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CURBING EMPLOYEE THEFT

By Risk Management Bulletin

According to the U.S. Commerce Department, employee crime costs American businesses as much as $40 billion a year — that’s “billion with a ‘B’.”

To help prevent a fox from getting into your henhouse, a leading risk management group recommends these guidelines:

  • Screen job candidates. You might discover that a potential employee was fired from another job for stealing. A thorough background check can give you hard evidence when doing an interview. Look for discrepancies between what the candidate says and what’s on paper; too many differences will point to a problem.
  • Reduce the temptation to steal. Be careful when making operational changes. The thief might become quite familiar with the change and believe that they have specialized and private information to use to their advantage. To avoid this danger, let everyone know about new procedures. Also, lock and bar all windows in warehouses or storerooms, create employee sign-ins in these areas, and never leave anything lying around to be picked up easily.
  • Protect monetary assets. Thieves sometimes write checks to ghost employees or vendors and use the money for their own finances. Separating accounts payable from accounts receivable will reduce the chances of such a fiasco. Also, if Jim in sales never, ever takes a vacation, something might be amiss; he could be snooping around or doing something besides genuine hard work.
  • Schedule periodic audits. If this isn’t possible, have an outside party review accounting and bookkeeping practices.
  • Create a zero-tolerance policy. Potential in-house thieves won’t be as inclined to steal if they know they’re risking their job.
  • Investigate suspected fraud. The Association of Certified Fraud Examiners (www.acfe.org) offers expertise in this field.

For an in-depth review and analysis of your in-house security systems, please feel fee to contact our risk management specialists.

IS YOUR BUSINESS INSURED AGAINST DISASTER?

By Risk Management Bulletin

In the aftermath of storms, flooding, or wildfires , thousands of small-business owners are being hit with the bills for salvaging their building or the business itself, because they didn’t carry enough (or the right type of) coverage. In some cases, the culprit was ignorance; the owners might not have realized that a policy didn’t cover certain hazards. In others, a difficult economic climate created cash flow problems that led businesses to forgo the cost of insurance.

For example, you might not think your business needs insurance against flood damage. However, no matter where you’re located, if a small stream near your business swells up after an unusually long period of rain and water pours in, coverage through the federal National Flood Insurance Program will pick up the tab. For more information, visit the program’s Website, www.Floodsmart.gov.

Similarly, a standard policy probably won’t cover earthquake damage – and quakes are by no means limited to California. The largest temblor in U.S. history was centered near New Madrid, Missouri in 1812, causing damage in half a dozen states, ringing church bells on the East Coast, and re-routing a section of the Mississippi River.

You buy Property insurance to protect your business against losses from such perils as wind, rain, and hail. But do you have Business Owners Policy (BOP), which combines Property coverage, together with Business Interruption insurance – which will pick up the tab for operating expenses and lost profit if your business is shut down for an extended period. That can include salaries and employee benefits, rent and line-of-credit payments. It doesn’t have to be a natural disaster that shuts down the business; even losses stemming from a power outage can be covered.

Some small companies should carry special policies because of the kind of business they’re in. For example, a heavily damaged bed and breakfast that would need to restore its quaint ambience by purchasing antiques would probably need additional “guaranteed replacement” coverage.

Our risk management professionals would be happy to help you develop a comprehensive program to protect your business. Just call or e-mail us.

THE 10 COMMANDMENTS OF CELL PHONE SAFETY

By Risk Management Bulletin

THE 10 COMMANDMENTS OF CELL PHONE SAFETY Cell phones and navigation devices allow drivers to stay connected and find their destinations, making them indispensable – especially for salespeople, repair personnel, and other employees who drive on the job.

However, using cell phones behind the wheel also creates liabilities – and the toll can be heavy. “Distracted driving” is the fourth most serious vehicle safety issue, according to the Network of Employers for Traffic Safety. With motor vehicle accidents the leading cause of work-related injuries, the use of cell phones and other high-tech devices by employees driving on the job leaves your business wide open to workers compensation exposures, lawsuits for deaths and injuries, and other third-party claims.

