The Department of Labor tackled that question in a recent Opinion Letter. A company asked about this scenario:

A group of store managers were selected to be trained for a possible promotion to district manager positions. Both store manager and area manager are exempt jobs.

But during most of the seven-week training course, the employees performed mostly nonexempt work while they shadowed an existing area manager. The amount of hands-on management (i.e., exempt work) they performed increased as the training progressed.

So the company asked the DOL: Do those employees lose their exempt status during training?

The answer: No.

The Opinion Letter noted that the executive exemption doesn’t apply to nonexempt employees who are training for, but haven’t yet assumed, an exempt position. In other words, a nonexempt employee training to be a manager wouldn’t become exempt during the training.

But in this case, the employees are already exempt. And, the DOL said, attending training doesn’t change the store managers’ primary duty. They’re still employed as store managers, which is an exempt position in this case.

Read the Opinion Letter from the DOL here.

HR understands the liability companies face when managers don’t pay attention to legal training or skip it completely — but that doesn’t mean all managers get it. And it’s especially tough to change their minds when you don’t have direct authority over the person.

It’s not a lost cause, though. Here are some ways to boost the interest in training:

• Help them out with time – If time really is the main reason supervisors are reluctant to be trained, work with them to make it as convenient as possible. They may be able to complete the program in bite-sized sessions; or they might prefer to take care of it in one day. The only way to know is to ask.
  
• Relate it to their people – Many managers don’t buy into training because, as they say, they “already know how not to harass anyone.” So make sure they understand the other key topics you cover — like effectively communicating with their staff and dealing with problematic behavior of the people who report to them.
• Look to the top – When you notice a problem with a supervisor, talk to upper management. Those execs will likely have a better grasp of how legal training relates to the bottom line — and they can discipline managers who still have problems with attending.

How has your HR department increased buy-in from managers when it’s time for harassment training? Share your advice in the comments section below.

More than 1,400 store managers recently sued Family Dollar Stores, Inc., claiming they weren’t payed OT they were owed.

The employees regularly worked 60-70 hours a week, but, like most employees classified as managers, they were considered exempt.

The managers were the highest-level employees in their respective stores. Therefore, the company argued, it was clear that they should qualify for the exemption.

But that wasn’t enough for the court, which ruled that the actual duties of the jobs made them nonexempt positions. For example:

• The store managers were closely supervised by district managers
• Store managers spent roughly 80% of their time on manual tasks like running registers, stocking shelves, cleaning the store and unloading trucks, and
• Virtually all managerial decisions, such as scheduling shifts, setting store hours, and hiring and firing employees, were made by district managers — store managers simply carried out those decisions.

Family Dollar was forced to give the managers a total of $35 million for unpaid OT.

What managers are exempt?

Given the confusion over who’s really exempt, how can HR figure out who needs to be paid OT?

The court cited the FLSA’s criteria for the executive exemption. To be exempt, managers must:

• be paid a salary of at least $455 per week
• have management as a “primary duty”
• direct the work of at least two full-time employees, or an equivalent number of part-timers, and
• have the authority to hire, fire and promote — or at least have significant influence on those decisions.

Cite: Morgan v. Family Dollar Stores, Inc.

1. Do forward all complaints to HR. Some charges are filed with HR directly, but most often, frontline managers get the first word. When that’s the case, they should tell HR about it immediately.
   Don’t investigate on your own. Some supervisors may want to look into the situation as soon as they learn about it, but matters should be handled by someone who isn’t directly involved with the employees in the dispute.
2. Do work with HR to separate the accused and the accuser, figuring out whether to transfer one person to another part of the company, place the alleged harasser on a paid, non-disciplinary suspension, etc.
   Don’t take those actions without HR’s help. The key is to avoid making it seem like one side is being punished. If the complainant thinks he or she is being disciplined, that can lead to a retaliation complaint. And until the investigation is finished, the accused harasser has the same rights as any other company employee.
3. Do discuss the complaint only with those who need to know about it. Spreading the word to everyone can leave the accuser open to retaliation from co-workers, and the accused may claim defamation if the the complaint was false.
   Don’t promise confidentiality. Many harassment victims will ask a manager to “keep it between you and me.” But it’s impossible to conduct an investigation while keeping the parties anonymous.

As far as the law goes, one of a manager’s most important jobs is responding to complaints from employees. A recent case shows the financial hit companies can take when the boss fails to answer effectively.

A woman sued her employer for sexual harassment. She claimed the head of her department repeatedly made sexual comments, asked her on dates and referred to her by obscene nicknames.

She complained to her direct supervisors. Their response: “Go along with it.”

The woman then brought the issue to HR. The company investigated, and the alleged harasser got a warning.

