The Bottom LineADP RESOURCE®

A Publication Dedicated to Employers’ Current HR Issues & Solutions Brought to You by ADP Resource Volume 12

Also in this issue

Office Parties:Inviting Holiday Cheer, Not Lawsuits

At-Will Employment:

Does It Really Matter Anymore?

Making the Most

of Millennials

The Irrationality of Employee

Engagement — and How to

Work Around It

Deducting From an

Employee’s Pay:

When Is It Okay?

The Impact of Religious Beliefs

in the Workplace

State Employment

Law Updates

What ADP Resource®

Clients Are Saying

17 Deducting From an Employee’s Pay:When Is It Okay?Who pays for employee uniforms? Is a company required to pay a staffer for working unauthorized overtime? Find the answers to these questions and more.

21 The Impact of Religious Beliefsin the Workplace Religion is a difficult subject that many people don’t feel comfortable discussing. Inevitably, it has to be addressed in a place of business. But whether an employee is Jewish, Muslim, Christian, Buddhist, or any other religion, his or her rights must be respected. Here’s how to make sure they are.

25 State Employment Law UpdatesHelping you stay on top of recent legislative changes at the state level.

26 What ADP Resource® Clients Are SayingHow ADP Resource helped one client manage the effects of growth on HR and compliance while setting a course for the future.

The Bottom Line Volume 12

09 Making the Most of MillennialsSuper-creative or super-spoiled? The challenge for small-business owners of getting to know the twenty-somethings entering the workforce right now—and figuring out how to manage them.

13 The Irrationality of EmployeeEngagement — and How to Work Around ItWhen you want your employees’ buy-in, making a business case for change may work for you— but not for them. Take cues from what consumer marketers already know about engaging people and changing behaviors.

03 Office Parties: Inviting Holiday Cheer, Not Lawsuits The end of the year is a celebratory time that brings colleagues of all stripes together, but it’s very easy to get too swept up in the joy of the season. Some helpful tips about keeping the office holiday party—and partiers—under control.

05 At-Will Employment: Does It ReallyMatter Anymore?The law basically states that employers can fire employees simply because they feel like it, but in the real world, this doesn’t happen without lawsuits. A look at how the “at-will” doctrine is being reevaluated.

The office holiday party can be a lot of fun, but it can also spur a host of litigation nightmares: scandalous photos on Facebook, drunk-driving accidents and sexual harassment. What follows are several practical ways that employers can festively boost worker morale without becoming entangled in embarrassing and costly legal claims.

ADP Resource® has the tools and resources to lead you in the right direction. Its Human Resources Business Professionals can help you make fully informed decisions regarding a broad range of employment issues..

DO NOT REqUIRE ATTEnDAnCE

MONITOR InTOxICATED WORkERS

INVITE FRIEnDS AnD FAMIly

CONSIDER CABARET lAWS

HAVE WORkPlACE RUlES APPly

WHEN IT’S OVER, IT’S OVER.

CURB BOOZInG

Employees should not be required to attend a company holiday party. Some may not feel comfortable socializing in a work context, and others may perceive the party as a religious celebration or have objections to alcohol being served.

OFFER TAxI VOUCHERSMake available cab vouchers that staff can use without having to go to a manager. Sure, a few employees may abuse the privilege, but if the vouchers prevent one accident, they are money well spent.

While it is best to encourage employees to maintain control over themselves by limiting their alcohol intake, employers should still have sober managers or other “babysitters” to ensure that employees behave properly. These supervisors should be briefed prior to the festivities about keeping the revelers in check and avoiding harassment.

As employers continue to cut corners post-recession, they might be tempted to exclude a group of people who could also keep employees’ behavior in check: friends and family. Sexual harassment is most likely to occur at parties that take place after work hours with open bars where spouses and significant others are not invited.

And even though it might be more expensive for the company in the short run, allowing employees to bring dates could keep them on their best behavior and help the company avoid expensive litigation afterward.

While discouraging workers from busting a move might recall the film Footloose, in which a small-town reverend bans dancing, giving employees the green light to touch each other can open the door for sexual harassment. Play music that’s lively but not easy to dance to.

Employers should formally remind employees that the decorum they exercise at work should also apply to the office holiday party, as should all of the company’s sexual-harassment policies.

Of course, some may argue that a holiday party is not a workplace, but behavior can get out of control when workers and managers decide that they can act inappropriately simply because they are at a social event with alcohol, and they might need a reminder to exercise their best judgment, even if they have nothing to drink.

Make sure the party ends at the scheduled time. It should not continue at a manager’s hotel room or other location.

If alcohol is served, have a cash bar to prevent free-flowing alcohol. You might consider donating the money to a charity.

