Comstock's magazine 0818 - August 2018 - Page 48

n LAW J ane Bei, chief financial officer at California Electronic ecutive, administrative or professional roles generally can be Asset Recovery, thought she had a deal. salaried. Most others must be paid hourly, receive overtime Last April, the company’s former sales director asked and be provided meal and rest breaks. whether she could get back the position she had left in Those categories may seem straightforward, but there August. By then, CEAR, an electronics recycling company are trip wires. For example, to meet the executive exemp- in Mather, had hired a replacement and couldn’t afford two tion, a worker must spend at least 51 percent of their time salaried people in that role. So the former employee made on managerial tasks, including regularly exercising “dis- the company an offer: She’d work as a contract salesperson cretion and independent judgment.” But that phrase has on commission only, earning 10 percent of each sale. She’d a specific meaning: “An employee who merely applies his work off-site and set her own schedule. Bei says both sides or her memory in following prescribed procedures or de- thought it was a good plan. termining which required procedure out of the company But when CEAR ran the arrangement by their human manual to follow” isn’t exercising discretion and indepen- resources expert, the answer was no. Under federal and Cali- dent judgment, according to the California Department of fornia state labor law, the former employee would need to Industrial Relations’ website. have her own company and do similar And to get the administrative work for other clients to be a legal in- exemption, the employee must, dependent contractor. “It’s frustrating among other requirements, do “of- because we both lost,” Bei says. fice or non-manual work directly But what the parties want doesn’t related to management policies or matter when it comes to the key state general business operations of his rules on employee classification — who or her employer or his or her em- qualifies as an independent contrac- ployer’s customers.” But the rule tor, and which employees must be paid carefully distinguishes between hourly as nonexempt vs. salaried as ex- “administrative” functions and empt. There’s a reason, say proponents the “production” aspects of the of the current framework: Without business: Someone who spends those mandates, employers could force too much time helping create a workers into arrangements that look product the business sells doesn’t consensual but aren’t. qualify. Recent court cases have tightened Meeting the professional ex- — Jennifer Randlett Madden, up the classification requirements emption is more straightforward. employment lawyer, Delfino Madden even more. Given the penalties associ- The employee has to work in a job ated with mistakes, it’s more important that requires a license or certifi- than ever that companies stick to sound personnel manage- cation or one that’s “commonly recognized as a learned or ment procedures to stay in compliance, say employment artistic profession,” among a few other rules. lawyers and human resource experts. Employers often wrongly think that job titles matter in assessing classification. “Many people say, ‘We’re going to CALIFORNIA RULES JUST GOT TOUGHER hire this person, and their job title is going to be X,’ and that The California Division of Labor Standards Enforcement should be good enough,” says Amelya Stevenson, president launches hundreds of investigations on employee classifi- of human resource consulting firm e-VentExe in Granite cation each year and sends a report to the state Legislature Bay. “I tell them, ‘Throw the title out the window.’ What the on how many companies it has fined fo ȁɕ݅Ʌѥٔ܁ՑݥЁ̀ѡȁՅѥ)ȁ̸%ذѡѵЁՕЀхѥٕ́䁑今tḾѼMхɉՍ̰ݡ́Օ)ٽ٥ٕѥ͍ͥѥݥѠѥ́Ѽѽɔ́ѡɽ䁱ѡ)хЁ́хѕݥ=݅́ᕵиQ͔͕́ɸЁݡѡȰѥѱ́ͥ)ЁݥѠİ)́ѡɥ䁽ѡȁѥ)Qձ́ѕɔͼѡЁ͕ͥݡѡȁ)%)ձܰՑ́ѡɅ9Ѡ ɍեЁɕٕ͕)ͥ́́ȁ̸QݕȵЁͥݡձѡЁ ɹ)ѡɕձѥ́ѡqᕵеᕵӊt٥ͥPݡ)éչɥѕ́ݕɔᕵЁɽٕѥͼݕɔ)Ёɱ䁅ݡͅɥQ͔ഁЁݕ̸݅Q9Ѡ ɍեЁɥ䁑ͅɕ+qQѥɔՍЁ)ЁɅѽ)ͥѥ́)ٕ䁕ȁ͡ձ)Ёٕ䁍Ʌѽ)ѡ͔ɥЁݡ)Ѽt()ѽ͵՝Ѐ