If an employer provides employees with “per diem” for meals, lodging, etc., the amount provided must reasonably approximate the expenses actually incurred by employees. The regulations to the Fair Labor Standards Act govern “reimbursement for expenses,” and provide that per diems are generally not included when determining the regular rate of pay for non-exempt employees. 29 C.F.R. § 778.217(a). However, only per diems representing the “actual or reasonably approximate” amount of expenses incurred may be excluded from the regular rate. 29 C.F.R. § 778.217(c). If the employer provides a greater amount, the excess per diem must be factored into the regular rate and used to calculate overtime.

For example, if employees are actually incurring $25 per day for meals, an employer cannot pay a per diem of $100. The Department of Labor would require the excess $75 to be factored into the regular rate of pay for nonexempt employees, resulting in higher regular and overtime wages.

By Courtney Bru, cbru@dsda.com

Under the Oklahoma Uniform Unclaimed Property Act (Title 60, Sections 651-688), “unpaid wages, including wages represented by un-presented payroll checks, owing in the ordinary course of the [employer’s] business which remain unclaimed by the [employee] for more than one (1) year after becoming payable are presumed abandoned.” OKLA. STAT. tit. 60, § 657.2. Once “abandoned,” the employer owes certain obligations under the Act.

If the employer has a last-known address for the employee and that address is in Oklahoma, the employer must report the abandoned property to the State Treasurer on a state-provided form and turn the property over to the custody of the State Treasurer.

If the employer has a last-known address for the employee and that address is in another state, the situation is a bit more difficult. The employer must determine that state’s reporting and turn-over requirements under the laws of the state of the last-known address.

Finally, if the employer does not have a last-known address for the employee, but the employer is incorporated under Oklahoma law, or is unincorporated but has its principal place of business in Oklahoma, the employer must report and turn over the abandoned property to the Oklahoma State Treasurer.

Failure to report and turn over property may result in fines of up to $100 per day.

The State Treasurer of Oklahoma maintains a website to provide assistance to employers. It is available here. Forms are available here.

By Courtney Bru, cbru@dsda.com

For those of you subject to DOT drug and alcohol testing, you will recall that there has been considerable activity regarding the rule it first announced last year. We covered this in our October 2008 Employer’s Legal Resource. After the rules were announced, lawsuits were filed challenging the DOT’s rule regarding when the collector should directly observe the employee providing a urine specimen. The Court eventually held that the DOT’s rule was valid, which we discussed in our June 2009 Employer’s Legal Resource.

But, we continued to wait to hear from the DOT. Now, we have heard.

On July 30, 2009, the DOT issued its final rule, which you can view here. The majority of the notice concerns the history, how we got here. The actual rule is quite simple. Section 40.67(b) will read:

As an employer, you must direct a collection under direct observation of an employee if the drug test is a return-to-duty test or a follow-up test.

This rule is effective August 31, 2009.

To ensure compliance, you should do two things. First, be sure your written DOT drug and alcohol policy does not require a change. Some will. You have until August 31 to get this done. Second, be sure the collection facility understands that they absolutely must collect under direct observation when conducting a return-to-duty or follow-up test on or after August 31, 2009.

Remember, this rule does not apply to testing you may conduct which is not required by the DOT.

Finally, if you are subject to a collective bargaining agreement, you cannot delay implementing this rule. The DOT was clear to address this: “Employers must use direct observation collections for such tests that take place after the effective date of this rule [August 31], and any contrary provisions of CBAs in the present or in the future will not be effective.” While true, it is probably a good labor relations idea to let your union business managers or representatives know this change will take place August 31.

By Kristen L. Brightmire, kbrightmire@dsda.com

On July 1, 2009, Immigrations and Customs Enforcement (ICE) notified more than 650 businesses nationwide that ICE will be auditing their records to determine whether the companies have complied with Federal immigration law. The 650 notices issued on July 1 are the highest number of notices ever issued in a single day and exceed the total amount of notices sent out in 2008, which totaled 503 for the entire year. The Obama administration is implementing increased employer enforcement as a cornerstone of its immigration policy. This is a shift from the Bush administration, under which work-site raids focused on workers, rather than employers.

