Fraudulent unemployment claims on the rise in Michigan

Back in November 2017, several staff members at western Michigan television station WZZM 13 had unemployment claims filed in their names and the problem seems to be getting worse in the Grand Rapids area. There have been more than 100 reports taken since November in Walker alone.  Wyoming has reported 19, and Kent County overall has seen about one to six reports per week.

The result of unemployment insurance fraud is an increase in unemployment taxes for businesses: It threatens the availability of funds for people with legitimate unemployment insurance claims and burdens the state’s unemployment trust fund. After these recent data breaches, the agency anticipated an increase in false claims. However, they have put a higher degree of security measures in place, and the agency is catching most of the fraud before money is paid out.

How does unemployment fraud happen?

Unemployment fraud occurs when a perpetrator uses an individual’s personally identifiable information to file for unemployment benefits on the Unemployment Insurance Agency’s website.

According to WZZM13 reports, investigators say the criminals are from out of state and using the UIA because the agency typically tries to get people benefits as soon as possible.

What should you do if this happens to you?

  • Contact the Unemployment Insurance Agency immediately to report the fraud. Report fraud online at Michigan.gov/uia through the Report Fraud or Report Identity Theft link or call the UIA Fraud hotline at 1855-UI-CRIME.
  • Complete UIA Form 6349 Statement of Identity Theft and submit the form either in person at a Problem Resolution Office (PRO), by mail at Unemployment Insurance, PO Box 169, Grand Rapids MI 49501, or by fax at 517-656-0427.
  • Place a fraud alert on your credit record at the three credit reporting agencies (listed below) and get a copy of your credit reports. A fraud alert is free and will make it harder for someone to open new accounts in your name. To place a fraud alert, you only need to contact one of the three credit bureaus listed below. The company that you contact is required by law to tell the other two.

If you suspect a claim has been filed fraudulently in your name, contact BCN Services for additional resources and assistance.

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Lisandra Quiñones Garrow, Partnership Manager

Do workplace gender pay disparities really still exist?

The “Me Too” and “Time’s Up” movements have prompted discussions and brought to the forefront all aspects of sexual harassment and treatment of women in the workplace.  Part of this focus has put light on a subject that may have improved some over the last several decades, but is still not where is needs to be: Gender pay discrepancies.

The U.S. Census Bureau reports that in 2014, on average, women earned 79 percent of men’s median annual income.  The National Committee on Pay Equity, which reports a comparable statistic for 2014, 78.6 percent, has been documenting pay inequality since 1960.  If we look back 50 years prior to the 79 percent statistic, we can see that the gap has shrunk significantly.  In 1964, women earned only 59.1 percent of what men earned.  However, if you compare 2009 and 2014, the 5-year span saw an increase of only 1.6 percent.  There’s quite a way to go to bridge the gap completely.

A recent Hollywood scenario put into perspective how everyone, no matter what your job is, can fall into this statistical gap.  In reshoots for the movie “All the Money in the World,” Mark Wahlberg was paid an additional $1.5 million, while his co-star, Michelle Williams was paid $80 per day for a total of less than $1,000.  An open letter published by the “Time’s Up” movement stated that “the systematic gender equality and imbalance of power” in the workplace “fosters an environment that is ripe for abuse and harassment against women.”

Now is the time to reflect on your own company’s pay practices to bring gender pay in line and protect your company against future claims.  It’s not only good practice, it’s the law.  The Equal Opportunities Commission (EEOC) requires that equal pay for men and women be established under the Equal Pay Act of 1963.  The Equal Pay Act restricts employers from paying unequal wages “to men and women who perform jobs that require substantially equal skill, effort, and responsibility, and that are performed under similar working conditions within the same establishment.”

The EEOC looks at the following criteria to establish equal pay: Skill, effort, responsibility, working conditions, and establishment location (for example, when a company has several locations in different geographical areas, those can be considered separate establishments due to the area’s median income).  Differences in pay are only permitted based on seniority, merit, quantity or quality of production, or other factors not related to gender.  The EEOC also states that “It is also unlawful to retaliate against an individual for opposing employment practices that discriminate based on compensation or for filing a discrimination charge, testifying, or participating in any way in an investigation, proceeding, or litigation under Title VII, ADEA, ADA or the Equal Pay Act.”

