If you are a business owner, speak to an experienced Provo Utah corporate lawyer. Federal, Utah and local laws may require your business to have certain insurance coverage.
Most organizations have some type of insurance coverage for property damage or loss in the event of a disaster. Some companies also seek coverage for loss of income or expenses while they are closed, or coverage of commissions that must be paid even though the merchandise was destroyed. An organization seeking insurance coverage should ask the following questions:
• What is insurable and what is not?
• What are the extent and limits of coverage?
• How soon after a loss must it be reported?
• What records will be needed to file a claim?
Insurance helps replace buildings and equipment, but it cannot always replace lost information and records. Replacement of lost information may not always be possible, or it may be too expensive. In spite of insurance for the loss of a computer and its software and data, data replacement may not be possible in the absence of appropriate data backup procedures. Insurance for office contents often includes records, but the true value of most records and information cannot be recovered. Insurance cannot replace the loss of proprietary information or the loss of records that preserve a company’s rights–including the right to file insurance claims. Because insurance is not always a quick fix for the loss of records and information, the safeguarding of certain records becomes a major consideration. Records vital to specific industries may include:
• manufacturers’ production engineering drawings and specifications
• hospital and clinic patient files
• depositor and investment account records of banks and other financial institutions
• a magazine publisher’s subscriber list
Certain records will be required in order to file insurance claims for liability, relocation expenses, business interruption, and other insured expenses and losses. Replacement of insured property may be jeopardized when proof of ownership was destroyed along with the property. Among the first records necessary for the long road to recovery after a catastrophe may be:
• proof of ownership and value of assets that were destroyed
• insurance policies, claim forms, and complete records of premium payments
• profit and expense, and other financial records
Speak to an experienced Provo Utah corporate lawyer to know the employee records that your business is required to maintain by law. Employee record-keeping is necessary for business management planning and decision-making. Records preserve the many details to be remembered year after year for a changing number of workers. Keeping accurate employee records also is a good business practice that meets the various government requirements and protects a business. Employers have a number of rights and responsibilities regarding their workers relating to personnel actions, health, safety, payment of wages and taxes, privacy, protection of intellectual property, and more. Records are created, reported, maintained, and protected in order to comply with government record-keeping requirements or to show that the business is in compliance with employment laws and regulations. Records also are created, maintained, and protected in order to preserve certain rights of the employer:
• The right to proper defense in a lawsuit or claim
• The right to file a claim against another party
• The right to protect the assets of the business
Defending Employers and Businesses
Not every business is affected by all federal employment laws, but an employer may be subject to the requirements of every state in which it has employees. Seek the assistance of an experienced Provo Utah Corporate Lawyer to know how various Federal and State laws affect your business. Failure to comply with even a single one of such laws can have serious consequences for your business and for you as a business owner. State laws tend to pattern themselves after federal laws, and they usually extend their impact to companies smaller than those affected by federal laws. The intent of employment law is to protect the innocent worker. Regulatory agencies, legislation, and the courts are taking over the historical role of organized labor to protect the worker as we move from an industrial to a service economy. But employment law has become a measurable threat to even the fairest and most generous employer. Claims and charges by employees and government agencies have become an inevitable part of doing business in today’s regulated and litigating business environment. Economic downturns, sympathetic juries, and media hype contribute to increasing employment litigation risks for employers. The risk of being sued rises each time a court defines what constitutes unfair, unethical, or discriminatory behavior. Most businesses are eager to settle employee claims out of court, because of the:
• expenses involved in defending themselves
• potential of a damaged reputation
• risks of additional similar suits
• tendency of juries to be sympathetic to workers
Employment laws and regulations directly or indirectly influence personnel record-keeping practices. A number of them stipulate that a business must create, collect, and maintain or report certain records. Reporting or information disclosure requirements by government agencies cover payroll, benefits, taxes, equal employment opportunity, safety, health, and other functions or activities.
Other laws compel the creation of records in order to show compliance with a law. It is in the best interest of a business to collect and maintain accurate and complete records that demonstrate compliance with an employment law, even if the law has no record-keeping requirements.
