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2015 Employment Law Update: Part I

Effective township governance includes the responsibility of being an effective employer. This responsibility requires townships to face many concerns that other employers face in the management of employees. In this first part of our two-part series on effective employment practices, we look at some common employment issues that can turn into traps for townships and suggest a number of employment policies that every township should adopt.

Common Traps for Township Employers

As an employer, townships are faced with many issues that result from managing employees. These range from the major issues, such as determining health benefits, to the seemingly mundane, like identifying the length of coffee breaks. Although some of these issues may seem trivial, they can cause headaches and more for townships. Here are the key issues that all townships should consider now to avoid future problems.

At-Will vs Just-Cause Employment

Theoretically, employers have much greater discretion in an at-will employment setting, as opposed to a just-cause employment setting. In Michigan, there is a presumption of at will employment, meaning that employees may be terminated at any time for any lawful, non-discriminatory reason. Just-cause employees, on the other hand, are employees that may only be disciplined or discharged for a reasonable and lawful reason.

Most township employees are at-will employees. However, some township employees may be covered by collective bargaining agreements that require the township to justify any employment decision by the principles of just cause.

But even if you are an “at will” township, you may still be required to show just cause for an employment decision. For example, if an at-will employee can demonstrate the basic elements of an employment discrimination claim (like race or sex discrimination), the township would be forced to prove a good-faith, business reason for the employment decision—whether hiring, discipline or discharge. So whether an employee is at-will or just-cause, we recommend that townships always state a legitimate, good-faith business reason for any employment decision.

Working Lunches

Breaks, meal or rest periods for employees 18 years of age or older are not legally required. For purposes of tracking hours worked though, actual meal periods (usually lasting at least 30 minutes) are different in nature than coffee or snack breaks. Generally, meal periods like lunches are not considered work time and are not compensable, unless the policies say otherwise.

But an employee is entitled to be paid for work performed during a meal period if the township requires an employee to work or permits an employee to “volunteer” to work during an otherwise unpaid meal break. It is important to draft and enforce an employment policy that clarifies the expectations of employees while on their meal periods. If a township needs an employee to work during an otherwise unpaid meal break, we strongly recommend that the time spent working during the break be included on the employee’s time sheet or other record of hours worked for the week, and paid accordingly.

Employees on Social Media

Social media policies must walk a fine line between protecting the township and respecting employees’ rights to freedom of expression. The township has an interest in statements that are expressed, or have the impression of being expressed, on behalf of the township. Effective social media policies ensure that employees are holding themselves out as individuals, not township representatives, but avoid any “chilling effect” on employees’ rights of free expression.

Beware of the current trend to use social media as a union organization tool. Private sector employers face significant pressure from the National Labor Relations Board (“NLRB”) to evaluate their social media policies and the manner in which employees are disciplined and discharged for use of social media, versus employees’ rights to discuss wages, hours and other terms and conditions of employment, whether or not a union is present. This has increased limitations on how a private employers may lawfully respond to an employee’s rant or private group of coworkers on Facebook or an errant Tweet on Twitter about a supervisor or coworker, or even the “retweeting,” “liking” or commenting on another post about the employer or working conditions. The Michigan Employment Relations Commission (“MERC”) has not yet ruled on these issues, but it would not be unusual for MERC to follow the NLRB’s lead. We strongly recommend that townships review and understand the NLRB’s position on social media-related employment actions before responding to an employee’s social media activity.

So-Called “Informal Discussions”

Do not fall into the trap of assuming you are engaged in an informal meeting when discussing work-related issues with multiple employees. Under Michigan’s Public Employment Relations Act, it is an unfair labor practice for a public employer to interfere with, restrain, or coerce employees in the exercise of their right to engage in organized labor activities. Engaging in discussions with multiple employees could open up a township to accusations of an unfair labor practice if not handled correctly, since even a meeting with two employees to discuss wages, hours, terms or conditions of employment is the exercise of a legally protected right to organize—even if no union is involved!

Essential Township Employment Policies

Well-defined personnel policies are critical to the efficient operation of a township. A good policy manual ensures that everybody, from Board members to employees, is clear and in agreement on how the employment relationship will operate and the expectations of each party. A comprehensive policy manual can be help protect townships in employment matters. The following policies are essential to a complete policy manual and a well-run township.

Equal Employment Opportunity

Equal employment opportunity policies should be in every policy manual. They provide, at a minimum, that the township offers equal employment to protected classes of individuals under state and federal law, such as race, religion and national origin. In Michigan, such a policy should broadly include “religion, race, color, national origin, age, sex, height, weight, disability, veteran status or marital status.” These policies also offer townships an opportunity to be more inclusive than current laws, such as by including equal treatment on the basis of sexual orientation or gender identity—classes that Michigan’s legislature is now considering as additions to Michigan’s anti-employment discrimination law.

The policy should clearly state that the township will not discriminate or retaliate against any employee or employment applicant for any of those reasons. Your township may expressly identify examples of employment decisions that will be made in a lawful manner, such as:

“Therefore, it is the Township’s policy to:

  • “Recruit, hire and promote all job classifications without regard to race, color, gender, religion, age, marital status, national origin, height, weight, disability, or other reason prohibited by federal or state law;
  • “Ensure that all personnel actions such as compensation, benefits, dismissals, company-sponsored training, education, and social programs shall be based on qualifications, experience, or other legitimate, non-discriminatory considerations.”

Accommodations

An accommodation policy should provide the process and timeline for an employee to request an accommodation for a disability. If a disability can be reasonably accommodated to enable the employee to perform the essential functions of his or her job, the employer must provide that reasonable accommodation unless it presents an “undue hardship” to the employer.