Someone other than an employee should do the bartending. Under no circumstances should a manager be in charge of pouring drinks—the manager is an agent of the company, and that would increase the company’s liability for events caused by alcohol consumption. To that end, employers should hire insured third parties to serve alcohol. A professional bartender is more likely to be trained to identify someone who is clearly intoxicated and cut him off. It’s better if the bartender makes that decision, as opposed to an agent of the employer.

Be sure the bartender is instructed to check IDs before pouring. The greatest exposure to legal problems here involves minors. If a minor drives under the influence of alcohol served by an employer and gets in an accident, a substantial likelihood of employer “social host” liability will result.

Lastly, the bartender should have a company point person to contact. The employee in charge may need to take action, such as making sure that an intoxicated partygoer gets home safely.

Office Parties:INVITINg HOLIDAY CHEER, NOT LAWSUITS

1

2

3

4

5

6

7

8

3 the Bottom line | Office Parties the Bottom line | Office Parties 4

At-Will EmploymEnt:DoEs it REAlly mAttER AnymoRE?

The law basically states that employers can fire employees simply because they feel like it, but in the real world, this doesn’t happen without lawsuits. A look at how the “at-will” doctrine is being reevaluated.

“I can fire him for a good reason, a bad reason or no reason at all because he is an at-will employee, right?” Wrong. While the employment at-will doctrine specifically says that this is the case, there are many exceptions— not to mention the fact that a terminated employee can sue you for a good reason, a bad reason or no reason at all. Employers must be careful, and the reality is that the at-will defense is not what it used to be.

Only in Montana are employees presumed to be “for cause”

exceptions to the At-Will DoctrineTo be sure, in 49 states, at-will status is presumed. Only in Montana are employees presumed to be “for cause,” meaning that the employer must have some type of legitimate reason before discharging an employee. Nonetheless, many federal laws create exceptions to the at-will doctrine.

For example, the Age Discrimination in Employment Act prohibits discrimination against applicants and employees who are age 40 or older; it does not protect workers under the age of 40, although some states do have laws that protect younger workers from age discrimination. The Americans with Disabilities Act prohibits discrimination against applicants and employees who are disabled. And Title VII of the Civil Rights Act of 1964 prohibits discrimination against applicants and employees on the basis of race, sex, age, color, national origin and religion.

In addition, some states have created their own exceptions to the at-will doctrine, such as protections for those who are married or homosexual.

Wrong

“ I can fire him for agood reason, a bad reason or no reason at all because he is an at-will employee, right?”

5 the Bottom line | At-Will Employment the Bottom line | At-Will Employment 6

A Rarely effective Defense“Well, of course I’m not going to fire an employee because of his race, age, disability or something like that. So I have nothing to worry about, right?” Wrong again.

Individuals who sue rarely have smoking-gun evidence of discrimination, such as “We fired Larry because he is too old.” Courts understand that discrimination is often much more subtle, so they allow plaintiffs to use circumstantial evidence to prove their case. Examples of circumstantial evidence include whether the termination decision makes sense.

A jury is permitted to rule in favor of a plaintiff based entirely on inferences they draw fromcircumstantial evidence. If a jury believes an employer’s termination decision doesn’t makesense—and they believe it doesn’t make sense because the real reason was age discrimination—they can rule against the employer. Consequently, the notion that an employer can terminate an employee for a bad reason or no reason at all is legally correct, but it doesn’t hold water in the real world.

important Protections RemainPerhaps more than anything else, at-will language in an offer letter or an employee handbook gives an employer a solid defense against a claim that an individual has an employment contract for a definite duration. Provisions requiring employees to acknowledge that their employment is at will and may be terminated at any time, and further advising them that their at-will status may not be altered without a letter signed by a high-level official at the company, have often been used to defeat breach-of-contract claims.

Recent Government ActivityStill, the impact of at-will disclaimers continues to erode. Recently, the National Labor Relations Board (NLRB) has been investigating at-will disclaimer language that is typically found in employee handbooks.

In separate and unrelated situations, the NLRB has either concluded or advocated that broadly written at-will disclaimers chill employees’ right to engage in protected, concerted activity under the National Labor Relations Act (NLRA). This right applies to union and non-union employees. For example, earlier this year, the NLRB determined that an employer violated the law by maintaining an employee-handbook provision that stated, in pertinent part, “I further agree that the at-will employment relationship cannot be amended, modified or altered in any way.” The NLRB found that maintaining and requiring employees to sign such an acknowledgment violated the law because it could be reasonably construed by an employee as relinquishment of his or her right to engage in concerted action to change the employee’s at-will status through union representation or collective bargaining.