Good record-keeping practices help prepare for litigation and government investigation or audit, by documenting compliance with the law to minimize the risks and losses. Complete, accurate, and indisputable records may deter an employee or agency from even filing charges. Or such records may encourage an employee to drop unfounded charges, or to settle out of court. When a company becomes the target of an investigation and has not created and maintained records according to a government requirement, it could have serious difficulties defending itself and may be subject to fines and penalties. The Department of Labor, the Equal Employment Opportunity Commission (EEOC), and the IRS are among a number of different agencies that rely on records showing proper payment of wages, taxes, and other employee payments. When a question arises regarding payment of minimum wage or taxes, overtime practices, discrimination in pay or benefits, and other claims, the following records may be among those reviewed:
• wages, overtime, sales commission payments
• other employee payments (bonuses, perks, educational assistance)
• income tax withholdings
• unemployment taxes
• worker compensation payments
• Social Security taxes
• health benefit plans and payments
• retirement and pension plans and payments
• death benefits
Safety and Health in Business
Every business in Provo, Utah must comply with Federal, Utah and local health and safety regulations. Speak to an experienced Provo Utah Corporate lawyer to know if your business is compliant with these regulations. Inadequate and inaccurate records are especially harmful on matters regarding worker health and safety issues. Prosecutors are bringing more criminal charges, and executives are receiving jail sentences for reckless endangerment of lives. Efforts to meet compliance with health and safety regulations must be shown in court or in government inspections, audits, or investigations. Safety program records that may help provide evidence of compliance include:
• risk management and safety program documentation
• company policies, procedures, and standards to eliminate or reduce hazardous practices and conditions
• employee education and training activities
• vehicle maintenance and accident reports
• employee accident and illness reports
• medical files and benefits payments
• short-term and long-term disability records
The workplace safety issue is ergonomics. Its impact goes beyond manufacturing environments to even the smallest of office sites.
Another health and safety issue is drugs and the workplace. Fearing liabilities of intoxicated workers, businesses are restricting alcohol consumption at company-sponsored events and off-premises client entertainment. Documented policies against alcohol mixed with client entertainment–including a policy not to reimburse travel and entertainment expenses for alcohol–help show a company’s commitment to safety. Federal contractors and major employers also must ensure a drug-free workplace.
Worker exposure to toxic substances is another high-risk area for employers. In its defense, a business must have records relating to:
• hazardous conditions and substances (air quality tests, records of spills and clean-up operations, etc.)
• efforts to adequately warn employees of the risks and to provide training on proper handling of materials
• actions taken to increase safety
• effects of exposure on workers
State prosecutors increasingly are bringing criminal charges against companies and executives based on state laws that are tougher than federal laws.
As protective labor laws come under fire for being discriminatory, companies may be exposed to new health and safety liabilities. Fetal protection policies, formerly a bona fide occupational qualification exception allowed as essential to a safe workplace, are now considered a form of sex bias.
An employer generally cannot foresee when and if a hearing or lawsuit will occur regarding an employment action, but events and practices must be documented, just in case. Good documentation may prove that a hiring or firing decision was valid. Employment actions to be documented include:
• selection for hiring
• pay and other compensation
• selection for promotion, layoff, recall, education and training opportunities, early retirement, and so on.
• performance appraisals
• employee grievances or complaints
• disciplinary action or demotion
An experienced corporate attorney will review a company’s policies and procedures regarding employment actions. The attorney will also review any personnel manual, employment contracts, and other employee recordkeeping practices. The attorney can advise on what specific records to keep, what records not to keep, and how long those records should be kept. A company’s personnel records are used not only in its defense; they also may be used by a plaintiff to support its case against an employer. Judges traditionally grant plaintiffs broad access to defendant records in bias cases because the employer–not the worker–has all the facts and records. Government agencies also may have access to employer books and records for audits and investigations. A paper trail of evidence to back up a company’s reasoning and actions may be necessary one day. The key to avoiding problems and reducing risks is to begin record-keeping efforts at the inception of employment and continue them through termination:
• hiring phase documentation
• documentation throughout employment to show that employee policies and procedures were applied consistently and equitably
• documentation of termination process.
Records of employee performance and employment actions should be created consistently and on a regular basis for all employees. Documentation of events should be direct observations (not hearsay) and should be completed in a timely manner, as close as possible to the time of their occurrence. Both positive and negative job-related performance should be recorded. All documentation should be accurate and factual. Because a complaint of discrimination may be filed within 180 days of an action, records of an employment action must be maintained for this time period to defend against any discrimination charges. Evidence that may be necessary to refute allegations of discrimination include:
• job group profiles
• job placement files (job requisition, advertising copy, job candidate files, documentation of the review and selection process, documentation of any testing, etc.)
• guidelines, reports, and analyses on compensation and salary plans
• selection processes used and a history of employee transfers, layoffs, promotions, educational and training opportunities, etc.
In addition to documentation of how existing policies and practices were followed, a business must be able to articulate a legitimate business reason for when those policies and practices were not binding in a particular instance. Employment decisions that result in a disparate effect or adverse impact may be allowed under certain circumstances. For example, a small business that cannot afford to modify its delivery truck to accommodate every type of handicapped operator may not be open to charges of discrimination against the handicapped for that particular job function.
Documentation becomes even more critical when a termination follows shortly upon any sensitive occurrences, such as an employee claim for worker compensation or a complaint made to a government agency about discrimination, work conditions, or business activities. Such a termination may be construed as retaliation, which is forbidden by law. Any termination found to be in breach of public policy is considered a wrongful discharge.
Provo Utah Corporate Attorney Free Consultation
When you need legal help for your business, please call Ascent Law for your free consultation (801) 676-5506. We want to help you.
8833 S. Redwood Road, Suite C
West Jordan, Utah
84088 United States
Telephone: (801) 676-5506