http://jobs.aol.com/articles/category/cover-letter-examples

Can prospective and current employers check up on employees? Yes, but with limitations. It may be used to verify previous work history and accuracy. Social Media may also be monitored for postings that may be viewed as harassment by other employees. It can also be checked to see if an employee who calls in sick was not out partying the night before. A very large issue is an individual’s right to privacy. Does someone have the right to make postings in confidence that no repercussions may occur? No, once you post an item to the internet it is considered public information.

• Privacy: Has a person’s constitutional right to privacy been violated? It first depends on the individual’s reasonable expectation of privacy and whether that was infringed.
o There remains no established method for determining if a reasonable expectation of privacy was established. Therefore proving their right to privacy has been violated is very difficult.

Many employers are using social media as pre-employment screening. This practice is becoming increasingly popular. In a June 2009 survey of 2,600 companies performed by CareerBuilder.com, 45% of employers stated that they used social media to pre-screen job applicants. Of the employers that said they pre-screened applicants through social media, 35% admitted that they reviewed content on social media sites which caused them to disregard a job applicant for employment. The thing that employers must remember is that you cannot “unsee” what you have discovered in social media. Often times, the information you garner about a job applicant does not create any legal issues. However, knowledge that an individual is within a protected class (be it based on race, religion, or disability) could increase the risk of a discrimination claim if that individual is not hired. It will basically place an employer in a situation where it must provide a non-discriminatory reason as to why a certain individual was not hired. It is very easy to discover such information from a quick review of a Facebook or MySpace page. The applicant’s profile picture can often give away race, ethnicity, and disabilities. In addition, the applicant’s profile may also give religious information and the applicant’s date of birth (bringing age discrimination into the mix as well).

When utilizing social media for pre-employment screening best practices should be considered and policies should be written and implemented. While very few legal guidelines exist in regards to legislation there are still legal implications that can arise if best practices are not followed. Below are nine steps that are recommended to assist in your development of best practices.

• Screen in a consistent and uniform manor – make sure you follow the same process for everyone you are screening. Don’t follow a random process of only checking up on people you think may be hiding something or may have some secret life you think you should know about.
• Screen the same sites for everyone and maintain the list of sites you screen – determine which sites you think are the most relevant to look at (Linked In, Quora, Spoke, Twitter, etc) and don’t alter the list just because of the candidate. In other words – if you feel like Facebook is really a social environment without much relevant job information – don’t suddenly search it for the candidate that has a funny tattoo.
• Pre define the types of information you are screening for and the criteria used for screening – This is a KEY point: You are looking for relevant, work related information only. You probably don’t need to know about someone’s partying habits, but you probably do need to know about threats of violence, hate messages against minorities or ethnic groups, a pattern of disparaging comments about previous employers, or misleading information about their college degree.
• If you don’t plan to screen everyone, be clear and consistent about what groups you are not screening – like all background checking, social media is not that different in a case like this. You don’t have to screen all job categories, but be clear (and document) why you screen some and not others.
• Have a neutral party do the screening to avoid hiring manager seeing protected data (age, race, religion, health conditions, etc.) – The fundamental point here is – if you are going to look at data on a social media site – you will see more than you need to. To avoid that risk – use a third party that will filter out that data.
• DO NOT friend an applicant – this is fraught with all kinds of problems. Not only does it provide you access to information you do not need to know, it opens up all kinds of issues with privacy, harassment, etc.
• View only publicly available information – most of what you need to know can be found in the public data. No need to ask for an applicant’s access or password, or to friend or “connect” with them to see additional data.
• If you use social media data to reject an applicant, point to clear, legitimate hiring requirements for reason to not hire (e.g. poor judgment) – your reason for not hiring someone should be sound. Enough said. Social media data is no exception.
• Gain applicant’s consent – it really is a good idea to follow the same notice and disclosure policies you would with any pre employment screen. Let the applicant know you will be checking their social media footprint and gain their consent.

Sources:

Thuber, J (2011, April 9). 9 Steps if Considering Social Media in Pre-Employment Screening. http://hrtoolbox.com. Retrieved August,4, 2011, http://hr.toolbox.com/blogs/musing-on-preemployment-screening/9-steps-if-considering-social-media-in-pre-employment-screening-45441

Sherwood, M (2011, March 21). Social Media in the Workplace: Pre-Employment Screening. www.unlaw.com. Retrieved August 4, 2011, http://www.uwlaw.com/articles/SOCIALMEDIAINTHEWORKPLACEPREEMPLOYMENTSCREEN.htm

Saper, D (2009, April 6). An Introduction to Legal Issues Surrounding Social Media. www.saperlaw.com. Retrieved August 4, 2011, http://www.slideshare.net/DaliahSaper/legal-implications-of-social-media

