years they worked together, Prieto hugged her hundreds of times.
Zetwick also claimed that during that same time frame, Prieto hugged several dozen other female employees, but never male employees.
Others, however, testified that Prieto also hugged men, just not as frequently as women. Zetwick alleged that a result she found it difficult to concentrate, and that she was constantly stressed and anxious about Prietoâs touching, which she believed had sexual overtones.
The 9th Circuit Court of Appeals concluded that a reasonable jury could conclude that Prietoâs hugs could create a sexually hostile work environment.
While it may appear that Prietoâs hugs were âcommonâ in the workplace, and that some other cross gender hugging occurred, neither of those things demonstrates beyond dispute that Prietoâs hugging was within the scope of âordinary workplace socializing.â A reasonable juror could find, for example, from the frequency of the hugs, that Prietoâs conduct was out of proportion to âordinary workplace socializingâ and had, instead, become abusive. âŚ
So, employers, whatâs the takeaway from this case? How about this: Hands off at work. Letâs not forget our common sense. Yes, hugs when excessive and unwelcome can create a hostile work environment.
If you have a close enough relationship with someone to greet with a hug, then hug it out. If someone complains about your hugs, stop. Itâs just that simple.
Jon Hyman is a partner at Meyers, Roman, Friedberg & Lewis in Cleveland. To comment, email editors@workforce.com. Follow Hymanâs blog at Workforce.com/PracticalEmployer.
H-1B visa program reform and immigration reform are in the books for the new administration.
Itâs widely recognized that the federal governmentâs H-1B visa program needs a change. The Trump administrationâs executive order draft aims at overhauling work-visa programs and affecting hiring practices, which could impact how tech companies recruit tens of thousands of employees. Currently, it allows them to bring in high-skill workers when they canât find qualified local workers, and the U.S. permits 85,000 H-1B visas annually for highly technical positions in STEM fields.
Allegations have sparked controversy that companies are abusing the program to bring in cheaper workers for jobs that otherwise might go to Americans. Legislation plans to prohibit companies who are heavy users of the visa program.
Those supporting the changes believe more jobs will be brought back to local workers, but those opposing argue it will burden employers and make it harder for them to access skilled talent, especially highly educated students from foreign universities â the top recipients of the H-1B visas work in the technology departments of large corporations such as Microsoft Corp., Amazon.com Inc. and Apple Inc., highly sought-after positions. Workforce is keeping a running list of important developments in immigration and H-1B Visas.
Updates
April 21: President Donald Trumpâs âBuy American, Hire Americanâ executive order encourages government agencies and businesses to buy American-made products and hire American labor.
April 5: The Trump administration issued new guidelines for the work visa program. Computer programmers applying for H-1B visas need to prove the jobs require more advanced knowledge and experience than what U.S. workers with similar education or credentials can offer. The U.S. Citizenship and Immigration Services agency issued the change.
April 3: The courtâs decision on the Save Jobs lawsuit is extended for another 180 days. The suit concerns H-1B visa holdersâ spouses, who can currently work under an H-4 employment authorization when theyâve applied for lawful permanent residence. The Save Jobs suit seeks to take away their right to work.
March 15: Mayor Rahm Emanuel plans to announce that five of Chicagoâs colleges are collaborating to sponsor H-1B visas for 10 to 20 foreign student entrepreneurs. Loyola University Chicago, Northwestern University, Columbia College Chicago, DePaul University and the Illinois Institute of Technology will adopt individual global entrepreneur-in-residence programs. Students can stay in Chicago to build their startups. Universities around the U.S. are in the process of creating similar programs.
March 13: The Trump administration suspended fast-track processing for H-1B visas, making it harder to bring in foreign workers in a hurry. Companies will have to give entry-level jobs to the existing domestic pool of unemployed native and immigrant workers. The policy called for the minimum wage payable to H-1B visa holders to be raised to a level comparable to prevailing wages in the U.S. United States Citizenship and Immigration Services advises that applicants and employers complete paperwork prior to the April 1 H-1B deadline.
March 7:Â Leon Rodriguez, former director of U.S. Citizenship and Immigration Services at the Department of Homeland Security, is joining Seyfarth Shawâs labor and employment department in Washington, D.C. He offered his insight into immigration reformâs future.
