LEGAL ISSUES AND PRACTICAL TIPS FOR HIRING

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LEGAL ISSUES AND PRACTICAL TIPS FOR HIRING
Oregon Youth Soccer Association Annual General
Meeting January 9, 2010
Chandra Hatfield Williams, Zografos Peck,
P.C. chatfield_at_wzplaborlaw.com 503-699-1300
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Employment Basics Employee? Volunteer? Or
Independent Contractor?

• EMPLOY TO SUFFER OR PERMIT TO WORK
• Includes all time that an employer knows or
  should know that an employee is working.
• An employment relationship creates numerous
  obligations,
• such as
• Minimum wages and overtime (for non-exempt
  employees)
• Time and Other Recordkeeping obligations
• Workers compensation, unemployment and wage taxes

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EMPLOYMENT EXCEPTION VOLUNTEERS

• ORS 653.010(2) Employment does not include
  voluntary or donated services if
• Performed for no compensation or without the
  expectation or contemplation of compensation
• payment of reasonable expenses incurred in
  performance of voluntary service is permitted
• For a public employer OR for a religious,
  charitable, educational, public service or
  similar nonprofit corporation, organization or
  institution for community service, religious, or
  humanitarian reasons.

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• Federal law also recognizes volunteerism as an
  exception to employment. The US Dept. of Labor
  considers factors such as
• whether the services are performed full-time or
  part-time
• the nature of the entity (public or non-profit
  for charitable, civic, humanitarian, etc.
  purposes)
• the receipt by the worker (or expectation of)
  benefits for performance of the services
• whether regular employees are displaced
• whether services are freely offered without
  pressure or coercion
• whether the services are of the type typically
  associated with volunteer work.

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• REMEMBER
• For-profit businesses/organizations are not
  allowed to use volunteers.
• Employees cannot perform volunteer services for
  their own employer unless
• The volunteer services performed are different
  (not the same or even similar) from the type of
  services they are employed to perform. (e.g. a
  paid coach cannot volunteer to coach a special
  clinic or tournament).
• The volunteer services are performed outside the
  normal work hours.
• The services are freely offered and not coerced.

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Tony and Susan Alamo Foundation et al. v.
Secretary of Labor, 471 US 290 (1985)

• Foundation was a non-profit religious foundation
  that had commercial enterprises (gas stations,
  retail outlets, motel, etc.) to help generate
  income. Former drug addicts, derelicts and
  criminals (Associates) volunteered their time
  to the Foundation in exchange for food, clothing
  and shelter.
• US Supreme Court held Associates were employees
  entitled to minimum wage and overtime despite
  their own testimony that they considered
  themselves volunteers for religious reasons.
• Rationale Associates expected the Foundation to
  provide them with food, shelter, clothing,
  transportation and medical benefits for the work
  ( benefits were conditional on the work). These
  benefits were wages.

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EXCEPTION INDEPENDENT CONTRACTORS

• ORS 670.600 An independent contractor is a
  person who provides services for remuneration ()
  and meets ALL of the following
• 1. Is free from direction and control over the
  means and manner of providing the services.
  Entity engaging I.C. may only specify desired
  results
• Means resources needed to perform the services.
  Independent contractor must determine which
  resources (such as tools, equipment, labor,
  plants, property, work location, etc.) are needed
  to perform the services.
• Manner processes and procedures, work schedules

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• 2. Is customarily engaged in an independently
  established business must satisfy any 3 of the
  following
• The person maintains a business location
• Must be separate from the engaging club/entity
• If in the persons home, must be in a portion of
  the home primarily designated for the business.
• The person bears the risk of loss related to the
  business or provision of services. Must be shown
  by
• Entering fixed price contracts
• Person is required to fix defective work
• Person warrants the services provided, or
• Person negotiates indemnification agreement or
  purchases liability insurance, performance bonds,
  or errors and omission insurance

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• The person provides contracted services for 2 or
  more different persons in a 12 month period
• If not-the person must routinely engage in
  business advertising, solicitation or other
  marketing efforts reasonably calculated to obtain
  new contracts to provide similar services.
• The person makes a significant investment in the
  business
• Purchasing tools or equipment necessary to
  provide the services
• Paying for premiums or facilities where the
  services are provided
• Paying for licenses, certifications or
  specialized training when required to provide the
  services
• The person has the authority to hire other people
  to provide or assist him/her in providing the
  services and has the authority to fire those
  persons.
• 3. Is licensed under Oregon law where required

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• Note merely creating or using a business entity
  (such as a corporation or LLC) by an individual
  for the purpose of providing services does not
  establish that the individual is an independent
  contractor.