If pay differences do exist for similar positions regardless of whether women are paid less than men, or men paid less than women, it is best practice to establish from the hire date how the salary decision was made.  Be prepared to back up how your wage determination was made based on the criteria previously mentioned.  Encourage open dialogue with your employees if they have a perception that a gender pay gap exists.  BCN Services staff are prepared to guide you through this process.  Please contact your Partnership Manager with any questions or concerns regarding your employees’ wages.

 

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Frank Lewandowski, Benefits Program Manager

Take care when classifying your workers to avoid costly audits

Job duties, not job titles, determine pay classification and workers’ compensation codes. Not making the correct choice can cause problems, or even prompt a workers’ comp or federal wage audit

When hiring a new employee, it is important to review the individual’s primary job responsibilities before determining whether they will be paid on an hourly or salaried basis.  It is also critical to determine a correct job code when reporting the new employee to your workers’ compensation carrier.

Although employers may have business reasons for making decisions, without professional guidance, employers can get caught on the wrong side of a Department of Labor wage and hour audit or a workers’ compensation audit.

Here are some key areas to consider:

Salary/exempt employees:  Many employers pay all office or supervisory employees on a salaried basis.  For most employers, that means no docking for missed time and no overtime pay.  This is a common violation with the U.S. Department of Labor and without timekeeping documentation, employers often lose during an audit.  Additionally, employees should not be paid on a salaried/exempt basis unless they make at least $455 per week and the employee’s primary duties include “the exercise of discretion and independent judgment with respect to matters of significance.”  Other factors may also apply to this decision about exempting an employee

Workers’ compensation class codes:  Insurance carriers often conduct workers’ compensation audits to determine whether employees are in the correct class code. Misclassification discovered during an audit can result in unexpected, additional insurance premiums. This can add up to thousands of dollars you were not expecting to pay.

1099 contract employees:  This is another area where employers should be sure they understand regulated guidelines.  Contract employees set their own hours, determine the amount they will be paid, determine how the work will be done, pay their own taxes and carry workers’ compensation insurance on themselves.  If you are issuing 1099s to individuals, yet directing their work, you may want to review this situation with one of our HR professionals.

Remember to take the proper steps to classify your employees correctly when they begin employment or change positions.  Let BCN help you before you get audited. Our HR staff is available to discuss any concerns you have in these areas, either regarding existing staff, or in determining direction before you make your next hiring decision.

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Sue Kester, HR Manager

Unannounced MIOSHA inspections can add up to employer fines

It appears MIOSHA (the Michigan Occupational Safety and Health Administration) has ramped up its “unannounced” inspections this past year with small business machine and repair shops and buildering contractors, both in General Industry or Construction categories.  Fines have been levied.  The wise adage “an ounce of prevention is worth a pound of cure” definitely has an application when it comes to safety in the workplace.

A multi-year review of the top 10 most frequently cited MIOSHA and OSHA violations show that violation types have remained fairly constant.  BCN Services will be dedicating this blog to safety issues throughout 2018 to raise awareness, educate and remediate the most serious of these violations.

No matter what the violation, the safety inspector always wants to see training plans.  When inspectors arrive, they check to see if the employer has properly trained employees regarding worksite hazards.  As a client of BCN Services, you have access, at no charge, to state-of-the-art, OSHA-compliant online safety courses for each of the following top 10 most serious violations, according to MIOSHA statistics:

  1. Lacking a hazard communication program – average fine: $512*
  2. Non-operational emergency eye flush stations – average fine: $933
  3. No effective information or training of chemicals – average fine: $497
  4. No written respiratory protection program – average fine: $865
  5. Exposure to air contaminants exceeding established exposure limits – average fine: $5,355
  6. Failure to provide appropriate eye and face protection – average fine: $565

Combined with no effective personal protective equipment training – average fine:  $690

  1. No program in place to determine if employees have a reasonable exposure to bloodborne infectious diseases – average fine: $820
  2. Failure to provide a medical evaluation to determine an employee’s ability to use a respirator – average fine: $596
  3. No written exposure control plan – average fine: $173
  4. No hearing conservation program when noise exposures equal or exceed the action level – average fine: $1,850

In addition to the above, there are several additional violations which include:

  • Lack of machine guarding
  • Improper wiring methods, components and equipment
  • Lack of forklift training
  • No fall protection program
  • Improper use of portable ladders
  • Using powered staplers and nailers with no proper eye protection
  • Employer not providing a safety harness when using an aerial lift

Once a fine is levied, MIOSHA will return to the employer’s site for follow-up.  Failure to correct a previously cited violation will result in additional fines averaging $2,554 per violation.