To lessen liability and help reduce accidents, it makes sense to adopt a policy on driver use of cell phones that includes these guidelines:

  1. Use a headset while driving or pull over to use a hand-held cell phone.
  2. Keep the phone where it’s easy to see and easy to reach.
  3. Plan any calls you’ll need to make before you begin to drive; enter numbers into your speed-dialing feature.
  4. Do manual dialing only when the vehicle is stopped.
  5. If possible, make your calls when stopped at a stop sign, red light, or when you are otherwise stationary.
  6. If possible, ask a passenger to make the call or at least dial the number for you.
  7. Never take notes or look up phone numbers while driving.
  8. Suspend a conversation during hazardous circumstances — for example, in heavy traffic, when maneuvering around a hazard, or in severe weather conditions.
  9. While talking, keep your head up and your eyes on the road and check the side and rearview mirrors. frequently.
  10. Let voice mail pick up your calls when it’s inconvenient or unsafe to answer the cell phone.

LIMITING EMPLOYEES “PROTECTED ATIVITIES”

By Your Employee Matters

Every employer wants to, and should, keep confidential information just that. In an effort to do so, companies use employee handbook provisions, contracts, passwords and access codes, locked file drawers and so on. What many employers forget is that because of the breadth of these protective documents, any employer can run up against the National Labor Relations Act Rule which allows employees to discuss with the wages, hours and other terms and conditions of their employment. As the NLRB stated in a recent case, “The ultimate question in these cases is whether employees reading these rules, would reasonably construe the rule as precluding them from discussing their terms and conditions of their employment with other employees or a union or that they reasonably understand that the rule was designed to protect their employer’s legitimate proprietary interests.” As the board has further stated, “It makes no difference whether the employees were asked not to discuss their wage rate or ordered not to do so. Nor does it matter if the rule was unenforced… In the absence of any business justification for the rule, it is an unlawful restraint on the rights protected by Section 7 of the Act and violated by Section 8A.”

Learn more about “protected activities” here.

ACCOMMODATING ACTIVE MILITARY DUTY

By Your Employee Matters

Employers continue to be faced with military personnel coming back from active duty, whether fighting wars or battling hurricanes and other natural disasters. Last year a court ordered Target Corp. to pay nearly $1 million in damages for retaliating against a National Guardsman who complained about being demoted when he returned from active duty. A graduate of West Point, James Patton served six years in the Army before retiring as a captain in 2001. After the Sept. 11, 2001 terrorist attacks he joined the Oregon National Guard. Patton had been working for Target since the summer of 2000 and was employed as a group leader at the company’s distribution center in Albany, OR. After returning from a two-week term of active military duty with the National Guard in 2003, Patton was told he had been demoted.

He sent an e-mail to co-workers at other Target warehouses informing them of the demotion and directing them to contact his successor. Patton also contacted an employer support representative from the Oregon National Guard to help convince Target to reinstate him to his prior position.

In mid-July 2003, Target fired Patton, saying his e-mail to co-workers was disruptive and violated company policy.

Patton testified at trial about his treatment, the timing of his National Guard training and his demotion on the day he returned from active duty. He told the jury that after his supervisors demoted him, they told him to take a week off. Patton said that one human resources official told him that the company thought he would quit after being demoted. Target contended that it does not discriminate on the basis of military service and has a strong history of supporting employees who are veterans, reservists, or members of the National Guard. Several of Patton’s supervisors testified that both his demotion and termination were based on legitimate personnel reasons.

However, the jury ultimately found that Target officials retaliated against Patton for asking the National Guard to intervene. They awarded him $84,970 in lost wages, other economic damages and non-economic damages. The jury also ordered Target to pay $900,000 in punitive damages. Read the entire opinion here.

Here’s the point: This is a serious exposure to the company that doesn’t handle things right! The DOL has issued a great FAQ on the combined FMLA/ USERRA obligations.

FAMILY CAREGIVER BIAS CLAIMS ON THE UPSWING

By Your Employee Matters

Family caregiver bias claims have sharply risen in recent years. This type of claim has increased by 400% during the past decade. A big reason is that younger men and women entering the workforce expect to spend more time with their families and less time in the office.

