How to Carefully Address Alcoholism in the Workplace

Whenever a new employee starts a job, personnel managers privately hope they’ve adequately screened the person. Hiring workers has become a much more complex task now that so many qualified professionals move freely between long-term positions, the “gig economy” and periods of self-employment.

Finding productive employees is also hard because many people who suffer from alcoholism or “alcohol use disorders” have learned various ways to try and hide their problems.

What exactly is alcoholism or “alcohol use disorder?”

The Mayo Clinic website states that people who experience “repeated significant stress and problems functioning” in their daily life due to drinking, usually suffer from alcohol use disorder.

Those attempting to cope with this daily disorder also struggle with increased drinking in hopes of obtaining the same “high” that helps them escape their emotional pain. Over time, many alcoholics find it hard to even quit thinking about alcohol. Still others stay busy with “binge drinking” spells — or the physical and psychological problems that occur during withdrawal.

Some larger companies have employee assistance programs that can readily offer counseling and other services to workers struggling with addictions and other psychological problems. However, there will always be many workers who remain in denial about their critical drinking problems — and small businesses who simply cannot afford to provide a wide array of special services to their workers.

What follows is a brief review of American alcohol abuse statistics, a list of signs that workers may have drinking problems – and a look at how employers can try to reach out and help employees with apparent alcohol use disorders.

What statistics tell us about alcohol abuse in America

  • Well over 12 million adults struggle with alcoholism. In fact, one 2018 study revealed that 14.4 million adults (at least 18 years of age or older) were battling alcohol use disorder (AUD). Approximately 9.2 million of these individuals were men and 4.1 percent were women.
  • Heavy use and binge drinking are also common. This same 2018 study noted that when adults age 18 or older were asked about their drinking during the prior month, 6.6 percent of them said they were heavy drinkers. And 26.45 percent of them admitted to binge drinking during the past 30 days.
  • Every year, about 88,000 people die of alcohol-related causes.

As these statistics indicate, every business surely has more than a few problem drinkers. And experts estimate that lost productively due to alcoholism can cost American employers between $33 billion and $68 billion each year.

Common signs that employees may have drinking problems affecting their work

  • Repeated, unexplained absences from work
  • Ongoing tardiness
  • Frequent use of sick leave
  • Too many absences occurring the day after payday – or a pattern of taking too many three-day weekends
  • Falling asleep on the job
  • Moody behavior and difficulty getting along with other employees
  • Bloodshot eyes, an unsteady gait – and the faint smell of alcohol
  • Claims of too many sudden “emergencies” during relatively short timeframes
  • A steady stream of assignments finished late
  • Incomplete assignments or clear signs of inadequate effort
  • Ongoing problems with meeting assigned sales or other quotas

How should employers address one or more of these problem behaviors?

  1. You will need to schedule a private meeting with the employee. Prior to this meeting, you should review all recent employee work evaluations and privately talk with the person’s supervisor (who may also want to attend the meeting). Be sure to take notes. Also, make it clear that you’ll be checking back with the employee at a later (specific) date to see if their work and/or attendance record is improving.
  2. If your company has an EAP (employee assistance program), meet with your personal representative of that program prior to the meeting referenced above. It may be necessary to schedule some type of intervention with the employee, after that person is given ample notice of the meeting. This event (which should probably be managed by your EAP contact) can include the person’s workplace supervisor, spouse, clergy or other family members. All who attend must indicate that they’re simply trying to help the person improve their health and keep their job.
  3. In some cases, you are likely to meet up with an employee’s denial. If so, you must still make a referral to your EAP — or remind the person to obtain this type of outside help on his or her own if your company doesn’t provide EAP resources. You must also clearly state that if one or two more unexplained absences (or poor work performance reports) are received, the employee will be terminated. Be sure to have at least one other company official present during such meetings and keep detailed, confidential notes.
  4. You must be prepared to tell an employee who appears to be intoxicated at work to stop working immediately. This is especially true if the person is driving a work vehicle or handling potentially dangerous equipment. You may also have want them to take an evidentiary breath testing (EBT) device.

Employers should avoid taking the following steps when alcoholism may be present

  • Covering up for an employee with a drinking problem
  • Loaning money to the person with alcoholism
  • Helping the tardy employee make up assignments later, instead of disciplining him/her
  • Requiring co-workers to complete the apparent alcoholic’s assigned work
  • Allow a spouse to call in absences for the employee

Hopefully, the problem drinker will respond to your outreach efforts, agree to a temporary term of leave and then follow-up care. If all goes well, this person will then be able to carry a normal workload again. While this is always a very difficult problem to handle, it’s important to remember that those who do recover from an alcohol abuse disorder may one day become your most loyal employees, grateful that you gave them a chance to fully address their problems.

Please feel free to contact one of our Murray Lobb attorneys when you need help deciding how to respond to this type of employment law issue. Our office also remains available to help you draft any contracts or other documents you may need while running your business.

Minimizing Chances of Violence When Terminating Difficult Employees

Although some angry former employees who’ve been fired have tried to physically harm or kill their former employers and co-workers, there are constructive steps you can take to greatly lower the chances of any workplace violence. After all, most workers don’t suddenly begin doing poor work or behaving rudely to others. There is usually an extended time period when a person’s work starts to deteriorate.