“The unexamined life is not worth living.” – Plato

Whether leading yourself toward a higher path, leading a family, community, congregation, or an entire organization, this is a good time to reexamine your leadership effectiveness. On a scale of 1 to 10, 10 being the highest, how would you rate yourself as a leader? Leadership effectiveness, what I like to call LQ or Leadership Quotient, is primarily determined by a combination of Physical Intelligence, Mental Intelligence, Emotional Intelligence, and Spiritual Intelligence. These four areas (Body, Mind, Heart, and Spirit) are essential toward the making of a whole leader. Let’s explore the key leadership factors that bring wholeness:
1. Inspire with Integrity (Spirit or Conscience)
2. Initiative and Innovation (Body and Mind)
3. Impactful Influence (Heart)

An easy way to remember this is LQ = 6I (Inspiration, Integrity, Initiative, Innovation, Impact, and Influence). This exercise will only take about fifteen minutes in which you answer some questions and honestly rate yourself on a scale of 1 to 10 for each factor.

1. Inspire with Integrity (Spirit or Conscience)
Are you energized with a larger than life vision or transcendent goal that serves the greater good and inspires others, or is your focus limited to only your own immediate needs? Are you aware of your highest purpose?
Great leaders subordinate their ego to their spirit or conscience by putting the needs of others before their own and finding a cause or purpose that’s greater than themselves. This gives a leader the moral authority to lead others.
On a scale of 1 to 10, rate yourself for * Inspiration _________
(*In my book, The Hero Soul, http://www.herosoul.com, pg. 117, I provide deeper reflections on ‘inspiration’).
Do your actions reflect your vision, beliefs, and values? Do you do as you say and honor your word? Andrew Carnegie once said, “As I grow older, I pay less attention to what [people] say. I just watch what they do.”
On a scale of 1 to 10, rate yourself for Integrity ___________

2. Initiative and Innovation (Body and Mind)
Once you know what your highest purpose and core genius is, how well do you execute on your vision and key priorities? Are you focused on doing the right things, what’s important, or are you spending too much time on urgent but not important activities and doing things right?
Leadership is about doing, taking initiative, and getting things done. Do you usually wait for things to happen and wait for others to initiate, or do you make things happen and initiate things on your own?
Additionally, the body is the temple of the spirit. Are you taking care of your body by exercising regularly and eating healthy so you have enough energy to take lots of action, or are you often succumbing to whims of the day?

On a scale of 1 to 10, rate yourself for Initiative ___________

Are you continually growing and innovating as a leader in the never ending pursuit of excellence, or are you settling for mediocrity by being comfortable with the status quo?
Are you using your creative problem-solving skills and imagination to become a change-agent by experimenting with new ideas, solutions, and technology, or are you continually in fire-fighting mode by being frequently blindsided with change?

On a scale of 1 to 10, rate yourself for Innovation ___________

3. Impactful Influence (Heart)
Are you reaching out to people and making an emotional impact in their lives? Are you getting to intimately know people in your circle of influence and taking the time to find out their fears, desires, challenges, and goals? Are you touching people’s lives by serving? The old adage, “people don’t care about what you know, until they know you care,” applies here.
The hero’s journey is about following your bliss and doing what you love doing in service to others. Interestingly, through the heart, by making an emotional impact in people’s lives and serving, the spiritual dimension is tapped. Rabrindranath Tagore once said, “I slept and dreamt that life was joy. I awoke and saw that life was service. I acted and behold, service was joy.” In other words, service is spirit.

On a scale of 1 to 10, rate yourself for Impact ___________

Finally, influence is a measure of your character that comes with time and experience. How wide and impactful is your influence? Are people seeking you out for your leadership, mentorship, and guidance? What is the quality of people you have attracted in your work and life?
We are in many ways the sum total reflection of the people in our circle of influence. Look around you. What type of people have you attracted in your sphere of influence? The majority of people you attract in your life, whether negative or positive, bright or ignorant, are mostly a reflection of your own character. If you’re not happy with the quality of people in your circle of influence, it’s time to work on yourself.

On a scale of 1 to 10, rate yourself for Influence ___________

After you’ve rated yourself for all six factors (Inspiration, Integrity, Initiative, Innovation, Impact, and Influence), add all the scores and divide by six. This indicator will give you a rough idea of your total LQ and where you need to make improvements. Make it a goal in this year to raise the bar in every category.
We have now come full circle in the leadership cycle starting with spirit (call it whatever you want) and ending with spirit; for everything rises and falls on leadership, everything comes from the spirit and returns to the spirit like the dust in the wind. Our highest purpose comes from spirit and returns to it in the form of service.