March 3: New bipartisan legislation called the H-1B and L-1 Visa Reform Act was introduced in the House of Representatives on March 2. The bill would eliminate the lottery system in favor of a preference system. It restricts companies from hiring more H-1B employees if 50 percent of their employees are already on H-1B and L-1s. According to CNN, it requires employers to make a âgood faith effortâ to recruit American workers over foreigners and gives the Departments of Homeland Security and Labor more authority to investigate fraud and abuse.
Feb. 28:Â Â President Donald Trump expressed openness to immigration reform in an address to Congress and asked Republicans and Democrats to work together. Trumpâs potential bill could grant legal status to millions of undocumented immigrants living in the U.S., according to CNN. It would allow undocumented immigrants who arenât criminals to live, work and pay taxes in the U.S. without fear of deportation. More details to come.
Feb. 13: More than 100 workers from Bay Area tech companies protested President Donald Trumpâs recent efforts to keep immigrants from entering the country and deport those already here. The rally was centered largely around nontechnical workers, like custodians, cafeteria workers and bus drivers, rather than software engineers and programmers who carry specialty H-1B visas.
Feb. 8:Â Texas state senators approved Senate Bill 4, which withholds state dollars for sanctuary cities (cities where police fail to enforce immigration laws at the request of federal officials). The bill will not permit officers to search a business solely to enforce an immigration law.
Feb. 7: Junior senators from Arkansas and Georgia, Tom Cotton and David Perdue, proposed a new law to reduce legal immigration. The bill plans to restrict green cards and eliminate the diversity visa lottery â a program that gives visas to countries with low rates of immigration to the United States.
Feb. 8: More than one-third of organizations have been impacted by the travel ban, according to new research by the Institute for Corporate Productivity. A pulse survey of 261 companies revealed 24 percent expect it will have a negative impact on productivity this year (only 3 percent say it will have a positive impact).
Feb. 6: The tech industry braced for another executive order that could hit business hard. Nearly 100 tech companies support a high-profile legal battle opposing President Donald Trumpâs Immigration Ban. The brief says, âImmigrants or their children founded more than 200 of the companies on the Fortune 500 list ⌠and employ millions of Americans.â Among the tech companies that signed are Google, Airbnb, Microsoft, Intel, Netflix, Snap, Facebook and Uber.
Feb. 5: The future of Indian tech firms and billion-dollar ideas could be in trouble. At least nine private startups with valuations of $1 billion or higher have a founder of Indian origin. North America is the biggest export market for the countryâs $150-billion IT industry, and the possibility of overhauling all American work-visa programs could impact India greatly.
Feb. 1: Sens. Chuck Grassley, R-Iowa, and Dick Durbin, D-Illinois, reintroduced a bill that will eliminate the H-1B visa lottery system. Replacing it would be a preference system awarding priority to foreign students who hold advanced degrees from the U.S. over importing more foreign workers. They will be offered the highest wage for jobs to which they apply.
Jan. 28: A federal court in New York issued a temporary injunction against the federal governmentâs implementation of portions of the order. The government canât remove affected individuals from the U.S. just on the application of the order. Removal applies to individuals being sent out of the United States after requesting entry. The order violates the Constitutionâs Due Process and Equal Protection Clauses.
Jan. 27: President Donald Trump signed an executive order that âsuspends entryâ of both âimmigrant and nonimmigrantâ individuals from the seven countries currently subject to visa waiver restrictions: Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen. This 120-day hold is an indefinite ban on refugees from Syria. Citizens from the seven Muslim countries are barred from entering the U.S. for 90 days.
Jan. 4: U.S. Rep. Darrell Issa (R-California) introduced legislation backed by multiple Democrats and Republicans that would change the requirements for the H-1B visa program. New standards will turn the four-tier wage system into a three-tier system and make it difficult for employers to access entry-level workers and exploit the program. Employers will pay foreign national workers more than similarly situated U.S. workers.
Mia Mancini is a Workforce intern. Comment below or email editors@workforce.com.
Late Feb. 15, news broke that Andy Puzder, Donald Trumpâs pick for secretary of labor, had withdrawn his name from consideration, just one day before his oft-postponed confirmation hearing was to take place.
