The Advantage

October 2000

Changes to California Overtime Exemptions

On October 1, 2000, new California rules will become effective for determining which jobs are exempt from overtime pay require- ments. This comes as a result of action taken by the Industrial Welfare Commission (IWC) at its June 30, 2000 meeting. Changes were precipitated as a result of last year's passage of AB 60, the law returning California to daily overtime requirements.

We recommend that you review each of your job descriptions to assure you are correctly classifying them as exempt or non- exempt under the October 1, 2000 California rules. If you feel you would like to have help with that project, please call our office and we will schedule a time to discuss how we can give you the consulting support you need. You can reach us at 1-888-671-0404. You may also send an email to: FLSAhelp@management-advantage.com .

Here are the new exemption requirements:

"The following requirements shall apply in determining whether an employee's duties meet the test to qualify for an exemption from [Sections 3 through 12 of this Order]:"

A. Executive Exemption. A person employed in an executive capacity means any employee:

1. Whose duties and responsibilities involve the management of the enterprise in which he is employed or of a customarily recognized department or sub- division thereof; and
2. Who customarily and regularly directs the work of two or more other employees therein; and
3. Who has the authority to hire and fire other employees or whose suggestions and recommendations as to the hiring and firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight; and
4. Who customarily and regularly exercises discretionary powers; and
5. Who is primarily engaged in duties which meet the test of the exemption. For purposes of this provision, "primarily engaged in" means that more than one-half (1/2) of the employee's work time must be spent engaged in exempt work. The activities constituting exempt work and non-exempt work shall be construed in the same manner as such terms are construed in the following regulations under the Fair Labor Standards Act effective as of the date of this order (29 C.F.R. Sections 541.102, 541.104-111, 541.115-116) and shall include, for example, all work that is directly and closely related to exempt work and work which is properly viewed as a means for carrying out exempt functions. The work actually performed by the employee during the course of the work week must, first and foremost, be examined and the amount of time the employee spends on such work, together with the employer's realistic expectations and the realistic requirements of the job, shall be considered in determining whether the employee satisfies this requirement.
6. Such an employee must also earn a monthly salary equivalent to no less than two (2) times the state minimum wage for full-time employment. Full-time employment is defined in Labor Code Section 515(c) as forth (40) hours per week.

B. Administrative Exemption. A person employed in an administrative capacity means any employee:

1. Whose duties and responsibilities involve either:
   1. The performance of office or non-manual work directly related to management policies or general operations of his employer or his employer's customers, or
   2. The performance of functions in the adminis- tration of a school system, or educational establishment or institution, or of a depart- ment or subdivision thereof; in work directly related to the academic instruction or training carried on therein; and
2. Who customarily and regularly exercises discretion and independent judgment; and
3. 1. Who regularly and directly assists a proprietor, or an employee employed in a bona fide executive or administrative capacity (as such terms are defined for purposes of this section); or
   2. who performs under only general supervision work along specialized or technical lines requiring special training, experience, or knowledge, or
   3. who executes under only general supervision special assignments and tasks, and
4. Who is primarily engaged in duties which meet the test of the exemption. For purposes of this provision, "primarily engaged in" means that more than one-half (1/2) of the employee's work time must be spent engaged in exempt work. The activities constituting exempt work and non-exempt work shall be construed in the same manner as such terms are construed in the following regulations under the Fair Labor Standards Act effective as of the date of this order (29 C.F.R. Sections 541.201-205, 541.207-208, 541.210, 541.215) and shall include, for example, all work that is directly and closely related to exempt work and work which is properly viewed as a means for carrying out exempt functions. The work actually performed by the employee during the course of the work week must, first and foremost, be examined and the amount of time the employee spends on such work, together with the employer's realistic expectations and the realistic requirements of the job, shall be considered in determining whether the employee satisfies this requirement.
5. Such an employee must also earn a monthly salary equivalent to no less than two (2) times the state minimum wage for full-time employment. Full-time is defined in Labor Code Section 515(c) as forth (40) hours per week.