Federal law requires employers review identification and work authorization documents and complete the I-9 form for every employee. During the audits, ICE may review a company’s hiring records, including I-9 records, any I-9 policies, training manuals, training schedules, lists of all current and terminated employees, wage reports for employees, Social Security No-Match Letters. Employers with a significant number of unauthorized workers may be subject to fines. Criminal charges can apply if ICE believes the business knowingly hired illegal immigrants or there is a “pattern of egregious violations.”

As a result of a recent audit of an apparel company in California, ICE determined that 1,600 of the companies' 10,000 employees may not have had work authorizations. The company may be subject to a fine exceeding $100,000. Future violations may result in criminal charges. The company states many of the issues may have resulted from typographical errors or honest mistakes.

Employers should ensure current I-9 practices comply with the law. Each employer should designate one person responsible for ensuring I-9 compliance. Each employer should have an I-9 policy in place that describes that company’s I-9 procedures.

To avoid possible discriminatory action, the I-9 policy should ensure consistent treatment for all employees and proper understanding on the limitations that apply to an employer’s requests for an employee’s documentation. For example, an employer is not required to keep copies of the documents reviewed to complete an I-9. However, if an employer chooses to do so, the copies must be retained for all employees. If an employer only keeps copies for some employees and not others, this may be considered discrimination. To avoid such inconsistencies, the I-9 policy should state whether the company will retain copies.

Annual self-audits are essential to ensure a company is following proper I-9 procedures. Those completing the I-9 forms should be trained on the contents of the I-9 policy, the I-9 Handbook, and common errors discovered during self-audits. Correctly setting up I-9 procedures now, which comply with the law, may save you problems down the road.

By Hilary L. Velandia, hvelandia@dsda.com

The U.S. Supreme Court’s 2008 term ended June 29, 2009. The labor and employment cases decided during the 2008 term, much like those decided in the 2007 term, was a mixed bag for employers. The following is a summary of the labor and employment cases decided by the Supreme Court in its 2008 term:

1. A unanimous Supreme Court held the First Amendment permits a local union to charge non-members for national litigation expenses so long as (1) the litigation would be properly chargeable if local (such as litigation related to collective bargaining, as opposed to political activities), and (2) the charge is reciprocal, that is, the contributing local union reasonably expects other local unions to contribute to the national union’s resources if similar litigation is undertaken on behalf of the contributing local union. Locke v. Karass, 129 S.Ct. 798 (appeal from 1st Circuit) (decided January 21, 2009).

2. The Supreme Court held the anti-retaliation provision of Title VII protects an employee from being terminated because the employee cooperated with the employer’s internal investigation of another employee’s claim of sexual harassment. Crawford v. Metropolitan Government of Nashville and Davidson County, 129 S.Ct. 846 (appeal from 6th Circuit) (decided January 26, 2009).

3. A unanimous Supreme Court held that (1) a federal common-law waiver signed by an ERISA benefit plan participant’s ex-spouse did not invoke ERISA’s anti-alienation provision, and (2) under ERISA a plan administrator performs its ERISA duty when it pays benefits in conformity with the plan documents. Kennedy v. Plan Administrator for DuPont Savings & Investment Plan, 129 S.Ct. 865 (appeal from 5th Circuit) (decided January 26, 2009).

4. The Supreme Court determined that Idaho’s right-to-work law, which permits public employees to authorize payroll deductions for general union dues, but prohibits such deductions for union political activities, does not infringe the union’s First Amendment rights. The majority found the state’s ban serves the state’s interest in separating public employment from political activities. Ysursa v. Pocatello Education Association, 129 S.Ct. 1093 (appeal from 9th Circuit) (decided February 24, 2009).

5. In a 5-4 decision, the Supreme Court held a provision in a collective bargaining agreement which clearly and unmistakably required union members to arbitrate claims under the Age Discrimination in Employment Act is enforceable under federal law. 14 Penn Plaza LLC v. Pyett, 129 S.Ct. 1456 (appeal from 2nd Circuit) (decided April 1, 2009).

6. Congress added the Pregnancy Discrimination Act (PDA) to Title VII in 1978. Prior to the PDA, the employer’s predecessor had a service credit policy which granted full service to temporary disability leave other than pregnancy leave. Upon passage of the PDA, the employer amended its plan to conform to the requirements of the PDA, but did not make any retroactive adjustment for pre-PDA personnel policies. In a 7-2 decision, the Supreme Court held the PDA did not apply retroactively, and the employer was not liable for calculating pre-PDA pension benefits that gave less retirement credit for pregnancy than for medical leave generally. AT&T Corporation v. Hulteen, 129 S.Ct. 1962 (appeal from 9th Circuit) (decided May 18, 2009).