By subordinating our vision to the spirit, our conscience, our highest purpose is revealed. If you are not sure about your purpose, ask your higher self for guidance. A great way to do this is to ask a question before you go to sleep fully expecting an answer to be revealed in a dream or when you wake up. It might take several tries, but that’s okay, keep at it — and the answer will be revealed to you. A question you could ask might be, “What is my highest purpose?” or “How can I use my core genius to serve the greatest good?”

Nonfarm payrolls rose by a seasonally adjusted 54,000 in May. This is the smallest gain since September and a fraction of the 125,000 jobs expected by economists polled by MarketWatch.

That forecast had been cut in recent days as economists grew pessimistic after a string of disappointing data this week. Just a few days ago, economists were expecting jobs growth of 175,000 jobs in the month.

The official unemployment rate increased to 9.1% in May from 9.0% in April. This is the highest unemployment rate since December. Economists were expected a slight drop in the jobless rate to 8.9%.

“While one month does not make a trend and we are coming off three solid report payroll reports, today’s employment report not only confirms the recent softening in the economic data, but suggests that momentum is slowing sharper relative to market expectations,” said Neil Dutta, an economist at Bank of America Merrill Lynch.

The unemployment report adds to fears that the U.S. economy may have hit more than a soft patch and that a more protracted and dangerous downturn could be in the offing.

U.S. stocks traded lower on Friday, two sessions after the Dow Jones Industrial Average had the biggest one-month drop since July. Oil and silver futures also dropped.Read Market Snapshot.

Economists blamed the slowdown on higher gasoline prices and a slowdown in manufacturing caused by lack of parts from earthquake-wracked Japan.

“The deceleration in employment growth, together with a string of disappointing results on other indicators, calls into question the sustainability of the recovery,” said David Greenlaw of Morgan Stanley.

“However, we are still inclined to believe that this is a temporary soft patch reflecting supply chain disruptions, a spike in gasoline prices (which has been partially unwound), and weather-related influences.”

The government rejected the notion that deadly storms in the Midwest and the South played a role.

“We found no clear impact of the disasters on the national employment and unemployment data for May,” said Keith Hall, commissioner of the Bureau of Labor Statistics, in a statement.

Total payrolls were revised down by 39,000 for March and April. March’s gain was revised to 194,000 from 221,000, while April’s gain of 244,000 was revised to a gain of 232,000.

There was no sign that hiring at McDonald’s boosted payrolls. Food and drinking employment rose by 13,600 jobs in May after adding 28,000 workers in April.

“The breakdown of the leisure category suggest that the so-called McDonald’s effect was probably even smaller than the +25,000 or so that we had anticipated,” said Greenlaw.

A more detailed estimate for May fast food hiring will be available with a one-month lag, officials said.

The big picture

Stepping back, the economy has only recovered a small portion of the more than 8 million jobs lost during the recession.

Even before today’s disappointing number, the pace of job growth had not been sufficient to make a meaningful dent in the unemployment rate.

The problem of long-term unemployment continues to fester.

The number of unemployed workers out of work for 27 weeks or more rose to 6.2 million in May, or 4% of the labor force.

The labor force participation rate has held steady at 64.2% since January.

The underemployment rate, which includes part-time workers seeking full-time work, slipped to 15.8% in May from 15.9% in April.

Details

Details of the May report just added to evidence of a sharp deterioration in labor conditions.

Employment in the private sector was up by 83,000 in May, down from an average 244,000 gain in the prior three months.

The government sector shed 29,000 jobs in May, the seventh straight month of losses.

Services sector employment slowed to a gain of 51,000 in May from 194,000 in April.

Average hourly earnings increased 6 cents, or 0.3% to $22.98. Economists had been expecting a 0.2% gain. Earnings are up a slim 1.8% in the past year.

This shows that workers do not have a lot of spare cash as they grapple with higher prices at the pump.

The average workweek was steady at 34.4 hours. The factory workweek rose 12 minutes to 40.6 hours while factory overtime was unchanged at 3.2 hours.

“The only good news in the report was some upside in hours worked which points to a decent rise in wage income and a sharp jump in manufacturing output,” said Greenlaw of Morgan Stanley.

…The news sources used on Schwab.com come from independent third parties. Schwab is not affiliated with any of the news content providers. Schwab is not responsible for the content, and does not write or control which particular article appears on its website.

In today’s rapidly changing business climate, efficiency and effectiveness are crucial to your organization’s survival. This means you must have the right person for the job—any job—whether that job is temporary or permanent. America’s staffing companies can help you find the best talent—for any job—when you need it.

Today’s staffing employee might be a highly trained nurse at one of our nation’s finest hospitals, or a lawyer researching a big case. He could be a skilled technician, engineer, project manager, or scientist. She could be a truck driver, administrative assistant, medical technician, accountant, or architect. And he or she could be an interim CEO or CFO for a company in transition.