The Equal Employment Opportunity Commission has issued guidelines addressing this issue. Although the agency emphasized that it didn’t intend to create a new category of protected workers, it did provide 20 examples of caregiver (also known as family responsibilities) discrimination. The examples address everything from stereotyping during the hiring process to the hostile work environment that can result from stereotyping mothers or fathers. These guidelines signal the commission will be more aggressive in investigating these claims.

The most common example of caregiver discrimination occurs when a women either informs her employer she is pregnant or gives birth to a child, and then finds her workload and responsibilities decreased – commonly referred to as being put on the “Mommy track.” This happens because employers wrongly assume that a pregnant woman or new mother is no longer devoted to her work. Men who file these claims usually make the opposite argument – that they faced discrimination against for not following gender stereotypes. For example, a father might take some time off work to care for his children, and when he returns he is put on rotating shifts so he can never set up regular child care, forcing him to quit.

A caregiver or family responsibilities claim must be tied to another type of discrimination because “caregiver” is not a protected class of worker. Instead, workers must rely on such laws as the Americans with Disabilities Act (for example, needing time off to care for a disabled child) or Title VII (perhaps tying the claim to gender discrimination). Claimants can also use a variety of state law claims, including state equivalents to the federal discrimination statutes, and common law claims such as wrongful discharge, breach of contract, or intentional infliction of emotional distress.

A handful of states have enacted laws that address caregiver discrimination. The District of Columbia, for example, has an ordinance protecting workers from family responsibilities discrimination, and similar legislation is pending in California. In Alaska, a more limited statute protects workers from discrimination based on parental status. A similar executive order covers federal workers and contractors.

Employer training is the key to reducing family responsibilities discrimination and lawsuits. The commission’s new guidelines make it clear that employers must focus on the job, not family or kids. Employers are advised to avoid those issues and stick to the job description, both in interviews and in conversations. Employers shouldn’t assume a female employee can’t handle the demands of motherhood and a full-time job.

Read Questions and Answers about the EEOC Enforcement Guidance on Unlawful Disparate Treatment of Workers with Caregiving Responsibilities.

HOURLY WAGE SUIT FOR ‘DONNING’ SAFETY CLOTHING DENIED

By Your Employee Matters

Union employees of a poultry processing company are not entitled to compensation under federal law for time spent putting on and taking off protective clothing, according to a recent federal appeals court ruling.

This topic continues to develop in court rulings around the country. For example, a contrary ruling on this issue came out earlier from another federal appeals court.

In the most recent case, the employer compensated workers from the time chickens to be processed reached the production line. Employees were paid based on when the first and last chickens reached the line.

The workers were required to wear various articles of protective clothing, which they had to put on before working on the production line. They had to remain after the production line time ended to take off the protective gear.

The court said the federal Fair Labor Standards Act did not include “hours worked” for time spent changing clothing at the beginning and end of each workday, when this time was excluded from measured working time under the collective bargaining agreement. (The CBA was the main factor in the analysis).

Read the DOL advisory on “hours worked.”

Note that state wage and hour laws might also affect this issue. For example, California employers should look at sections 46 and 47 of the Wage and Hour manual.

THE WORLD IS BECOMING A RISKIER PLACE — INCLUDING YOUR WORKPLACE

By Your Employee Matters

Jury Verdict Research has just released its Jury Awards and Statistics. It’s not a pretty picture. The median award in 2007 came to $250,000, up from $192,000 in 2006, representing an all-time high. Nearly one in five verdicts (18%) came in between $100,000 and $250,000, 14% averaged between $250,000 and $500,000, while 22% came in at more than $1,000,000, the highest percentage ever! Discrimination awards (based on race, sex, and disability) jumped from a low in 2006 of $247,500 to $252,000 in 2007.

The probability of a plaintiff’s winning a verdict in 2007 came to 71%, up from 56% in 2006. The probability of a plaintiff verdict was even higher in state cases at 66%, up from 55%. One bright lining: the median settlement for 2007 was $77,875, a reduction from $85,000 in 2006. The report contains many more statistics, as well as noteworthy employment practices awards.

Here’s the point: In today’s tightening economy the last thing you can afford is an employee lawsuit! Make sure that you have your compliance act together and purchase Employment Practices Liability Insurance (EPLI).