C. Professional Exemption. A person employed in a professional capacity means any employee who meets all of the following requirements:

1. 1. Who is licensed or certified by the State of California and is primarily engaged in the practice of one of the following recognized professions: law, medicine, dentistry, optometry, architecture, engineering, teaching, or accounting; or
   2. Who is primarily engaged in an occupation commonly recognized as a learned or artistic profession. For the purposes of this subsection, "learned and artistic profession" means an employee who is primarily engaged in the performance of:
      1. Work requiring knowledge of an advanced type in a field or science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, as distinguished from a general academic education and from an apprenticeship, and from training in the performance of routine mental, manual, or physical processes or work that is an essential part of or necessarily incident to any of the above work; or
      2. Work that is original and creative in character in a recognized field of artistic endeavor (as opposed to work which can be produced by a person endowed with general manual or intellectual ability and training), and
      3. Whose work is predominantly intellectual and varied in character (as opposed to routine mental, manual, mechanical, or physical work) and is of such character that the output produced or the result accomplished cannot be standardized in relation to a given period of time.
2. Who customarily and regularly exercises discretion and independent judgment in the performance of the duties set forth in paragraph (1).
3. Who earns a monthly salary equivalent to no less than two (2) times the state minimum wage for full-time employment.
4. Subsection (1)(b) is intended to be construed in accordance with the following provisions of federal law as they existed as of the date of this Wage Order: 29 C.F.R. Sections 541.207, 541.301(a)-(d), 541.302, 541.306, 541.307, 541.308, and 541.310.
5. Notwithstanding the provisions of this subsection, pharmacists employed to engage in the practice of pharmacy, and registered nurses employed to engage in the practice of nursing, shall not be considered exempt professional employees, nor shall they be considered exempt from coverage for the purposes of this section unless they individually meet the criteria established for exemption as executive or administrative employees.

For a complete copy of the IWC meeting minutes, including the Duties Test for Overtime Exemptions, go to: http://www.dir.ca.gov/IWC/Amendedagenda6302000.html

Investigatory Interviews: The Employee's Right to a Representative

Non-union employers rarely think about the impact of the National Labor Relation Act (NLRA) on their operations. Although the NLRA is best known as establishing and protecting the right of employees to engage in union activity, it also has aspects which affect all employers, whether their employees are represented by a union or not. This was reiterated on July 10, 2000, when the National Labor Relations Board (NLRB) decided Epilepsy Foundation of Northeast Ohio. In that decision, the NLRB ruled that the so-called "Weingarten" right (i.e., the right of an employee to have a co-worker present during certain investigatory interviews) applied to non-union employers as well as union employers. This article defines the Weingarten right and anticipates questions and answers about practical applications of the Epilepsy Foundation decision.

WEINGARTEN FOR NON-UNION EMPLOYERS

The United States Supreme Court issued its decision in NLRB v. Weingarten, Inc. in 1975. That decision extended to employees what is commonly referred to as their "Weingarten right." In Weingarten, the company's employees were represented by a union. Management interviewed an employee during its investigation of allegations that she had stolen food from the store. The employee requested the presence of a union representative during the interview. However, this request was denied by management. Even though the meeting revealed that the employee was innocent of the act alleged, the Supreme Court held that the employer's denial of the request that a union representative be present at the investigatory interview which the employee reasonably believed might result in disciplinary action violated the NLRA. The Court viewed the request for representation as "protected concerted activity" because the union representative could safeguard the interests of all bargaining unit employees against unjust disciplinary procedures and their steward's presence could assure all employees that they would also have their assistance, if requested, whenever they were called to an investigatory interview. The determinative factor in whether the Weingarten right attaches to a particular meeting is whether discipline may reasonably be expected to follow. No Weingarten right arises if the employer merely intends to communicate a disciplinary decision previously made. An employer is not obliged to inform an employee of their Weingarten right. No right to representation attaches unless it is specifically requested, verbally or in writing, by the employee.