Staffing firms nationwide collectively employ an average of 2 million workers daily across all industries, providing work force flexibility and access to talent to businesses like yours. They also offer competitive wages and benefits to attract the best talent, and provide free training to millions of temporary, contract, and permanent employees each year.

How do you, as a business owner or executive, stand to gain? According to a major survey conducted for the American Staffing Association, companies use staffing employees for two principal reasons: flexibility and access to talent.

You’ll Profit From Work Force Flexibility
Nine out of 10 business customers rated flexibility as an important reason to use staffing companies, saying it keeps them fully staffed during busy times. Whether it’s a temporary job lasting a few hours or several years—or a permanent job placement—America’s staffing companies allow businesses to adjust their work forces to meet their ever-changing needs.
There are three main types of job placements in the staffing industry:

■Temporary or contract, where you add a staffing employee on an interim basis
■Temp-to-perm or temp-to-hire, where you add a staffing employee until you’re sure a spike in business will sustain itself or you want to make sure you have the right candidate for the job—if so, he or she becomes your employee
■Direct hire or permanent, where you tell the staffing firm what you’re looking for, it selects candidates for interviews, and you hire the best one
You’ll Enjoy Access to First-Class Talent
A staffing company not only offers you work force flexibility—it can provide you with specialized skills for a particular project. If you need a lawyer specializing in tax law, for example, a few calls to staffing firms in your area may fill your need. In addition, these firms can serve as deep recruitment pools for your permanent hiring. In fact, eight in 10 business customers say that staffing companies are a good way to find potential permanent employees—and industry research indicates that three out of four customers rank the quality of the employees they get from staffing firms as good as or better than their own employees.
You’ll Save Time, Money, and Worry
Consider this scenario: You’ve just realized you need to comply with the Sarbanes–Oxley Act, a recently enacted law requiring businesses to adhere to strict accounting practices. What do you do? You can develop compliance solutions yourself and hope they work. But if not, what then? Hire consultants or contract the work out at a significant expense? Remember, this expense is in addition to the man-hours already invested in the project.
Why not reach out to a staffing firm and bring in senior accountants and auditing specialists specifically to manage compliance with this law? Since these accountants have already been working on Sarbanes–Oxley, they know the new law from top to bottom. Time and resources are not wasted on false starts or missteps. And you might gain some valuable new permanent employees.

Determine the Type of Staffing Help You Need
OK, you’ve decided to use a staffing company. First, you need to choose a staffing firm that specializes in your industry or type of operation. Figure out if you need staffing employees for a one-shot deal, a long-term assignment, or a permanent job placement. Also, if it’s a permanent position—or likely to become one—find out if the company will let you submit interview questions for job applications and participate in the selection process.
Shop Around
There are thousands of staffing firms out there, from small operations to large multinational firms. Use the Internet to visit various Web sites. Check out several companies and ask for references. Ask about their fees; the turnover rate among account executives, office staff, and staffing employees. Make sure the firm will visit your premises to get a feel for your corporate culture, meet supervisors face to face, and learn details about the jobs that need filling. If you’re staffing a major project or function, expect a thorough review and presentation.
Also, find out if the staffing firm is an ASA member. These members represent 15,000 offices and branches nationwide, have agreed to conform to the industry’s highest standards, and are up-to-date on all the latest human resources developments and trends. Find a Staffing Company will help you select an ASA member that offers the services and skills you need.

How Was Your First Interaction With the Companies You Contacted?
Their Web sites should be informative, up-to-date, and easy to use. Telephone or e-mail the companies to get your first clue as to their business styles. Remember, staffing firms are employers. Their management practices greatly affect the quality of the employees who come into your offices—on a temporary or permanent basis. Staffing firms recruit, hire, and train their staff, so make sure you are dealing with a professional, capable organization.
How Well Run Is the Organization?
This will reflect the quality of help you receive. Ask how long the company has been in business in your area. Call references. Ask how satisfied they were with the employees at the staffing company as well as with the workers assigned to their organization, whether temporary or permanent.
How Does the Company Recruit and Retain its Qualified and Reliable Work Force?
Get details. See ads. To what extent are its techniques passive or active? What kind of a database does it maintain? For temporary and contract positions, consider whether the firm’s compensation and benefits are competitive to attract the type of workers you need. A more complete benefits package often attracts a better-quality worker. Also, ask about the firm’s turnover rates.
How Are Potential Staffing Company Employees Screened and Tested?
Many staffing companies give their employees initial “skills tests.” Some provide specific skills training, such as software tutorials in PowerPoint, Word, and Excel, and educate them on how to behave at businesses such as yours. This will help you greatly in determining the “quality” of worker you receive. In addition to skills testing, find out if the staffing firm conducts background checks and drug tests.
Does the Company Fully Understand Your Needs?
Get the most appropriate temporary or permanent person for the position. Make sure the company has an extensive database of available workers. This will help you get the right person for the job in a timely manner. If you need several jobs filled, ask the firm to help you determine the number of employees you should bring on board. Also, find out how to reach the company after regular business hours in case of an emergency.
Remember
The critical element in your relationsship with a staffing firm is the quality of temporary employees and job candidates you receive. Reliance on a reputable and capable staffing company can be an important management tool for your business. A little investigation and observation beforehand can save you time and money and result in a long-lasting business relationship.