If you’ll conscientiously conduct regular employee job evaluations that put each worker on notice of any deficits in their productivity or demeanor, being let go should rarely come as a surprise (unless there’s been a sudden, violent outburst or you’ve recently discovered illegal activity).

Here’s some specific advice about how your company or office manager should interact with employees once you’ve decided to fire them.

Workplace practices that may help a dismissed employee cope better when terminated

  • Privately inform the employee that you need to meet with him/her in your office.

No one likes to be embarrassed in front of others, so be discreet. Plan to have at least one other management employee present to witness the event. Once you start this meeting, be sure to briefly reference the other person present and then immediately tell the worker being fired that this is a permanent decision that’s been made after great consideration of all the relevant facts. (These words can help prevent an anguished exchange during which the employee may beg to stay on the job – or even unwisely threaten those s/he blames for the firing.)

Give serious thought to creating a folder with all the materials the employee will need inside of it. Then, tell the employee you’d like to go over the different forms, possibly including any severance agreement that your company may need signed and dated in your presence. If you employ 20 or more employees, be sure to include adequate information about how the employee can apply for (and most likely) receive health insurance through the COBRA program. (COBRA stands for Consolidated Omnibus Budget Reconciliation law.) And be sure to check with your Houston employment law attorney to see if Texas requires that you provide the person with any other health insurance information.

Remember to always speak in a calm and pleasant tone, even if the employee becomes a bit agitated or excited. Consider always having a company (or building) security guard on hand in the outer office, just in case an upset employee becomes unruly.

Be willing to stop and answer questions. After all, most people have many questions they need to ask at such an upsetting time in their life — even if they “should have known” this event was likely. Carefully explain exactly when a final check will be cut and explain how you will deliver the funds to the person being dismissed.

  • Obtain all remaining property that must be returned. When providing the employee with notice of the meeting, you should always give the individual a clear list of all proprietary equipment, keys and other materials that you expect to have returned to you in good condition. If the person has been entrusted with extremely important security codes, you might want to note that those are always changed when any employee leaves the company.

If any major piece of equipment is not returned, be prepared to discuss a reduction in the final sum of money owed to the person – unless you failed to state that policy in your employee handbook. If no prior notice was provided, you should speak to your attorney about the wisdom of deducting any amount of money from that final paycheck or payment of benefits owed.

In addition to all company vehicles, be sure to collect all ID badges, security parking tags not currently affixed to vehicles, beepers, cell phones and confidential company publications.

Finally, you should calmly allow the employee to express some moderate anger about the decision. Sit quietly – and at most, simply restate that the decision is final. By listening to the person, you’re affirming them to some extent, and that’s important to having the individual leave in a calmer state of mind.

Unless the employee becomes verbally abusive (not just angry or a little flippant), ask them to be prepared to leave with all their belongings right after the meeting. (Of course, you should have already conducted a thorough investigation of any reported wrongdoings by the employee – and given that person a chance to explain his/her side of any alleged wrongdoing.)

Note: Always be sure that the person has time to collect his/her belongings and remind them to check the employee lunchroom or any locker that may have been assigned. It’s also wise to state that you will not be discussing the dismissal further with any of the departing employee’s co-workers. As for references, try to state (if true), that your company normally only provides confirmation of employment dates, without further comments or explanations. (Be sure that’s already set forth in your employee handbook). If the person has remained calm, brief goodbyes to co-workers should also be allowed.

  • One other key point: always be specific during the dismissal process. Employees being let go really want to know why their work wasn’t satisfactory. Since people often feel completely out of control of their lives when they’re being fired – specific feedback helps them feel empowered and like they can bounce back with a new job. It can help to have copies of all recent job performance evaluations handy when meeting with any employee who is leaving.

If you liked the person but found their work unacceptable, you’re always free to tell them that you wish them well and hope they can find another position more in keeping with their most highly developed talents;

  • Decide in advance whether your company believes it should ever allow someone being fired to “resign” their position instead. This helps some people feel less angry and like they have retained some degree of self-respect. Of course, if you do choose to allow this approach, you should remind the departing employee (in writing) that s/he might still be legally viewed as having been fired.

However, be sure you avoid making any promises about the receipt of unemployment benefits when someone chooses to resign. To protect yourself, it’s probably best to tell the person (in writing) that they will need to check with the Texas Workforce Commission about such benefits, noting that all dismissals are usually handled on a case-by-case basis.

  • Formal outplacement services. While these are most frequently used by large corporations when laying off groups of employees, it’s wise to check on all the services that they provide. However, if you’re a smaller company or a solo office with a relatively small group of employees this probably won’t be practical. If nothing else, try to include a form in the “separation” or dismissal packet that provides the address of the nearest Texas Workforce Commission office, its website address, and the phone number for that office. People will usually be calmer if they have an idea about how they can immediately begin looking for a new job;
  • Provide clear information about what you’ll be including in the employee’s final paycheck. In Texas, an employer normally has six days to provide the departing employee with his/her final paycheck. However, if someone insists that they’re quitting the job, you can wait to issue their final paycheck at the time of the next scheduled payday.  See Texas Code Annotated, Labor, Section 61.014.

If you fail to pay a fired employee on time, you might be required to pay that person damages – and possibly even a penalty to the employee and the state.

And remember that in most states, you’re usually required to pay the employee for any accrued vacation time.