Like Trumpâs immigration ban, opposing Puzderâs nomination was not a political issue, but a right/wrong issue. Had I had the chance to ask Andy Puzder a question during his confirmation hearing, I would have asked the following:
Can you reconcile your potential position as the head of the federal department that regulates the relationship between employers and employees, and your statements about the sexually based advertisements your restaurants ran under your tutelage as CEO, such as, âI like our ads. I like beautiful women eating burgers in bikinis. I think itâs very American. I used to hear, brands take on the personality of the CEO. ⌠I think this one, in this case, it kind of did take on my personality.â? How can you assure women that your âpersonalityâ will not interfere with their ability to be treated equally in the workplace, and be paid the same wage for the same work as their male counterparts?
According to NBC News, while Democrats staunchly opposed Puzderâs nomination because of his opposition to raising the minimum wage, in addition to his restaurantsâ racy ads, it was ultimately Senate Republicans that killed the nomination.
Some conservatives have also taken issue with Puzderâs immigration stance, saying it is at odds with Trump. His family also employed an undocumented worker as a housekeeper, though Puzder said he was unaware she was in the country illegally.
Personal issues also complicated the restaurant executives nomination. Puzder went through a messy divorce and his ex-wife made allegations of domestic abuse that were later recanted.
As Iâve said previously, someone who espouses Puzderâs view of women has no business directing our nationâs labor policy. While I agree with his view on other labor issues, such as minimum wage, overtime, and joint employment, there must be someone else qualified who lacks Puzderâs sexist baggage. Hopefully President Trump will allow us to discover who that person is.
Itâs important for businesses to understand the different types of wage garnishments and learn ways to accurately and efficiently process them.
Proper management of wage garnishment can be especially crucial to growing businesses because as their hiring increases, they may also be inadvertently increasing their garnishment liability. Thatâs why itâs important for an employer to remember four things can help appropriately and accurately process wage garnishments while remaining compliant.
1. All garnishments are not the same.
Hereâs a basic wage withholding definition: When an employee fails to repay a debt, a wage withholding court order can be issued against the employeeâs earnings to satisfy that debt. This court order â also called a wage garnishment â requires the employer to withhold a portion of the employeeâs wages and forward them to a third party. Wage garnishment orders also can be issued by government agencies such as the IRS, state tax agencies and the U.S. Department of Education.
Simple, right? A business receives an order about one of its employees and refers it to its payroll department to process by withholding the appropriate wages and forwarding it to the proper recipient.
There are six common types of wage garnishment. They are:
Child support garnishment comprises by far the highest volume of orders employers process, and, while some of the laws are very standardized, the law can vary by state.
Creditor garnishments are debts that occur when a person is delinquent on consumer payments (e.g. credit card debt). The creditor may take the debtor to court and seek a wage withholding order for the outstanding debt.
Bankruptcy orders. Based on research from the American Bankruptcy Institute, 97 percent of all bankruptcies are personal filings rather than business filings.
Student loans may be collected by the U.S. Department of Education, which may contract with collection agencies to enforce and collect the defaulted loans.
Tax levy garnishments can be issued at the federal, state or local level. Each state differs in its requirements and those laws may differ from federal levies.
Wage assignment occurs when an employee voluntarily agrees to have money withheld from his or her wages. Wage assignments are governed by state law and do not involve a court order. Since they are voluntary and the employee specifies the amount to withhold, they do not fall under the requirements of the Federal Consumer Credit Protection Act.
Itâs important that employers keep in mind the type of debt owed, the party collecting it, and the laws applicable to that debt. Knowing which laws, rules, and regulations apply and keeping current on them when processing wage garnishments can be challenging for employers, and, if done incorrectly, may expose employers to various liabilities and penalties.
In addition, the six types of wage garnishments noted above are the most common wage garnishments; employers may receive other less common types of wage garnishments. Itâs the employerâs responsibility to comply with and make sure all orders are processed in a timely manner and correctly whether or not they are familiar.
2. Wage garnishment can affect employee productivity and morale.
Most employers recognize that wage garnishment has a direct impact on employees. However, this impact can extend beyond their paychecks. Processing garnishments is not as straightforward as simply withholding wages from an employeeâs paycheck and sending a payment. The process is far from simple and can be complicated by myriad emotions.
Employees often find it humiliating because the courts have intervened and employers have become involved in their private struggles.