7. In a 5-4 decision, the Supreme Court held that a plaintiff bringing an ADEA disparate treatment claim must prove, by a preponderance of the evidence, that age was the “but for” cause of the challenged adverse employment action; a burden shifting “mixed motive” jury instruction is never proper in an ADEA case, even when a plaintiff has produced some evidence that age was one motivating factor in the employer’s decision. Gross v. FBL Financial Services, Inc., 129 S.Ct. 2343 (appeal from 8th Circuit) (decided June 18, 2009).

8. A city used tests to identify firefighters best qualified for promotion. When the results of the tests showed that white candidates had outperformed minority candidates, the city discarded the tests based on its belief the use of the results could have a disparate impact on minority firefighters. The Supreme Court, in a 5-4 decision, held the city violated Title VII by discarding the tests. Ricci v. DeStefano, 129 S.Ct. 2658 (appeal from 2nd Circuit) (decided June 29, 2009).

By Jon E. Brightmire, jbrightmire@dsda.com

You may recall we told you about the Red Flag Rules in the May 2009 Employer’s Legal Resource. The FTC announced last week that it has once again delayed enforcement of the ‘Red Flag Rules’ which require creditors to develop and implement written Identity Theft Prevention and Detection Programs. Now, the Rules will not be effective until November 1, 2009.

The FTC cited uncertainty among small businesses, as well as other entities, such as law firms and health care facilities regarding their compliance obligations. In response, the FTC has promised to “redouble its efforts” to educate such businesses, by releasing additional compliance guidance in the upcoming weeks.

DSDA is able to assist you in any program development and/or compliance issues you may have regarding the ‘Red Flag Rules.’

By James R. Bullard, jbullard@dsda.com

Doerner Saunders Launches New Website

Doerner Saunders has launched its new website. In addition to updated information about the firm and its practice areas, it will be used as the repository for earlier editions of The Employer’s Legal Resource as well as other e-newsletters distributed by the firm. You can find all of this and more at www.dsda.com.

Wofford to serve as General Counsel of Central Oklahoma Master Conservancy District

Mike Wofford was recently selected to serve the Central Oklahoma Master Conservancy District as its general counsel. The District is the operator of Lake Thunderbird, the Norman Dam, and the associated water transportation system. Constructed by the Bureau of Reclamation in 1965, Lake Thunderbird supplies municipal and industrial water to the cities of Norman, Midwest City, and Del City. Mike continues Of Counsel to Doerner Saunders. You can contact Mike at mwofford@dsda.com or 405-319-3504.

July 24, 2009

Minimum wage rose to $7.25 per hour.

August 13, 2009

N. Lance Bryan will speak at a Real Property Foreclosure seminar at the Doubletree Hotel in downtown Tulsa. Mr. Bryan will be conducting a step-by-step workshop on the foreclosure process and its legal considerations. The seminar will cover the entire foreclosure process from default through post-sheriff sale procedures, including tips for spotting and handling problem issues. For more information, please contact Lance Bryan, lbryan@dsda.com, 918-591-5256.

September 18, 2009

Kristen L. Brightmire will be presenting on the subject of Muddled Waters in Our Own Back Yard: The Expansion of the Public Policy Tort and What it Means for Oklahoma Employers and Employment Lawyers. The seminar, Law of the Workplace: The Changing Landscape of Employment Law, will be held at the Renaissance Hotel in Tulsa, Oklahoma. For more information, or to register, please go to www.okbar.org.

September 22, 2009

James R. Bullard will be speaking on Red Flag Compliance for Healthcare Providers at the Oklahoma Association of Health Care Providers Annual Fall Fair at the Renaissance Tulsa Hotel and Convention Center. For more information, or to register, please click here.

September 25, 2009

Kristen L. Brightmire will be presenting on the subject of Muddled Waters in Our Own Back Yard: The Expansion of the Public Policy Tort and What it Means for Oklahoma Employers and Employment Lawyers. The seminar, Law of the Workplace: The Changing Landscape of Employment Law, will be held at the Oklahoma Bar Center in Oklahoma City, Oklahoma. For more information, or to register, please go to www.okbar.org.

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