Gray areas can easily occur during dismissals

A bit too often, people get very angry when being fired. In some cases, they will storm off during your meeting, claiming that you can’t fire them – because they’re quitting. While you do not have to put up with rude or antagonistic behavior, you might want to calmly note that being fired might be the better option, if they prefer to sit and think about it for a few minutes.

However, you have no duty to try and counsel the person on this issue. Just be aware that when any employee says s/he is walking off the job, the law may not treat that person as fired – causing the individual to lose access to unemployment benefits.

If the departing employee really tried hard to do good work for many years and may just no longer be able to keep up with new job technologies, your company always has the option of covering the fee so that individual can go to a local personnel agency and receive one formal placement in a new position.

Final tips for carefully handling employee dismissals

  • As the Texas Workforce Commission notes, try to avoid dismissing or firing any employee “during the heat of the moment.” All future interactions will go much more smoothly if there are clear reasons for firing a person that have been documented over time – even though Texas doesn’t require warnings for at-will employees. Just try whenever possible, to treat anyone you wish to fire with dignity.
  • Make sure all your actions are backed by clearly stated company policies and procedures. The last thing any company needs is to be sued by an angry former employee who can reference an employee handbook that clearly indicates that you failed to properly handle his/her dismissal.
  • Be sure you always responded to all legitimate complaints made by the person you’re about to fire. The Texas Workforce Commission is often sympathetic to people seeking unemployment benefits who can document that certain workplace problems – that were formally reported and negatively impacted the person’s performance – were never properly addressed.
  • Try to only fire people early in the morning or late in the day – when few other workers are still present. And be sensitive enough to not provoke someone by firing them on their birthday or the day before a major holiday.
  • Check ahead of time with your accountant to be sure the employee doesn’t owe the company for any loan made against future paychecks.
  • While it was suggested above that you may rarely want to try and help a worker meet with a personnel agency, keep in mind many workers may try to abuse that privilege.
  • Never allow any employee who was just dismissed to log back into the company computer system. Irate people with moderate skills can easily wreak havoc on your database or other sensitive files.
  • Always have each staff person present during the termination meeting prepare a memo documenting what took place. This information can prove very useful later if your company is sued for wrongful termination.

Please feel free to contact one of our Murray Lobb attorneys if you need to ask any questions about specific issues involved with terminating an employee. We can also help you (re)draft your employee handbooks so that all procedures involved with firing employees are set forth clearly.

Understanding the Purpose and Benefits of HB 4390

Texas and many other states have recently been passing new data breach protection laws to be sure that consumers receive timely notification after their most sensitive personal information has likely been breached or stolen. In June of 2019, HB 4390 was signed by Governor Greg Abbott. It became effective on January 1, 2020.

What HB 4390 is designed to accomplish – in general terms

Known as the Texas Privacy Protection Act, this legislation amends pertinent portions of the Texas Identity Theft Enforcement and Protection Act (“TITEPA”) set forth in the Texas Business & Commerce Code. In addition, the Texas Privacy Protection Act creates the Texas Privacy Protection Advisory Council that’s currently studying the data privacy laws of other states and countries.

HB 4390 requires this council to report its findings to the legislature by September 1, 2020 – so more comprehensive consumer privacy legislation can be considered during the next session of the Texas Legislature, beginning in January 2021.

New notification duties after suspected data breaches in the future

Now that the Texas Privacy Protection Act has gone into effect, the following new rules must be obeyed by all companies doing business in the state.

  • HB 4390 has added a new deadline. Consumers must be timely notified when there’s been a definite or suspected data breach (of sensitive personal information). This notification must be made within 60 days of the date when the apparent breach was discovered.
  • As amended by HB 4390, the TITEPA requires businesses to provide notice of certain types of data breaches to the Attorney General of Texas. More specifically, notice is mandatory when a breach has compromised the data of 250 or more Texas residents. This notice to the AG’s Office must also cover the following topics.
  1. The nature and circumstances of the breach must be described – and information must be provided about how the compromised data has been used (if known);
  2. There must be a statement about the number of Texas residents who were affected by the breach and when notifications were sent out;
  3. The reporting party must describe any measures taken to address the consequences of the breach;
  4. The AG’s Office must also be told whether any additional, corrective measures (regarding the suspected breach) are planned in the future; and
  5. There must be a statement about whether any law enforcement agency is currently involved in investigating the reported breach.

At present, at least 17 other states have established similar timeframes for reporting data breaches, usually between 30 to 90 days after the breach was discovered.

The Texas Privacy Protection Act also created the TX Privacy Protection Advisory Council

As was briefly noted above, this council will be meeting regularly until it tenders its required report to the Texas legislature by early September 2020. It’s hard to know if the group’s recommendations will be very comprehensive since some legal experts are concerned that Texas is rather hesitant to pass the full panoply of data breach protections that may be necessary. Far stronger measures were rejected – when HB 4390 and another bill were first proposed in Texas.

Better protection for victims of data breaches will likely be affected by the views of those currently sitting on this council. Here’s a look at the membership of this group.

  • Three of those who are on the council are members of the current Texas House of Representatives;
  • Three others are Texas senators;
  • Nine seats on the council were reserved for representatives of a wide number of industries including: consumer banking, technology, internet, medical profession, retail and electronic transactions, telecommunications, cloud data storage and social medial platforms;
  • Just two members of the Texas Privacy Protection Advisory Council are either members of a nonprofit organization that regularly evaluates data privacy issues from the viewpoint of consumers – or are professors at a Texas law school (or other higher educational institution) who have had important work published regarding data privacy.

