McGowanPRO Professional Liability Blog / Resources / Articles

Is your firm prepared for the New Overtime Pay Rules?

Posted by Gary Sutherland on Fri, Nov 18, 2016 @ 11:41 AM

On December 1, 2016 the overtime rules for "white-collar workers" will take effect.

Effective December 1, 2016, executive, administrative, and professional employees making less than $47,476 per year are entitled to be paid overtime, including salaried employees. This salary level will be updated every three years, beginning January 1, 2020. Prior to December 1, 2016, the “exempt from overtime” salary threshold was $23,660.

 Learn more about the impact on employees and employers.

There is a strong likelihood that wage and hour claims will increase in 2017.

The most common FLSA offenses for small businesses include:

  • Not paying overtime for time worked over 40 hours in a week
  • Misclassifying managers and assistant managers as exempt
  • Paying lump sum amounts for overtime hours worked vs. paying 1.5 times the normal hourly rate
  • Not paying for overtime since it had not been pre-approved
  • Allowing employees to “waive” their rights under the FLSA

Claims will come not only from the misclassification of employees, but from non-exempt employee allegations such as:

  • Not being paid properly (incorrect overtime payments)
  • Being forced to work "off the clock"
  • Not being given sufficient meal and rest periods
  • Pay equity issues

Now is the time to be certain your firm is protected with Employment Practices Liability Insurance (EPL) - with coverage for violations of the Fair Labor Standards Act (FLSA)!

NAPLIA offers FLSA coverage with  an Employment Practices Liability policy from Mount Vernon Insurance Company, an A+ rated carrier with AM Best:

  • $100,000 sublimit for costs of damages and defense for claims alleging violation(s) of the FLSA (wage and hour)1

1 Subject to underwriter approval.

Questions?

Rob Ferrini | Program Manager | NAPLIA

Direct: 508.656. 1327 |Toll Free: 866.262.7542, ext. 1327 www.naplia.com

[email protected]

 

Tags: employment

NAPLIA ebook Chapter 2:  Removing client files from the office

Posted by Alison Simons on Fri, Sep 11, 2015 @ 09:24 AM

When client files are removed from the office there is an increased risk of loss. It’s easy for an employee to misplace a USB stick, leave important documents on a train or have a company laptop stolen, and client files may then be available to (often non-traceable) third
parties. Firms should therefore only remove client files from the office when such files are necessary for reference in client meetings.

Permission for removal should always be obtained from a manager and portable devices that hold client files should always be encrypted (see guidelines in Chapter 3). Client files should not be stored on portable storage media (e.g., (USB sticks, smartphones, tablets etc.) or laptops for longer than the period of active use if such devices will be removed from the office. Client data should be deleted from such devices when no longer required.

The partner or officer responsible for information security or compliance within your firm should be advised immediately if client files are lost outside of the office. This step is critical to allow you to comply with your incident notification policies and manage any additional damage that the disclosure may cause.

Employees may be reluctant to report a loss, but a firm needs to communicate to its employees the importance for compliance under firm policies and as well as under law. One approach to minimize the risk of not reporting, at least with regards to electronic media, is for the company to only permit company-issued electronic storage media to store client files and to keep inventory of such media. This inventory documents all devices that have access to client files. Keeping the inventory up to date and running regular device checks can provide early notification of losses that may otherwise remain undetected.

Attention should also be paid to the potential for employees to remove client files at the end of their employment. Portable devices, physical documents and even hard drives may easily leave with a departing employee, either as an oversight or an act of malice. The associated risks can be minimized with measures including:

  • A departing employee checklist: This checklist ensures that all company-issued devices (and the client files that they may contain) are returned before the employee leaves the company.
  • A media sanitization policy that extends to employees’ personal devices: This provision ensures that client files are removed from devices that do not fall under the company’s direct control.

Responsibility for these measures will be more effective if assigned to a named representative. The representative will in most cases be the departing employee’s direct superior.

Check back each month for a new chapter of the NAPLIA cyber ebook.

Tags: employment, risk management, cyber

Economy shows moderate growth, and Accounting Industry hiring

Posted by Tom Henell on Mon, Jan 31, 2011 @ 10:08 AM

According to an article in the LA Times today, the economy grew at a 3.2% annual rate in the last three months of 2010, driven by stronger consumer spending and trade, the Commerce Department reports. Economists expect the recovery to pick up momentum this year, though a shadow still looms over employment.  Read full story

Despite pessimism over the impact of the economy growth on employment an analysis of professional liability applications over the past 4 years shows noticeable improvement in hiring in the Accounting industry.

Accounting professional staff counts from professional liability applications received through NAPLIA:

2006  - control

2007 - moderate growth from 2006

2008 - significant decrease from 2007

2009 - flat

2010 - significant improvement back to 2007 numbers

Although not a scientific study, employment in the Accounting industry can be measured through insurance applications.  Our experience is that the Accounting industry is seeing a recovery and we expect that employment rates in the industry will continue to rise through 2011.

Tags: accountants, employment, professional liability