EDITOR’S COLUMN: ARE YOU MARKETING SAVVY?

By Your Employee Matters

My workshops stress the importance of internal branding. I discuss how you can use acumen learned in the field of marketing and turn this inward to motivate, engage and inspire your employees more effectively.

In a recent issue of One Look magazine (a great publication for the advertising community), I highlighted these words in the issue:

  • Fresh
  • Buzz
  • Integration
  • Immersion
  • Experience

These words lie at the forefront of marketing to clients and customers – which means that they should also be at the forefront of the marketing efforts to your employees. How well would you say that the employee experience captures these ideals? I can hear the chorus now – “Come on Don, we’re a manufacturing firm, a CPA office, a small retailer, etc. How can we expect to create this type of excitement?” My answer to you is this – if you don’t find a way, I guarantee that sooner or later you’ll be out of business. Just as retailers who don’t capture the essence of these phrases go out of business from the outside, companies that don’t capture the essence of these phrases will go out of business from the inside. It’s a choice.

I’d recommend working with your marketing team. Ask your employees how you can create some buzz and make things fresh. Change around the furniture, paint the walls, enhance the lobby, get your employees kids to do some drawing for you – in short, make things fun. If you do so, your work experience will be richer and so will your bottom line.

PROTECT YOURSELF AND YOUR FAMILY WITH LONG-TERM CARE INSURANCE

By Life and Health

With 77 million U.S. baby boomers reaching retirement over the next decade, experts say that the number of people in need of long-term care will double over the next 30 years. Some estimate that 14 million Americans will require some form of assistance with day-to-day activities by 2035. Consequently, senior care could soon replace child care as the country’s number one dependent care issue.

The cost of long-term care can range anywhere from $25,000 to $95,000 a year depending on the region. Without Long-Term Care insurance to cover this hefty price, many families end up paying out of pocket and suffering great financial strain. However, money isn’t the only thing at stake for families without Long-Term Care insurance.

Families who are suddenly faced with the unexpected cost of long-term care must make a tough decision: They can either pay the exorbitant price for a nursing home or professional caregiver or take the ailing loved one into their own home. A great deal of families without Long-Term Care insurance end up caring for their relative at home. Such families often have dependent children in the home in addition to an ailing parent. They quickly learn that caring for an ill loved one has a major emotional and physical impact on everyone in the family. When you take a sick loved one into your home, every day tasks such as eating, bathing, dressing or going to the bathroom become daunting struggles. Plus, caring for an ailing senior is a full-time job—24 hours a day, seven days a week. The responsibilities involved with this undertaking begin to take a toll on the entire family.

Oftentimes, those caring for a sick relative no longer have time to take care of themselves. They abandon healthy eating habits and exercise routines because they simply don’t have time anymore. They also suffer from high levels of stress. Caregivers often become sleep deprived because they must get up numerous times throughout the night to help their loved one. This can all add up to health problems for the caregiver. As a matter of fact, some studies show that long-term caregivers often have a shorter lifespan and more health problems than other people their age. Many long-term caregivers end up quitting or losing their jobs. After all, you can only take so many sick days to care for your loved one. Without a job to help pay the bills, many of these families find themselves struggling financially, often sinking deep into debt.

If you believe that Long-Term Care insurance is unaffordable, just think about the price you and your family could have to pay without it. By planning ahead, you will save yourself and your loved ones from immeasurable amounts of physical, emotional and financial stress. Planning for long-term care is not an easy task for anyone. Most of us don’t want to think about a time when we or one of our loved ones might need help with simple daily tasks. However, in order to protect your family’s financial and emotional well-being, it’s important to plan ahead for an unexpected long-term care situation.

Having Long-Term Care insurance will greatly lessen the suffering that comes with a long-term illness—for both the caregiver and the patient. That’s because with insurance, your family can afford to place your loved one under professional care. This will allow you to focus on dealing with the emotional issues of having an ailing loved one instead of completely draining yourself by trying to meet their physical needs 24/7.

The first step in protecting yourself from such a painful situation is finding a reliable financial advisor who can help you design a long-term care plan. One of our financial professionals can walk you through your family’s needs and find an insurance policy that fits your unique situation and budget.