Hopefully, most Texans will be pleased with the legislation that will eventually be passed based on this group’s recommendations.

Please feel free to contact one of our Murray Lobb attorneys if you have any additional questions about how this new legislation may affect your company either before or after you experience a data breach. We’re also available to address any of your other general business law needs — and we can readily draft the contracts and other legal documents you need to run your company each day.

Workplace Evaluations: Skills, Aptitude, Psychological and Lie Detector Tests

Ideally, every job applicant should be fully tested and evaluated before being hired for any position. However, state and federal laws impose certain restraints on the specific types of tests that can be given to job seekers. While skills tests are usually the most critical and widely accepted exams, care must be taken to administer them fairly and accurately.

Here’s a general overview of the types of job applicant rights you must respect while using any of the types of tests referenced above. As will be referenced below, all tests must be given in full compliance with the Americans with Disabilities Act (ADA).

Skills and aptitude tests – evaluating clerical, computer software and other job skills

A general rule of thumb that can guide you about many tests is that they must be specific to the types of skills that a job requires on a regular basis. Therefore, it’s usually fine to find out how fast a potential clerical employee can type or how much someone knows about repairing and maintaining computer systems if you’re hiring a computer help desk employee.

While you can usually test most the job skills of the disabled, you may need to make some accommodations in how you administer such tests. Cornell University’s publication entitled, Pre-Employment Testing and the ADAis well worth reviewing to gain a better understanding of job testing requirements. Just keep in mind that certain timed tests may need to provide slightly longer completion times and accommodations may need to be extended to applicants who’ve made their special testing needs known to you, in advance.

Although general aptitude tests can still be given using multiple choice tests, great care must be taken to avoid formats that may mainly reward test-taking skills over a job candidate’s ability to properly handle future job tasks. Short-answer questions based on factual job topics may provide greater insights into a person’s capabilities.

Psychological testing of job applicants

Although some employers still place great value on these types of tests, they are no longer highly favored. Two of the chief reasons that employers are thinking twice about administering these types of tests is that they can sometimes illegally discriminate against certain job applicants or invade their privacy regarding their moral and religious beliefs.

Employers should only administer psychological profile tests that have been scientifically validated, indicating direct correlations with a worker’s job performance. Another potential problem with psychological testing is that the ADA does not allow medically oriented tests to be administered to applicants who are disabled — if it might help discern their disabilities.

In certain situations, the ADA may also require you to revise a psychological or other test if an applicant claims it tests skills related to his/her disability (such as hearing capacity) – that are not regularly required for the job.

Lie detector or “honesty” tests for job applicants and employees

In general, the federal Employee Polygraph Protection Act – with only limited exceptions – prevents employers from requiring job applicants or employees to undergo lie detector tests. While certain types of unique applicants or employees may have to take such tests – including those wanting to provide armored security services (or dispense pharmaceuticals) – restrictions must still be honored as to how such tests are administered and evaluated.

Most of the time, in the few instances when a larger employer might want to administer this type of test, it’s normally only used when there’s reasonable suspicion that an employee may have embezzled from the company or committed other workplace theft.

At present, experts on this topic indicate that it’s nearly always best to restrict the use of any type of “honesty” test to situations where an employee may need to handle cash.

Always remember that in order to protect your company or business from any possible future claims of discrimination, you must make sure that all job applicants take the required tests at the same basic time in the hiring process.

Every employer may want to create a copy of this EEOC document designed to help determine the best job candidates — while fully complying with all federal laws.

Please feel free to contact one of our Murray Lobb lawyers if you need legal advice about administering specific tests to any of your job applicants or employees. We also remain available to discuss any other legal concerns you may have – and can readily draft a wide range of contracts and other documents you may need while conducting daily transactions with your business customers and other parties.

Overview of Small Business Administration Online Courses

Ever since our government created the SBA (Small Business Administration) back in 1953, it’s been working hard to promote, assist and protect America’s small business interests. Chief among its goals is to help entrepreneurs as they try to create and “grow” new companies.

During recent years, the SBA has been offering online courses that can help people focus in on creating viable business plans – while also securing adequate funding for their initial marketing and other needs. Whether your business is still in the planning stages – or already gaining traction – you can benefit by taking several of these courses.

SBA classes can greatly help many business owners

  • The All Small Mentor-Protégé Program. Like most of the courses offered, this one allows you to glance at a course transcript or outline before starting the class. This 30-minute program is designed to help entrepreneurs decide if they’re businesses are ready to sell goods or services to the federal government. If you believe your business is ready, you can take this course and use the certification of completion while applying for acceptance into this mentor-protégé program;
  • Business opportunities. This 30-minute class (offered on a self-paced basis), helps entrepreneurs learn how federal contract procedures work and what they must first do before trying to sell goods to the federal government;
  • A course on gaining a competitive advantage for your company. This SBA class teaches students how to accurately evaluate their competition, create a brand, seek out potential customers and decide how best to set prices for their goods and services;
  • Financing your business. There are many ways to come up with the money you’ll need besides funding it yourself or obtaining a bank loan. This class explains the basics facts about venture capital, crowdfunding, angel investors, grants and other sources. You’ll also gain a better idea how to figure out your exact start-up costs and other expenses;
  • Legal requirements for a small business. This course explains many basic aspects of employment law that must be understood before trying to start a company. One key topic looks at how you must responsibly hire and fire employees. Be sure to speak with your Houston business law attorney during the earliest stages of starting your company to make sure you’re complying with all applicable state, local and federal laws;
  • Social media marketing. Every small business owner must learn how to properly market goods and service to the public using social media platforms like Facebook, Twitter, Pinterest, LinkedIn, YouTube, Tumblr and others. This course also teaches students how to reach their prime or target audiences based on such factors as age and location;
  • Growing an established company.  At some point, most companies find themselves facing unexpected competition or a change in market forces that makes them need to retool their approach to winning new customers. This class will help you determine if your company is ready to expand and how to carry out that goal. It also teaches important growth strategies;
  • A course on buying a company already in business. Terms like due diligence are explained so that students will understand the critical need to learn all they can about any business before buying it,
  • The special cybersecurity needs of small businesses. This course helps acquaint owners with some of the ways they can try to protect themselves against major cyber threats that can take down websites and otherwise disrupt normal business transactions. There’s also a related class that describes useful ways to prevent general crimes from being committed against your company.