BCN Services’ safety program has dedicated resources providing safety walk-throughs, written programs, online safety training and recommendations at no charge for all of the above cited violations.  Our online safety programs average 15 minutes per course topic.  We also provide the OSHA 10-hour General Industry courses at least once per year by certified trainers.

Look for more specific information regarding the above in the coming year through our safety blogs.

Take advantage of all these resources and experience that “ounce of prevention” in 2018 for employee safety and peace of mind.  Call the Risk Management Department at BCN Services today at 734-994-4100, ext. 108 to access these programs.

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Patrick Boeheim, Risk Manager

The 5 Ws of the EEOC (or why it does what it does)

Many businesses understand the importance of advertising themselves as an equal opportunity employer. But companies may not be familiar with the government agency that enforces this law and exactly what they do

Who: The EEOC is the Equal Employment Opportunity Commission and it is “responsible for enforcing federal laws that make it illegal to discriminate against a job applicant or an employee because of the person’s race, color, religion, sex (including pregnancy, gender identity, and sexual orientation), national origin, age (40 or older), disability or genetic information.”

What: The EEOC is responsible for interpreting and enforcing these civil rights laws:

  • The Pregnancy Discrimination Act makes it illegal to discriminate against a woman because of pregnancy, childbirth, or a medical condition related to pregnancy or childbirth.
  • The Equal Pay Act makes it illegal to pay different wages to men and women if they perform equal work in the same workplace.
  • The Americans with Disabilities Act makes it illegal to discriminate against a qualified person with a disability in the private sector and in state and local governments. In general, the law also requires reasonable accommodations for a qualified applicant or employee with a disability.
  • The Age Discrimination in Employment Act protects people who are 40 or older from discrimination because of age.
  • The Genetic Information Nondiscrimination Act makes it illegal to discriminate against employees or applicants because of genetic information, which includes an individual’s genetic tests and the genetic tests of a family member and information about a disease, disorder or condition of a family member.

All of these laws make it illegal to retaliate against a person for complaining about discrimination, filing a related charge or participating in a discrimination investigation or lawsuit.

Where: When we talk about federal government agencies, it is easy to picture them as far away, perhaps only in Washington D.C. The EEOC is headquartered in Washington, D.C. but has 53 field offices throughout the country.

When: The EEOC began operating on July 2, 1965,  one year after President Johnson signed Title VII of the Civil Rights Act.

Why: The role of the EEOC is to fairly and accurately assess allegations of discrimination. If the EEOC finds that discrimination has occurred, they try to settle the charge. The EEOC has the authority to sue to protect the rights of individuals and the interests of the public.

The EEOC also works to prevent discrimination before it occurs through outreach, education and technical assistance programs.

Recommendations: When terminating or disciplining employees, it is always good to ask if your company is using a consistent practice. Trying to be generous to one employee, can appear discriminatory to another. Remaining consistent in your approach is important to avoid an EEOC investigation. A best practice would be to have an employee handbook that outlines specific policies and procedures for termination and discipline. BCN Services recommends discussing difficult or questionable terminations with your HR representative before taking action to avoid any problems.

The above is information about the agency taken from the eeoc.gov website.’

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Kari Stanley, HRCCC Supervisor

Be aware of your IT Security Policies and Procedures

Starting today, and from time to time in the upcoming months,  BCN will be adding business blog posts about current topics from friends of BCN.   Today, we hear from Mr. Joe Dylewski, owner of ATMP Solutions, an IT Security firm.  Joe has been successfully assisting businesses and health care companies since 1989.