Is the sky really falling?

Last week, the U.S. Department of Labor published a Final Rule concerning changes to its regulations and interpretations. One portion of the Final Rule’s commentary appears to say that the DOL is now taking the position that employees doing the typical work of service writers/service advisors/service salespeople (we’ll refer to them all as “service writers”) are NOT exempt from overtime under the federal Fair Labor Standards Act.

This has prompted a flood of alerts warning dealers that they should immediately start paying service writers overtime. We disagree; the sky is not falling. Instead, we recommend that dealers should calmly think through the different possibilities.

First, Some Historical Perspective

In order to understand the significance of the Final Rule, you have to understand what has gone on with service writers over the last 40 years. In 1966, Congress amended the Fair Labor Standards Act (FLSA) to create an exemption for any “salesman,” “partsman” or “mechanic” employed at a retail dealership. The following year, the DOL issued an Opinion Letter stating that an individual performing service writer duties would be included within the exemption.

However, about a month later, the DOL issued another Opinion Letter stating the opposite – that service writers were not exempt under the 1966 provision. Over the next four years, the DOL issued at least three Opinion Letters reiterating its position that service writers were not exempt from overtime. In 1970, the DOL restated that position in its Interpretive Bulletin.

Of course, the DOL is not the final authority on what Congress meant by “salesman, partsman or mechanic.” The courts are. In the early 1970s, the DOL sued a dealership in Florida because it had not paid its service writers overtime. The DOL argued that the exemption must be “narrowly construed” and that if Congress had intended to make service writers exempt, it would have listed them along with salesmen, partsmen and mechanics. Based upon arguments raised by Fisher & Phillips in the dealership’s defense, the court disagreed. Ruling for the dealership, the court stated that the DOL’s interpretation was too narrow and that Congress intended it to cover employees who were selling service as well as selling vehicles. The DOL appealed to the U.S. Court of Appeals for the 5th Circuit, and that court also rejected the DOL’s position, ruling that service writers were exempt. Dealers: 2; DOL: 0.

In 1975, the DOL tried again, suing a dealership in Michigan. The district court rejected the DOL’s arguments and found service writers to be exempt from overtime. The DOL appealed the case and the U.S. Court of Appeals for the 6th Circuit affirmed the district court. Dealers: 4; DOL: 0.

The DOL subsequently sued two other dealerships, one in Kansas and one in Nebraska. In both cases, the district courts rejected the DOL’s position and ruled in favor of the dealerships. The DOL did not appeal either of these cases. Dealers: 6; DOL: 0.

In 1978, the DOL changed its position. It announced that it would consider a service writer to be exempt from overtime if the dealership could show that the employee was primarily engaged in “selling service.” So, service writers who wrote a majority of customer-pay work would be exempt. On the other hand, those who wrote a majority of “warranty work,” would not be selling service because the warranty work had already been sold when the vehicle was purchased.

In 1987, the DOL finally cried “uncle.” Realizing the difficulty in enforcing its “customer-pay v. warranty” position, the DOL reversed its enforcement position on that issue. In its Field Operations Handbook, it stated:

Employees variously described as service writers, service advisors, service managers or service salesmen whose primary duty is to record the condition of a vehicle and write up a report indicating the parts and mechanical work needed have been construed as within the ["salesman, partsman and mechanic" exemption] by two appellate courts (Fifth and Sixth Circuits) and two district courts (in the Eighth and Tenth Circuits). Consequently, [the DOL] will no longer deny the OT exemption for such employees. This policy (that these employees are within the exemption) represents a change from the position in [the 1970 Interpretations], which will be revised as soon as practicable.

Apparently, it was not “practicable” to do this for the next 24 years.

In 2004, a former service writer sued a dealership in Virginia claiming that he was entitled to overtime. The district court granted summary judgment for the dealership, finding the service writer to be exempt from overtime. The service writer appealed to the U.S. Court of Appeals for the 4th Circuit and argued that the DOL’s Interpretation specifically stated that service writers were not exempt. (He was referring to the same Interpretation the DOL said it was going to change, but never did). The court concluded that the DOL’s interpretation of the exemption was “an impermissibly restrictive construction of the statute” and went on to state “we reject the [DOL's] interpretation.…” Dealers: 8; DOL: 0.