All the courses referenced above may prove useful to a large percentage of new businesses (or those needing to reinvent themselves). The following brief synopses are related to classes created for unique groups of entrepreneurs.

SBA classes designed for the needs of specific individuals and groups

  • Special contracting opportunities for veteran entrepreneurs. Nearly one in ten U. S. businesses are owned by military veterans. Since these men and women often face special burdens after serving our country, the government has created unique programs to help them find profitable ways to support themselves and provide jobs to others;
  • A course designed for Spanish-speaking young people. Titled Jovenes Emprendedores, this class provides key guidance for those who need business training materials taught and presented in Spanish). There is also a class designed for young entrepreneurs who are native English speakers;
  • Business development class for Native American businesses. Students in this class will learn more about the 8 (a) Business Development Program that’s been specially set up to help many small business owners facing economic disadvantages;
  • Entrepreneurship program for women over 50. Given the high number of seniors now needing to remain in the workforce past normal retirement age, this course is perfect for older women wanting to get new businesses off to a good start. Those who take this course may also want to review the materials designed for the more general WOSB (women-owned small business) Advantage class.

The courses referenced above are just a sampling of the roughly 63 free classes available to anyone who has 30 minutes (or more) to spend mastering these core topics. Should you decide to contact the SBA directly or online, they may be able to provide you with additional online and community resources that can help you get your business off to a promising start.

Please feel free to contact one of our Murray Lobb attorneys while trying to start up a new company – or purchasing one that’s already helping customers. We appreciate the opportunity to help all our clients succeed in all their new business endeavors.

Update: Department of Labor Issues New Rule on Overtime Pay

The Department of Labor issued a final rule in September of 2019 that could allow an additional 1.3 million more American workers to become eligible to receive overtime pay. This new rule becomes effective on January 1, 2020.

One key focus of the new rule is to update the earning thresholds that exempt certain professional, executive and administrative employees from the FLSA (Fair Labor Standards Act) minimum wage and overtime pay guidelines. The new rule is also designed to allow employers to count portions of some bonuses and commissions toward meeting the required salary level.

These adjustments are being made to recognize the increase in employee earnings that have occurred since these salary thresholds were last reviewed in 2004.

Earning levels and other specific issues addressed by the new DOL rule

  • Changes are being made to the “standard salary level.” At present, the enforced earning level is $455 per week – and that’s being raised to $684 per week (or $35,568 for an entire year);
  • There’s an increase in the total annual compensation requirements for workers categorized as “highly compensated employees.” The current enforced level of $100,000 a year is now being raised to $107,432 annually;
  • Employers can now count nondiscretionary incentive payments, bonuses and commissions paid at least once annually. These sums can now be added to help satisfy as much as 10% of what’s now known as the standard salary level – recognizing how pay practices are evolving;
  • Salary levels have now been revised for specific groups of workers. These include people who labor in U. S. territories – or individuals employed by the motion picture industry.

Some of the many earlier overtime pay guidelines that still apply

  • Unlimited overtime hours.  The FLSA (Fair Labor Standards Act) still allows exempt employees age 16 and older to work an unlimited number of overtime hours during any one workweek;
  • Timely payment of overtime. Employers must pay for all hours worked, including overtime, on each regular pay day;
  • When overtime pay is required. Once a non-exempt worker has put in at least 40 hours during any one calendar workweek (which can begin on any day of the week), the overtime pay rate applies.

If you have any questions about how the new DOL overtime pay rule may affect your workforce, please give one of our Murray Lobb attorneys a call. We’re also available to provide legal advice on many other important topics – and can draft any contracts or other documents you may need.

Properly Handling Background Record Checks of Potential Employees

All companies must proceed cautiously while trying to create safe, productive and pleasant work environments. The best approach is to develop standard procedures for running background checks and investigations for all applicants who will be handling similar tasks — without regard to any discriminatory traits or characteristics.

First and foremost, you must obtain each job applicant’s written permission to run checks on their job and educational records, criminal background history and financial credit status. Should any of the information you obtain make you no longer wish to consider a specific job applicant, you must inform that person about each report’s negative findings – since all potential employees have the right to refute and correct such data.

Always be sure to also treat all applicants with equal respect and remind them that you’re simply trying to learn all you can about your top applicants. And be sure to state in writing that providing false information can cause individuals to be immediately dropped from further consideration – or be fired in the future when such misinformation is discovered.

