News & Analysis

Employee's comments to female colleague doom appeal

The Alaska Supreme Court recently rejected an employee's claim that his due-process rights were violated when a city personnel board upheld his discharge based on "misconduct" without specifying what the misconduct was. The record was clear that the misconduct was sexual harassment.

IRS releases regs detailing employers' ACA reporting requirements

When it comes to the Affordable Care Act (ACA), the employer responsibility section (also commonly referred to as the "play or pay" provision) has received a lot of attention from the media and employers. However, employers also need to be aware of another related provision — the employer and insurer reporting requirements found in Internal Revenue Code Sections 6055 and 6056. The IRS recently released final regulations clarifying these reporting requirements.

Don't be too quick to dismiss telecommuting as reasonable accommodation

The Americans with Disabilities Act (ADA) requires employers to provide a "reasonable accommodation" for the known disability of a qualified individual unless doing so would impose an undue hardship on their business operation. Reasonable accommodation is any change or adjustment to the job — or the work environment — that permits the employee to perform the essential functions of the job or to enjoy the benefits and privileges of employment equal to those held by workers without disabilities. Examples of reasonable accommodation may include acquiring or modifying equipment used to perform the work, restructuring job requirements, or offering modified or part-time work schedules.

9th Circuit declines to review railroad station dispute

Although the rail industry is heavily regulated, some matters are in the exclusive province of collective bargaining between railroad companies and the unions that represent their employees. That was the reasoning behind a recent decision from the 9th Circuit (whose rulings apply to all Alaska employers), which declined to review the refusal of the Federal Railroad Administration (FRA) to hear a union challenge to a railroad's new station designation.

Store managers exempt? Maybe, maybe not

In the retail setting, a store manager is typically the person with overall responsibility for all personnel and customer service activities at the location. So if she's paid a salary, she likely would be exempt from overtime requirements of the Fair Labor Standards Act (FLSA), right? Well, it all depends, according to a recent unpublished decision of the 9th Circuit.

BYOD? Avoiding the pitfalls of employee use of personal devices

Bring your own . . . device (BYOD)? A majority of businesses now allow employees to bring their own electronic devices to use at work. With the rapid evolution of technology, this policy has quickly become the go-to standard in most workplaces. However, commingling personal and professional usage, data, and ownership of electronic devices creates challenging legal and security implications. Who owns work-related data on employee-owned devices? The harsh truth is that courts and legislatures have yet to decide that complicated issue.

Whether driven by the younger generation's need to have the most recent and technologically advanced devices or employers' attempt to save corporate money, BYOD is the new norm. However, as the line between business and personal ownership begins to blur, corporate security concerns grow. A survey by YouGov and Research Now found that 67 percent of surveyed companies had no policies or procedures to manage employees' use of personal devices for work purposes. If you are one of the 67 percent, you may be headed for trouble. Here's why.

Real-world concerns

An employee leaves your company but still has sensitive company data on a dual-use device. A hacker preys on the unsecure smartphone carried by your employee and gains sensitive information. Your employees store company trade secrets on their personal devices, which leads to the information "leaving" your control. Your company is involved in a lawsuit and as part of e-discovery (the exchange of information relevant to the lawsuit before trial), normally purged information is found stored on an employee's personal device.

All of those scenarios can occur when you allow your employees to use their own electronic devices at work. Gale Gruman, the executive editor of InfoWorld, has observed that companies have adopted three types of BYOD policies to address these concerns:

  • Shared management: Company policy states that an employee accessing business resources from a personal device gives the company the right to manage, lock, and wipe that device. The policy is normally put into a written agreement.
  • Corporate ownership: The company owns and buys the device. If an employee doesn't like the company-issued device, he can buy his own personal device that has no corporate access.
  • Legal transfer: The company buys the device from the employee. Normally, the company will purchase the device for some nominal amount (e.g., $5) and give the employee the right to use it for personal purposes. The employee has the right to buy the device back for the same price when he leaves the company.

None of these policies is "right" or "wrong." Which type of policy you choose to implement will depend on your business needs.

Legality of accessing personal devices

Your company can manage the risks associated with BYOD by adopting policies and agreements that fit your risk tolerance, trust assessment, and regulatory context. However, the only way to guarantee your right to access all information on a device is to own the device.