In 2008, the DOL under the Bush Administration issued a Notice of Proposed Rule Making designed to revise some Interpretations that had become out of date due to subsequent legislation or court decisions. One of the proposed changes was to finally change the Interpretation concerning service writers to align the published regulation with the DOL’s position and to make it clear that the DOL now considered them to be exempt from overtime.

Nearly three years have passed and the DOL has finally published its Final Rule. After receiving comments strongly opposing the proposed change for service writers from the AFL-CIO and from plaintiff’s attorneys’ groups, the DOL under the Obama Administration issued a Final Rule announcing that it has decided that it is not going to change the Interpretation after all, because it now believes that Congress did not intend to make service writers exempt from overtime.

Now, What Does It All Mean?

This Final Rule commentary simply represents the current DOL’s professed beliefs about what Congress meant when it included the “salesman, partsman and mechanic” exemption in the FLSA. It is certainly not the final word on what Congress meant. The courts are the final word.

The DOL’s latest position represents at least its fifth shift since 1966. It said in July, 1967 that the work of service writers was exempt. It said in August, 1967 that this work was not exempt. It said in 1978 that some such work was exempt. It said in 1987 that all such work was exempt. Now, its Final Rule commentary says that “there are circumstances under which the requirements for exemption would not be met” and then seems to say that the “salesman” exemption is limited to sales of vehicles. Fortunately, four district courts and the two Courts of Appeals have unanimously rejected the DOL’s interpretation as being too narrow.

While an agency’s interpretation of a statute is generally given some deference by the courts, the DOL has now changed its position on service writers five times over the last 40+ years. Particularly in light of what the courts have already said, we contend that its latest position is not entitled to any deference at all.

This change in position probably does not signal any significant change in the DOL’s enforcement posture in at least some jurisdictions. That’s because the DOL has a policy of deferring to decisions of the Courts of Appeals that are contrary to its position in those jurisdictions. Therefore, if one assumes for the moment that the current administration will not also change that policy, the DOL is unlikely to bring a lawsuit involving a previously-exempt service writer in the 4th, 5th, 6th, or 11th Circuits[1]. While we do not yet know if DOL will attempt to assert its new position in other jurisdictions, if it does, it should face an uphill battle given the consistent court decisions rejecting it.

What Should You Do?

For now, dealerships should not be in any hurry to begin paying service advisors overtime. Thirty years of consistent federal court decisions supports the fact that, under federal law, service writers are exempt from overtime and the DOL’s new position does not change that.

Any dealership that does not already have a possible back-up exemption for their service writers – the so-called “commission-paid retail” employee exemption – should immediately consider taking the steps to claim it. This exemption is available to any employees of a retail dealership who receive the majority of their compensation in the form of bona fide commissions, and receives more than 1½ times the federal minimum wage ($10.89/hr. at the current federal minimum wage of $7.25/hr.) for all hours worked in an overtime workweek. If your service writers currently do not meet all three requirements, it should be a relatively simple matter to restructure their pay plans to meet those requirements and we recommend that you do this.

If you are audited by the DOL and the investigator says that you must pay service writers overtime, explain to the investigator that past court decisions unanimously say that you do not have to pay overtime. DOL then has the option of dropping its demand or filing a lawsuit. We expect that it will choose the former, although it may tell your employees that it believes that they are entitled to overtime and encourage them to bring their own lawsuits.

Plaintiffs’ attorneys may well be emboldened by this new development to threaten lawsuits in an effort to extort overtime for current or former service writers. Again, do not be intimidated. The Final Rule is not the law. The law has been spelled out by the courts over the years and clearly says that service writers are exempt from overtime.

Please keep in mind that this article deals with only one group of employees – service writers whose job duties met the requirements for exempt status before the DOL changed its mind yet again. Dealerships have many other employees who are exempt from overtime ONLY if the employee’s job duties and pay plan are properly structured. This is a complicated area of the law which can significantly impact your dealership.

Because the DOL has already announced that it intends to aggressively enforce the wage-hour law, we strongly urge every dealership to carefully audit its entire payroll on a regular basis to ensure that all employees are being paid properly. If you do not have an attorney who is familiar with these laws, we will be happy to help you.

Finally, please keep in mind that this article deals only with the exemption under the FLSA. Dealerships must comply with both state and federal wage-hour laws. Some state wage-hour laws do not contain an exemption from overtime for service writers and may not contain a “commission-paid” exemption. Again, we urge every dealership to ensure that it is in compliance with both state and federal law. If we can help, please let us know.

For more information visit our Wage and Hour Laws Blog or contact any attorney in our Dealership Practice Group.

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This Legal Alert provides an overview on certain aspects of a specific law. It is not intended to be, and should not be construed as, legal advice for any particular fact situation.

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[1] Fourth Circuit: MD, VA, WV, NC, SC; Fifth Circuit: MS, LA, TX; Sixth Circuit: MI, OH, KY, TN; Eleventh Circuit: AL, FL, GA.