Quarterly Information Security Briefing and Reminder

October 2017

Topic: Data Breaches and Potential Exposure

Content:  News of large data breaches is becoming more frequent. Recently, Equifax was breached and an estimated 150 million Americans may have been affected. The complete impact of this breach will not be known for some time.  However, initial response suggests that personal financial information on individuals that includes names, Social Security Numbers, addresses, credit card numbers, driver’s license numbers, credit history, integrated public records and other financial information may have been exposed.

What happens to the information that is breached?

Once breached, the information is typically placed on the “Dark Web” and made available globally to anyone that has the tools and knowhow to access it.  The Dark Web is a portion of the Internet that is used extensively by criminal elements to obtain drugs, arms, pornography, human trafficking, and stolen information.

How can it be used?

Once this information is made public, the possibility of identity and direct financial theft increases significantly. Consider how much information the average person discloses on social media. The combination of Facebook and LinkedIn, which is used by most working professionals, along with a person’s financial history, gives a criminal the ability to impersonate just about anyone. Additionally, with enough information, a criminal could access accounts containing personal financial information on the internet.

What can I do to protect myself?

  1. Treat the information that is on the internet the same way you would treat it as if it was paper stored in your It is important that you are a good steward of your personal information and assume that the internet site that is storing it is not perfect.
  2. Use different passwords on each site that contains sensitive Once a hacker has access to one password, eliminate the possibility that they have access to every account. The CEO of Facebook was hacked because his Facebook and LinkedIn passwords were identical. If your passwords have not been changed in the last 6 months, set this as a high-priority task.
  3. Monitor the online identity for everyone in your Services such as IdentityGuard track changes to your public and credit records, looking for any activity. Using this may alert you to suspicious activity.
  4. Use credit cards instead of debit cards for purchases, maintain low balances in your checking accounts, and disable overdraft The less access a criminal has to your liquid funds, the better.
  5. Consider the amount of information that you make publicly available on social media. How many internet sites or credit cards ask your mother’s maiden name as a security validation question? Can this information be obtained by simply looking at your Facebook profile?

Be aware of your IT Security Policies and Procedures.

Always consult your Privacy and Security Official with questions!

ATMP© ATMP Solutions – 2017

This guest article is published with permission of the writer. The opinions, representations and statements made are those of the author and not of BCN Services or any affiliate companies and does not constitute any representations, warranties or guarantees. All content provided is for information purposes. The company accepts no liability for any errors, omissions or representations.

New I-9 Completion and Compliance rules takes effect September 18

In mid-September, employers will be required to use a new version of form I-9 to verify employment eligibility for new hires. The form changes are minor but employers must be using form I-9 version 1615-0047 (dated July 27, 2017) as of September 18, 2017. All previous versions of form I-9 will be considered out of compliance for employees hired after that date.

Information from U.S. Citizenship and Immigration Services (USCIS.gov):

Revisions to the Form I-9 instructions:

  • The name of the Office of Special Counsel for Immigration-Related Unfair Employment Practices was changed to a new name: Immigrant and Employee Rights Section.
  • Removed “the end of” from the phrase “the first day of employment.”

Revisions related to the List of Acceptable Documents on Form I-9:

  • The Consular Report of Birth Abroad (Form FS-240) was added to List C. Employers completing Form I-9 on a computer will be able to select Form FS-240 from the drop-down menus available in List C of Section 2 and Section 3. E-Verify users will also be able to select Form FS-240 when creating a case for an employee who has presented this document for Form I-9.
  • All certifications of report of birth issued by the Department of State (Form FS-545, Form DS-1350 and Form FS-240) were combined into selection C#2 in List C.
  • All List C documents were renumbered except for the Social Security card. For example, the employment authorization document issued by the Department of Homeland Security on List C will change from List C #8 to List C #7.
  • All changes were put into in a revised Handbook for Employers: Guidance for Completing Form I-9 (M-274), which is also easier for users to navigate. Find it here: https://www.uscis.gov/i-9-central/handbook-employers-m-274
  • Employers must continue following existing storage and retention rules for any previously completed Form I-9.

Employers who have questions about the I-9 process, need additional information or need general help with any human resources matter should contact their HR specialist at BCN Services.