Here’s additional information about the types of errors that can appear in background checks, how you might allow job candidates to respond to negative findings — and tips on exercising special caution when sensitive data appears on either sex offender registries or terror watch lists.

Types of negative information & errors that may be uncovered during background checks

Hopefully, most of your searches will just reveal that your applicants have provided their correct names, full address histories, all job information for recent years, accurate Social Security numbers and other basic data. However, chances are that at least some of your potential employees will need to explain about one or more of the following findings.

  • Past arrests or conviction records. Always pay close attention to the types of behavior or crimes involved, when the events occurred and how (if true) that history might affect your work environment. If you still wish to hire a person with some type of negative arrest or conviction, remember that you have a legal duty to create a safe work environment for all your employees. Also, bear in mind that future claims of negligent hiring could prove very costly to your company.
  • Fraudulent or grossly misleading information about the applicant’s academic background or work history. As noted above, make sure that all your application forms clearly indicate that providing false information on such forms (or on a resume) can be immediate grounds for dismissing an applicant from further consideration. Should you believe that any applicant may have simply made a typographical or innocent error on the forms, always allow the person to provide corrected information. Just be sure to respond to the discovery of such false information in the same manner for every applicant;
  • Misleading or inaccurate driving record information. If you’re hiring someone to deliver packages or goods for you – or drive others around on your company’s behalf, you better make sure they have an excellent driving record.
  • A very poor credit score, a bankruptcy or other signs of major financial problems. Always be sensitive and careful when asking applicants to explain this type of information;
  • The person’s name turns up on a sex offender registry or a terrorist watch list. Given the number of people who are burdened with very common names, always reveal what you’ve learned to the individual in a calm manner, preferably with at least one other human resources staff member present. If you still want to hire a person whose name was on one of these lists, always first speak with your Houston employment law attorney.

Your lawyer can tell you how you should go about carefully determining a person’s correct identity and if it’s too risky to hire someone. It may even be necessary to contact the Department of Homeland Security if the person is listed on a terrorist watch list. (Do keep in mind that even the government knows that it can be very time-consuming to remove a name wrongfully added to a terrorist watch list);

It’s crucial to maintain a standard of fairness that applies to all applicants

Be sure your company’s hiring policies provide specific time limits on when applicants must provide you with corrected information after background checks turn up negative or disturbing information. Always apply that same standard to all applicants. If someone needs more time, you should only allow a one-time extension that applies equally to others.

How long must you keep all job application forms and background check information?

The EEOC (Equal Opportunity Commission), the Department of Labor and the FTC (Federal Trade Commission) each provide slightly different guidelines on how long certain records should be kept. Overall, it’s a good idea to keep a copy of all application materials and background information for about two years. Of course, if any job applicant or employee files a lawsuit against your company, that person’s records should be kept until all legal proceedings and appeals have come to an end.

Make sure all employee records are stored in a restricted area where only one or two senior human resource officials have access to them. Once it’s time to destroy the records, it’s wise to carefully shred, burn or pulverize the data so that the material can no longer be read.

Of course, some employers keep all resumes and job application forms in case they later have problems with an employee — or come across information that indicates that the background check failed to disclose fraudulent claims were contained in those documents. Some firms just scan all such data into secure databases.

Since credit background checks are governed by the Fair Credit Reporting Act (FCRA), be sure you understand the terms of that legislation and how it impacts your specific workplace. Also, always keep in mind that the State of Texas also has laws and regulations that can impact how your company handles background checks and employee records. It’s always wise to periodically touch base with your lawyer to find out if any of these laws have recently changed.

Please feel free to contact one of our Murray Lobb attorneys so we can provide you with the legal guidance you may need while hiring employees or simply running your business. We can also provide you with any contracts you may need — or review the contents of your current employee handbook.

The SBA Suggests 10 Key Steps for Starting a New Business

Once you’ve decided to start a new business, it can be tempting to simply moved forward with various tasks as they come to mind. While this may work for a few entrepreneurs, it’s always best to create an organized plan of action so you won’t waste time and cause problems for yourself that could easily have been avoided.

Fortunately, the SBA (Small Business Administration) provides excellent online materials that can help you plan the most useful way to start a new company – or expand the current reach of an existing one. Here’s a brief review of the ten important tasks that should normally be addressed first as you launch a new business.

The key steps for creating a solid foundation for your new business

  1. Decide where to locate your company. Prior to starting any market research, you’ll need to look at several cities to decide upon the best location for your business. This decision must be partly based on if you’ll be selling goods and services to your customers from a brick-and-mortar storefront or office – or if you’ll just be contacting potential customers on the phone or over the Internet. Be sure to select a location where many well-qualified job applicants live – as well as a city and state with reasonable business taxes;
  1. Develop a reliable market research plan. Once you’re certain about the goods or services your new business will sell, you must conduct market research to verify that there’s a definite need for what you’ll be selling in a specific location. This activity also involves identifying your potential customers and all known competitors; 
  2. Create a viable business plan. Most people starting a new business choose between a traditional business plan or a lean one for a basic start-up company. If you need to borrow money to finance your company, you’ll almost certainly have to provide a lender with a traditional business plan.