Nonfarm payroll employment rose by 192,000 in February. Since a recent low in
February 2010, employment has grown by 1.3 million, or an average 106,000 per month.

Employment in the private sector rose by 222,000 in February. In the past 12 months, the
private sector has added 1.5 million jobs – an average of 127,000 per month.

In February, job gains in professional and business services were concentrated in
employment services.

Since September 2009, employment growth in professional and business services has
been driven primarily by temporary help services.

Average hourly earnings of all employees in the private sector were changed little in
February, following a 9-cent gain in January. Hourly earnings are up 1.7 percent over the
year.

Employment in professional and business services expanded by 47,000 over the month,
and has increased by 601,000 since reaching a trough in September 2009.

Health care employment continued to increase in February (+34,000). Over the past 12
months, health care has added 278,000 jobs, or an average of 23,000 jobs per month.

On March 1, 2011, the U.S. Supreme Court held that an employer may be liable for the discriminatory motives of a supervisor who influences but does not make the ultimate employment decision. The Court’s ruling will impact employment discrimination claims where multiple individuals are claimed to have made, caused, or influenced the ultimate employment decision. Staub v. Proctor Hospital.

The Cat’s Paw Theory Of Liability

In employment discrimination claims, plaintiffs must establish that the employer took an adverse employment action based, in whole or in part, on their protected status, such as age, sex or religion among many others. Employees typically prove their claims by demonstrating that the ultimate decision maker had a discriminatory motive for the employment action. But where the ultimate decision maker is admittedly unbiased, several courts have allowed employees to use a subordinate bias or “cat’s paw” theory of liability to prove their claims.

The term “cat’s paw” derives from the 17th century fable of “The Monkey and the Cat” where a clever monkey persuades a cat to pull chestnuts from the fire by flattering the cat and promising to share the chestnuts. The unwitting cat burns its paws removing the chestnuts from the fire while the monkey sits back and eats all of the chestnuts. As in the fable, a biased supervisor can dupe an unbiased decision maker into taking an adverse employment action based on inaccurate, incomplete, or misleading information.

Courts of Appeal have applied at least three distinct approaches when addressing the subordinate bias theory of liability. At one end of the spectrum, some courts have held that subordinate-bias liability is available when the subordinate with the discriminatory animus provides input that may have affected the adverse employment action. At the other end of the spectrum, other courts hold that subordinate-bias liability is only available if the biased subordinate is the actual decisionmaker, regardless of whether the subordinate exercised substantial control or played a significant role in the decision. In the middle ground, subordinate-bias liability is available if the biased subordinate uses the formal decision maker as a pawn in a deliberate effort to trigger a discriminatory employment action.

Today, the Supreme Court has clarified the standard by which an employer may be held liable for discrimination based on a subordinate supervisor’s discriminatory animus when the ultimate decision maker is admittedly unbiased.

Hospital Makes Termination Decision Without Knowing All Of The Relevant Facts

Vincent Staub worked at Proctor Hospital as an angiography technologist in the Diagnostic Imaging Department. Staub was also a member of the United States Army Reserves. As a reservist, Staub was obligated to attend training sessions one weekend a month and two full weeks during the year. In addition, Staub was required to report to active duty when called.

Michael Korenchuk was the head of the Diagnostic Imaging Department at Proctor Hospital. Janice Mulally was second in command, in charge of preparing work schedules for the department. Mulally began scheduling Staub to work weekends, which created conflicts with Staub’s military obligations. When Staub raised the issue with Mulally, she threw him out of her office and said she did not want to deal with it. Occasionally, Mulally made Staub use his vacation when he had to attend military training and scheduled him for additional work shifts without notice. Mulally called Staub’s military duties “bull****” and said the extra shifts were his “way of paying back the department for everyone else having to bend over backward to cover [his] schedule for the Reserves.”

Korenchuk was not sympathetic to Staub’s plight. He also characterized Staub’s weekend military obligations as “Army Reserve bull****” and “a b[u]nch of smoking and joking and [a] waste of taxpayers['] money.” Korenchuk also told one of Staub’s coworkers that Mulally was “out to get” Staub.

Shortly after Staub received an order to report for “solider readiness processing,” a precursor to active deployment, Mulally gave Staub a written warning for disregarding his job duties. Specifically, Mulally accused Staub of failing to assist with other diagnostic imaging procedures within the department when requested. Staub disputed the basis for the warning and refused to sign it. Nevertheless, the warning stood and Staub was instructed to report to Korenchuk or Mulally when he had completed his angiographic duties and did not have any patients. Staub was also instructed to remain in the general diagnostic area unless he told Korenchuk or Mulally where he was going and why.