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Kari Stanley, HRCCC Supervisor

Employers bear the burden of proof in unemployment court cases

“How can a fired employee be awarded unemployment benefits that he did not deserve to get?” This is perhaps one of the most asked questions I hear from employers after they receive an unfavorable hearing decision.

Three of the top reasons employers lose unemployment compensation discharge cases are:

1. Discharge was for incompetence, but not misconduct.
2. The final incident of a series was not misconduct
3. No documents and/or first-hand witnesses were present at the hearing.

The employer often believes they had a valid business reason to fire the person and, therefore, the claimant did not deserve the benefits. Although employers have a valid business need to terminate in most of the cases involving discharge, they sometimes fail to understand what the administrative law judge is listening for in the hearing. In every case, the judge considers whether the party with the burden of proof met that burden with credible testimony. In a discharge case, that means showing “misconduct” and “connection with work”. In the case of a discharge, the burden of proof is always on the employer.

So what is the definition of misconduct? An explanation is offered in a decision by Michigan Employment Security Act, which explains that misconduct is not defined by the statute, but defined in several court cases, including Carter v Michigan Employment Security Commission, 364 Mich 538 (1961), where the state Supreme Court used a definition from Boyton Cab Company v Newubeck, 296 NW 636, 640 (Wis 1941).

The Boyton case defines misconduct as a “wanton disregard of an employer’s interest” and when an employee has a “deliberate violation or disregard of standards” that an employer has a right to expect. It can also be a high degree of carelessness or negligence by the employee or when he/she shows “an intentional and substantial disregard” of the employer’s interests and the obligations the employee has. The case also notes that inefficiency on the job, simply unsatisfactory conduct or the inability to do a job or good-faith errors made on the job are not misconduct.

Examples of cases that failed to show misconduct:

Case 1: At the hearing, the employer’s witness testifies claimant was discharged for “poor performance.” Previous discussions about multiple, past poor work quality was presented but no documentation or write-up were provided. Final event was a failure to complete a job that did not meet the employer’s standards. Claimant stated that he exerted his best efforts at work and followed the instructions given to him.

The decision: The employer may have had a good business reason for discharging the claimant. However, the claimant’s denials of wrongdoing were, at least, as believable as the employer’s evidence against him. Burden of proof to establish discharge for work-connected misconduct was not met by the employer. No disqualification. Redetermination affirmed.

Case 2: At the hearing the employer testified that the claimant was discharged for violation of the company attendance policy. The claimant had been given several disciplinary writeups which the claimant acknowledged receiving. The claimant was given a final writeup stating that the next attendance infraction would result in termination. The claimant called in sick no less than one week later due to hurting his foot over the weekend and was subsequently discharged. The claimant testified that had he been able to come to work he would have and was also able to provide a doctor’s note for his injury.

The decision: The administrative law judge concluded that although the claimant had been given proper warnings prior to the final incident, the employer had not carried its burden of showing misconduct. The judge found that, based upon the testimony, the last incident showed no wrongdoing by the claimant and was, in fact, a situation that was out of his control. No disqualification. Redetermination affirmed.

Understanding what the judge is listening for is critical for preparing for unemployment hearings. If you have any questions about the unemployment hearing process, contact the experts at BCN Services to assist.
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Lisandra Garrow, HR Generalist

New ‘Michigan Law Prohibits Discrimination’ poster should be displayed now

The Michigan Department of Civil Rights has updated its “Michigan Law Prohibits Discrimination” poster and BCN Services recommends replacing the current MDCR poster and is coordinating delivery of the new poster to all of its Michigan worksites.  Similar to other employment postings, employers are required to display the most current poster as notice of Michigan’s ban against discrimination in the workplace.

The MDCR enforces two state laws: The Elliott-Larsen Civil Rights Act #453, Public Acts of 1976, as amended, and The Persons with Disabilities Civil Rights Act #220, Public Acts 1976, as amended.  The posting of “Michigan Law Prohibits Discrimination” is a requirement of these Acts and reads in part:

  • MICHIGAN LAW PROHIBITS DISCRIMINATION in Employment, Education, Housing, Public Accommodation, Law Enforcement or Public Service.
  • MICHIGAN LAW PROHIBITS DISCRIMINATION BASED ON: Religion, Race, Color, National Origin, Sex, Disability, Age, Marital Status, Height, Weight, Arrest Record, Genetic Information, and familial status.