The NLRB’s recent attention to at-will employment disclaimers is a reliable indicator of future action challenging such provisions. Employers would be well-advised to position themselves to defend their at-will employment disclaimers by ensuring that they are not written in so broad a manner as to reasonably suggest that an employee would be precluded from engaging in concerted activity as a legitimate means of altering his or her at-will status.

“ Well, of course I’m not going to fire an employee because of his race, age, disability or something like that. So I have nothing to worry about, right?” Wrong again

More than just a payroll processor, ADP Resource® provides its clients with the latest human-resources advice and best practices on a wide variety of issues, including appropriate language for employee handbooks and offer letters. ADP Resource also provides its clients with up-to-date compliance alerts, helping to ensure that their policies and procedures are in compliance with the ever-changing landscape of employment law.

7 the Bottom line | At-Will Employment the Bottom line | At-Will Employment 8

Making the Most of MillennialsManaging your staff is probably one of the most challenging and important aspects of running your business. Every generation brings its own perspective to their work. While most managers are well versed in the differences between baby boomers, Generation X and Generation Y, the newest generation, millennials, has very different work styles. How do you integrate the millennials into your workforce, and how can you use their unique characteristics to further the success of your business?

As a generation, baby boomers pioneered individuality and self-validation. So there’s a lot of irony in the boomers’ decision that their children’s path to gaining a competitive edge is their involvement in group activities. Boomers believed that individualism and leadership skills would come from the team dynamic. In other words, from the group would come the individual.

Whether it’s sports, music, art or academics, the foundation of learning for nearly all millennials has been through the lens of a team. So it’s no surprise that the millennial generation places tremendous value on social and support networks. From their point of view, teams are the only means to personal success.

A recent study by attitudinal research firm The Futures Company shows how the perceptions and views of millennials and boomers differ when it comes to community and individuality.

yet for millennials, community and individuality are not mutually exclusive. Instead, they take what they learned in a team environment and use it to shape and hone their own performance. They’re also accustomed to receiving continuous feedback to help measure and improve their performance. In short, they want and respond to coaching. That’s good news for a small-business owner looking for enthusiastic and eager-to-learn new hires.

there’s no “i” in “team,” But there is “Me”

millEnniAls

45%63%63%

67%76%78%49%

36%41%41%

53%57%58%58%

boomERs

CommunityBeing part of a close community is important to me

I like to keep people up to date about what’s going on in my life

I am enthusiastic about new technology that can enable me to find and interact with like-minded people

IndividualityNowadays, we are free to shape our identities and transform ourselves in whatever way we want

I am very competitive when it comes to my career (among employed)

I work hard at coming out on top in every situation, from the least to the most important

I want others to see me as someone who is willing to defy convention

millEnniAls

boomERsVs.

ON VALUES OF COMMUNITY & INDIVIDUALITY

the Bottom line | Making the Most of Millennials 109 the Bottom line | Making the Most of Millennials

A new Definition of success: not losingEven as the economy slowly rebounds, the recession will have a long-lasting impact on new entrants into the workforce. The lack of employment opportunities is likely to affect millennials for most of their careers. A study by Yale economist Lisa Kahn shows that people who graduated from college during previous recessions earned $100,000 less in cumulative net present value earnings than those hired during non-recession times. And since millennials have watched their boomer parents delay retirement and lose financially during the recession, they are redefining what success means to them. It’s not the money that drives them; it’s performing a job well. Because they were told they were winners simply for showing up and for being part of a team, they have abandoned the concept of losing.

To them, success is not the destination but the journey. This could have significant implications to business leaders who will need to find new and innovative ways to motivate and reward young workers. New research has shown that millennials are looking for benefits and work-life balance as much as they are salary. Are we on the forefront of new performance-management and compensation programs driven by the millennials’ new definition of rewards? It’s possible.

Managing MillennialsAs millennials join your workforce, you are presented with a great opportunity. Their commitment to community makes them very comfortable in team settings. They enjoy working with people from different backgrounds with different ways of working. They are confident, poised, and self-assured. Adapting to change is part of their DNA. And they treat the latest technological tools and devices as extensions of their own limbs.

They have the creativity and adaptability to respond quickly to change and aren’t daunted by challenges. However, they do prefer continuous feedback, and traditional performance— management programs may be too rigid to provide the motivation they need.

Managing millennials may require out-of-the box thinking to capitalize on their abilities to network, use technology and pursue alternative approaches to problem solving. You just may need to exchange your managerial hat for a coach’s cap!

millEnniAls vs. boomERsON QUESTIONS ABOUT HEALTH ACCOUNTABILITY

Millennial traits of flexibility, innovation and adaptability are likely to be tested when it comes to their health. This generation has come of age during an epidemic of childhood obesity. As adults, they will face higher health-care costs, lower quality of life and loss of income due to more missed days of work. They could be the first generation to live shorter lives, on average, than their parents’ generation.