Mulally then called Staub’s Reserve Unit Administrator, Joseph Abbidini, and asked if Staub could be excused from some of his military duties because he was needed to work. Abbidini told Mulally that the training was mandatory and that Staub could not be excused. Mulally called Abbidini an “a**hole” and hung up.

A couple of months later, Staub completed his angiographic procedures around noon and decided to go to lunch. Because of the warning he had received, Staub went to Korenchuk’s office to tell him that he was going to lunch. Korenchuk was not in his office, so Staub called Korenchuk and left a voicemail message notifying Korenchuk that he was going to the cafeteria for lunch. Staub returned to work 30 minutes later. Korenchuk confronted Staub and demanded to know where he had been. Staub explained that he had gone to lunch in the cafeteria and had left Korenchuk a voicemail message to notify him. Korenchuk was not satisfied with the explanation and escorted Staub to the Human Resources Department where they met with Linda Buck, the Vice-President of Human Resources.

Korenchuk had already met with Buck and told her that Staub failed to report his whereabouts as instructed and that he could not be located. Accordingly, a decision was made at that time to terminate Staub. When Staub walked into Buck’s office, she handed him his termination notice and the security guard escorted Staub out of the building. According to the termination notice, Staub was discharged for failing to comply with the written warning instructing him to report to Korenchuk whenever he had completed his angiographic procedures and did not have any patients. Notably, Korenchuk did not tell Buck about Staub’s voicemail message.

Prior to deciding to terminate Staub, Buck reviewed Staub’s personnel file, including his positive annual performance evaluation and the prior written warnings. Buck also relied on input from Korenchuk, but the ultimate decision to terminate Staub was Buck’s. Staub’s involvement with the military played no role in Buck’s decision to terminate Staub.

After his termination, Staub filed a lawsuit against Proctor Hospital under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) alleging that he was terminated based on his military involvement. USERRA prohibits an employer from denying “employment, reemployment, retention in employment promotion, or any benefit of employment” based on a person’s “membership” in or “obligation to perform service in a uniformed service,” and provides that liability is established “if the person’s membership … is a motivating factor in the employer’s action.”

At trial, the jury sided with Staub and found that Staub’s military status was a motivating factor in the decision to terminate him. Proctor Hospital appealed the verdict to the U.S. Court of Appeals for the 7th Circuit. On appeal, Proctor argued that the Court improperly admitted evidence of discriminatory animus by non-decisionmakers.

The Seventh Circuit reversed the jury’s verdict, finding that there was insufficient evidence for a jury to conclude that Staub was fired because he was a member of the military. Specifically, the Seventh Circuit concluded that Proctor Hospital could not be liable to Staub under a subordinate-bias or cat’s paw theory of liability because a reasonable jury could not find that Korenchuk, Mulally (or anyone else) had “singular influence” over Buck, who was admittedly unbiased.

The Supreme Court Defines the Scope of Employer Liability

In a decision delivered by Justice Scalia, the Supreme Court held that, “if a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA.” Justices Roberts, Kennedy, Ginsburg, Breyer, and Sotomayor, joined in the decision. Justice Alito filed an opinion concurring in the judgment, in which Justice Thomas joined. Justice Kagan took no part in the consideration or decision of the case.

The Court further declined to adopt a blanket rule immunizing an employer who performs an independent investigation of the conduct that led to the adverse employment action. Instead, the Court provided a very limited exception to liability where subordinate bias is at issue:

Thus, if the employer’s investigation results in an adverse action for reasons unrelated to the supervisor’s original biased action (by the terms of USERRA it is the employer’s burden to establish that), then the employer will not be liable. But the supervisor’s biased report may remain a causal factor if the independent investigation takes it into account without determining that the adverse action was, apart from the supervisor’s recommendation, entirely justified.

Accordingly, the biases of those who make, cause, or influence the employment decision are relevant and can be considered when determining employer liability.

How Will This Decision Impact Employers?

The Court’s decision adds another layer of potential liability for employers in USERRA claims and other types of discrimination claims where an individual’s protected status is a “motivating factor” in the adverse employment action. Indeed, the decision makes it clear that if the biased motives of a subordinate supervisor influenced the chain of events that led to the adverse employment action, the employer may be liable for discrimination, even if the ultimate decision maker had no discriminatory intent.

As a result of the Court’s decision today, employers will have to look more carefully at an employee’s prior conduct and the discipline or corrective action issued before taking an adverse employment action. The ultimate decision maker can no longer rely solely on the content of an employee’s personnel file or the recommendation of an employee’s immediate supervisor before taking an employment action and, instead, must conduct an independent investigation to confirm that there is a legitimate non-discriminatory reason for the adverse employment action.

For more information or contact your Fisher & Phillips attorney.

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This Alert provides information about a specific Supreme Court decision. It is not intended to be, and should not be construed as, legal advice for any particular fact situation.