The employee took the company to court, claiming her managers ignored her complaints, and that HR just gave the department head a slap on the wrist.

Managers failed to respond

Who won?

Answer: the employee. The court agreed that the supervisors’ response was unacceptable and that the warning from HR wasn’t enough to prevent future harassment.

Furthermore, while the company had a written harassment policy, there was no evidence all employees received it. Also, the company claimed to conduct harassment training, but again, had no documented evidence that any training took place.

The case went before a jury, who made the company pay $100,000 in punitive damages.

Harassment prevention

This case brings some helpful reminders for HR pros:

• Train managers on effectively responding to complaints
• Have all trainees sign an attendance sheet to prove they were there, and
• Get everyone to sign your policy, so you can prove they received it.

Cite: Bjornson v. Dave Smith Motors/Frontier Leasing and Sales

An employee comes to you or a manager with a harassment claim. What’s the best way make sure that internal complaint doesn’t turn into a court visit?

A solid investigation, says Robert Yonowitz, an attorney with the law firm Fisher and Phillips. Thoroughly investigating the facts and taking appropriate action gives companies an “affirmative defense” and shows the employee — and possibly a judge — that everything was done to diffuse the problem.

However, botched investigations can be costly. Here are seven common mistakes that get companies in trouble:

1. Trying to be “right” instead of “reasonable” — Obviously, the goal of an investigation is to get the facts and find the truth about what happened. But things aren’t always that conclusive, and the courts know it. That’s why companies are normally off the hook if the action they take is reasonable based on the facts they were given.
2. Agreeing to “keep it between you and me” — If a manager gets a complaint, action must be taken — even if the victim asks the manager not to do anything. In a worst case scenario, the employee’s intentionally setting your company up for a lawsuit. Even if that’s not the goal, you’ll still get in trouble if the harassment continues.
3. Promising confidentiality — There’s no way to conduct an investigation while keeping the parties anonymous. It just can’t be done — witnesses and decision makers need to know what’s going on. That said, you should ask witnesses to keep their lips sealed after you interview them.
4. Having one person in charge — One way to avoid complaints of a biased investigation is to have a team in charge — usually HR in tandem with upper management, possibly with an attorney providing guidance. Also, make sure there’s a witness present during interviews.
5. Not getting it in writing — Before asking any questions, have the alleged victim write everything he or she knows about the situation and sign the statement. Same goes for witnesses. That way you have documentation in case people change their stories if they end up in a courtroom.
6. Leading witnesses — Don’t say something like, “We’ve been told Johnny may have sexually harassed Sally — do you know anything about it?” Instead, start out vague: “You’ve been identified as a possible witness to policy violations involving Sally and Johnny. Have you seen anything?” If the answer’s no, make sure you get that in writing. Otherwise, find out what they know.
7. Making legal conclusions — When documenting the conclusions of the investigation, don’t ever write “Johnny sexually harassed Sally” — that’s a conclusion only a judge can make. Instead, write that he broke company policy and list the specific offensive actions.

What’s HR’s strongest weapon in the fight against lawsuits? That’s right, documentation. But too often, documentation is weakened when managers make these common mistakes.

The biggest documentation blunder, of course, is not having any. But there are plenty of other little things managers do that can get companies in trouble.

Here are some common mistakes many managers make, according to attorney Allison West, who spoke at this year’s Society for Human Resources Management conference:

1. Using general buzz words — Statements like “The employee has a bad attitude” or “He’s not a team player” are worthless on their own — and are often red flags for discrimination suits. They make it look like the company’s fishing for reasons to fire or discipline an employee. The documentation needs to include the specific actions and behaviors that led to those descriptions.
2. Coming to legal conclusions — Managers must be sure not to accuse anyone of breaking the law. For example, documentation should never say an employee “sexually harassed” someone. Instead, the manager just needs to describe what the employee did or was accused of doing.
3. Not giving the employee a chance to weigh in — Employees should be able to make written statements about parts of the documentation they disagree with. It lets the employee know you’re being fair and can go a long way toward alleviating frustration. The supervisor may even learn something about how to manage the employee.
4. Using absolute language — Statements like “The employee never met deadlines” and “The employee was always late” are rarely true — employees will always be able to point to times when they made deadlines, or came in on time. And when documentation contains any statements that aren’t true, employees — and their attorneys — can use that to their advantage.
5. Giving timelines without following them — If a manager disciplines an employee and writes that she has 90 days to improve her performance, then he’d better give her 90 days to improve her performance. Supervisors must be absolutely sure the timeframe is appropriate before sealing the deal in writing.
6. Writing verbal hiccups — Meaningless phrases like “it appears” or “it seems like” often innocently appear in managers’ writing. But to an outside reader, they imply the manager isn’t sure what he or she is saying is true.
7. Including things the employee wasn’t directly told — Writing down critiques of an employee’s performance won’t do any good if you can’t prove the employee was told what was wrong and given a chance to improve. Where appropriate, have the employee sign off on the documentation.
   