In 2010, the U.S. Supreme Court held that employers have the right to access all communications on corporate-issued devices. The Court didn't address a company's right to access information on personal devices. Therefore, if you want to have access to all communications and data on personal devices used by your employees, you should be aware of the inherent risk in adopting a BYOD policy.

Mitigating security risks

The content of your BYOD policy (or your choice to forgo a policy) should be decided by thoroughly analyzing the sensitivity of the information your employees handle, the inherent security concerns in your industry, the legal regulations you face, and your ability to oversee and manage the use of such devices. If you decide to implement a BYOD policy, here are some important things to consider:

  • Initiate a "wipe" policy. Require your employees to download software that allows you to remotely access and wipe devices. That provides protection if devices are lost or stolen. Additionally, there are software programs that can sequester work-related information into a software "sandbox," creating a virtual folder in the personal device.
  • Require written agreements. Once you locate software that fits your needs, have your employees sign a written agreement that discloses all risks associated with the software (such as information loss) and requires them to download it onto any device that will be used to access work-related information.
  • Make the privilege exclusive. Allow only certain employees to have the privilege of using personal devices (exclude personnel who frequently handle sensitive data or personally identifiable information). Further, limit the type of information that's accessible from a personal device (e.g., e-mail).
  • Make device inspection a part of the exit interview. Have employees consent in writing to have their devices inspected at exit interviews. Also, obtain permission to remotely wipe the device of any terminated employee.
  • Don't allow employees to store corporate information on personal devices. Have them sign a written agreement that they will not store any corporate information on their personal devices.
  • Require employees to produce their devices for inspection. Have them sign a written agreement that they will turn over their personal devices for inspection upon a legitimate request.

Bottom line

Although dual-use devices have resulted in difficult legal and security issues for employers, you can mitigate the risks by implementing a properly crafted policy and using privacy software. Because the law on this issue is not settled, you should contact an attorney before creating a BYOD policy so that you fully understand all risks involved in such a policy.

Agency Action

Notices clarify eligibility for Health Insurance Marketplace. The Obama administration announced in May that it was proposing changes to model notices informing workers who are eligible for insurance coverage under COBRA. The changes make clear that eligible workers may have more affordable options through the Health Insurance Marketplace, which was created by the Affordable Care Act (ACA). Workers and their families who are eligible for employer- sponsored health insurance coverage generally must be informed of their right to COBRA continuation coverage at the start of employment and when they separate from a job. In most cases, workers and their families who are eligible for but not enrolled in COBRA continuation coverage would be able to enroll in marketplace coverage outside the normal open-enrollment period.

Workplace Trends

Skills shortage blamed for sizable loss in manufacturers' earnings. The much discussed skills shortage is to blame for manufacturers losing up to 11% of their earnings annually because of increased production costs, according to a new study from Accenture and The Manufacturing Institute. Among other things, the report notes that when manufacturers are unable to fill roles, overtime, downtime, and cycle times increase, more materials are lost to scrap, and quality suffers. More than 70% of the 300 U.S. manufacturing executives surveyed reported at least a 5% increase in overtime costs, and 32% reported an increase of 10% or more. As manufacturers used overtime to maintain base production levels, 61% said their downtime increased by at least 5% because they lacked enough people to run and maintain the equipment.

Union Activity

AFL-CIO says 150 workers die each day from preventable workplace conditions. The AFL-CIO released a report in May saying that 4,628 workers were killed in the United States during 2012 because of workplace injuries. Also, an estimated 50,000 died from occupational diseases, resulting in a loss of nearly 150 workers each day from preventable workplace conditions. The report shows the highest workplace fatality rates were found in North Dakota, Wyoming, Alaska, West Virginia, and Montana, while Massachusetts, Rhode Island, Connecticut, New Hampshire, and Washington had the lowest state fatality rates. The report says North Dakota's job fatality rate was 17.7 per 100,000 workers, five times the national average. The report also highlights the number of Latino and immigrant workers killed on the job, with Latino workers facing a nine percent higher risk of workplace death than the national average.

Not enough: Employee's 30-count discrimination claim insufficient

The U.S. 8th Circuit Court of Appeals (whose rulings cover all Arkansas employers) recently held that a former employee's 30-incident complaint was insufficient to sustain her claims of race discrimination, hostile work environment, retaliation, and constructive discharge.