Employees in this position may feel that theyâre now working for the institutions to which theyâre indebted rather than for themselves and their futures. Stress and anxiety are often natural extensions of the garnishment process.
An affected employeeâs anxiety could show itself through decreased productivity or a lack of motivation. Employers can help affected employees and potentially decrease future garnishments by providing financial wellness training and counseling, as well as tax education, to help employees manage debt.
3. Wage garnishment can affect an employerâs finances and business efficiency.
Employees arenât the only ones affected by wage garnishment. Employers expose themselves to financial and legal risk when they incorrectly garnish an employeeâs wages, fail to file in a timely way, file a defective response, fail to follow specific requirements when sending payments, or make other missteps with a garnishment. Mishandling a garnishment can lead to a judgment against the employer for the entire amount of the employeeâs debt, a lawsuit from the creditor or the employee, or other costs or penalties that the employer didnât anticipate or budget for.
In the instance of garnishments for child support, employers could potentially feel the impact of laws designed to restrict travel. For instance, the Social Security Act was amended in 1997 with a sub-section that established the denial, revocation, or restriction of U.S. passports if the non-custodial parent has child support arrears of $2,500 or more. Additionally, some state agencies have the authority to deny or revoke driversâ and professional licenses for past-due child support obligations.
If your business requires employees to travel internationally or employs drivers, these laws could impact an employeeâs ability to do his or her job effectively and, by extension, impact the efficiency of your business.
Another current area of focus that could impact employers is in the creditor garnishment arena. Currently, the American Payroll Association is working with the Uniform Law Commission to establish a standardized processing for creditor garnishments through the Uniform Wage Garnishment Act, which proposes to standardize the wage-garnishment process for employers, employees and creditors. Currently, state laws differ significantly in their requirements regarding wage garnishment, from the beginning to the end of the garnishment, and are often outdated. This means businesses that operate in multiple states must identify and abide by these different legal requirements, which can potentially lead to processing errors, confusion, inefficiency and noncompliance.
Companies can help manage these challenges if they become familiar with garnishment laws and guidance from agencies such as the Federal Office of Child Support Enforcement, develop reliable and timely procedures for garnishment processing and ensure that policies are administered fairly for all employees facing a wage garnishment.
It may be useful to develop tools, resources and strong contacts with agencies, courts and garnishors. Staying close to these agencies may help your business remain aware of major changes to wage garnishment laws.
Consider participating in state and federally initiated pilot projects. These programs are valuable opportunities to positively build relationships, influence initiatives and provide needed feedback. Make sure you have established a way to monitor legislation that could affect garnishment processing.
Other steps an employer can take include participating with committees, attending conferences regarding wage withholding, and leveraging other contacts youâve developed with the agencies, those imposing wage garnishments, or other employers.
4. Paper processing is the not the only option.
A study by the ADP Research Institute revealed that 7.2 percent of employees had wages garnished in 2013. Keeping pace with the proper and timely processing of wage garnishments is challenging for many businesses.
As wage garnishment volumes and laws intensify, garnishment processors have the option to use electronic funds transfer, or EFT, to save time, increase efficiency, streamline processes and potentially reduce costs.
Currently, virtually every child support state agency has the ability to accept child support payments via EFT, and some have even mandated employers to send payments electronically. Some tax levy agencies, trustees and student loan agencies also are implementing electronic payment capabilities. In addition to business efficiencies, EFT enables greater security of personally identifiable information, such as Social Security numbers.
Minnesota has passed legislation requiring employers to electronically file their response to a state tax garnishment summons with the state tax agency, and Wayne County Court in Michigan is piloting the option of electronic responses.
Electronic income withholding orders are already very popular. These enable states to electronically distribute income withholding orders and employers to electronically accept or reject them.
Clearly, wage garnishment can have a profound effect on the employee who is being garnished, as well as the employer who must implement the garnishment. Itâs important for businesses of all sizes to understand the different types of wage garnishment, familiarize themselves with the laws governing them, and learn ways to accurately and efficiently process them.
Using best practices can help streamline an employerâs responsibilities and ease the potential anxiety an employee may feel with this sometimes-necessary workforce issue.
Julie Farraj is vice president of Garnishment Services for ADP Added Value Services. Comment below or email editors@workforce.com.