In the MDCR’s revision of the “Michigan Law Prohibits Discrimination” poster, there is additional language requiring an applicant or employee with a disability to request any special accommodation within 182 days of when the applicant or employee knew, or reasonably should have known, of the need for the accommodation.  The request must be made in writing as specified in the posting:  Persons with disabilities needing accommodations for employment must notify their employers in writing within 182 days.

A covered employer (Michigan employers having one or more employees) must display the posting to give applicants or employees notification of the 182-day requirement.

If the revised posting and 182-day notification requirement sounds familiar, it is because the MDCR removed the language in 2011.  In 2017, the MDCR reconsidered and issued the revised posting which, once again, contains the 182-day written notice language.

As always, if you have questions about posting of required materials in your workplace or any other human resources question, the experts at BCN Services are here to help. Give us a call if we can answer any questions.

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Susan Price, Strategic Services Manager

Trump’s Executive Order, immigration, and the how it affects employers

On Friday, January 27, 2017, US President Donald Trump issued an Executive Order (EO) titled “Protecting the Nation from Foreign Terrorist Entry into the United States.”

The Executive Order does the following:

  • Suspends entry of all refugees to the United States for 120 days.
  • Bars Syrian refugees indefinitely.
  • Blocks entry into the US for 90 days (until 4/27/17) for individuals from Iraq, Iran, Syria, Sudan, Libya, Somalia, and Yemen. The ban applies to individuals with both visitor visas (B-1/B-2) and work visas (H-1B, L-1, O-1).

Naturalized U.S. citizens from the seven designated countries, as well as permanent residents with Green Cards will not be banned from entering the U.S.  Individuals who are not citizens of the designated countries but are residents of, or have strong ties to any of the countries, will be banned from entering the US.  This includes citizens of the designated countries who hold dual-citizenship with another country.

US Citizenship and Immigration Services (USCIS) has also been ordered to suspend processing of all immigration benefit applications filed by or on behalf of nationals of the seven countries.

Wide-ranging implications for Employers

This order has wide-ranging implications for employers who employ Visa or Green Card holders from one of the designated countries.  While a small number of Visas are exempt from the executive order (including diplomatic Visas, North Atlantic Treaty Org. Visas, C-2 Visas, and G-1, G-2, G-3, G-4 Visas), most Visas, including the common H1-B, L-1, and F-1 Visas, are covered by the order.

Employees from one of the designated countries who hold Visas covered included in the order will likely have difficulty entering/re-entering the U.S. while the order is in effect. Though not technically included in the order, Green Card holders may be subject to heightened scrutiny when re-entering the country.

Suggested Employer actions:

  • Cancel international travel for at least 90 days by employees or individuals doing business with your company who will be subject to the travel ban
  • Identify pending requests for immigration benefits on behalf of individuals from one of the designated countries in order to assess the implications of the apparent suspension in the processing of those petitions or applications
  • Prepare for potential disruption with service providers whose employees may be impacted by the EO

Remember your legal obligations

Be aware that federal employment laws still prohibit discrimination based on national origin, religion, and citizenship status. Be careful about taking action based on the President’s executive order that may be perceived as averse to current employees located in the U.S.  Employers should not ask for additional documentation from employees who may be affected by the President’s order (unless it’s regarding a Visa status close to expiring), as doing so may be cited as evidence of citizenship discrimination.

Be sensitive to possible claims of harassment or discrimination in the workplace that might arise from heightened tensions between employees or as a result of affected employees feeling targeted or singled out.

Expect Further Developments

President Trump’s order provides for additional countries to be added to the list of those with prohibited entry and provides that a Presidential proclamation will be issued in the near future prohibiting the entry of foreign nationals from a list of specified countries.

At the same time, further legal challenges to the order are anticipated and additional guidance and clarifications are expected. In addition, a draft Executive Order is under consideration that would subject the H1-B program and other immigration policies and procedures to further review.

BCN Services will stay abreast of additional information about this Executive Order and others to come and will help your business interpret any federal rules, policies and legislation. Contact us if we can answer questions or offer additional guidance.

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Thomas Moore, Partnership Manager