Here’s what happened:

A group of managerial employees sued their employer for unpaid overtime. They claimed they spent more than half of every day doing clerical work and therefore were incorrectly classified as exempt.

The court didn’t agree. Under current wage and hour regs, it doesn’t really matter how much time employees spend on different types of work. The important question is whether or not someone’s “primary duty” involves exempt work.

The time test can be a good rule of thumb, the court said, but it’s also possible for employees’ primary duties to take up less than half their time. Other factors to consider include:

• relative importance of managerial duties compared to the other work
• the employee’s freedom from direct supervision, and
• the reason the employee’s position exists.

In this case, the court found the employees’ jobs existed primarily to manage other workers — the clerical duties were just incidental to the managerial work. Therefore, they were exempt from overtime.

Cite: Desmond v. PNGI Charles Town Gaming, LLC

You know how careful a company needs to be when an employee is fired. But managers sometimes jump the gun and create legal risks. These questions can help guide them through the termination process:

1. Are all the facts documented? This is the most obvious one — but it’s important enough that it should always be asked.
2. How have similar cases been handled? As HR pros know, an easy way to end up in court is to have a manager give a slap on the wrist for something and then fire someone else for the same reason. Sometimes there’s good reason for different treatment. Find out what happened to others in the same situation — and why.
3. What are you going to tell the employee? The explanation given to a fired employee should be planned beforehand. Managers might try to soften the blow and give the employee something other than the real reason — but if the company doesn’t have its story straight, he or she might be convinced some kind of bias played a role.
4. How are you going to tell him or her? Seasoned managers have likely fired folks before, but less-experienced supervisors might not know how best to handle it. HR should give a brief refresher on how to conduct a termination meeting.
5. What’s the employee’s story? In some cases the employee might have legally protected reasons for not meeting the standards set by the company. Hearing the employee’s explanation can help you and the manager learn if you have any obligations under ADA, FMLA or other applicable laws.
6. What does the policy say? Not every termination is the result of a direct violation of a written policy. But if a manager takes action that contradicts what’s said in the handbook, that might be asking for trouble. Employees have sued because they were fired before going through the disciplinary procedures listed in the handbook.
7. Will the employee be surprised? Find out what action has already been taken, and if the employee’s been given a chance to improve. Except in rare cases, a termination shouldn’t be an absolute shock to an employee, and can give them reason to cry “bias.”

Of course, you know how to respond to FMLA requests. But you also know managers need to see you when they get a request — and that they don’t always do it.

As HR pros know, employees don’t qualify for FMLA leave if:

• they work in a location with fewer than 50 employees in a 75-mile radius
• they don’t have a “serious medical condition,” or
• they don’t meet the law’s 12-month/1,250-hour requirement.

But too often, managers mistakenly tell those employees they can take medical leave. That can cause huge legal problems later.

In one case, an employee found out she needed surgery. She scheduled the operation and asked her manager for FMLA, which he approved.

While she was gone, HR discovered she hadn’t met the 1,250-hour requirement. When she came back, her job was gone, due to a restructuring that took place while she was away.

Despite not being eligible for leave in the first place, she sued. She claimed her manager led her to believe she was eligible, and she would have rescheduled the surgery for a later date if she knew that wasn’t the case. The judge agreed, and the company lost the case (Cite: Kosakow v. New Rochelle Radiology Associates, P.C.).

Watch those handbooks

Another recent case involved a company with two locations: its main building and a smaller plant that had fewer than 50 employees and was more than 75 miles from headquarters. Employees in both places were given a copy of the same handbook — which included an explanation of FMLA rights that didn’t mention the size requirement.

An employee at the smaller plant took time off for an illness. He never specifically asked for FMLA leave. But apparently, his supervisor didn’t know he didn’t qualify for FMLA and didn’t tell him beforehand that the absences wouldn’t be allowed.

When he came back to work he was fired. He sued, claiming he was led to believe he was eligible for leave, so he couldn’t be fired for taking it. The court agreed (Cite: Myers v. Tursso Co.).

Steps to take now

Education and training is the key to preventing those problems. Two things companies can do to avoid being trapped into offering more than the law requires:

Keep policies up-to-date — It’s important to keep track of who’s covered and who isn’t and give the right policies to the right people. Also, to limit confusion, policies should mention all of the law’s eligibility requirements.

Train managers — Supervisors need to be aware of who’s eligible for leave, since they’re the first point of contact when employees need time off. They should be trained on the law’s requirements and told to bring FMLA issues to HR before approving or denying anything.