Consulting with companies that don’t have or need a full-time HR person (my specialty) continues to bring me surprises. When I first started consulting I discovered that neither the state nor federal government websites offered new employers information about being an employer beyond how to obtain an Employer’s Identification Number (EIN). Not a thing about the fact that hiring employees automatically brings a business into the world of HR … or it should. It was both a surprising and disappointing discovery.
Considering that federal employment laws apply to every employer in the U.S., you’d think some kind of "cheat sheet" would be available to give new (or experienced) employers a heads-up on what they need to do to be compliant with these laws. Yes, you can read the full text of the federal laws but no help is provided in how to implement them or what they mean in the day-to-day running of your business.
I recently reviewed a 45-page booklet provided by the SBA (Small Business Administration). Lots of great information in general for business owners but it only told readers how to get an EIN, not how employment laws may affect how they do business and deal with their employees.
Is it any surprise that so many small (and larger) employers aren’t fully compliant with employment laws? Even the basics are often omitted by a company … usually due to lack of knowledge than a willful omission. However, if you ever ended up with a labor claim or lawsuit, ignorance of the law isn’t considered a defense. A no-win situation. No information and no defense!
Consider this post your information resource for the most basic part of compliance with federal employment laws: the forms you are required to give employees.
- Current federal employment law poster — This isn’t something you need to give employees but you are required to hang the poster in a conspicuous place located where all employees will see it. The usual place is the coffee area, next to the time clock, or other place where everyone has reason to go by it. Sometimes you need to get creative. I know a couple of companies who are putting the information as an addendum to their Employee Handbook because their employees don’t come into the office.
- IWC Wage Order — If you look really close at the margins of the employment law poster you may find a little sentence that reminds you about posting this information but most companies miss it. The Industrial Welfare Commission (IWC) has created 17 different wage orders, each directed toward specific industries. You need to determine which IWC Wage Order fits your industry, print it out (about 14 pages), staple it together, and stick it on the wall next to your employment law poster. This gives all the minute details about the wage and hour laws affecting your industry. There may be subsequent "interpretations" written about how to implement this wage order but those don’t need to be posted.
- IRS W-4 form — This is the one form that everyone seems to use … but that’s only because it has information you need when putting an employee on payroll. Although the Internal Revenue Service (IRS) issues a fresh copy each year, nothing but the year imprinted on it has changed in a long time.
- INS I-9 form — Although the Immigration and Naturalization Service (INS) created this form many years ago, it’s been taken over by Homeland Security. That means the form has seen several updates in the last few years and another is expected mid-2009. This form needs to be fully completed within 3 days of an employee’s hire date. There are fines and penalties for partially completed forms, so be sure to finish what you start. The point of this form is to ensure you have hired a person legally authorized to work in the U.S. The documentation an employee may use to prove that is what Homeland Security continues to change. While the form continues to evolve, you don’t need to have a new one completed each time. Just use the newest form with new employees. If an employee is using documentation that expires, you will need to follow up and record the updated documentation as needed.
- Initial Notice of COBRA Rights — You only need to worry about this if you are providing benefits to your employees that are subject to COBRA (Consolidated Omnibus Budget Reconciliation Act of 1985). This issue just got more complicated with Obama’s stimulus bill, so check with your insurance broker to ensure you are doing everything you need for this. The point of this notice is just to let new employees know that, if employment ends, they may be able to continue their benefits via this law.
- Workers’ Compensation Insurance brochure — This is a brochure that you should be able to obtain for free from your insurance carrier. The brochure provides basic information on what the insurance covers and what the employee should do if an injury happens.
- Sexual Harassment brochure — To be honest, I don’t know that this brochure is "required" but I feel it should be (and is in California). It’s a simple brochure that provides a description of sexual harassment and what an employee can do about it. This is really only the tip of the iceberg on this topic and I would strongly recommend you also invest in some type of recorded training that becomes part of your orientation. This is still the most common area for lawsuits so it’s worth the investment to ensure your employees understand what harassment is and, as importantly, that you don’t condone or tolerate that behavior.
California also has several state forms that are required but this post is only about the federal ones. Once you start using these forms, you’ll find that it really isn’t that much extra effort to minimize your company’s risks. You can get the latest versions of INS I-9 form, IRS W-4 form, and COBRA notices here (HR Jungle’s free HR forms). If you have employees that have never received these forms, it’s better late than never to work on being compliant with them. So, get your materials ready and go "paper" your employees!
Leave a Reply