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Primary Risks of Independent Contractor
Misclassification

• Tax liability and penalties for failure to
  properly withhold employment taxes
• Unpaid benefit liability. Example Microsoft
  litigation resulted in liability of 96 million
  in unpaid benefits
• Unemployment Insurance liability The
  unemployment department will assess a penalties
  plus interest for all years that taxes are not
  properly paid.

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• Workers' compensation liability initial fine of
  two times the amount of the premium that employer
  should have paid for coverage.
• An additional penalty applies for each day the
  employer continues to employ employees without
  coverage. There is no limit on this penalty.
• The workers compensation division can also seek
  court orders forcing the employer to comply.
• Also, if any of contractors are hurt while at
  work, the employer will be required to pay the
  same benefits the injured worker would be
  entitled to receive if you were insured. In the
  event of an actual injury, there is an additional
  penalty and processing fees to the workers'
  compensation division.
• Finally, if employees who are misclassified as
  independent contractors and thus not covered
  under your workers' compensation policy are
  actually injured, the employees retain the right
  to file lawsuits against the employer for their
  injuries (a right they would not have if covered
  by the workers' compensation system).

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THE HIRING PROCESS
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CONTRACT OBLIGATIONS ARISING FROM THE HIRING
PROCESS

• of course wed never
• Yes, your employment terminate you
  without
• will be permanent just
  cause

sure, youll have a job until retirement
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INTEGRATED AT WILL STATEMENT

• I understand that no supervisors, manager or
  other representative of the Company has any
  authority to enter into any employment agreement
  for any specified period of time, or to assure me
  of any future position, benefits or terms and
  conditions of employment, except as specifically
  stated in a current written agreement signed by
  the Club President.

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TORT LIABILITY ARISING FROM THE HIRING PROCESS

• NEGLIGENT HIRING

Mom, please tell them I will be out and available
for work in two weeks

• Liability to 3rd parties is incurred from the
  failure to obtain adequate reference/background
  information when injuries/damage is caused by the
  foreseeable acts of an employee.

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THE APPLICATION PROCESS

• TIPS
• Obtain fully completed and signed applications
  from all applicants.
• Do not accept resumes in lieu of Employment
  Applications
• Do not accept incomplete, undated or
  unsigned applications
• Do not consider applicants with expired
  applications
• Require all applicants to sign an Authorization
  for Release of Reference Checks as a condition of
  consideration for employment.

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SCREEN APPLICATIONS TO TOP CANDIDATES BASED ON
LEGITIMATE, NON-DISCRIMINATORY CRITERIA
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GENERAL GUIDELINES FOR CONDUCTING AN INTERVIEW

• Prepare for the interview
• Allow a sufficient amount of time
• Plan an appropriate environment
• Review the application
• Formulate interview questions
• Begin the interview with a thorough review of
  the
• Employment Application.

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• Limit questions to those acceptable under
  employment
• discrimination and other laws.
• Re-direct applicant who volunteer information
  that cannot lawfully be used in making hiring
  decisions.
• Document usable information, but do not
  document
• information that cannot be lawfully used in
  making hiring decisions.

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EFFECTIVE INTERVIEWING TECHNIQUES

• Ask open-ended questions (behavioral probing
  hypothetical) they will provide you with greater
  insight into the applicants work ethic,
  job-related values and suitability for the job.
• Avoid leading questions and questions with
  predictable right answers . . . they will not
  provide you with valid information.
• Avoid cross examination questions . . . they
  will make the applicant defensive.