Yet despite the threat of poor health, millennials are more likely than boomers to see the need for greater accountability when it comes to health and wellness.

62%59%35%53%

45%36%25%39%

Health insurance companies should charge higher rates to people who don’t take care of their health

We would have a healthier society if more laws were put in place to encourage healthy lifestyles and discourage unhealthy lifestyles

I support adding a tax on sales of all fattening foods

The government has a responsibility to encourage healthiness by banning ingredients and cooking methods that may lead to obesity

millEnniAls boomERs

the Plan B GenerationA March 29, 2011, report by The Futures Company says of millennials, “The most successful people will be those able to continually learn, re-learn, and adapt, not those who stop learning and settle into some end-state. The world will leave behind those who quit keeping up by refusing to change.”

Millennials have learned to expect the unexpected and have become adept at adapting to change. They approach risk differently, possibly due in part to their highly structured, carefully monitored childhoods and their concept of success. Because losing is not part of their makeup, when presented with an insurmountable hurdle, they have been trained to figure out how to go around it instead of over it. They approach problems with flexibility and creativity, and when one solution doesn’t work, they are comfortable taking a new approach. They have become the Plan B generation.

ADP Resource® can offer you innovative employee programs to attract, retain and motivate all the generations that make up your workforce. Core services and solutions include professional development and business skills training, a toll-free employee-service center and complete employee-relations guidance and support. Among the less traditional advantages are mobile solutions to reach a workforce on the go, employee-assistance programs, and discounts on major retail products and services. With all of the challenges of operating a business, ADP Resource can take this one off your plate!

11 the Bottom line | Making the Most of Millennials the Bottom line | Making the Most of Millennials 12

{ }Employee engagement is the goal of just about every manager. After all, the relationship between engaged employees and business achievements is well documented. But with all that we know about the importance of engaging employees, why aren’t we more successful at it? Maybe it’s because we haven’t really thought about it from the perspective of the end users: your worksite employees.

Humans make decisions based on many factors, but because we are complex beings, sometimes those factors aren’t rational. That’s what makes it so challenging to engage worksite employees. Most people want to be committed to their jobs and perform at top levels, and they certainly know why it’s important. So why aren’t more employees “walking the walk”?

The Irrationality of Employee Engagement — and

How to Work Around It

13 the Bottom line | Employee Engagement the Bottom line | Employee Engagement 14

When clients work with ADP Resource®, you’re assigned a HR Business Partner (HRBP) who can help you brainstorm about how to increase employee engagement and productivity. Your HRBP can also help you get the most from the engagement-focused tools and resources available through ADP Resource, such as employee-engagement surveys, exit interviews and 360° performance evaluations. Once you identify trends, you can start solving problems—reducing turnover, improving engagement and driving productivity.

ADOPT A NEW ATTITUDEIf you’re not seeing the results you were hoping for in your engagement efforts, you may want to rethink how you’re presenting your initiative to your employees.

According to research from the partnership of Aon Hewitt and The Futures Company, most people fall into discrete attitudinal segments that influence how they think and feel about engagement. Take wellness, for example: The behavioral tendencies of many in the C-suite, most managers and others in leadership roles fall into a category that embraces a sense of control and personal responsibility when it comes to improving health. And leadership sees wellness as part of the solution to important business problems: lowering costs and increasing productivity. The average worker, on the other hand, falls into a different segment—because he or she has a completely different mind-set.

Here are a few of the characteristics that define nearly half of the U.S. working population and ultimately shape their attitude in the workplace:

In addition, while you might appreciate a lot of detail, the people you need to engage aren’t likely to be information junkies. Try one or more of these consumer-marketing approaches, and see if they don’t resonate better with your workforce:

• Make it entertaining, and create some buzz. To get employees’ attention, it needs to be fun, hip, humorous and exciting.

• Appeal to what’s important to them. Tell your staff how it will help them look good, feel good and be more confident.

• Make it easy. Today’s workers are stressed and starved for time, so it needs to be simple and uncomplicated.

• Make them feel like part of a community. Family and friends are important, and people like to feel connected to others.

• Time-starved

• Seeks entertainment

• Family-oriented

• Stressed

• Likes high-tech media and social networking

• Interested in group activities and competition

• Wants to look and feel good

• Wants recognition for their accomplishments

• Trusts friends and family as information sources

Instead of trying to persuade worksite employees to change their behaviors to solve your company’s issues, sell it to them as a way to solve their issues. In other words, if you make it about them, you might just get what you need: engaged employees.