In the NLRB's recent Epilepsy decision, two employees of the Epilepsy Foundation of Northeast Ohio were terminated for various acts of insubordination. One of the employees, Arnis Borgs, was approached prior to his termination and instructed by the company's Executive Director to meet with both her and Borgs' supervisor. Because Borgs claimed that he would feel intimidated by his supervisor's presence, he requested that a coworker be present at the meeting. Borgs' request was denied. When Borgs continued to express reservations about meeting alone with the Executive Director and his supervisor, he was instructed to go home and report back to work the next day. Upon his return, Borgs was informed that his refusal to attend the meeting was gross insubordination. As a result, he was terminated. The NLRB found that the termination violated the NLRA. The Board noted that Weingarten rights are grounded in § 7 of the NLRA, which gives employees the right "to engage in . . . concerted activities for the purpose of . . . mutual aid or protection." The Board reasoned that the presence of a coworker at a meeting that could lead to disciplinary action "greatly enhances the employees' opportunities to act in concert to address their concern 'that the employer does not initiate or continue a practice of imposing punishment unjustly.'" Thus, the Board has now determined that this principle applies independent of the presence of a union.

Companies whose employees are not represented by a union now must familiarize themselves with the Weingarten right, its application, and its limitations. The right applies only to employees covered by the National Labor Relations Act. Supervisors, managers, and independent contractors are generally excluded from coverage under the NLRA and, consequently, could not claim a Weingarten right. Additionally, the right only attaches to an investigatory meeting out of which discipline is likely to result. Interviews and meetings which have some other purpose, such as simply to announce a disciplinary decision previously made, do not support invocation of the right. More important, however, the right must be invoked by the employee being interviewed. If the employee does not ask for representation, the employer is not obligated to provide it. Furthermore, the employer does not need to inform the employee of their Weingarten right, even where the employee might be frightened or confused by the interview. Once a valid request is made, an employer has four options:

1. grant the request and continue with the interview;
2. terminate the interview and assess discipline;
3. terminate the interview and conduct its own investigation without the benefit of the interview; or
4. offer the employee the choice of either continuing the interview unaccompanied by a co-worker or having no interview at all and thereby dispensing with any benefits that the interview might have conferred on the employee.

However, the employer is not obligated to accede to the request. Should the employee choose to refrain from participating in the interview, the employer is then free to act on the basis of information thus far otherwise obtained from other sources.