An accommodations policy should specifically require employees who feel they need an accommodation to notify a particular individual of the need, in writing, within a certain time (like 182 days or sooner) after the employee knows or reasonably should have known of the need for an accommodation. The policy should further require an employee to report, in writing, an instance of unlawful discrimination or retaliation related to the need or request for accommodation, immediately after the alleged discrimination or retaliation occurs.

Unlawful Harassment

Each township should have a policy that the township clearly expects a respectful, lawful working environment by prohibiting unlawful harassment of any kind – not just sexual harassment. The policy must include a complaint procedure, explaining: how to file a complaint and the investigation procedures; assurances that an employee need not fear retribution for filing a complaint; and repercussions for filing a false complaint or providing false information during an investigation. The township should provide proper training to prepare all employees to comply with the policy and identify the serious consequences for failing to adhere to the policy. The township must comply with the policy when a complaint is received.

Such a policy is the first line of defense in a harassment lawsuit. If the township is ever subject to an unlawful harassment or discrimination complaint through or from a state or federal agency, such as the Equal Opportunity Commission or Department of Civil Rights, the agency will ask first for a copy of this policy and to learn whether it was followed.

Standards of Conduct

Standards of conduct are essential in setting the tone among a township’s employees. Many townships choose to extend the standards of conduct (when possible) to elected officials. Standards of conduct may include a non-exclusive list of certain actions that will result in discipline. The policy should clearly state that any conduct that may jeopardize the personal safety, security, or welfare of the township or its employees will not be tolerated.

Time Limitation for Employment Claims

Michigan Courts have repeatedly upheld limitations periods on employment-related claims. This enables townships to ensure that they do not have potential claims existing against them in perpetuity for employees that left the township’s employ or for those employees who did not get the promotion they thought they should have. Michigan courts have upheld limitations periods as short as 182 days after the date the employee knew or should have known that a claim existed or later than the applicable limitations period established by law, whichever is less. To be enforceable, townships must include this policy in a personnel policy manual or employee handbook both as a policy and as part of the acknowledgment form that an employee must sign to demonstrate acceptance and understanding of this important limitations period.

Alcohol and Drugs

Township employees should be provided a clear notice that the township has a zero-tolerance policy for alcohol or drug use. The policies should not only include provisions for alcohol or illegal prohibited drugs, but also account for legal prohibited drugs. The policy may require employees taking a legal prohibited drug to notify his or her supervisor of its use and expected effect. It is very important to define terms such as “illegal prohibited drugs” or “legal prohibited drugs” in order to avoid creating ambiguity within the policy.

The policy should reserve the right to search an employee, employee work area and property and/or test an employee for alcohol or drugs if the township has a reasonable suspicion that this policy may have been violated. Such searches or tests may be initiated without prior announcement and will be conducted at such times and locations as the township deems appropriate. Refusal to cooperate with such searches or tests may result in discipline or discharge.

Overtime

An overtime policy should make the distinction between “exempt” and “non-exempt” employees instead of salary or hourly, as “non-exempt” employees must be paid one and one-half times their regular rate of pay for all hours over forty (40) worked in a workweek. Though not legally required, some townships also pay overtime for time worked over a particular number of hours (8, 10?) in a day. This is of course a policy decision for each township to make, understanding that at the very least, most non-exempt employees must be paid after 40 hours in a week. There are special rules for police and fire employees, which should also be reviewed carefully.

An overtime policy should explain when overtime may be worked and what hours count toward the 40 hours in a normal work week. Make sure employees are aware that they may not work more than their regularly scheduled shift without approval from the township or a particular supervisory position. The key for these policies is to enforce them consistently and not just pay lip service to requiring prior approval before working beyond a normal shift.

Technology

A technology policy can and should be broad: it could apply to telephones, fax machines, photocopiers, computers, printers, voicemail, e-mail systems, internet access and other technology. The policy should clearly state whether the township will permit any personal use of technology and if so, what the parameters on that use will be. A critical piece to this policy is to notify employees that they have no expectation of privacy when using the township’s technology systems. Any violation of policy or law through the use of the township’s technology may also constitute a violation of the technology policy.

Compensation and Benefits

Compensation and benefits policies must clearly define who qualifies for what pay and benefits, what constitutes any particular benefit (i.e., holiday pay, personal days, vacation, sick leave, etc.), how the benefits accumulate, what happens to the benefits at the end of the year or upon termination of the employment relationship, procedures for general leaves of absence, and the procedures for FMLA (or FMLA-like) leave.

Personnel Administration System

Whether you have one employee or 87, each township needs an effective personnel administration system. It should be comprised of informed people who understand the potential pitfalls of the personnel administration process. Such a system will help ensure your township will have uniform, up-to-date forms for everything from applications and background checks to tax withholdings and direct deposit, disciplinary memoranda and exit interview questions. In addition to updated employment applications, townships should possess a list of lawful interview questions that are designed to get essential information while avoiding questions that might reveal an applicant’s membership in a protected class. (Remember the Equal Employment Opportunity Policy applies to even applicants for employment!) 

Ultimately, an efficient personnel administration system functions in a proactive matter and as a guide and fallback when employment arise. Planning (by having proper policies) and preparing to avoid the worst case scenario can help your township deal with what would otherwise turn small, administrative employment matters into headaches.

By:      Helen “Lizzie” Mills and Steve Koski

Click here for a PDF version of this publication.

Fahey Schultz Burzych Rhodes PLC, Your Township Attorneys, is a Michigan law firm specializing in the representation of Michigan townships. Our lawyers have more than 150 years of experience in township law, and have represented more than 150 townships across the state of Michigan. This publication is intended for our clients and friends. This communication highlights specific areas of law, and is not legal advice. The reader should consult an attorney to determine how the information applies to any specific situation.

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