BEhAvIOrAl TENDENCIEsHistorically, engagement programs have been designed around the idea that people are sensible and will act in ways that maximize their interests. Unfortunately, that’s not the reality. We are very much influenced by what’s going on in our lives, what others are doing, and our emotions. In other words, these behavioral tendencies, not rational thought, may be driving our decisions. Here’s why this is often the case:

1

2

3

4

5

6

7

We’re biased toward the status quo. It’s hard to break bad habits and overcome inertia. That makes the default option (doing nothing) an attractive option for some.

We’re influenced by others. We live in a “monkey see, monkey do” world. People often learn by observing others and copying their behavior. It helps us feel connected. Not convinced? Look at how quickly dress designers copied the gown Kate Middleton wore to marry Prince William.

We want to avoid loss. For many, losing hurts worse than winning feels good. Think about it: Is it easier to remember an embarrassing moment or one you’re proud of?

We like immediate gratification. Many of us are willing to accept a smaller reward today in exchange for a larger reward later: “I know I should substitute that side of fries for a salad, but…”

We’re overwhelmed by too many choices. If it’s too hard to choose among all the options, we won’t make any decision at all.

We use mental shortcuts. We put more weight on recent events than on past events. And we are strongly influenced by how the problem/information is presented to us.

We need it to relate to us. We need to feel involved and part of the solution. Just having the information isn’t enough. We need the answer to the question “Why should I care about this?”

15 the Bottom line | Employee Engagement the Bottom line | Employee Engagement 16

Deducting From an Employee’s Pay: When IsIt Okay?

Whether you can deduct from an employee’s pay will depend on whether she is a non-exempt or an exempt employee. The federal Fair Labor Standards Act (FLSA) requires that most employees in the United States be paid at least the federal minimum wage for all hours worked, and overtime pay at time and one-half the regular rate for all hours worked beyond 40 in a workweek. Such employees are commonly referred to as non-exempt. The FLSA does provide an exemption from both minimum wage and overtime pay for certain employees, including those who are bona fide executive, administrative, professional and outside sales employees. These workers are usually referred to as exempt.

On June 4, 2012, the U.S. Department of labor announced that a San Antonio–based

car-wash company agreed to pay $246,438 in back wages to 308 employees following a

DOl investigation. Among other things, the DOl found that the company had taken illegal

deductions from employees’ paychecks for uniforms, insurance claims, and cash-register

shortages that resulted in employees’ pay falling below the federal minimum wage.

So what went wrong? This is a tricky area of the law, and it is not always logical.

Can You Deduct the Cost of Clothing for a non-Exempt Employee?The FLSA does not require that employees wear uniforms. However, if uniforms are required by another law, the nature of a business or by an employer, their cost and maintenance is considered to be a business expense of the employer. If the employer requires the worker to bear the cost, it must not reduce her pay below the minimum wage or cut into overtime compensation.

For example, if an employee is paid an hourly wage of $7.25 (which is the federal statutory minimum), the employer may not deduct from those wages for the cost of the uniform or require the employee to purchase the uniform on his own. However, if the employee were paid $7.75 per hour and worked 30 hours in the workweek, the employer could legally deduct up to $15 ($.50 X 30 hours) from his pay.

The employer may prorate deductions for the cost of the uniform over a period of paydays, provided the deductions do not reduce the employee’s pay below the required minimum wage or overtime compensation in any workweek.

17 the Bottom line | Deducting From an Employee’s Pay the Bottom line | Deducting From an Employee’s Pay 18

The cost of any items that are considered primarily for the benefit or convenience of the employer would have the same restrictions that apply to reimbursement for uniforms. In other words, no deduction may be made from an employee’s wages that would reduce her earnings below the required minimum wage or overtime compensation.

Examples of such items are tools the workers use, damages to the employer’s property by the staff or any other individuals, financial losses due to clients/customers not paying bills, and theft of the employer’s property by the staff or other individuals. Employees must not be required to pay for any of the cost of such items if it would reduce their pay below the required minimum wage or overtime. This is true even if an economic loss suffered by the employer is due to the employee’s negligence.

Employers also may not circumvent FLSA requirements by having the employee reimburse them in cash in lieu of deducting the cost from the employee’s wages.

Also, an employer is not required to pay the full salary in the initial or terminal week of employment, or for weeks in which an exempt employee takes unpaid leave under the Family and Medical Leave Act.