ANTICIPATED QUESTIONS & ANSWERS

1. Does the Epilepsy Foundation decision apply to all employers?
   A - Most private employers. Any employer covered by the NLRA is bound by the decision.
2. Does a non-union company have to follow the decision of the NLRB?
   A - Yes. Unless or until the Board's decision is overruled by the U.S. Supreme Court, the NLRB decision in Epilepsy Foundation is currently binding on most all companies, even those without a union.
3. Do the NLRA and the Epilepsy Foundation decision apply to all employees?
   A - No. The NLRA provides specific exemptions from its coverage. Any employees that are exempted from the NLRA are likewise not covered by the Epilepsy Foundation decision, generally including managers, supervisors and independent contractors.
4. What is the "Weingarten" right?
   A - The "Weingarten" right allows an employee to request the presence of a co-worker during an investigatory interview which the employee reasonably believes may result in disciplinary action against them.
5. Do I have to inform employees of this right?
   A - No. You are not required to inform employees of this right, nor ask an employee who is about to be interviewed if the employee wants a representative.
6. Does the employee have the right to a representative during a drug test?
   A - Possibly, depending upon the circumstances. If the drug test is an additional or follow-up part of another investigation (such as post-accident testing), it is an investigatory interview that entitles the employee to representation. Drug tests that are not triggered by a specific incident involving the employee, such as random tests, are not likely investigatory interviews. Thus, the employee would not be entitled to representation under those particular circumstances.
7. If the employee requests the presence of a co-worker, what are the options?
   A - An employer has four options: (1) grant the request and continue with the interview; (2) terminate the interview and assess discipline; (3) terminate the interview and conduct its own investigation without the benefit of the interview; or (4) offer the employee the choice of either continuing the interview unaccompanied by a co-worker or having no interview at all and thereby dispensing with any benefits that the interview might have conferred on the employee. However, the employer is not obligated to accede to the request. Should the employee choose to refrain from participating in the interview, the employer is then free to act on the basis of information obtained from other sources. Employers must be mindful, however, of maintaining objective fairness throughout the investigatory process.
8. Does the Weingarten right attach to a meeting where I am simply going to inform the employee of disciplinary action upon which I have already decided?
   A - No. Employees have no right to the presence of a co-worker if the only purpose of the meeting with the employee is to inform them of predetermined disciplinary action.
9. Is the employee entitled to request or demand the presence of someone other than a co-worker, such as a friend, relative or attorney?
   A - No. Epilepsy Foundation states that the employee is entitled, under the Weingarten decision, to request the presence only of a co-worker. The Epilepsy Foundation decision also adopts the Board's 1982 decision in Materials Research Corporation, which clarified that an employee confronted with an investigatory interview which might result in discipline may turn to fellow employees for assistance.
10. Who chooses the co-worker that will be present during the interview?
    A - The employee being interviewed selects which co-worker will be present.
11. What if the requested co-worker refuses or is otherwise unable to attend the meeting?
    A - The employer can continue with the interview as long as another co-worker is available at the time set for the interview. However, the employer is under no obligation to suggest or secure an alternate co-worker for the employee; it is the employee's obligation to secure the presence of a co-worker. In order to maintain objective fairness during the investigatory interview, it may be in the employer's best interest to evaluate whether to assist the employee in doing so.
12. After scheduling an interview with an employee whom I am considering disciplining, do I have to allow the employee to consult with his or her chosen co-worker on company time prior to the interview?
    A - If the interview date otherwise provides the employee an adequate opportunity to consult with the co-worker on his or her own time prior to the interview, the employer has no obligation to allow prior consultation on company time. However, if the employer insists that the interview take place immediately, the better practice would be permitting the employee and the selected co-worker a brief time to confer privately in advance of the meeting.
13. Does the employer have to "bargain" with the co-worker during the interview, or consider the co-worker's comments in deciding whether to discipline the employee?
    A - No. The employee being interviewed only has the right to have a co-worker present during the interview, not to have the co-worker affect the disciplinary decision. If they so desire, the co-worker must be allowed to speak during the interview. However, the employer need not give any consideration to the co-worker's comments in making the disciplinary decision.

Timothy S. Bland and David P. Knox are attorneys in the Memphis, Tennessee office of Ford & Harrison LLP, a national law firm that exclusively represents management in labor and employment matters. Mr. Bland can be reached at tbland@fordharrison.com, and Knox can be reached at dknox@fordharrison.com .

Book Review: Intercultural Services

It's difficult to pick up a trade publication these days without finding a reference to global business activities. From small companies to the largest multi-national corporations, government agencies and associations, globalization is taking on a vital importance.

In his new book, Intercultural Services: A Worldwide Buyer's Guide and Sourcebook, Gary M. Wederspahn shares many of the ideas and resources he has gathered over a 30-year career managing cross-cultural adventures. The book is organized logically and deals with every major aspect of cultural issues. He uses case-study examples to emphasize his points along the way. He includes diagrams and checklists that help readers understand the relationships involved in cross-cultural interactions.

Throughout the book, Mr. Wederspahn has included lists of action steps readers can use to influence their organizations' performance in cross-cultural involvements. He has laid a solid foundation on subjects like "Understanding Cultural Differences," "Cross-Cultural Communications," "Cross- Cultural Transitional Experiences," and "Cross-Border Organizational Relationships and Issues."

The book lists specific resource contacts for training programs, assessment and selection services, research services, counseling services, consulting services and workplace diversity experts. While no such list could possibly be complete, Mr. Wederspahn has made a daunting task seem plausible. There are even five pages of Internet resources listed to save readers search time on the web. These are simply examples of the many lists of resources available in the book's 344 pages.

