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EMPLOYMENT ISSUES

Businesses with employees need to follow extensive legal guidelines or risk liability. Read the information below to learn more about the various issues surrounding employees.

DISCRIMINATION AND HARASSMENT

How can I prevent discrimination and harassment in the workplace by my employees?

The best way to prevent discrimination and harassment is to TRAIN your employees on what the laws say, and what the consequences of breaking those laws. Make it clear that your business does not allow discrimination and harassment, and give employees plenty of examples and reminders. The EEOC (US Equal Opportunity Employment Commission) provides tips to help businesses train their staff: https://www.eeoc.gov/employers/small-business/employee-training-tips



How can I protect my business from lawsuits for discrimination and harassment?

A business is responsible for the acts of its employees, generally speaking, especially where the business does not act on known infractions. That said, it is best not to avoid or brush off concerns that arise with regard to instances of discrimination and harassment. A business owner may need to discipline or terminate employees engaged in discriminatory activities. On the other hand, terminating victims is generally not a good idea (retaliation). Another way to protect your business in the event of an employment discrimination or harassment claim is to insure your business against such claims. EPLI (Employment Practices Liability Insurance) is a type of insurance that can provide legal counsel in the event of a lawsuit. Here are some resources that explain the process an employee will go through when submitting a claim: https://www.worker.gov/concerns/protection-against-retaliation/
https://www.doi.gov/employees/anti-harassment/definitions
https://www.ftc.gov/site-information/no-fear-act/protections-against-discrimination



As a business with employees, what am I required to do with regard to complying with regulations and/or prevent discrimination and harassment?

If you have employees, you have at least some federal legal obligations with regard to all kinds of employment laws. The more employees you have, the greater your responsibility becomes. (see link below) State and/or local employment discrimination laws may also apply to your business. State and local government websites may have information about these laws. Federal: https://www.eeoc.gov/employers/small-business/small-business-requirements
KY: https://kchr.ky.gov/Pages/index.aspx
OH: https://www.ohioattorneygeneral.gov/FAQ/Civil-rights-FAQs



EMPLOYEE BENEFIT

How can I prevent discrimination and harassment in the workplace by my employees?

The best way to prevent discrimination and harassment is to TRAIN your employees on what the laws say, and what the consequences of breaking those laws. Make it clear that your business does not allow discrimination and harassment, and give employees plenty of examples and reminders. The EEOC (US Equal Opportunity Employment Commission) provides tips to help businesses train their staff: https://www.eeoc.gov/employers/small-business/employee-training-tips



How can I protect my business from lawsuits for discrimination and harassment?

A business is responsible for the acts of its employees, generally speaking, especially where the business does not act on known infractions. That said, it is best not to avoid or brush off concerns that arise with regard to instances of discrimination and harassment. A business owner may need to discipline or terminate employees engaged in discriminatory activities. On the other hand, terminating victims is generally not a good idea (retaliation). Another way to protect your business in the event of an employment discrimination or harassment claim is to insure your business against such claims. EPLI (Employment Practices Liability Insurance) is a type of insurance that can provide legal counsel in the event of a lawsuit. Here are some resources that explain the process an employee will go through when submitting a claim: https://www.worker.gov/concerns/protection-against-retaliation/
https://www.doi.gov/employees/anti-harassment/definitions
https://www.ftc.gov/site-information/no-fear-act/protections-against-discrimination



As a business with employees, what am I required to do with regard to complying with regulations and/or prevent discrimination and harassment?

If you have employees, you have at least some federal legal obligations with regard to all kinds of employment laws. The more employees you have, the greater your responsibility becomes. (see link below) State and/or local employment discrimination laws may also apply to your business. State and local government websites may have information about these laws. Federal: https://www.eeoc.gov/employers/small-business/small-business-requirements
KY: https://kchr.ky.gov/Pages/index.aspx
OH: https://www.ohioattorneygeneral.gov/FAQ/Civil-rights-FAQs



EMPLOYEE VS. INDEPENDENT CONTRACTOR

Why would I ever categorize workers as employees when I can categorize them as independent contractors and avoid payroll tax?

Everyone wants to save money on taxes, but there are specific requirements that must be met for you to be able to truly call a worker an "independent contractor." In general, the main test for whether you have an employee or an independent contractor is "control," however, the factors that go into determining which classification is correct are many. It's best to speak to an attorney to make sure you are in compliance with the law if you are using "independent contractors." Learn more here: https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee



What are the rules with regard to the categorization of employees vs. independent contractors?

The best place to get an understanding of the difference of an employee and an independent contractor is to go straight to the source. The designation of employee vs. independent contractor is squarely a matter of federal taxation: https://www.irs.gov/newsroom/understanding-employee-vs-contractor-designation



What are the potential consequences for mis-categorizing employees and independent contractors?

Walking the line between employee and independent contractor is not worth it, because it can come with big penalties if you get it wrong. The penalties may not be just back taxes, they can also be criminal! Learn more here: https://www.dol.gov/agencies/whd/flsa/misclassification



EMPLOYMENT CONTRACTS

Why would I ever categorize workers as employees when I can categorize them as independent contractors and avoid payroll tax?

Everyone wants to save money on taxes, but there are specific requirements that must be met for you to be able to truly call a worker an "independent contractor." In general, the main test for whether you have an employee or an independent contractor is "control," however, the factors that go into determining which classification is correct are many. It's best to speak to an attorney to make sure you are in compliance with the law if you are using "independent contractors." Learn more here: https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee



What are the rules with regard to the categorization of employees vs. independent contractors?

The best place to get an understanding of the difference of an employee and an independent contractor is to go straight to the source. The designation of employee vs. independent contractor is squarely a matter of federal taxation: https://www.irs.gov/newsroom/understanding-employee-vs-contractor-designation



What are the potential consequences for mis-categorizing employees and independent contractors?

Walking the line between employee and independent contractor is not worth it, because it can come with big penalties if you get it wrong. The penalties may not be just back taxes, they can also be criminal! Learn more here: https://www.dol.gov/agencies/whd/flsa/misclassification



LABOR LAWS

As a business owner, am I required to post labor laws for employees?

If you have employees, you may be required to post federal labor laws at your workplace. Here’s a guide:
https://webapps.dol.gov/dolfaq/go-dol-faq.asp?faqid=531&topicid=1



How are labor laws enforced?

State governments and the federal governments have procedures for filing for labor law infractions, which may result in investigations, mediation, or other governmental action against the business. Alternatively, employees can also sue their employer directly for damages.
Learn more here: https://www.dol.gov/general/topic/youthlabor/enforcement



WORKER SAFETY

Am I obligated to take steps to ensure my employees act safely?

Generally, as an employer, a safe workplace is something an employer must provide. However, some industries have specific safety requirements. Each industry is going to have specific regulations. A web search or an attorney can help set up a system for making sure the business’s legal duty of providing a safe workplace is satisfied.



How does the safety of my workplace relate to workers’ compensation claims?

An unsafe workplace can cause a worker’s compensation judgement to be inflated as a penalty. Know your state law. KY: https://labor.ky.gov/Documents/An%20Overview%20of%20Kentucky%20Workers%20Compensation%20Law.pdf OH: https://info.bwc.ohio.gov/wps/portal/gov/bwc/for-employers/workers-compensation-overview/understanding-workers-compensation



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