Note that an employer will lose the exemption if it has an “actual practice” of making improper deductions from exempt employees’ salaries. Factors to consider when determining whether this is the case include but are not limited to the number of improper deductions, particularly as compared to the number of employee infractions warranting deductions; the time period during which the employer made improper deductions; the number and geographic location of both the employees whose salary was improperly reduced and the managers responsible; and whether the employer has a clearly communicated policy permitting or prohibiting improper deductions. If an actual practice is found, the exemption is lost during the time period of the deductions for employees in the same job classification working for those managers responsible for the improper deductions.

Fortunately, isolated or inadvertent improper deductions will not result in loss of the exemption if the employer reimburses the employee for those deductions.

Employers can rarely deduct from an exempt employee’s salary. Deductions are permissible in the following limited circumstances:

What Are Some Typical Mistakes Employers Make When Deducting From non-Exempt Employee’s Pay?

Can You Require Non-Exempt Employees to Pay or Reimburse the Company for Other Items?

Can You Refuse to Pay Overtime When a non-Exempt Employee Works Extra Hours Without Approval?

When Can You Deduct From an Exempt Employee’s Pay?

Is There Anything Else Employers need to know?

1. Requiring a cashier who earns minimum wage to reimburse the employer for a cash-drawer shortage.

2. Requiring tipped employees to pay for customers who walk out without paying their bills or for incorrectly totaled bills.

3. Furnishing elaborate uniforms to employees and then holding them responsible for having them cleaned.

4. Holding an employee responsible for automotive repairs after she caused an accident in the employer’s vehicle, thereby reducing her wages below minimum wage.

5. Requiring a security guard to purchase a gun for the job, the cost of which causes him to earn less than minimum wage.

6. Requiring employees to get a physical examination that cuts into their minimum-wage or overtime pay.

Here are six common deduction errors:

• The employee is absent from work for one or more full days for personal reasons other than sickness or disability

• For absences of one or more full days due to sickness or disability if the deduction is made in accordance with a bona fide plan, policy or practice of providing compensation for salary lost due to illness

• To offset amounts employees receive as jury or witness fees, or for military pay

• For penalties imposed in good faith for infractions of safety rules of major significance

• For unpaid disciplinary suspensions of one or more full days imposed in good faith for workplace- conduct-rule infractions

No. You may discipline the employee, but you must pay overtime for the hours worked.

Yes. Sometimes state laws contain more severe restrictions on deductions from employees’ wages. If this is the case, you would have to obey state law.

It is difficult to keep up with all the laws affecting how employees must be paid. ADP Resource® is well versed in payroll compliance, updates clients about new developments of significance in a timely manner, and offers guidance and best practices that allow clients to focus on their business objectives.

19 the Bottom line | Deducting from an Employee’s Pay the Bottom line | Deducting From an Employee’s Pay 20

Three days after the events of Sept. 11, 2001, the federal Equal Employment Opportunity Commission (EEOC) issued a statement reminding employers and employees that Title VII of the Civil Rights Act of 1964 prohibits workplace discrimination based on religion. It also asks them to promote tolerance and guard against such discrimination.

In addition, Title VII requires that employers reasonably accommodate religious practices of applicants and employees unless doing so would impose an undue hardship on the operation of the business. State and local laws may impose similar obligations.

From 2001 to 2010, perhaps due to a heightened awareness of the protection on the part of individuals, the number of religious-discrimination charges filed with the EEOC increased by 80 percent, with the most significant increase occurring from 2008 to 2010. What follows is important information about this area of the law and practical ideas about how employers can minimize the risk.

the BasicsThe EEOC enforces the federal law that prohibits religious discrimination. It explains that religious discrimination involves treating a person (an applicant or employee) unfavorably because of her religious beliefs. The law protects not only people who belong to traditional, organized religions (such as Buddhism, Christianity, Hinduism, Islam and Judaism) but also those who have sincerely held religious, ethical or moral beliefs.

The U.S. Supreme Court recognizes a religious belief as one that is sincerely held by the individual and constitutes a meaningful part of his life. This means a sincerely held belief need not be religious but may stem from a person’s moral or ethical principles of right and wrong.

Some examples: In a case involving swab testing for drugs, a court recognized that if an employee’s religious practice prohibits others from possessing his saliva, he may be protected. In a grooming case, a court found that a Rastafarian employee’s long hair manifested a bona fide religious belief. And in a dress-code case, a court held that Muslim employees had a protectable interest in wearing turbans or khimars, as long as the head coverings didn’t display any logos. These examples signal the courts’ reluctance to entertain challenges to the sincerity of an employee’s stated belief.