The traditional plan is normally very comprehensive – it describes your specific goods and services, provides a mission statement about what you seek to accomplish in the long run and names the initial team of professionals who will be running the company. It also states where the business will be located and how many employees you’ll need to hire. A traditional business plan should also describe the business structure you’ll be using, who will be handling specific tasks – and it should review your market analysis. Initial financial projections or earnings for the company should also be included.

In contrast, a lean start-up business plan may simply describe your goods and services, provide a statement about who will be running the company and state who you believe will be your most likely customers. It should also contain information about how you’ll initially finance the company and where it will be located;

  1. Make sure you have enough initial funding for the company. You and your business partners or advisors must determine how much money you’ll need to start your business. If you cannot raise this money among your business partners, then may have to try and obtain funds from venture capitalists or request a small business loan from a bank or through SBA resources. Other options include raising capital through crowdfunding or other online resources;
  2. Select the best business structure for your company. While many people run sole proprietorships if they’ll be handling all of the major company tasks themselves, others choose between forming such structures as partnerships, limited liability companies (LLCs) — or some type of corporation or cooperative;
  3. Decide upon the best name for your company. It’s a good idea to brainstorm with your partners or investors since you want to try and choose a name that clearly reflects the nature or “brand” of your business – as well as its spirit. Be aware that one of your first tasks will be to make sure the name you select is original and that it’s not already being used by anyone else;
  1. Be sure to register and protect your business name. After you’ve chosen the best name for your company, you’ll need to take steps to protect that name by properly registering it. Keep in mind that you may also need to register any trademark you’ll be using. Since additional ways of protecting your company name may also be required, you should always discuss this topic with your Houston business law attorney;
  2. You must request state and federal tax IDs. You will need to obtain an EIN (employer identification number) for many reasons. For example, you must have an EIN to open a bank account for your company and to pay taxes (among other tasks). Depending on the different states where your company will be operating, you may also need to obtain one or more state tax IDs;
  3. Obtain all required licenses and permits. Your specific type of business activity and where you’ll be working will determine the types of permits and licenses you must obtain, if any;
  4. Be sure to open one or more business accounts for your company. These most often include checking and savings accounts, credit card accounts and a merchant services account. Depending on the nature of your business and its initial size, you may be able to simply start with a checking account and then open other accounts as the need arises.

Please feel free to contact one of our Murray Lobb attorneys for legal advice as you address any or all of the various steps named above while starting a new business. We’ve had the opportunity to help many clients establish a wide variety of successful businesses in the past and are prepared to provide you will all the guidance you may need.

Designating a Guardian for Your Children in a Will

If you’re a parent with children who haven’t yet reached the age of majority, you need to create a Will that designates a guardian to step in and look after them if you suddenly pass away. If you fail to provide for your kids in this manner, a court will usually appoint someone to serve in this role – especially if your former spouse is deceased or incapable of handling this responsibility.

A list of traits and abilities a responsible guardian should have are set forth below. If your children have entered their teens at the time when no parent remains alive to care for them, the courts will normally consider their preferences for a guardian at that time.

What are some key considerations when choosing a guardian for your children?

  • It’s often best to choose someone already known to your kid(s) or who has a definite gift for caregiving. This might be one of your parents, a sibling or a very close and trusted friend. Always be sure to obtain this person’s advance permission to name him (or her) in your Will before doing so. If you prefer, you can also designate a married couple as co-guardians;
  • If possible, try to choose a person who already lives in the same city as you — or who is willing to relocate there in the future. It can be very comforting to children if they’re allowed to remain in their same school district. If you can’t find someone who lives nearby, be aware that it may prove a bit expensive for an out-of-state guardian to handle legal matters for the children in a different state. Choosing a local guardian can prevent this type of problem;
  • Give serious thought to choosing a guardian who will fully support your faith beliefs and core ethical values. It’s always best to appoint a person who’s eager to help your children grow up in the faith community you prefer – and who will daily enforce the moral teachings you treasure most;
  • Think about the financial responsibilities involved. Hopefully, you’ll have provided well for your children’s future with life insurance and other funds prior to your death. However, regardless of how much money you’ve put in an account for your kids, you’ll need a guardian who can responsibly handle money. If you do not know of anyone with strong financial skills, you can still choose a person to serve as the caregiving guardian – and designate a different individual to manage the children’s financial resources;
  • What should you do if you do not want your estranged spouse to become the guardian after you pass away? Your Houston estate planning attorney may advise you to write and sign a letter documenting your reasons – and to attach relevant police reports or court documents to the letter. You can then give that letter to your named guardian so that it can be presented to the court after you’ve passed away;
  • How should you proceed if you have children living with you from different marriages? It may be necessary to name more than one guardian for the children. Your main goal should be to keep as many of the kids together as possible. However, you must be realistic about how many children your named guardian can handle;
  • Give some thought to the age of the person you’d like to name. If your parent or another desired guardian is still in good health, you may decide to go ahead and name that person now and simply revisit your decision within the next five years (or when that guardian’s health suddenly declines.) If you are naming a much older person as guardian, be sure to also name a secondary guardian who is willing to step in if the first one cannot serve in this capacity after you pass away. In fact, it’s always a good idea to have a back-up guardian named in your Will;
  • Remember to name every child you want to be cared for by your guardian. It’s never wise to think that a court will assume that all your kids are covered if you only name one or two. Also, extended family members might step in and try to contest your choice if every child isn’t named individually.

Before finalizing any Will that designates one or more guardians, be sure to discuss your choices with your older children. Also, make sure each named guardian is truly interested in helping you by taking on such a demanding assignment.