It seems anyone, of any level of expertise, working on issues of intercultural issues will find value in this volume. It is new, so the contacts listed are going to still be accurate. It's easy to follow and the complete index makes rapid subject access an easy task.

We are impressed by Intercultural Services and have selected it for inclusion in our HR Webstore. You will find it at www.hrwebstore.com . It is priced at $37.95, and that's reasonable for this hardback edition. You will want something like this that wears well in anticipation of the many times you will be searching within its pages.

If you are involved in workplace diversity, managing intercultural issues, or helping your employer expand its global presence, you need this reference. Well done, Mr. Wederspahn.

William H. Truesdell is president of The Management Advantage, Inc. and editor of this newsletter. He can be reached at 925-671-0404 or billt@management-advantage.com .

Making Change

What allows some people to take things in stride? What creates the runaway imagination that causes others to picture the worst-case scenario? If you have ever wondered about the differences between people who see a glass as half-full or half-empty, you aren't alone.

Roles to Play

When something happens that catapults you into a stress response, there are a variety of ways to react. We all rely on three basic roles, and although we each have favorites, we depend on all of them at different times. The challenge is to recognize which role you use the most and to work toward the role that helps you handle change in a positive and productive manner.

The Victim

Feeling powerless, these are the sufferers. As the injured party, this reaction allows people to view the changes that create stress as inevitable. They think life is just a series of negative events strung together with meals and sleep. Although this is the easiest role to play, you should use it least. When you decide to play the victim, at least understand why you are choosing it.

The Survivor

These are the people who endure what life dishes out. Perceiving that they have no power, they will do what they have to do in order to get through. Carrying the list of hardships along with them wherever they go, they can recite what they have had to endure at the drop of a hat. One step above the role of the victim, the survivor is a popular role. Sometimes, we all need to camp out in this role for a while, but try not to stay put in this less-than-productive coping style.

The Navigator

Thinking that they have some power in life, these are the folks who figure out what they CAN do. Once they get a clear focus on the present and the future they are aiming for, they pilot their way through the storm. This is a proactive and empowering role to play. Not everyone can play the navigator all the time. But you can behave like a navigator, and you will eventually achieve this positive style.

We have all three of these perspectives within us, as we move from one role to another from day to day. There are a variety of factors that go into the mix, that help determine which role we tend to favor.

• Nature: our own personality, our genetic make-up
• Nurture: the way we were raised
• Experience: our own life history
• Education: what we have read or observed from others

Like a R-O-C

What helps us move through change and stress more efficiently is a trio of traits and behaviors that are braided together to form a strong line that connects us to the future.

• Resiliency - a buoyant spirit that reveals hardiness and an ability to bounce back
• Optimism - a hopefulness that carries a cheerful outlook
• Confidence - a belief in your self and your ability to succeed

Confidence is often the leader behind which resiliency and optimism march, though it can become a "chicken and egg" type of discussion, trying to determine which you need first in order to obtain the rest.

We Are Not Like Them

As universal as change is, it is still our personal response that determines how well we manage our way through it. We may hear leaders exhort the one-style-fits-all way of dealing with change because we are all in the same organization, industry or situation. But the "we," "us" and "ours" that are talked about don't exist in your personal world. No one else has your unique nature, your upbringing, life experience or knowledge. That's why everyone must learn to navigate change from his or her own unique perspective.

If you wish you could handle change and the stress that comes along with it better than you do, take heart. While personality and history are fixed, education and experience are not. People have a huge capacity to learn and grow. There are times when the best thing you can do is "fake it 'till you make it." I'm not suggesting that you be a phony; I propose behaving in the manner that you know you should or want to, until navigating change becomes second nature.

Joni Daniels, Principal of Daniels & Associates, is a dynamic speaker with over 20 years experience presenting topics related to personal and professional development. She is also an instructor in management topics at the Wharton School's SBDC. She can be reached at JDanAssoc@aol.com, 215.635.5359, or www.powertoolsforwomen.com .

A Gentle Word on Behalf of Our Business

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