ThE ImPACT Of rElIgIOUs BElIEfs IN ThE WOrkPlACE

21 the Bottom line | Religious Beliefs the Bottom line | Religious Beliefs 22

harassmentIt is illegal to harass a person because of his religion. Harassment is illegal when it is so frequent or severe that it creates a hostile or offensive work environment or results in an adverse employment decision (such as the victim being fired or demoted). But the EEOC states that the law does not prohibit simple teasing, offhand comments, or isolated incidents that aren’t very serious.

The harasser can be the victim’s supervisor, a supervisor in another area, a co-worker, or someone who is not an employee of the employer, such as a client or customer.

Reasonable AccommodationThe EEOC states that reasonable accommodations must be provided to allow an employee to practice his or her religion unless doing so would cause more than a minimal burden on the operations of the business. Examples of common religious accommodations include flexible scheduling, voluntary shift substitutions or swaps, job reassignments, and modifications to workplace policies or practices.

Reasonable accommodations may also be required for religion-based dress or grooming practices, such as wearing particular head coverings (such as a Jewish yarmulke or a Muslim head scarf) or certain hairstyles or facial hair (like Rastafarian dreadlocks or the Sikh uncut hair and beard). It also includes an employee’s observance of a religious prohibition of wearing certain garments, like pants or miniskirts.

When an employee or applicant needs a dress or grooming accommodation for religious reasons, he should notify the employer. If it would not pose an undue hardship, the employer must grant the accommodation. Undue hardship results when the adjustment would be too costly, compromise workplace safety, decrease workplace efficiency, infringe on the rights of other employees, or require other employees to do more than their share of potentially hazardous or burdensome work.

Avoiding ConflictThe EEOC and the courts have established a broad sphere of protectable beliefs for employees, encompassing traditional religious beliefs as well as moral and ethical ones. Workers have become more assertive in notifying their employers of conflicts in their beliefs and work and in seeking accommodations.

Employers should institute policies that clearly articulate a prohibition on religious discrimination and establish a transparent process for employees to request an accommodation. Equally important, they must support these policies by training their managers and supervisors on best practices. Disputes occur when there is a miscommunication or misunderstanding over a policy. Employers may consult with religious organizations to avoid potential misunderstandings. In fact, working with religious organizations to craft a policy and communicate the requirements to employees may help the employer to create an atmosphere of collaboration and minimize the potential for conflict.

With planning, employers can continue to attract, engage and retain the best employees.

ADP Resource® clients can rely on the expertise of their designated human-resources professional to help them navigate many complex areas of the law, including training, drafting policies and reasonably accommodating employees’ religious beliefs.

23 the Bottom line | Religious Beliefs the Bottom line | Religious Beliefs 24

Meeting today’s needs and Planning Future Growth with ADP ResourcePacific Television Center is a relatively small but rapidly growing provider of TV production facilities and a satellite-content distributor. In the past ten years, its staff has more than doubled. Yet, its internal HR department continues to be managed by just one person, Andrea Bracken, who also wears numerous other hats for the company. Simply put, the firm needed outside HR support if it wanted to effectively manage its operations, remain compliant and achieve its aspirations for growth. The solution was ADP Resource.

Keeping up with compliance and tax-reporting requirements was a significant challenge. For Pacific Television Center, what was once a single office with a small handful of employees is now a bi-coastal operation in the U.S., with another facility overseas and an ever-expanding staff. According to Bracken, matters “came to a head when one of our New York employees pointed out a payroll-tax issue.” This proved to be the motivation for the firm to identify a supplier that had the breadth of knowledge and expertise to meet their needs. Says Bracken: “I can count on my ADP Resource HR Business Partner to make sure we meet our changing compliance and payroll requirements.”

Another priority was to reduce the demands on the internal HR manager. Bracken’s day was often disrupted with questions from the company’s employees regarding their benefits accruals. She could also spend hours surfing the Internet to research HR-

related issues. With ADP Resource’s user-friendly employee website and toll-free Employee

Service Center, Pacific Television Center’s staff now has instant access to information

regarding their vacation accruals and related matters. When Bracken

has a difficult HR question, she simply contacts her ADP Resource HR Business Partner for the

answer. “ADP Resource is an extension of our HR department, and it lets me focus my efforts on other areas of our business that require my undivided attention,” she says.

Keeping track of vendors around the country was time-consuming and becoming a larger issue as Pacific Television Center expanded its operations. “With ADP Resource, I now have a single source for HR support, compliance materials, payroll forms, posters and management training tools,” Bracken says. Richard Neri, president, adds: “ADP Resource quickly paid for itself. We significantly enhanced our HR operations without having to add staff. And by making sure we have the proper HR processes in place, we can avoid unnecessary compliance expenses down the road.”