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• Do not share information that reveals the
  perfect candidate for the job . . . you will
  get that information back, even if it doesnt
  exist.
• Practice active-listening skills talk less,
  listen more . . . you arent being interviewed.
• Use silence to your advantage . . . require the
  applicant to answer your question.
• Use neutral terms and softer introductory phrases
  . . . they will encourage more candid
  responses.

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GETTING INFORMATION

• Probing . . . questions that allow the
  interviewer to
• drill down deeper, usually short and simply
  worded.
• Why?
• What caused that to happen?
• Under what circumstances did that occur?
• Who else was involved in that decision?

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• Hypothetical . . . questions are valuable tools
• What would you do if . . .?
• How would you handle . . .?
• How would you solve . . .?
• In the event that . . . ?

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• Use neutral rather than emotional words
• Emotional Neutral
• Fight Didnt get along
• Quit Left
• Bad Not as well or less satisfactory
• Fire Discharge
• Job hopping Changing jobs often
• Hate Dislike or did not enjoy

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• Use softer introductory phrases
• What prompted you to . . . ?
• Is it possible that . . . ?
• How did you happen to . . .?
• What led you to do . . .?
• Describe for me a specific time
• where . . . ?

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RED FLAGS IN INTERVIEWING
Unreasonable or unrealistic expectations Chip
on the shoulder responses or excuses for past
employment record Perception of self does not
correspond with employment history Positions
held show declining levels of responsibility that
tend to be indicative of individual efforts,
rather than economic climate or other
uncontrollable factors Explanation or reasons
for leaving previous jobs are vague or
unsatisfactory Unexplained or suspicious gaps in
employment history
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REFERENCE CHECKS

• Why Check References?
• Because the best predictor of future
  behavior is past
• behavior.
• Also . . . To eliminate candidates who have
  given false
• information.
• To protect against negligent hiring claims.

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APPLICANT AUTHORIZATION FOR REFERENCE CHECKS

• I hereby authorize my past employers to release
  information to_____________________ Soccer Club
  regarding my employment. This release of
  information covers my employment record in
  general, including information on the following
  questions
• 1. Dates of employment
• 2. Position(s) held
• 3. The quality and quantity of my work
• 4. My attendance habits (excluding workers
  compensation, pregnancy, disability, FMLA and
  other protected
• absences)
• 5. My relationship with co-workers, supervisors
  and managers
• 6. My attitude toward work (cooperative?
  positive?, etc)
• 7. Reason for leaving and eligibility for rehire
  (would the employer rehire if they had to do it
  all over again?)
• 8. Strong and weak points
• 9. Willingness to comply with policies and
  standards
• 10. Whether I have had outbursts of temper,
  threatened, provoked fights with or assaulted
  others, engaging in hostile
• or violent behavior
• 11. Other relevant information regarding my
  performance, skills, ability, suitability for
  employment sought, etc.
• I agree that all former employers who provide
  such information are indemnified and release from
  liability arising from such
• disclosures. I also understand that if I do not
  sign this Authorization, my application will be
  rejected.
• __________________________________________________
  ____

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APPLICANTS AND EMPLOYEES CANNOT BE DISCRIMINATED
AGAINST BASED ON

• PROTECTED
• STATUS

• PROTECTED
• ACTIVITY

• Use of Workers Compensation
• Retaliation for opposing unlawful employment
• practices or participating in employment
• proceedings
• Use of family medical leave (OFLA, FMLA)
• Opposition to safety/health hazards
• Whistle-blowing
• Military duty
• Association with a person of a particular
  race,
• religion, sex, etc.
• Union and concerted activity.
• Garnishment
• Use of other employment rights (wage hour,
• unemployment, etc.)
• Refusal to take polygraph, psychological
  stress
• or blood/breathalyzer test to detect
  alcohol
• Use of domestic violence leave rights

• Race/color
• Religion
• Sex
• National origin
• Marital status
• Age-18 older
• Pregnancy
• Family relationship
• Citizenship
• Veteran status
• Expunged juvenile record
• Being a smoker
• Sexual orientation, Gender Identity