Please feel free to contact one of our Murray Lobb attorneys so we can prepare a Will that designates a guardian for your children. We’ll be happy to answer any additional questions you may have about this critical task. Most parents gain a greater sense of peace once they’ve legally provided for these important caregiving needs for their children.

What Types of Deceptive Trade Practices Are Forbidden in Texas?

Too many Texas consumers regularly lose money on purchases due to misleading advertising and fraudulent business practices. When those events occur – especially when large sums of money are involved – it’s often necessary to contact the Consumer Protection Division of the Texas Attorney General’s Office. That division is charged with enforcing the Texas Deceptive Trade Practices Act (DTPA) that’s set forth in the Texas Business and Commerce Code.

A Consumer Protective Division lawyer must then investigate the consumer complaint and decide if any legal remedy like an injunction must be pursued. The wronged consumer should also consider hiring a Houston business law attorney to file a lawsuit seeking Texas DTPA damages from the merchant or company that allegedly violated the DTPA.

Here’s a brief look at those who may want to file these types of complaints and lawsuits, followed by a review of some of the commonly alleged DTPA violations — and the basic types of civil damages available to plaintiffs who win these kinds of cases.

The general categories of plaintiffs under the Texas Deceptive Trade Practices Act

  • The average, individual consumer buying property or goods. When buying a home, a car, indoor furnishings or other personal property, a consumer has the right to complete such transactions without being fraudulently manipulated by false advertising or other schemes that cause the loss of hard-earned money;
  • Those seeking repairs (or other types of service) work. Consumers must be quoted fair and accurate rates. They must also be provided with correct information about the training and experience of those who will be performing the requested services;
  • Individuals or companies seeking to close expensive business transactions, within certain established financial limitations. For example, a person or company seeking to buy a business franchise worth three hundred thousand dollars will usually be covered. However, the Texas DTPA is not intended to cover any business consumer with assets worth more than $25 million or more – or a business entity with $25 million (or more) in assets that’s controlled or owned by another business or corporation that has assets valued at or above $25 million.

Types of complaints and claims often brought under the Texas DTPA

Since highly diverse claims are covered by this statute, the following list only provides a general sampling of the complaints often alleged by consumers.

  • Being sold goods or services that were not actually made by the company that claimed to have created or provided them. In other words, the seller tried to mislead the buyer as to the true maker or provider of what was being sold;
  • Buyers were intentionally misled as to where certain goods or services originated. It’s against the law to sell goods claiming they were grown or made in a specific country when the seller knew that wasn’t true. Likewise, you cannot advertise that certain services will be provided by employees or contractors from one city or region who will be coming from another location;
  • Advertising goods or services as having the approval or sponsorship of specific individuals or groups when that’s a fraudulent claim. For example, you cannot sell certain medical devices and claim they’re backed by the American Medical Association (or a local medical group) when that’s untrue. Likewise, there can be no attempt to claim that the seller had direct ties to another specific company or government entity when that’s a fraudulent misrepresentation;
  • Selling goods or services and saying that they meet certain objective standards (or are made of specific types of materials) when that’s an intentional misrepresentation. For example, a company cannot claim that a couch was made of leather when it knew it was made of Naugahyde. Likewise, a company cannot claim all service personnel have earned specific licensing credentials – or are bonded – when it knows that’s false information;
  • Making purposeful “bait-and switch” sales. It’s a deceptive trade practice to run a print ad (or an online or televised commercial) that states that a store is selling a specific brand of products – or providing a certain grade of service by specially trained personnel – when the seller knows those facts to be false. Likewise, a company cannot claim that highly experienced contractors with over 10 years of experience are being sent to someone’s home to repair a major roof leak – when the actual workers have very little experience handling such tasks;
  • Misleading the buying public as to why certain goods are being sold at a major discount. For example, a merchant cannot claim that an accidental, large shipment of goods came in and they must now be sold at a greatly reduced price – when that merchant is really trying to unload damaged goods on unsuspecting buyers;
  • Selling a car, truck or other vehicle after rolling back the odometer. When a seller has any reason to believe that someone has reset or rolled back an odometer – or has personally done so because that part stopped recording mileage – all such facts must be fully disclosed to each potential buyer;
  • Taking advantage of the buying public after a natural disaster has been formally declared by the state’s governor. The DTPA does not allow anyone to sell goods at excessive or unfair prices, especially after a natural disaster like a flood. Therefore, no store can charge inflated prices for necessities like water, food, fuel, flashlights, batteries or medicine.

While this list isn’t comprehensive, it should provide a clear idea of the types of fraud and misrepresentation that can cause lawyers with the Texas Attorney General’s Consumer Protection Division – and individual consumers — to pursue through DTPA litigation.

Penalties or damages that can be sought for Texas DTPA violations 

As your personal lawyer will tell you, the Texas Attorney General’s public remedies may include different types of injunctions, restraining orders and penalties. Should you file a private lawsuit, the penalties awarded to you can be influenced by whether the wrongful conduct was knowingly committed. When a violation of the DTPA was “knowingly” committed, penalties are sometimes awarded at the level of three times the sum awarded for the economic damages.

If you believe your consumer rights under the Texas DTPA have been violated, you should contact one of our Murray Lobb attorneys. We can provide you with the timely advice you’ll need while we help you decide whether to file a DTPA lawsuit on your behalf.