“ADP Resource helps my company run more efficiently.” Pacific Television Center continues to thrive, and it plans on opening several new offices to further grow the business and expand its global footprint. According to Neri, “The size and financial stature of ADP® is a great comfort. And we’re confident we’ll continue to receive the same excellent support from ADP Resource so we can meet our future goals.”

sTATE EmPlOYmENT LAW UPDATESADP Resource® offers clients help and guidance with legal and regulatory burdens, including the legislation shown here. Timely communication, clear action plans and helpful resources allow ADP Resource clients to focus on their business objectives.

The following updates reflect sample developments from June to August 2012.

ADP resource Action(s)

In July, Indiana became the 40th state to ban smoking in places of employment, as well as in public places and government vehicles. Certain types of workplace are exempt, as are nonprofit private clubs and fraternal organizations. Covered employers and operators of public places must post conspicuous signs at each public entrance informing those entering of the ban.

Under an ordinance effective September 1, 2012, businesses in Seattle that employ at least five full-time employees (FTEs) must provide paid leave to employees when they or their family members fall ill or become victims of domestic violence. The new ordinance also requires employers to post a notice informing employers of these rights.

Alerted clients to the update; provided HR guidance and best practices to help clients stay in compliance with the law.

Alerted clients to the update; provided HR guidance and best practices to help clients stay in compliance with the law.

INDIANA

WASHINgTON

Maryland recently became the first state to enact legislation prohibiting employers from requesting or requiring an employee or applicant to disclose any user name, password or other means for accessing any Internet- or electronic-based account. There are exceptions: For example, employers are not prohibited from acting upon and investigating information they may receive regarding an employee’s unauthorized downloading of proprietary or financial data.

Alerted clients to the update; provided HR guidance and best practices to help clients stay in compliance with the law.

MARYLAND

In July 2012, Vermont joined a growing list of states that restrict an employer’s right to obtain and use credit information for making employment decisions. Under the new law, a Vermont employer may not inquire about or use an applicant’s or employee’s credit report or credit history with respect to employment, compensation, or a term, condition or privilege of employment. Certain exemptions apply.

Alerted clients to the update; provided guidance on complying with the law, especially regarding circumstances in which the allowable exemptions may be exercised.

VERMONT

The National Labor Relations Board (NLRB) has issued a third report regarding the legality of language contained in employers’ social-media policies. The report focuses on the question of whether policy language could “reasonably” be read as restricting an employee’s rights under the National Labor Relations Act to engage in protected concerted activity. The report provides guidance on what constitutes a lawful social-media policy.

Alerted clients to the update; provided a new model social-media policy to clients.

The Department of Homeland Security (DHS) announced that certain young people who were brought to the U.S. as children and who are not presently authorized to remain in the U.S. will be considered for work authorization. Several eligibility criteria apply, and the process by which eligible individuals may apply for work authorization is still being finalized.

Alerted clients to the update; provided best practices for dealing with situations in which individuals identify as being eligible for the DHS program.

FEDERAL

What ADP Resource® Clients Are Saying

regulatory Development(s)Jurisdiction

Pacific Television CenterIndustry: Radio and Television Broadcasting

Type of Business: A 24/7 broadcasting service that provides an array of studio services and transmission capabilities

location: Los Angeles, California

Number of Employees: 32

ADP resource Client: Since 2009

Why ADP resource? “ADP Resource makes my life easier. It helps the company operate more efficiently, and it saves us money.”

25 the Bottom line | State Law Employment Updates the Bottom line | Testimonial 26

ADP Resource publishes The Bottom Line free of charge to its clients and prospects. This content provides practical information concerning the subject matter covered and is provided with the understanding that ADP® is not rendering legal advice or other professional services. ADP does not give legal advice as part of its ADP Resource Services. While every effort is made to provide current information, the law changes regularly and laws may vary depending on the state or municipality. The material is made available for informational purposes only and is not a substitute for legal advice or your professional judgment. You should review applicable law in your jurisdiction and consult experienced counsel for legal advice.

The ADP logo, ADP, and ADP Resource are registered trademarks of ADP, Inc. In the Business of Your Success is a service mark of ADP, Inc. All other trademarks and service marks are the property of their respective owners.MKR50-V12FY13 Printed in the USA ©2013 ADP, Inc.

HR. Payroll. Benefits.

Introducing a dedicated team of experts at your service to integrate and simplify all of your Human Resources needs from beginning to end. ADP Resource® allows you to:

u Focus on revenue generating activities through streamlined administration

u Reduce employer related liability with access to guidance from a dedicated HR professional

u Become an employer of choice by attracting and retaining top talent

Take charge of your time and take the first step to a more effective, compliant HR administration.

Call ADP Resource at 1-866-360-2454 or visit us at www.resource.adp.com

Your source for HR solutionsthat fit your business